Stellantis, the corporate behind Fiat, Dodge, and Jeep, has introduced that it plans to halt one in all its vegetation and lay off 1,200 staff come February. Its reasoning? Stress from COVID-19, certain, together with a touch of chip shortages — however primarily all these electrical autos it has to make.
The manufacturing facility in query is one which builds Jeep Cherokees in Illinois, and the information comes because the automaker is gearing up for union negotiations. Whereas United Auto Staff argues that “the transition to electrification additionally creates alternatives” on the plant, an unnamed Stellantis spokesperson informed CNBC and The Wall Avenue Journal that it was as a substitute the explanation for the halt. “Probably the most impactful problem is the rising price associated to the electrification of the automotive market,” the corporate claims, including that it’s exploring different makes use of for the plant, and that it’s looking for jobs for the employees it’s shedding.
Stellantis is spending billions on EVs
However let’s again up for a second — one of many world’s largest automakers is saying it has to shutter a plant indefinitely due to how a lot electrification is costing? That’s a daring declare, particularly because it’s coming from an organization I’d think about to be in distant third within the large three American automakers’ race to maneuver their lineups from gasoline to batteries. It additionally doesn’t assist that Stellantis has been promising fairly a number of electrified Jeeps, and it’s exhausting to see why this manufacturing facility couldn’t play a job in making these autos, not less than one in all which is due out subsequent 12 months (and lots of of which have been very tough to seek out).
This isn’t to say that Stellantis isn’t spending large on EVs — it’s promised to separate an as much as $3 billion invoice with Samsung for a battery manufacturing facility in Indiana, and it’s investing $4.1 billion in an identical facility positioned in Canada, this time with LG. However that’s not an unthinkably massive funding in comparison with a few of its friends: GM is spending a whopping $7 billion on one in all its three EV battery factories within the works, Honda’s serving to construct a $4.4 billion plant in Ohio (and spending $700 million extra to retool current amenities), and Ford has introduced it’s constructing three EV-related areas with a price ticket of over $11.4 billion.
Ford’s an attention-grabbing comparability, although, as a result of it additionally went by means of a latest spherical of layoffs, chopping round 3,000 jobs. No prizes for guessing one of many excuses it gave workers; “We now have a possibility to steer this thrilling new period of related and electrical autos,” learn a memo from CEO Jim Farley and chairman Invoice Ford. “Constructing this future requires altering and reshaping just about all features of the way in which now we have operated for greater than a century.” That, after all, meant chopping jobs.
It’s too early to say whether or not EVs are going to grow to be a standard scapegoat if the auto business retains finishing up layoffs, however now now we have not less than two corporations making an attempt to color 1000’s of peoples’ livelihoods as the price of the longer term. (EV-native corporations like Tesla or Rivian, which have additionally had their very own huge rounds of layoffs this 12 months, don’t have that luxurious.)