By Ben Klayman and David Shepardson
DETROIT/WASHINGTON (Reuters) – Chrysler parent Stellantis on Friday said it will indefinitely halt operations at an assembly plant in Illinois in February, citing the rising costs to shift to electric vehicles.
The Italian-American automaker, which employs about 1,350 workers at the Belvidere, Illinois, plant that builds the Jeep Cherokee SUV, said the action will result in indefinite layoffs and added it may not resume operations as it considers other options. The United Auto Workers union vowed to fight back against the announcement.
The company said the auto industry “has been adversely affected by a multitude of factors like the ongoing COVID-19 pandemic and the global microchip shortage, but the most impactful challenge is the increasing cost related to the electrification of the automotive market.”
UAW Vice President Cindy Estrada said the union was s “deeply angered by Stellantis’ decision to idle the Belvidere Assembly plant without a plan for future product.”
Estrada noted Stellantis imports many vehicles into the United States and said “companies like Stellantis receive billions in government incentives to transition to clean energy. It is an insult to all taxpayers that they are not investing that money back into our communities.”
Under the UAW contract that expires in late 2023, Stellantis cannot permanently close the plant without bargaining. Stellantis said it would stop building the Compass in late February at the plant but did not say if it would continue production of the SUV at another plant.
(Reporting by David Shepardson and Ben Klayman in Detroit; Editing by Mark Porter and Nick Zieminski)
