Stellantis said Friday that escalating costs to shift to electric vehicle production is forcing it to indefinitely halt operations at its assembly plant in Belvidere, Illinois, where 1,350 people work.
The plant, which builds the Jeep Cherokee SUV, will halt production Feb. 28. That will result in layoffs of at least six months or more, the automaker said, adding that it may not resume operations as it considers other options.
The UAW vowed to fight the shutdown.
“We are all deeply angered by Stellantis’s decision to idle the Belvidere Assembly plant without a plan for future product,” UAW Vice President and Director of the Stellantis Department Cindy Estrada said in a statement. “There are many vehicle platforms imported from other countries that could be built in Belvidere with skill and quality by UAW members at Belvidere.”
Estrada said the industry’s transition to electrification creates opportunities for new product and, “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.”
In a statement provided by Stellantis spokeswoman Jodi Tinson, the company said the increasing costs related with electrification are more impactful on its financials than the ongoing COVID-19 pandemic and the global shortage of semiconductor chips, problems that all automakers have struggled with in recent times.
“Stellantis has taken a number of actions to stabilize production and improve efficiency at its North American facilities to preserve affordability and customer satisfaction in terms of quality,” the statement read.
The “difficult but necessary action” of idling Belvidere Assembly “will result in indefinite layoffs, which are expected to exceed six months and may constitute a job loss under the Worker Adjustment and Retraining Notification (WARN) Act. As a result, WARN notices have been issued to both hourly and salaried employees,” the statement said.
To mitigate the impact of idling the plant, Stellantis said it will try to place the laid-off Belvidere employees in open full-time positions as they become available and the automaker is working to “identify other opportunities to repurpose the Belvidere facility and has no additional details to share at this time.”
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Contact Jamie L. LaReau: jlareau@freepress.com. Follow her on Twitter @jlareauan. Read more on General Motors and sign up for our autos newsletter. Become a subscriber.