Stellantis, the parent company of Chrysler, announced plans to lay off up to 2,450 workers at its Warren Truck Assembly Plant near Detroit. This decision comes as the company ceases production of the Ram 1500 Classic truck, effective October 8, 2024.
The plant will transition from a two-shift to a one-shift operation in its general assembly, focusing solely on the Jeep Wagoneer. Production of the Ram 1500 Tradesman will move to the Sterling Heights Assembly Plant, which has been upgraded to support new technologies beneficial for commercial fleets.
A Stellantis spokeswoman highlighted the enhanced features, stating, “The upgraded electrical architecture allows new technologies useful to commercial fleets for better tracking and improved safety systems.”
Approximately 3,700 workers at the Warren facility are represented by the United Auto Workers (UAW) union. Those affected by the layoffs will receive 52 weeks of supplemental unemployment benefits and transition assistance, along with two years of healthcare coverage. This move follows the UAW’s recent labor agreement with Stellantis, concluded after a historic six-week strike.
Further complicating matters, the UAW has expressed concerns over Stellantis’ commitment to previously agreed-upon production investments, particularly regarding the reopening of an Illinois plant. The union has indicated the possibility of filing grievances or initiating strikes if the company fails to honor its contractual obligations.
In addition to the layoffs, Stellantis has initiated voluntary buyouts for its U.S. salaried employees as part of broader cost-reduction strategies. These measures are in response to declining sales and profits in the U.S. market, particularly affecting popular models like the Jeep and Ram vehicles. CEO Carlos Tavares has emphasized the need for restructuring to address these challenges.
These developments underscore the challenges Stellantis faces in balancing cost-cutting measures with labor relations and market competitiveness. The company’s strategic shifts aim to realign its operations to better meet current market demands while addressing financial constraints.