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Stellantis is blaming EVs for its upcoming Jeep layoffs

Stellantis is blaming EVs for its upcoming Jeep layoffs

Stellantis, the company behind Fiat, Dodge and Jeep, has announced that it plans to close one of its plants in February and lay off 1,200 workers. Its logic? Pressure from COVID-19, of course, coupled with chip shortages -- but mainly to make those all-electric vehicles.

The factory in question is the one that builds the Jeep Cherokee in Illinois, and news comes that the automaker is gearing up for union talks. While the United Auto Workers argues that "the transition also creates opportunities for electrification" at the plant, an unnamed Stellantis spokesperson told CNBC and The Wall Street Journal that this was instead the reason for the halt. "The most impactful challenge is the rising costs related to the electrification of the automotive market," the company claims, adding that it is exploring other uses for the plant, and it is trying to find jobs for those workers. who are shutting it down.

But let's back up for a second - one of the world's biggest automakers is saying it will have to shut down a plant indefinitely because of how much electrification is costing it? That's a bold claim, especially since it's coming from a company I consider third in the race of the big three American automakers to move their lineup from gas to battery. It also doesn't help that Stellantis is promising quite a few electrified Jeeps, and it's hard to see why this factory couldn't play a role in making those vehicles, at least one of which is due next year (and many more are yet to be discovered). has become very difficult).

That's not to say Stellantis isn't spending big on EVs — it's promised to foot the bill for up to $3 billion with Samsung for a battery factory in Indiana, and $4.1 billion at a similar facility located in Canada. But it's not an unimaginably large investment compared to some of its peers: GM is spending $7 billion on one of its three EV battery factories in the works, Honda helping to build a $4.4 billion plant in Ohio (and spending another $700 million to retool existing facilities), and Ford building three EV-related locations with price tags in excess of $11.4 billion announced to do.

Ford's an interesting comparison, though, because it recently went through a string of layoffs, cutting nearly 3,000 jobs. No prizes for guessing one of the excuses given to employees; "We have an opportunity to lead this exciting new era of connected and electric vehicles," read a memo from CEO Jim Farley and Chairman Bill Ford. "Building this future requires changing and reshaping nearly every aspect of the way we have operated for more than a century." Of course, this meant cutting jobs.

It's too early to say whether EVs are going to become a common scapegoat if the auto industry keeps laying off, but we now have at least two companies trying to portray the livelihoods of thousands as future costs. Is doing. (EV-native companies like Tesla or Rivian, which have a spate of mass layoffs this year, don't have that luxury.)

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