Car manufacturing group Stellantis, representing 14 different brands with several North American brands among them, wants to reduce costs and finance the energy transition. On Wednesday, it indicated that it would propose a plan for voluntary redundancy in its US and Canadian branches.

Renowned cost-cutter Carlos Tavares has struck again. The Stellantis CEO wants to reduce all costs and thus also, labor costs to prepare for the future and the electric transition. In the US, the voluntary redundancy plan will be proposed for 33 500 employees who have already worked 15 years for their company in specific divisions. There are no figures yet for Canada. The employees concerned will be informed next week.

Profound examination

“In response to increasingly competitive circumstances worldwide and given the necessary energy transition, Stellantis will proceed to a profound examination of its North American activities,” says a press release. “The aim is to increase efficiency, reduce costs, and protect the competitiveness of our products. This will allow us to make strategic investments for a necessary transformation,” Stellantis confirms.

Like almost all car manufacturers, Stellantis has faced severe supply difficulties because of the pandemic and the semiconductor shortages. This has raised the costs and, consequently, the prices of cars. As a result, there’s a danger that the market won’t follow, and, in addition to that, there’s the necessity to invest billions in the electric transition.

Not alone

Other car manufacturers are struggling with the same problems. Staying with the American ‘big three’, General Motors also proposed a voluntary redundancy plan at the beginning of March. Until now some 5 000 employees have already subscribed to it.

Ford had also pointed to the electric transition and its cost when it announced a 3 000 personnel job cut in North America and India in August last year and a 3 800 personnel redundancy in Europe by 2025.

Blatant insult

All these plans have now been announced a few months before negotiations have to take place with the American United Auto Workers Syndicate (UAW) about a new agreement for the entire car sector.

In a separate announcement, the new UAW President, Shawn Fain, sees the Stellantis initiative as a blatant insult to its members, especially after realizing a benefit of €16,8 billion with Stellantis in 2022.

“The governments (via politically decided subsidies and incentives) and the taxpayers are financing the electric transition. So now you see how the working class gets rewarded for this,” Fain declared indignantly.