Production of the next Cherokee generation will be moved to Toluca, Mexico.
Following last week's news that Stellantis is idling its Belvidere, Illinois plant in February, where the Jeep Cherokee is produced, it is now being reported that production of the next generation will move to the Toluca plant in Mexico. This facility will build gasoline, hybrid, and ICE versions of the Cherokee SUV.
While the plant's idlingwas originally believed to be merely a sign of the times, with 1,350 salaried employers losing out, it appears that's not entirely the case and that production will be moved. The American Prospect spoke with Shop Chairman for UAW Local 1268, Tim Ferguson, and was told that it's an open secret the plant won't just be idled but instead shuttered. This comes after no future models have been secured for the plant. When reached for comment by the Prospect, Stellantis declined to confirm the report.
UAW Vice President Cindy Estrada has stated that the union is "deeply angered by Stellantis' decision to idle the Belvidere Assembly plant without a plan for future product."
This news comes a few months after Stellantis has already announced a few hundred layoffs at its Trenton, Michigan engine plant due to restructuring and a couple of months after over 1,000 workers were striking due to "appalling factory conditions" at the company's Kokomo, Indiana Casting pant.
Stellantis has pointed to higher interest rates, the global chip shortage, and the rising cost of batteries as a big part of the reason for relocation, and while they are valid excuses, it's not like the company is hurting for money at the moment. In fact, third-quarter revenues are up 29% compared to last year, thanks in big part to the push towards electrification, which saw a 41% increase in BEV sales compared to the same quarter last year.
For all the good the Inflation Reduction Act has done for US investment, the fundamental issue is we can still lose manufacturing to our neighbors. It seems likely that with the company announcing more investment in Canada and Mexico, those countries were able to garner better incentives than the US and the state of Illinois, which may speak to internal UAW issues as well as political ones.
The Prospect also reported that members have told it things could have been different if the UAW had acted sooner. According to Shawn Fain, challenger to the current UAW president Ray Curry, "The sad reality of this is, over the last year and a half, since President Curry's been in power, and Vice President Estrada, the company has awarded more than three different products, and Belvidere could have had every one of those,"
To Stellantis' credit, it announced a $2.5 billion battery plant to be built in Kokomo, Illinois, just a few months ago that will see the creation of 1,400 jobs and has stated that it aims to relocate workers from their shuttered ones to others. Many other automakers have announced new plants in the US, like Hyundai and Mercedes too, so there is a lot of good on the horizon for US auto manufacturing.
Unfortunately, this is little consolation for workers recently laid off looking for jobs as many of these plants won't be finished for years. We only hope Stellantis makes good on its promise to relocate the workers as soon as possible.