Will Auto Workers Strike to Hold Stellantis to Its Promises?

Contracts come and contracts go, but the bosses keep on scheming forever. So workers’ resistance must be permanent. In August, 17 union locals representing tens of thousands of workers charged the automaker Stellantis with failing to honor its agreements by reneging on investment promises, including the celebrated reopening of the Belvidere assembly plant in Illinois.

Today, the United Auto Workers filed unfair labor practice charges against Stellantis with the National Labor Relations Board over the company’s refusal to provide information about its plans for product commitments. Union locals also filed grievances over the company’s plan to move production of the Dodge Durango out of Michigan, to Canada, in violation of the national agreement.

“In our 2023 contract, we won major gains, including a commitment to reopen an idled assembly plant in Belvidere, Illinois, and to build the Dodge Durango in Detroit,” said UAW President Shawn Fain, ahead of speaking to members via Facebook Live. “Now Stellantis wants to go back on the deal.”

In last year’s negotiations the UAW won the right to strike over product commitments—an unusual thing to win. Employers often get away with breaking such promises.

The grievance filing sets the stage to strike Stellantis nationwide, if necessary. Fain asked the public for support for a potential strike when he addressed the Democratic National Convention in August.

FACTORIES AS CASH COWS

Last year the company agreed that in 2024 it would launch a parts distribution hub at the mammoth Belvidere complex. Stellantis had announced it was closing the assembly plant in December 2022, and one year later all the jobs were gone.

Stellantis also promised in the contract that in 2028 it would build a new $3.2 billion battery plant in the same complex, and by 2027 it would invest $1.5 billion to resume production of a mid-size truck there, the Dodge Dakota. All told, the company would add 5,000 new jobs in the U.S. But Stellantis now says that due to “market conditions,” all these plans are “delayed.”

“We don’t have a choice but to go on strike to hold this company accountable to their agreements,” said Stephen Hinojosa, a member of UAW Local 12 and a production team leader at the Toledo Assembly Complex.

Toledo is one of the largest Stellantis production factories in the country, where 5,000 workers struck on the first day of the Stand-Up Strike a year ago. It was also one of the plants where workers voted against the national agreement that ended that strike, citing concerns over the bonus structure, conversion of temporary workers, vacation time, and overtime provisions.

Issues at the plant have been boiling for some time. Hinojosa compares Stellantis to private equity: it treats its U.S. auto factories as “cash cows.”

“They come in,” he said. “They cut everything down to the last penny, and they suck up every profit they can. And when the product is finally at a point where there's nothing left for them to pull out, they just sell it off for scraps.”

Hinojosa said that has been CEO Carlos Tavares’s M.O. “Every time he took over a company, he cut production and sent the jobs to cheaper labor markets, and that’s how he was able to make those companies profitable.”

In a glowing 2023 profile in the French newspaper Le Monde, a French Finance Minister described Tavares as a “samurai, obsessed with work, demanding, cold, fast and with a tremendous efficiency,” crediting him with turning around French automaker Peugeot after bankruptcy and rewarding shareholders with lucrative dividends.

“To achieve such feats, Tavares shook up the company with staff reductions, competition between plants, drastic cost control and pressure on teams,” wrote Le Monde.

Tavares’s method is described as fiercely competitive in a Darwinist world. “Only the
best will survive,” he has said. “When I talk to a blue-collar worker about the goals I set for his plant, I tell him: ‘It’s demanding but if you don’t meet these goals, you’ll be in a vulnerable position. Only performance protects,’” Tavares told Le Monde.

“I find a pathetic irony in the fact that Stellantis is now, for the first time, citing ‘market conditions’ as their reason for attempting to break their promises to Belvidere and auto workers across America,” Fain said at the Democratic Convention. “It’s always ‘market conditions’ when they have to stiff an auto worker or close a plant. It’s never ‘market conditions’ when they want to raise CEO pay by 56 percent. Carlos Tavares is telling the American auto worker, ‘Market conditions for thee, but not for me.’”

PADDING PROFITS, SACKING WORKERS

Stellantis is a voracious beast. Like the Roman god Saturn, who ate his own babies to prevent them from challenging his power, Stellantis has gobbled up lesser corporate gods in a monopoly-seeking rampage. Formed in 2021 through a merger of Fiat Chrysler and France’s PSA Group, it has become the parent company of 14 car brands, including Jeep, Ram Trucks, and Chrysler, and one of the world’s most profitable automakers, with net profits of $20 billion last year.

“Stellantis purchased Chrysler for access to our dealership network in the United States, so they can sell cheaper products made in other countries,” said Hinojosa. “During the negotiation, they made it very clear that they wanted to reduce the footprint in the United States for manufacturing, and they clearly did not negotiate in good faith. They had ulterior plans, so they pretty much duped us at every turn.”

Stellantis has been laying off thousands of U.S. auto workers, including 2,450 next month, while amassing profits by gorging on human sacrifice. The company reduced its worldwide workforce by 47,500 (out of 242,000 total) from December 2019 through 2023.

The cost-cutting is part of its plan to double revenue by 2030. But things aren’t going according to plan. U.S. sales of its brands tumbled by 21 percent in the second quarter, compared to the same period last year, and net income fell by $6 billion, down 48 percent for the first six months.

“Sales are down, profits are down, and CEO pay is way, way up,” said Fain in an August video. “The problem isn’t the market. At General Motors and Ford, auto sales are up. And the problem isn’t the auto workers. The problem is this man, Carlos Tavares.”

Tavares is one of the highest-paid auto executives in the world, with a total compensation of $39.5 million. Stellantis has committed to $3 billion in stock buy backs this year and has already given out $5 billion in dividends.

In July, Tavares blamed auto workers for the plunge in sales—taking aim at the Sterling Heights factory in Michigan for producing RAM 1500 pickup trucks of poor quality, which reduced the number of vehicles that earned quality certification and delayed shipments to dealership lots.

A U.S. dealership network, on the other hand, has blamed Tavares for “rapid degradation” of the automaker’s brands and “short-term decision-making.”

It’s not so much a story of bust follows boom as bad management punting responsibility to workers and shareholders, while the boss cuts production and reduces the workforce.

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“Capital jealously guards its ‘right to manage’ from any labor influence, yet somehow it’s always labor's fault when management screws up,” said Brian Callaci, chief economist at the Open Markets Institute, a nonprofit that researches the stranglehold that corporate monopolies have on democracy.

Stellantis is recalling millions of vehicles, including the Jeep Wrangler and Gladiator built in Toledo. Hinojosa said the company’s job cuts have resulted in fewer quality inspectors and in suppliers with few checks and balances in their supply chains.

“We are getting bad parts and fewer inspectors with eyes on the vehicle to make sure that things are safe,” said Hinojosa. “At our height, we were over 6,000 people in our plant. Now we're below 5,000, so they have cut, cut, cut, and yet they have jacked up the prices for consumers, while they have made it very difficult for workers to build a quality product.”

GRIEVANCE STRIKE?

There’s still debate among Toledo auto workers about last year’s contract gains. But they now fear losing their jobs even more. It’s a familiar feeling for auto workers, especially those at Stellantis.

“Over the course of my 30 years here, we went from Chrysler to Daimler to Cerberus to Fiat Chrysler Automobiles, and now Stellantis,” said UAW Local 1268 President Matt Frantzen, an auto worker since 1994, representing the Belvidere plant. “So you never really knew. You always had this feeling in the back of your head, or at least I did: Are we going to survive? Who’s the next one to take us over?

“In my whole career, I’ve never felt that I can rest and relax and think I’ve got a job where I’m good for 30 years, 35 years, as many years as I want to work. It’s never been that type of job. It’s always been a matter of wondering what’s going to happen next.”

Workers are fed up. They routinely describe what’s happening at Stellantis as being “stripped for parts.”

Hinojosa and his co-workers are meeting weekly. “We come up with plans of how we can try to organize the shop floor better and take power back to the floor,” he said. “We have our finger on the pulse of what's going on, how people are feeling, to get them back on board and realize that we have more power to change the way things are run inside the plant, if we just are more organized.

“I don’t want to go on strike,” he said. “I’m just getting back on my feet from the last strike. I’ve got three kids. Mortgage is expensive, and groceries are through the roof. But I’m sick and tired of wealthy corporations pitting the working class against one another. Our livelihoods mean nothing to them.”

In 2022, workers at Belvidere threatened a grievance strike. They didn’t ultimately do it, but there was a strike by 1,000 workers at the Stellantis Kokomo Casting Plant in Indiana over management’s failure to maintain the HVAC system.

“The plan was that Kokomo would go out and we would go out as well,” said Frantzen. “We chose not to because we were identified as a plant that was going to be idled and with no future product in sight. And frankly, at the time, we had a different vice president and a different president that didn't give a shit about Belvidere. They gave a shit about the Detroit plants.

“And that’s something—being the outsider looking in—we’ve always fought. We were never under that Detroit umbrella, until Shawn Fain stepped in as president, and Rich Boyer as VP, and the whole change up there.”

To be effective, a strike over product commitments would have to hit strategic plants, not just the nearly idled Belvidere—and it would have to be carefully timed. “With too much inventory and the limited amount of product options that we’ve got in dealer lots, a strike [today] would only help Stellantis,” said Frantzen, echoing a sentiment of other auto workers. “I believe they would love for us to go out on strike, so they could handle their inventory issues, not pay us a dime, and put a bad light on the union.

“There’s got to be some strategy as to when Stellantis gets slapped. It may not be now, might be a year down the road, but it is something that’s going to have to happen; otherwise I could say in two years, every bit of product that we used to build in the States will be built somewhere else.”

BELVIDERE CANARY IN THE MINE

Only 80 workers are still at Belvidere, between the assembly plant and a parts distribution center, said Frantzen. Fifteen hundred who used to work there got transfers and are now scattered at other Stellantis plants across the country; the rest took buyouts or got other jobs. At its height in 2019, 4,500 UAW members worked inside the plant on three shifts; another 2,500 members worked for suppliers to the plant.

Frantzen thinks Stellantis deliberately lied about its plans for Belvidere, using the promise to reopen the plant as a bargaining chip to avoid giving in on other union demands. “If the negotiators and the international staff had known during negotiations that pretty much Belvidere was dead in the water for the next five years, then there may not have been so much emphasis on Belvidere,” he said. “They could have gone after post-retirement health care for those that don’t have it, pensions for those that don’t have it, things that we lost back in bankruptcy [in 2009]. There could have been more effort put into recouping these things we had lost.”

Members who believed Belvidere would reopen now feel “the rug has been pulled out from underneath them,” he said. “You start to realize, ‘Okay, record contracts got us record pay raises. But if we don’t have jobs, I don’t want to be the highest-paid person in the unemployment line.’”

Some blame the union, while others understand it was Stellantis that pulled the bait-and-switch. And the delay could put Belvidere’s fate in the crosshairs of the next bargaining cycle, so Stellantis can play this game all over again.

Responding to rising criticism, Stellantis said on September 11 it will spend $406 million to retool three Michigan factories. The bulk of this, $235 million, will go to the Sterling Heights plant near Detroit, where UAW members will begin producing the first battery-powered RAM 1500. But that’s just 2 percent of the total $19 billion in investments that Stellantis committed to in the contract.

ALL FOR ONE, ONE FOR ALL

By reneging on investment commitments, the company is also stoking divisions within the UAW membership. Toledo auto workers complain about the promise to build the new Dodge Dakota in Belvidere in 2027, because the current Gladiator chassis built in Toledo would be the same for the Dakota. With layoffs looming, Toledo workers have reasoned that assigning them the Dakota could save their jobs.

That’s buying into the company’s whipsawing one plant against another. Fain has tried to address the division at recent rallies.

“We’re done with the days of this union of every man for himself, every plant for itself,” he said in Belvidere last month. “That’s the old way of doing things. I’ve watched multiple plants close year after year, and other plants sit back and say, ​‘Well, it doesn’t affect me.’

“Everything that happens to any plant anywhere affects us, and that’s why locals across this country filed grievances, because we’re going to stand together as a united UAW.”

Frantzen agreed that members need to be as united as they were during the Stand-Up Strike: “It can happen to anyone. If you allow it to happen to Belvidere, well, be ready, because it’s coming somewhere else, too.”