Chrysler parent Stellantis said on Friday it will lay off about 400 U.S. salaried workers as it seeks to cut costs, boost efficiency and ramp up electric vehicle production plans. Stellantis layoffs will be in its engineering, technology and software units as the automaker faces what it calls challenging market conditions.
Stellantis on Friday said the layoffs would affect about 2% of employees in those units “after rigorous organizational reviews.” It employed 11,800 U.S. salaried employees as of the end of last year.
Stellantis layoffs are effective from March 31.
Stellantis layoffs
“As the auto industry continues to face unprecedented uncertainties and heightened competitive pressures around the world, Stellantis continues to make the appropriate structural decisions across the enterprise to improve efficiency and optimize our cost structure,” the company said in an emailed statement.
A spokeswoman for the automaker declined to discuss the exact number of employees who would be affected by the layoffs. A source familiar with the actions confirmed it at about 400 workers.
The layoffs occurred during a “mandatory remote work day” for U.S. salaried, nonunion employees in Stellantis’ engineering and technology organization, according to an internal announcement confirmed by two sources who were not authorized to speak about the actions.
Cost cutting by Stellantis
The action is the latest by Stellantis CEO Carlos Tavares to cut costs through layoffs, buyouts and other methods since the company was established through a merger of Fiat Chrysler and French automaker PSA Groupe in 2021.
The cuts are part of a push to achieve Stellantis’ “Dare Forward 2030” strategic plan that aims to increase profits and double the automaker’s revenue to 300 billion euros, or $335 billion, by then, among other targets.
“While we understand this is difficult news, these actions will better align resources while preserving the critical skills needed to protect our competitive advantage as we remain laser focused on implementing our EV product offensive and our Dare Forward 2030 strategic plan,” the company said.
Ford and GM layoffs
Both Ford Motor and General Motors(GM) have vowed further cost costs and layoffs over the last year.
Earlier this month, United Auto Workers President Shawn Fain said Stellantis had terminated 2,000 temporary workers, criticizing the decision as “about corporate greed.” He noted that under the UAW contract reached with Stellantis last, around 3,000 temporary workers were converted to permanent jobs.
In December, Stellantis said it would temporarily cut one shift at its Detroit assembly plant that builds Jeep sport utility vehicles and reduce production at its Toledo, Ohio, assembly plant that builds the Jeep Wrangler.
Buyouts offered by Stellantis
Stellantis cited preparations “for the transition to electric vehicles” last year in offering buyouts after telling employees earlier that a review of the company’s operations “made it clear that we must become more efficient.”
Stellantis plans to offer at least 25 battery-electric models in the U.S. by 2030.
The company did not disclose how many employees offered to take buyouts but said in February its North American workforce had fallen to 81,341 at the end of 2023, compared with 88,835 a year earlier.
Under the UAW contract Stellantis agreed to offer $50,000 buyouts for veteran production and skilled trade members in 2024 and 2026.
