- Chrysler-parent Stellandis will offer buyouts to half of its U.S. white-collar workforce to reduce the automaker’s headcount and cut costs at its North American operations.
- Voluntary severance packages will be offered to 6,400 of its 12,700 non-bargaining unit U.S. employees, the company said Monday.
- It marks the second round of pay cuts this year for Stellandis and comes just weeks after the automaker struck a tentative deal with the UAW for unionized workers.
Carlos Tavares, CEO of Stellandis, poses during a presentation at the New York International Auto Show on April 5, 2023 in Manhattan, New York City.
David Dee Delgado | Reuters
DETROIT – Chrysler-parent Stellandis is buying half of its U.S. white-collar workforce to cut the automaker’s headcount and cut costs at its North American operations.
The company said Monday that 6,400 of its 12,700 non-bargaining unit U.S. employees with five or more years of employment will be offered voluntary severance packages.
The move marks the latest in cost-cutting efforts for the U.S. auto industry, as companies try to cut costs over billions of dollars in new investments in emerging technologies such as electric vehicles amid economic concerns. Both General Motors and Ford Motor Co. have cut salaried workers in the past year.
“As the U.S. auto industry continues to face challenging market conditions, Stellandis is taking the necessary structural measures to protect our operations and the company,” Stellandis said in an emailed statement. “As we prepare to transition to electric vehicles, Stellandis announced today that it is offering a voluntary severance package to pursue other benefits with favorable benefits for unrepresented employees who wish to separate or retire from the company.”
A Stellandis spokeswoman declined to comment on how many people the company plans to cut or total costs. He declined to comment on whether involuntary layoffs would be planned if enough employees don’t accept the buyouts.
Stellandis North American COO Mark Stewart announced the plan to employees on Monday, which was first reported Wall Street Journal.
The company said that the employees will be given time till December 8 to accept the buyout offers.
This is the second round of paychecks this year for Stellandis. In April, the company extended voluntary buyouts to about 33,500 U.S. employees, including 31,000 hourly employees with at least one year of service and 2,500 salaried, non-union employees who have worked for the company for 15 or more years.
The latest purchases come weeks after the automaker struck a tentative deal with the United Auto Workers for new labor contracts covering its 43,000 unionized workers.
The tentative agreement between Stellandis and the UAW, which must still be ratified by union members, also includes voluntary buyouts.
The UAW has said there will be a voluntary incentive program for retirement $50,000 upfront 2024 and 2026 to an unlimited number of qualified manufacturing and skilled trade members.
A Stellantis spokeswoman said the salary increases are not directly tied to the expected increase in U.S. labor costs as a result of the agreement with the UAW.
The tentative union agreement includes 25% wage increases, including 11% upon ratification; recovery of cost-of-living adjustments; Additional contributions to retirees; billions in new investments; and other benefits.
