Even without the chaotic election season that we all just witnessed, multinational automaker Stellantis (STLA) has been having an eventful year.
Since the parent company behind well-known American car brands like Jeep, Dodge, Chrysler and Ram Trucks reported dramatic first-half 2024 earnings losses in July, it has been on a crash diet in an attempt to control its spending dramatically.
To the ire of labor leaders like the United Auto Workers' president Shawn Fain and politicians like Vice President-Elect J.D. Vance, the company enacted major cost-cutting measures including selling off major property, major C-suite shifts, and even risking layoffs to dramatically end or reduce production of old and slow-selling models.
Just a few days after President-Elect Trump declared victory in a decisive election against current Vice President Kamala Harris, the transition team is already planning dramatic policy endeavors it will pursue as soon as the Mr. Trump takes the oath of office on the steps of the Capitol, which has automakers on watch.
Stellantis will adapt, says CEO Carlos Tavares
On Friday, November 15, Reuters reported that the Trump transition team is planning to eliminate the Biden-era $7,500 consumer tax credit for electric-vehicle purchases; a program that has provided more than a billion dollars of subsidies for EVs.
Earlier this summer, on August 19, Trump signaled his intent to make this move, saying that eliminating the tax incentives would help drive market-facing "fairness."
"Well, we are looking at [EV tax credits], that is a big thing, but you know tax credits and tax incentives are not generally a good thing," Trump told Reuters back in August.
"I am not making any final decisions. I am a big fan of electric cars, but I am a fan of gasoline-propelled cars and also hybrids, and whatever else happens to come along. And you can't mandate that you can only buy an electric car."
One person who thinks the company can weather the storm is Stellantis CEO Carlos Tavares.
In remarks to the press during a visit to a plant in western France, the multinational automaker's CEO said that he has to keep a close eye on the kind of decisions that Trump will make during his administration, but reassured skeptics that the company could adapt to the various different political and economic conditions in the parts of the world that it serves.
“Our mission is simple: to provide clean, safe and affordable mobility. And we will do so in a way that meets the expectations of the communities and countries in which we operate,” Tavares said.
Tavares additionally rested on the laurels of his products, adding that the company is set to introduce a new “multi-energy” base platform for pick-up trucks before the Los Angeles Auto Show this week, which features solutions for gas, electric and hybrid models.
More Business of EVs:
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Morale is down, Stellantis worker advocates say
But while the bigwig exudes confidence, Stellantis workers are feeling gloomy.
As per a scathing new report in The Detroit Times, Stellantis's cuts of more than 3,750 workers at its domestic operations has left a climate of doom and gloom amidst factory workers at its facilities across metro Detroit and Toledo, Ohio.
“You’re laying people off before Thanksgiving and Christmas. It’s a tough pill to swallow,” UAW Local 1700 president Michael Spencer, who represents workers at the Stellantis's Sterling Heights Assembly Plant, which has been hit by 260 layoffs recently.
The Detroit news publication highlighted one particular Stellantis worker; 50-year-old Kirk Hoddinott, a line worker at the Toledo Assembly Complex who assembles Jeeps. He expects to be one of the 1,100 people who will be cut in January.
Related: Jeep has a major problem that its factory workers will pay for
As a father of three, he was expecting that the 2023 UAW agreement with Stellantis will guarantee him more job security. He has moved from a supplementary role to a permanent, full-time role since, but the hope is gone.
“This last year has felt anything but secure, with the ups and downs, go here, go there,” Hoddinott said.
The decisions from Stellantis has had Hoddinott, a Toledo native, considering moving anywhere there is job. So far, he's relocated away from his family to work at parts plant in Detroit, and back to the line at Toledo after being off work for six weeks due to slow sales. Now, even after temporarily losing access to health insurance, he expects to be gone for good come January.
UAW Local 140 President Eric Graham represents workers at another plant affected by layoffs: the Warren Truck Plant in Warren, Michigan. In October this year, Stellantis announced layoffs of 1,100 people at the plant after production of the Ram 1500 Classic ended.
As per Stellantis's contract with the UAW, workers are entitled to benefits that include a year of supplemental unemployment benefits paid by the automaker, a year of transition assistance, and two years of health care coverage. However, in addition to saying that "morale is down" at the plant, Graham notes that Stellantis may be falling short in following through.
"Not only are people laid off, they’re having issues with unemployment," Graham said.
Stellantis NV, which trades on the New York Stock Exchange as STLA, is down 2.54%, ending at the bell at $13.05 per share.
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