Automaker Stellantis, formed by the merger of Fiat Chrysler and French PSA Peugeot, has announced that the Belvidere, Illinois plant producing Jeep Cherokee models will be closed from February 28, 2022.
More than 1,350 workers are employed at the plant and hundreds will be laid off indefinitely due to the plant shutdown.
“This difficult but necessary action will lead to indefinite layoffs, which are expected to exceed six months. The company will make every effort to place laid-off indeterminate employees into open full-time positions as soon as they become available,” Stellantis said in a statement to The Associated Press.
The cause, explains Stellantis, is the persistence of economic turmoil.
“Our industry has been affected by a multitude of factors such as the current COVID-19 pandemic and the global shortage of microchips, but the most significant challenge is the rising costs associated with the electrification of the automotive market,” said Stellantis told CNBC.
The closure comes after the plant slowed production during the pandemic, operating only one of three available assembly shifts. The factory-produced Jeep Cherokee also had the worst sales of any Jeep product, with sales down 61% year over year in the third quarter, according to CNBC.
Workers at the plant are represented by United Auto Workers Locals 1268 and 1761, and UAW President Ray Curry has denounced the closure of the plant, which has been in operation since 1965, as “cruel disregard for contributions from our members,” in a statement from the union. .
“We are all deeply irritated by Stellantis’ decision to idle the Belvidere assembly plant without a plan for future product. Companies like Stellantis receive billions in government incentives to switch to clean energy. It is an insult to all taxpayers for not putting this money back into our communities,” UAW Stellantis Department Director and Vice President Cindy Estrada said in the statement.
Stellantis has not yet responded to a Washington Times request for comment.