Canada threatens Jeep maker Stellantis over possible US decision

The Canadian government has threatened to sue global auto giant Stellantis over its plans to move production of the Jeep Compass to the United States.

Earlier this week, Stellantis revealed a $13 billion (£9.68 billion) investment in America and plans to move manufacturing of the Compass model from Ontario to its Illinois factory.

Canadian Industry Minister Mélanie Joly said the company had made a “legally binding” commitment to stay in the city of Brampton in exchange for financial support, and that it would “exercise all options, including legal” if it did not comply with the agreement.

Stellantis said it was investing in Canada and had plans for its Brampton factory, details of which it could not disclose at this time.

In her letter to Stellantis CEO Antonio Filosa, Mélanie Joly said the country had given the company “billions of dollars” and the move would jeopardize the future of its Brampton factory.

In a statement released Wednesday, Mr. Filosa said it was the largest investment in the company’s history and would “drive our growth, strengthen our manufacturing footprint and create more American jobs in the states we call home” — but he did not mention its operations in Canada.

In response to the announcement, Joly said the automaker and the Canadian government had “built a strong and lasting partnership.”

“We were there to help the company in 2009 bring it back from the brink of bankruptcy, and now we hope you will be there for Canadians,” she added.

Canadian Prime Minister Mark Carney said the government was working with the company to protect Stellantis staff at the Brampton site and try to “create new opportunities” for them locally.

A Stellantis spokesperson said it was expanding operations at its Windsor plant in Canada, which would create 1,500 new jobs to “support increased demand” for its Chrysler Pacifica and Dodge Charger Scat Pack models.

“Canada is very important to us. We have plans for Brampton and we will share them in further discussions with the Canadian government,” they said.

Reuters reported that the automaker suspended retooling at the plant in February after U.S. President Donald Trump announced tariffs on Canadian products.

Stellantis owns 14 car brands, including Alfa Romeo, Maserati, Jeep, Fiat, Citroën, Chrysler and Dodge.

Although the automaker has manufacturing plants in the United States, it also produces vehicles in the United Kingdom, Europe, Canada, Mexico and South America.

In July, the company said tariffs imposed by the Trump administration had cost it $349.2 million (£259.6 million).

Trump introduced tariffs on cars to boost the U.S. auto industry, but within a month he eased tariffs on foreign auto parts.

On Tuesday, Trump’s new 10% tariff on softwood lumber took effect. This means that products from Canada – the world’s second-largest producer and a major supplier to the United States – are now subject to levies of more than 45%.

Most Canadian producers were already facing U.S. tariffs totaling 35% due to a long-running trade dispute between the two countries over the product.