Stellantis pauses some Mexico, Canada production, temporarily lays off 900 US workers due to tariffs
About 900 employees at US factories were temporarily laid off
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Stellantis is pausing some production in Mexico and Canada and temporarily laying off hundreds of workers in the U.S. as the automaker tries to navigate President Donald Trump's latest round of auto tariffs.
"We are continuing to assess the medium- and long-term effects of these tariffs on our operations, but also have decided to take some immediate actions, including temporarily pausing production at some of our Canadian and Mexican assembly plants," Chief Operating Officer Antonio Filosa told employees in an email on Thursday, when Trump's 25% tariffs on imported vehicles and auto parts took effect.
The company will be temporarily pausing production at the Toluca Assembly Plant in Mexico on April 7. It will simultaneously pause production at its Windsor Assembly Plant in Canada for two weeks. Those operations are expected to resume the week of April 21.
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The Toluca plant produces the Jeep Compass and Jeep Wagoneer S. The Windsor plant manufactures the Chrysler Pacifica, Chrysler Pacifica Hybrid and Dodge Charger Daytona. It also produces the Chrysler Voyager for the U.S. market and the Chrysler Grand Caravan for the Canadian market.
Jeep Compass 4Xe at Brussels Expo on Jan. 13, 2023. (Sjoerd van der Wal/Getty Images) / Getty Images)
Stellantis said the pause in production at the plants will impact "some employees at several of our U.S. powertrain and stamping facilities that support those operations."
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| STLA | STELLANTIS NV | 10.21 | -1.06 | -9.41% |
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There will be about 900 temporary layoffs at its Warren Stamping and Sterling Stamping plants in Michigan as well as at its Indiana Transmission Plant and Kokomo Transmission and Kokomo Casting plants, also located in Indiana.
Trump, who views tariffs as a way to bring in tax revenue for proposed tax cuts while spurring a revitalization of domestic manufacturing, has said the auto industry tariff will impact sedans, SUVs, crossovers, minivans, cargo vans and light trucks. It will also hit key automobile parts such as engines, transmissions, powertrain parts and electrical components, though there are "processes to expand tariffs on additional parts if necessary."
The new all-electric Jeep Wagoneer S. (Jeep/Stellantis / Fox News)
The industry is currently bracing for the impact, but it's far too soon to see how much more consumers will be asked to pay at dealers, experts say.
The levies will lead to higher prices on new vehicles and car repairs, but the price increases won't be uniform, according to Brian Moody, Autotrader’s executive editor.
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Just because the U.S. imposes tariffs on all imported autos doesn’t mean the cost of cars manufactured domestically will remain the same while prices of foreign-made cars rise, Moody said.
Deutsche Bank analyst Edison Yu estimated that consumers could see a price increase of 5% to 10% on cars, although this could fall on the lower end if there is a U.S.-Mexico-Canada Agreement exemption, or higher if there isn’t.