Stellantis Counters UAW’s Strike Threat, Cites Market Challenges
COO Carlos Zarlenga Defends Stellantis' Commitment To The 2023 Agreement Amidst Union Criticism...
Stellantis has issued a response to United Auto Workers (UAW) President Shawn Fain following remarks made during a recent Facebook livestream. In an e-mail addressed to Fain, Stellantis North America COO Carlos Zarlenga outlined the company’s position, defending its compliance with the 2023 Collective Bargaining Agreement (CBA) and addressing the potential for a strike.
Zarlenga’s e-mail directly countered Fain’s claims that Stellantis has not upheld its commitments during ongoing negotiations. He reiterated that the company has honored the terms agreed upon in 2023, pointing to specific language in Letter 311 of the agreement to clarify how investments and product allocations are determined.
Letter 311: Market Conditions and Allocation Contingencies –
The email highlighted that Stellantis’ investments are not guaranteed but contingent on various factors, including market conditions, customer demand, and plant performance.
“The language in Letter 311 is clear. It states that the investments and allocations set forth in Letter 311 ‘are subject to approval by the Stellantis Product Allocation Committee and contingent upon plant performance, changes in market conditions, and customer demand continuing to generate sustainable and profitable volumes’ for the relevant facility,” the e-mail states.
He went on to explain that Fain’s characterization of these commitments as guarantees is inaccurate, stressing the need for flexibility in the current market environment.
Impact of Market Volatility and EV Transition –
Zarlenga also pointed out the volatility within the automotive industry as it transitions to electric vehicles (EVs). He referenced multiple automakers who have revised their investment and product timelines and industry-wide EV sales projections that have been lowered by 25% for 2024.
“The evidence of a dramatic transformation of the industry and its effects on the market is clear,” Zarlenga emphasized, underscoring the challenges automakers face in navigating this transition. He reiterated that Stellantis’ decision to delay allocations at the Belvidere plant was consistent with both market realities and the language in Letter 311.
Clarifying Dodge Durango Production –
In response to Fain’s assertions regarding the production of the next-generation Dodge Durango, Zarlenga made it clear that Stellantis has not yet made any official announcements about the vehicle’s allocation.
“Contrary to Fain’s narrative, the company has not made an announcement regarding the production allocation of the next-generation Dodge Durango,” the e-mail stated, refuting the claims made during the livestream.
Investment Commitments –
Fain had also criticized Stellantis for allegedly fulfilling only 2% of its promised investments under the 2023 CBA. Zarlenga disputed this figure, highlighting significant investments Stellantis has already made in U.S. facilities.
“With those investments plus the recently announced +$400 million in Michigan, we have actually announced about 30% of the nearly $19 billion that is included in the 2023 agreement, not just 2% as Fain claims,” the e-mail clarified.
Commitment to Dialogue –
Despite the differences in interpretation, Zarlenga affirmed Stellantis’ commitment to working with the UAW to resolve any issues. He emphasized the company’s willingness to meet with Fain and other union leaders to discuss the situation.
“To be clear, Stellantis has abided, and will continue to abide, by the agreement the parties reached in 2023,” Zarlenga stated, adding that he and the company’s North American team remain available to engage in further discussions.
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