Following the sale of Stellantis’ plant in Brampton, Ontario, for an undisclosed amount, to Canadian defense contractor Roshel, Canada has given Stellantis 30 days to make good on past pledges.
That includes maintaining automotive production in the nation or facing being sued by its federal government for the return of “hundreds of millions of dollars” paid to the manufacturer, according to federal industry minister Mélanie Joly.
Joly said Thursday that she had written to Stellantis Canada CEO Trevor Longley, ending a resolution process with Stellantis over the CA$529 million ($374 million) it paid the company.
In an official statement provided to WardsAuto, via email, Stellantis confirmed that it is planning to return some of that.
“We will voluntarily return the $24 million CAD federal government support received for Brampton Assembly’s original retooling plan,” said Longley in the statement.
“The people who worked at Brampton made lasting contributions to Stellantis, and we take our responsibilities to them seriously,” Longley added. “Our priority is to work constructively with Unifor toward a fair, negotiated resolution that supports affected employees and recognizes their years of service.”
That federal government financing had been committed in 2022 on the condition that Stellantis maintain production at its Brampton and Windsor assembly plants through 2036, keeping an average of 4,475 employees. However, under Roshel, the plant could shed about 2,000 jobs, Joly has warned.
“Patience has its limits. To be frank, I’m fed up. I’m fed up and Canadians are fed up and workers are fed up,” Joly said, after a Thursday meeting in Toronto with Stellantis, auto union Unifor and Ontario Premier Doug Ford.
“Stellantis is in breach of its contract and commitments to Canada and the workers of Brampton,” Joly said. “I was extremely clear. Stellantis is on the hook for hundreds of millions of dollars. Stellantis knows how much it owes. We have sent them a notice of default.”
“Other automotive manufacturers are doubling down on Canada and investing in their plants,” Joly said — a reference to Honda Canada’s planned CA$166 million retooling of its Alliston, Ontario, plant. Joly also said at the Thursday meeting that she does expect another future meeting with Stellantis global CEO Antonio Filosa to discuss the future of Brampton:.
“Being informed or being aware of some aspects is not the same as Stellantis providing a global solution for those workers at the plant, which is their obligation,” said Canadian Prime Minister Mark Carney on Thursday, at the ninth summit of the European Political Community in Dublin, Ireland.
Bluster, anger…pragmatism?
Unifor national president Lana Payne, speaking after yesterday’s meeting, was not confident about a positive outcome. “We are in the same place; the company has sold the plant,” she said.
The Canadian and Ontario governments could reverse this process, according to Payne, but there was no evidence from the meeting that these political levers would be pulled. “The time to stop that was this week or last week or the week before,” she said.
Payne said this was galling, considering a likely shift in U.S. trade policy following the midterm elections, which could restore Canada’s attractiveness as a manufacturing center for automakers.
“We're in a place where we're going to get a trade deal sooner or later,” Payne said. “The conditions are changing in the USA.”
Citing the 2021 restart of General Motors’ Oshawa Assembly plant east of Toronto after a two-year production suspension, Payne said Unifor’s ongoing collective bargaining demands for Brampton reflected the difficult financial position faced by Stellantis worldwide at present.
“We weren't asking for the moon and the stars; we didn't even ask for a product; but we said, ‘Don't sell and don't close,’” Payne said.
