June 19, 2024


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Jeep Cherokee plant to be ‘idle, not closed,' Stellantis exec says

Jeep Cherokee plant to be ‘idle, not closed,’ Stellantis exec says

DETROIT — The Illinois plant that builds the Jeep Cherokee is being shut down in early 2023, but Stellantis North America COO Mark Stewart on Monday said the factory still could have a future.

Stewart, during an event at a Detroit-area plant, said the automaker is “continuing to look at what we can do to repurpose that facility — but it’s idle, not closed.”

Stellantis intends to help workers at the Belvidere Assembly Plant who are being displaced find other positions within the company, Stewart said. The company last week said production will end Feb. 28, with layoffs of hourly and salaried workers there expected to last at least six months.

“We’re also working together with the UAW, and also with the state and local government, to make sure that folks that are on layoff find roles,” he told reporters. “We have many roles here in southeast Michigan and Ohio and Indiana as well, so that folks who want to go to another location during that time to work, those jobs will be available for those folks. It’s really important for us as well as to the UAW that we find roles for those people.”

The plant, about 70 miles northwest of Chicago, has appeared to be on shaky footing for some time after frequently experiencing downtime and layoffs. Its future is certain to be a point of discussion during next year’s contract negotiations between the UAW and the Detroit 3. UAW officials last week called Stellantis’ decision to halt production “grossly misguided.”

Stellantis cited a number of factors behind the decision, including the COVID-19 pandemic, global microchip shortage, and costs related to developing and building electric vehicles.

It was announced a week after Illinois legislators approved expanding the tax incentives available to retool the plant for EV production. The bill is an amendment to the Reimagining Electric Vehicles Act, which Gov. JB Pritzker signed in Belvidere in November 2021.

U.S. sales of the Cherokee plunged more than 60 percent to under 90,000 last year from the nameplate’s peak of about 240,000 in 2018. They fell another 60 percent in the first nine months of 2022. The Cherokee is the plant’s only product and is not built anywhere else.

Likewise, employment at the plant has dropped to about 1,350 from more than 5,000 workers in 2019. Stellantis eliminated the plant’s second daily production shift last year.

The plant used to be the largest employer in the area around Rockford, Ill., but now ranks 10th, just behind Walmart, according to economic development officials.