*

UAW President Fain accuses Stellantis ( STLA ) of breaking contract

promises

*

Stellantis' ( STLA ) U.S. operations struggle with lagging sales

and

bloated inventories

*

Potential strikes could impact high-demand Jeep SUV

production,

analyst says

By Nora Eckert

DETROIT, Sept 18 (Reuters) - The United Auto Workers

union is eying multiple U.S. strikes against French-Italian

carmaker Stellantis ( STLA ) about a year after a national

walkout cost the Detroit Three automakers billions of dollars

and idled 50,000 workers.

Accusing Stellantis ( STLA ) of breaking its contract promises, UAW

President Shawn Fain on Tuesday night warned that several union

local chapters were laying the groundwork for strikes that could

collectively shut down the automaker.

The latest UAW threats follow last year's six-week strike that

cost Stellantis ( STLA ) about 750 million euros ($834.08 million) in

profit. The union also hit General Motors ( GM ) and Ford

during the historic 2023 walkout, and drew U.S. President Joe

Biden to the picket line to show his support for the striking

workers.

Stellantis' ( STLA ) North American operations have been struggling, and

the strike threat looms as the race for the White House between

Democrat Kamala Harris and Republican Donald Trump heats up.

Harris, who is currently the U.S. vice president, has been

endorsed by the UAW.

Union strikes outside the four-year contract negotiations

are unusual, and a large walkout at Stellantis ( STLA ) just one year

after its labor deal was penned, in an election year, would be

unprecedented.

"The union has picked the perfect time to target Stellantis ( STLA ),

because the North American group is likely at its weakest

point," said Sam Fiorani, vice president at research firm

AutoForecast Solutions.

Fain said on Tuesday that 28 locals, covering tens of

thousands of workers, had filed grievances against Jeep parent

Stellantis ( STLA ) and that 18 were at or near the point where they

could call for strike authorization votes - with at least one

expected in the next few days. Fain, who rose through the

union's ranks after working as an electrician for Chrysler,

brought a more combative approach and a fresh leadership team to

the union after his election in 2023.

The location and timing of the first strike authorization

vote is still uncertain, but locals that filed grievances last

month included plants in Toledo, Ohio; Kokomo, Indiana, and

several in Michigan. The UAW has said roughly 98% of Stellantis' ( STLA )

membership is covered through those grievances, making the

potential strikes as powerful as a nationwide walkout.

Stellantis ( STLA ) could not be reached to comment on Wednesday, but

said after Fain's warning the previous day that the union leader

had not offered any data or information to support his claims.

"(Fain) continues to willfully damage the reputation of the

company with his public attacks which is helpful to no one

including his members," Stellantis ( STLA ) said in a statement. "We

would all be better served if these issues were addressed across

the table with productive, respectful and forward-looking

dialogue. A strike does not benefit anyone."

The UAW's grievances center around product and investment

commitments made during the contract negotiations last autumn.

Delays of a planned multibillion-dollar investment into a new

battery plant and factory in Belvidere, Illinois, and possible

plans by Stellantis ( STLA ) to move production of the Dodge Durango SUV

out of the U.S. have emerged as main sticking points for the

UAW.

Stellantis ( STLA ) said it has not confirmed plans to move the

Durango. The contract signed between the UAW and the automaker

allows the company to delay financial commitments if market

conditions worsen.

TROUBLES IN U.S. MARKET

Stellantis' ( STLA ) U.S. business has faltered over the past year, and

dealers and shareholders have publicly called out its lagging

sales, bloated inventories and tumbling share price.

CEO Carlos Tavares has said he is focused on improving

Stellantis' ( STLA ) performance in the U.S., and stated a willingness to

shut down brands globally if they do not make money. Last month,

he visited the U.S. with the intention of developing a plan to

improve the U.S. operations.

Still, the automaker's U.S. vehicle inventories are larger

than those of a year ago before the strike, which could protect

Stellantis ( STLA ) from feeling any immediate pain if workers hit picket

lines, analysts said. Its 77 days' supply of vehicles at the end

of August was up 18 days from the same time last year, according

to industry firm Cox Automotive.

However, the UAW could target plants that make higher-demand

vehicles, like Jeep SUVs, Fiorani said. A more targeted approach

would allow the UAW to spend less money supporting striking

workers.

A new collective strike now would capture the attention of the

White House in the run-up to the Nov. 5 U.S. election. Michigan

is a battleground state, which both Harris and Trump have

visited several times.

Officials with the Harris and Trump campaigns could not

immediately be reached for comment.

Harris has the backing of many unions as she seeks to

attract support from more working class voters. Trump has said

Fain is costing union members their jobs as the industry ships

production outside of the U.S. and loses ground to China.

The executive board for the Teamsters is meeting on Wednesday as

the union decides whom to endorse.

Fain said the UAW in last year's deal won the right to

strike over product and financial commitments. However, that

could be tested in court, said Art Wheaton, labor professor at

Cornell University.

According to union procedures, Stellantis ( STLA ) has several

opportunities to respond to the UAW's grievances. If issues go

unresolved, the union has 60 days to hold a vote on whether to

strike. A strike authorization does not necessarily mean a

strike will occur.

($1 = 0.8992 euro)