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US lawmakers pressure automaker Stellantis on investment commitments
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US lawmakers pressure automaker Stellantis on investment commitments
Oct 30, 2024 5:31 PM

*

About 80 members of Congress urging Stellantis ( STLA ) to honor

contract

commitments with UAW

*

Stellantis ( STLA ) say not violating deal with union, cites

changing

market conditions

*

UAW could strike as tensions build in lead-up to US

election

(Adds details on letters, Stellantis ( STLA ) and UAW battle in

paragraphs 7-11)

By Nora Eckert and David Shepardson

DETROIT, Oct 23 (Reuters) - Nearly 80 members of

Congress, including the Senate's top two Democrats, on Wednesday

urged automaker Stellantis ( STLA ) to honor investment

commitments that are part of its contract with the United Auto

Workers union.

The union and the Jeep-maker have been in a bitter battle

after Stellantis ( STLA ) said it would delay a planned $1.5 billion

investment to reopen an assembly plant in Belvidere, Illinois,

though the automaker insists it is committed to the plan and

denies it is violating the contract.

Democratic members of the House of Representatives and U.S.

Senate sent two separate letters, first reported by Reuters, to

the automaker on Wednesday outlining their concerns. The

Democratic lawmakers including Senate Majority Leader Chuck

Schumer and Senator Dick Durbin cited the Illinois plant delay

and other reported decisions by Stellantis ( STLA ).

"These actions violate the obligations Stellantis ( STLA ) made to

the UAW," the lawmakers wrote to Stellantis ( STLA ) CEO Carlos Tavares,

asking the automaker, which has come under heat from dealers and

shareholders for its declining sales, to lay out a timeline for

the investments.

Chrysler owner Stellantis ( STLA ), which recently shook up its top

leadership as it tries to turn around slipping North American

sales, is now facing another nationwide walkout from the union,

just about a year after UAW president Shawn Fain led a six-week

strike against Detroit's Big Three automakers.

The company did not immediately respond to a request for

comment.

The UAW's grievances, echoed in those letters, center around

product and investment commitments made during the contract

negotiations last autumn. Stellantis ( STLA ) agreed to reopen the

shuttered Illinois assembly plant to build new mid-size trucks

by 2027.

The carmaker this month sued the UAW in federal court over

the allegations and said it was not in violation of the

contract. The agreement allowed Stellantis ( STLA ) to delay financial

commitments if market conditions worsen, but the union and

signers on the two letters from Congress are not satisfied with

the company using this as a reason to shift plans.

"Stellantis's ( STLA ) recent attempt to justify delays in its

contractually mandated investment and production commitments did

nothing to assuage our concerns. Stellantis ( STLA ) appears resolved to

claim market conditions prevent you from honoring these

commitments," said the letter sent from dozens of Democrats in

the U.S. House of Representatives.

Tensions between the union and carmaker have risen in the

lead-up to the Nov. 5 U.S. Presidential election, with Vice

President Kamala Harris specifically calling out Stellantis ( STLA ) in

public statements for taking actions that "break their word to

workers".

The union has laid the groundwork for a nationwide walkout

at Stellantis ( STLA ) through filing grievances and holding strike votes

at its local chapters. So far, some local chapters have already

voted to authorize a strike if the two sides cannot come to an

agreement.

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