DETROIT – Chrysler parent Stellantis is offering buyouts to about half of its U.S. salaried employees in a bid to reduce headcount and cut costs at the automaker’s North American operations.
The voluntary separation packages will be offered to 6,400 of its 12,700 non-bargaining unit US employees with five or more years of service, the company said on Monday.
The move marks the latest cost-cutting effort for the US auto industry, as companies seek to cut costs amid economic concerns and billions of dollars in new investments in emerging technologies such as electric vehicles. Both General Motors and Ford Motor have also cut salaried jobs over the past year.
“As the US auto industry continues to face challenging market conditions, Stellantis is taking the necessary structural actions to protect our operations and the company,” Stellantis said in an e-mailed statement. “As we prepare for the transition to electric vehicles, Stellantis announced today that it will offer a voluntary separation package to assist those non-represented employees who wish to separate from the company or retire to pursue other interests with a favourable benefits package.”
A Stellantis spokeswoman declined to comment on how many people or total costs the company was looking to cut. She also declined to comment on whether involuntary layoffs are planned if not enough employees accept the buyouts.
Employees will have until 8 December to accept the buyout offers, the company said.
This is the second round of employee buyouts for Stellantis this year. In April, the company extended voluntary buyouts to approximately 33,500 US employees, including 31,000 hourly employees with at least one year of service and 2,500 salaried, non-union employees with 15 or more years of service.
The latest buyouts come weeks after the automaker reached a tentative agreement with the United Auto Workers union on new labour contracts for its 43,000 unionised workers.
The tentative agreement between Stellantis and the UAW, which must be ratified by union members, also includes voluntary buyouts.
According to the UAW, the voluntary incentive plan for retirement will be $50,000 pre-tax for an unlimited number of eligible production and skilled trades members in 2024 and again in 2026.
The Stellantis spokeswoman said the employee buyout offers are not directly related to the expected increase in US labour costs as a result of the agreement with the UAW.
The tentative agreement includes 25% wage increases, including 11% upon ratification; restoration of cost-of-living adjustments; additional contributions for retirees; billions in new investments; and other benefits.
