33,500 buyout offers—how many lost jobs?

Stellantis is asking over 33,500 employees in the US and Canada to take a buyout or early retirement, according to the Detroit News. The breakdown is 31,000 hourly workers and 2,500 salaried ones, though not all of those will be lost jobs: there are numerous workers on indefinite layoff at the moment, and the actual targets people accepting the packages was not revealed. It could be that the company is only seeking to lose 20% of the people getting offers. Stellantis has around 51,000 hourly workers in the U.S. and Canada.

Brampton plant workers

Detroit News cited a letter from a UAW local blaming the cuts on competition and “the costly shift to electrification” (though Stellantis’ 2022 profit was $18 billion). Electric cars use less labor in both development and production, which is more likely the main issue; and Stellantis intends to launch 25 electric cars in the United States by 2030. Even if hydrogen turns out to be “the real technology of the future,” that will most likely lead to fuel cells powering electric motors.

Other new methods of building cars, such as Tesla’s use of quite large castings to replace smaller components welded together, are cutting into the need for humans in auto assembly—a trend which has been moving quickly since the 1950s.

Many large American companies have been trying to cut costs and lay off workers in preparation for a predicted recession; GM and Ford have recently eliminated thousands of positions for management and professional workers.

The deadline for workers to accept the package will be June 16. As noted earlier, those eligible for retirement can collect $50,000, while others will have a years-with-the-company based cash payment. It is highly unlikely Stellantis expects the majority of workers to take the buyouts, given that 64% of hourly workers are getting the offer.