1,100 Ohio Workers Facing Layoffs as Jeep Plant Cuts Shifts
Stellantis is planning to lay off approximately 1,100 workers at its Toledo South plant in Ohio early next year, as the company takes further steps to address high inventory levels at U.S. dealerships. The Toledo plant, which manufactures the Jeep Gladiator pickup truck, will reduce its operations from two daily shifts to one starting as early as January 5, 2025.
Sales of the Gladiator, the truck version of the Jeep Wrangler, have dropped nearly 21% this year, with only 36,519 units sold so far, according to Motorintelligence.com. Stellantis stated that while these actions are difficult, they are necessary to regain the company’s competitive edge and eventually restore production levels.
The company’s decision comes as part of a broader strategy to manage high inventory across U.S. dealerships. Stellantis has faced a downturn in U.S. sales for much of the year, and discounts introduced to counter high prices have not been enough to offset weak sales. As of June, the company’s dealer inventory reached over 430,000 vehicles, with third-quarter sales dropping by 20%, and year-to-date sales down by more than 17%.
Under the union contract, laid-off workers will receive supplemental pay, amounting to 74% of their regular pay when combined with state unemployment benefits. They will also be covered for health insurance for up to two years. The United Auto Workers (UAW) union, which represents the workers, has not yet commented on the layoffs.
Earlier this year, Stellantis warned of potential layoffs at its pickup truck plant in Warren, Michigan, but indicated the number of job cuts would be lower due to early retirement offers. The company’s efforts to reduce dealer inventory by offering discounts have not been successful, leading to a decline in sales.
CEO Carlos Tavares has focused on reducing costs by delaying factory openings and offering buyouts to salaried workers, but the company has also been under pressure from U.S. dealers and the UAW. The union has threatened to strike over delays in reopening the Belvidere, Illinois, assembly plant, which Stellantis blames on a slow market.
