Mass Layoffs Hit Toledo’s Auto Industry: Stellantis Cuts Over 1,100 Jobs as Sales Slump
In a significant blow to Ohio’s automotive sector, Stellantis announced plans to indefinitely lay off more than 1,100 workers at its Toledo Assembly Complex, highlighting growing challenges in the American auto industry. The layoffs, scheduled to begin as early as January 5, 2025, will impact both the Jeep Gladiator and Wrangler production lines.
Bruce Baumhower, UAW Local 12 President, revealed that the cuts will affect 500 workers from the Gladiator lines on the south side and 639 workers from the Wrangler lines in the north plant. “We’re concerned about losing 1,139 members – that’s a big chunk of our plant,” Baumhower stated. “It will also shut down our suppliers.”
The root cause of these layoffs stems from a dramatic decline in sales. The Gladiator has seen a sharp 70,000-unit drop in sales over the past four years. Similarly, Wrangler sales have plummeted by nearly 100,000 units since 2021. Baumhower points to the lack of hybrid options in the Gladiator line as a key factor in decreasing demand.
Stellantis, which owns popular brands like Chrysler, Jeep, Dodge, and Ram, is calling 2024 a “transitional year.” The company aims to slash its U.S. dealer inventory by 100,000 units by the end of November. This decision follows a concerning 27% drop in net revenues compared to the same period last year.
The impact on workers will be partially cushioned by provisions in the 2023 Collective Bargaining Agreement. Affected employees will receive:
- One year of supplemental unemployment benefits
- Combined with state benefits, workers will receive 74% of their regular pay
- An additional year of transition assistance
- Two years of continued health care coverage
Local response efforts are already underway. The Ohio Department of Jobs and Family Services has deployed its rapid response team to:
- Help workers understand and apply for unemployment benefits
- Provide job search assistance
- Offer skill development opportunities
“We’re working hard to find solutions,” says Baumhower. UAW Local 12, which has contracts with 41 other companies in northwest Ohio, is exploring temporary placement options for affected workers at other facilities until Jeep production rebounds.
The Toledo Assembly Complex has been a significant economic driver for the region. The 3.64-million-square-foot facility has received substantial investments over the years, including:
- A $1.2 billion investment in Toledo’s North plant since 2011
- An additional $1 billion commitment in 2017 to modernize the South plant
Local car dealerships are also bracing for impact, with many expecting a ripple effect on their sales. However, there may be hope on the horizon as plans are in development to build a smaller complementary facility near the Gladiator plant in the south.
This situation highlights the broader challenges facing the American automotive industry as it navigates changing consumer preferences, particularly the growing demand for hybrid and electric vehicles.
The impact of these layoffs will likely extend beyond the assembly plant, affecting suppliers, local businesses, and the broader Toledo community.