Stellantis NV, the parent company of Chrysler, is cutting about 3,500 hourly jobs in the United States and seeking to offer a willing and voluntary exit package, the UAW union said in a letter released Tuesday.
The automaker is proposing an incentive package that includes a $50,000 payout to workers hired before 2007 and is seeking to cut hourly headcount, UAW 1264 District posted in a letter on its Facebook page.
Stellantis spokeswoman Jodi Tinson declined to comment. An official briefed on the matter said the figures may be lower than those quoted in the UAW letter.
In late February, Stellantis (NYSE:STLA) indefinitely shut down its Illinois assembly plant, citing rising costs to produce electric vehicles.
The action affected approximately 1,350 workers at the Belvedere, Illinois, plant that produced the Jeep Cherokee SUV, resulting in indefinite layoffs. Stellantis warned it may not resume work as it considers other options.
The UAW letter said positions created by the departures would be filled by layoffs indefinitely. Stellantis said in February that about 40,000 U.S. hourly workers are eligible for profit-sharing.
Last week, UAW chairman Shawn Fain said Stellantis’ decision not to operate its Illinois plant was “a complete breach” of its union contract with the UAW and was unacceptable.
The UAW plans to begin negotiations with the Detroit Three before the labor contract expires in mid-September.
According to a CNBC report on March 9, General Motors (NYSE:GM) has begun to reduce its size by recommending large-scale honorary retirements to its white-collar workers in the United States. It is interpreted as part of the work to achieve the goal of structural cost reduction of $2 billion over two years announced by CEO Mary Barra.
Ford (NYSE:F) recently announced significant job cuts in Spain, Germany and the rest of Europe, and said in August it would cut a total of 3,000 salaried and contract jobs, primarily in North America and India.