Stellantis Will Buy Out Thousands of Hourly Employees to Cut Costs for EV Making

UAW Local 1264, which represents the Stellantis stamping plant in Sterling Heights, Mich., said in a letter to members that the offers would be made “corporate wide.”

Retirement-eligible workers hired before ratification of Chrysler’s 2007 contract with the UAW can receive $50,000 to leave their job, according to the letter, which Local 1264 posted Monday on Facebook. Employees who have been with the company for at least a year would be eligible for a lump-sum benefit payment, the letter said, without specifying how much that would be.

Workers can sign up for either package from May 6 through June 19. Departure dates are tentatively scheduled for June 30 through Dec. 31, depending on each plant’s needs.

The openings would be filled by workers on indefinite layoff, the letter said.

A Stellantis spokesperson didn’t immediately comment on the plan.

The 3,500-job target would represent about 8 percent of the 43,000 hourly workers who were eligible to collect a profit-sharing check from Stellantis in March.

[Honda] CEO [Toshihiro Mibe] outlined the vision on Wednesday while giving Honda’s annual business briefing. Mibe said Honda executives had an unpleasant surprise at this month’s Shanghai auto show.

Local Chinese brands flooded the exhibition hall with sophisticated, advanced EVs of all kinds.

As COO Shinji Aoyama put it, “We were overwhelmed by the Chinese.”

Mibe said Chinese EVs had made big strides during the COVID-19 pandemic when the world was largely cut off from the country by travel restrictions and quarantine measures.

“They are ahead of us, even more than expected,” Mibe said.

“We are thinking of ways to fight back. If not, we will lose this competition,” he said. “We recognized we are slightly lagging behind, and we are determined to turn the tables.”

Honda will build direct relationships with chip producers for the long-term stable supply of chips, Chief Executive Toshihiro Mibe said at a news conference where he gave an update about the automaker’s business strategy.

“Honda will work closely together with Tier 1 suppliers and semiconductor makers and move forward with drastic steps,” Mibe said, adding it had reached a basic agreement on strategic collaboration with TSMC.

“In the past, there were probably almost no direct discussions between automakers, including Honda, and semiconductor manufacturers,” he said.

The company expected to start seeing an impact from the tie-up with TSMC from the 2025 financial year, Chief Operating Officer Shinji Aoyama said.

The deal included sharing information about production and parts supply with a focus on securing integrated circuits and other parts, he said.

TSMC said in an emailed statement it was committed to serving as its customers “trusted long-term technology and capacity supplier to unleash their innovations”.

“TSMC continues to work closely with major worldwide automobile IC companies to support their success,” it added, without elaborating.

Two people familiar with the matter had previously told Reuters that VinFast’s planned U.S. Initial Public Offering (IPO) may be further delayed, with one saying it could be pushed into next year due to unfavourable market conditions.

VinFast had no immediate comment about the impact of the fundraising on its planned IPO on Wednesday. Last week it declined to comment on the listing.

VinFast, which began operations in 2019, is gearing up to expand in the U.S. market, where it hopes to build a car and battery plant to compete with legacy automakers and startups, although shipments of vehicles from its factory in Vietnam have so far proceeded slowly.

Of the new pledges, $1 billion will be provided as a grant within the next year from founder Pham Nhat Vuong, Vietnam’s richest man, the company said in a statement.

Parent company Vingroup, Vietnam’s biggest conglomerate, will provide a grant of $500 million plus a $1 billion loan with a maturity of up to five years.

That would increase total funds raised by VinFast to $10.7 billion, based on earlier company filings.

The grants and loan will “give a push for VinFast to accelerate its development,” the company said.

“EV demand in North America remains very strong,” Chief Financial Officer Lee Chang-sil said on a call after the Seoul-based company reported first-quarter net profit of 500.6 billion won ($374 million), which beat analyst estimates. “Although demand in Europe seems to be limited and metals prices are falling, we’re pretty sure we can meet our initial goal for 30% sales growth for 2023.”

LG Energy expects it will get tax credits from the US Inflation Reduction Act — which is aimed at bringing more battery and EV production to the US — for 15 GWh to 20 GWh of production in 2023. The company, which supplies Tesla Inc., General Motors Co. and Ford Motor Co., eventually aims to have around 250 gigawatt hours of production capacity in the US and develop cylindrical batteries and energy storage systems based on lithium-iron-phosphate batteries.

Meantime, LG Energy is trying to secure battery minerals in order to comply with Europe’s Raw Materials Act, which like the IRA seeks to reduce reliance on Chinese metals for EV batteries. Shortly after the earnings were released, LG Energy said it had signed a $23 billion deal with Posco Future M Co. to supply high-nickel cathode materials.

North American sales will jump this year, with production set to accelerate at a plant jointly built with GM because the US automaker is speeding up output of EVs, according to a note by Yongjin Jung, an analyst at Shinhan Investment Corp. The tax benefits from the IRA will grow every year as US production capacity rises, Jung said.

The plant has become one of the few bright spots in the area’s economy, which has been hurt by plant closings and layoffs. The factory, which cost more than $250 million, is the first passenger-car assembly plant owned by a Japanese company to open in the United States and the second foreign-operated plant to do so.

Honda has been producing motorcycles at a plant next door since 1979. Volkswagenwerk A.G. of West Germany makes cars in New Stanton, Pa. And the Nissan Motor Company, the maker of Datsuns, is nearing completion of a truck assembly plant in Smyrna, Tenn.

At present, the auto assembly line here is moving at a rate of 20 cars an hour, less then half that of most American plants. More striking is the cleanliness of the plant, with not a scrap of paper or refuse on the green painted floor. Honda simply prohibits smoking and eating or drinking in production areas.

The uniforms - worn by all employees, although managers button the white jackets over shirts and ties - are similar to those worn in Honda’s factories in Japan. So is the practice of referring to all hourly employees as ‘’associates.’’ Both ideas are part of an effort to promote identification with the company and greater attention to quality. Each employee had three interviews before being hired and three days of training. The success of these efforts in molding attitudes could not be gauged immediately, since Honda officials refused to let reporters speak to any of the men and women on the line.