The future of Stellantis Assembly Plant in Brampton will remain in limbo until U.S. lawmakers either bolster or drop a Biden administration-backed bill aimed at boosting the adoption of electric vehicles south of the border, according to the union that represents the workers at the plant outside of Toronto.
Unifor Local 1285 president Danny Price told members last week that the automaker’s North American COO, Mark Stewart, has informed union leaders that the choices of The company’s revenue allocation depended on the outcome of the US bill which includes financing for automakers and incentives for US buyers of electric vehicles.
“He was very frank in explaining the final decisions on product allocation,” Price said in a Nov. 22 letter to members. “These decisions depend on what happens with the legislation before the United States Congress.”
Stellantis declined to comment on the meeting with union leadership.
“When it comes to new investments and product allocation, many factors are taken into consideration to strengthen our global competitiveness and position the company for future growth,” said the company spokesperson, LouAnn Gosselin, in an email.
The Brampton Assembly Plant currently manufactures the Chrysler 300, as well as the Dodge Challenger and Charger. It employs nearly 3,200 workers on two shifts, but the impending switch from muscle cars to electrified platforms has raised doubts about what role will the 30-year-old plant play in the future.
The Brampton plant has no allocated proceeds after 2024, Unifor spokesperson Scott Doherty said, adding that the uncertainty surrounding the U.S. electric vehicle tax credit has put a “shock absorber” on on the decision-making process.
“They are not going to make any major investments now, until they know what playing field they are playing with,” said Doherty, executive assistant to the national president of Unifor. Automotive News Canada.
The tax credit proposed by the Biden administration would give buyers of U.S. electric vehicles up to $ 12,500 towards the purchase of an electric vehicle built in the United States, effectively increase the cost of vehicles made in Canada sold south of the border.
Doherty said the credits could have a “catastrophic” impact on the Canadian auto industry.
“This is probably the biggest crisis the auto industry has faced since the recession of 08.”
Doherty said that while Stellantis has made prior commitments to the union on upcoming investments in Brampton, the proposed tax credit has created “serious concerns.”
And the potential benefits extend far beyond Brampton.
Unifor and others in the industry have pushed all levels of Canadian government to engage with their US counterparts on the issue. Prime Minister Justin Trudeau increased tax credits during a recent visit to Washington, but failed to convince President Joe Biden must change course.
A first draft of the sweeping spending bill that includes electric vehicle tax credits was approved by the United States House of Representatives on November 19 and is now before the Senate.