Stellantis to offer buyouts to white-collar workers after down earnings report

Following a lackluster earnings report last week, Stellantis has announced buyouts for its white-collar workers in the United States.

The automaker, which owns the Jeep, Ram, Chrysler, Dodge and Fiat brands, told workers in an email Tuesday about its plans, suggesting the possibility of cuts if it doesn't get sufficient takers but without specifying its headcount reduction goal. The company has previously announced that it has more than 11,000 U.S. non-bargaining unit employees.

"We wanted to give you some advance notice so you can thoughtfully consider whether this opportunity might be of interest to you. As always, we would prefer to meet our strategic headcount objectives through natural attrition and voluntary programs. Transparently, it is important to note that subsequent involuntary actions may be necessary if we do not meet our objectives through voluntary means," according to the email, obtained by the Free Press and attributed to Tobin Williams, senior vice president of human resources and transformation for Stellantis North America,

The email noted that the 2024 Voluntary Separation Program would be offered to U.S. nonrepresented employees at the vice president level and below in "certain functions," and that, unlike previous programs, there would be no minimum service requirements but there would be an enhanced benefits package.

Eligible employees were told to expect an email with instructions to access their individual offers in mid-August. In addition to severance based on years of service as of Sept. 30, 2024, the program is to provide a lump sum cash payment to cover health care costs, outplacement services for three months and vesting of the 3% company contributions to 401(k)s for those with less than three years of vesting service, the email said.

The automaker, in a statement, highlighted the reasons for making the offer:

"As Stellantis continues to address inflationary pressures and, importantly, provide consumers with affordable vehicles at the highest quality, we remain focused on taking the necessary actions to reduce our costs to protect the long term sustainability of the company. One of those actions is offering a voluntary separation package to U.S. employees in certain functions. More detailed information will be provided to eligible employees in mid-August."

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Stellantis on Thursday released its earnings for the first half of 2024 that showed a big change from the same period last year, even as the company continued to realize billions of dollars in profits and did not back away from a forecast for the full year of a double-digit margin in adjusted operating income and positive industrial free cash flow.

CEO Carlos Tavares called the results "disappointing and humbling" and said corrective actions were being taken. He also highlighted issues with North America specifically. In a roundtable with reporters, Tavares noted that the profitability of the company's North American region dropped from No. 1 to No. 4, and he said it needs to be No. 1.

The company has been criticized by the UAW in recent months for job cuts even as it continues to remain profitable.

Contact Eric D. Lawrence: elawrence@freepress.com. Become a subscriber. Submit a letter to the editor at freep.com/letters.