UAW President Slams Stellantis CEO Over Job Cuts, Price Gouging Allegations
UAW President Shawn Fain chairs the 2023 Special Election Collective Bargaining Conference in Detroit, Michigan, U.S., March 27, 2023.
Rebecca Cook | Reuters
DETROIT – United Auto Workers President Shawn Fain has stepped up his criticism Stellantis CEO Carlos Tavares accused the automaker in a video on Friday afternoon of raising prices for consumers and failing to honor certain terms of its union labor contract with the automaker.
The comments are the latest in a back-and-forth between the CEO and union leaders following Controversial collective bargaining negotiations last year between the UAW and Detroit automakers, including Stellantis.
“Something is rotten at Stellantis,” Fain said to start. video length 2:30 min posted on Friday. “Sales are down, profits are down, and CEO pay is up a lot. The problem is not the market at GM and Ford, car sales are up, and the problem is not auto workers. The problem is this man, Carlos Tavares.”
Spokespeople for the union and the automaker did not immediately respond to comment on the accusations or the video.
Some of the criticism, including criticism of Tavares’s job cuts and pay cuts, is not new. But Fain’s comments on Friday took the allegations a step further, accusing Tavares of raising prices for consumers in the name of profit. He also alleged that Stellantis failed to honor parts of the company’s labor contracts, specifically that Stellantis was halting plans to reopen an assembly plant in Illinois.
“In fact, Stellantis has been selling fewer cars for years, but making more profit. What does that tell you? They’re raising prices. Now they’ve gone too far and they’re cutting into their own sales,” Fain said. “In fact, Stellantis CEO Carlos Tavares is trying to go back on the commitments the company made in our last contract, including postponing the reopening of the Belvedere Assembly.”
Tavares has recently criticized the UAW-Stellantis workforce, noting quality issues at a metro Detroit truck plant that produces the Ram 1500 pickup. The company has also announced thousands of layoffs at U.S. plants amid falling sales and product changes.
“The run rate of some of our plans starting with SHAP, Sterling Heights, is not good,” Tavares told reporters July 25 while discussing ongoing issues with the company. “It’s something we need to work through with our plant management team as well as with our employees.”
Stellantis CEO Carlos Tavares speaks to the media on June 13, 2024, following the company’s investor day at its North American headquarters in Auburn Hills, Mich.
Michael Wayland / CNBC
Tavares has been on a mission to cut costs since the company was formed through a merger between Fiat Chrysler and France’s PSA Groupe in January 2021. It is part of his “Dare Forward 2030” plan to boost profits and double revenue to 300 billion euros ($325 billion) by 2030.
Cost-saving measures include reshaping the company’s supply chain and operations as well as cutting the payroll of both salaried and hourly employees.
Stellantis has cut 15.5% of its payroll, or about 47,500 employees, from December 2019 through the end of 2023, including 14.5% in North America, according to public filings. That figure does not include additional cuts and layoffs this year.
Some previous executives described the cuts to CNBC. as if tired to the point of being excessive. Tavares last month was pushed back with the suggestion that the company’s cost-cutting efforts have led to its current problems.
