BELVIDERE, Ill. (WTVO) — Automaker Stellantis has idled the Belvidere Assembly Plant, where the Jeep Cherokee was made, opting to invest $155 million in three Indiana plants to further its electric vehicle (EV) production goals.
Production at the Belvidere plant came to a stop on Tuesday, February 28th.
Stellantis is the parent company of American auto brands Dodge, Jeep, Chrysler, and Ram, along with European manufacturers Alfa Romeo, Citroen, Fiat, Maserati, Opel, Peugeot, Vauxhall and others.
According to the United Auto Workers (UAW) union, Illinois Gov. JB Pritzker spoke with Stellantis in December, shortly before the company announced it would be idling the Belvidere plant, saying he thought the state would “land the plane” on a deal to enable the car company to manufacture future EVs there.
Stellantis has set a goal to achieve carbon net zero by 2038.
Carlos Tavares, CEO of Stellantis, said Tuesday that the company is “looking for a solution” for the Belvidere Assembly Plant.
Tavares said that the high costs of making electric vehicles at the plant made it difficult to keep it open, according to Reuters.
The CEO said that making the EVs at the plant would be “40% more expensive” than combustion vehicles. It would mean changing the automaker’s production footprint, according to Tavares.
On the same day the Belvidere plant ceased production, Stellantis announced it would invest in three plants in Kokomo, Indiana, to support the production of electric drive modules (EDM) that will be integrated into vehicles designed on the STLA Large and STLA Frame platforms for future electric vehicles.
The EDM will consist of an electric motor, power electronics, and transmission, combined into a single module.
Stellantis said the investments will be made at the Indiana Transmission, Kokomo Transmission, and Kokomo Casting Plants.
The decision to idle the Belvidere plant has been met with a fierce response from both workers and auto worker unions. The United Auto Workers (UAW) Union represented 2,300 employees at the plant, and they said that the decision to halt production “will not stand.”
“UAW Local 1268 members at Belvidere have proudly built vehicles for Chrysler, then FCA and now Stellantis since 1965. They have delivered quality and productivity for the corporation for generations,” the union said in a statement. “Stellantis’ ill-advised decision will have negative repercussions throughout the region and supplier network. It will disrupt lives, uproot families, and leave communities struggling to find economic drivers to pay for schools, roads and other services.”
The idling of the Belvidere Assembly Plant has raised a lot of questions for local workers, suppliers and Boone County residents.
Higher taxes are a possibility, but not just yet. It depends on what local officials decide to do when the factory’s assessment is done, which could be well into the future.
“The plant has obviously been a major part of our local economy for right around 60 years,” said Boone County Treasurer Curt Newport.
The idling of the Belvidere Stellantis plant brings a big hit to the local economy, as Newport said that the factory had a tax bill of over $1.9 million.
“When they’re talking about a state-wide, ‘we’re leaving Illinois and we’re going to Indiana,’ then it’s more than a Belvidere issue, and our state legislature has to understand what’s going on there,” Newport said.