Stellantis initiates legal action against UAW in a U.S. federal court due to alleged strike warnings.
Auto manufacturer Stellantis filed a lawsuit on Thursday, aiming to have the US District Court in Central District of California declare that UAW Local 230 in Los Angeles breaking contract terms by pushing for a strike authorization vote is illegal.
Stellantis aims to hold UAW and the local union chapter accountable for potential losses in revenue and damages caused by any strike due to production disruptions.
On Thursday, a significant majority of UAW members at Stellantis’ Los Angeles Parts distribution center decided to submit a request for strike authorization if the company and union can't resolve a dispute over the company's investment plans.
UAW President Shawn Fain asserted in a statement that the company has breached the contract by abandoning investment commitments, but Stellantis argues that such investments were contingent on market conditions and the slowing demand for electric vehicles.
"UAW showed poor faith by disregarding this condition, filing deceptive grievances, and instigating a strike authorization vote to coerce Stellantis into executing its investment plans," the company stated in the lawsuit.
In an email to UAW members on Friday, Fain warned of Stellantis management's attempts to spread misinformation and cause fear and confusion about authorization to strike rights. He called the lawsuit and other company actions "desperate moves," adding that union lawyers are "exceedingly confident" in the union's right to strike.
Fain accused Stellantis CEO Carlos Tavares of pursuing drastic cuts to the company's underperforming U.S. operations.
"We refuse to be passive spectators while this company breaches our agreement and jeopardizes our jobs, plants, and communities. We are united and resolute. We will do whatever it takes to enforce our contracts and protect American jobs," Fain said.
As part of the 2023 contract with the union, Stellantis agreed to invest $1.5 billion in its Belvidere, Illinois assembly plant to manufacture new mid-size trucks by 2027, which is part of an overall $19 billion investment strategy by the automaker.
Stellantis acknowledged in August that it is postponing some investments due to economic conditions but asserted that it "resolutely stands by its commitment."
The Energy Department announced in July that it plans to award Stellantis $334.8 million to reopen the shuttered Belvidere Assembly plant to manufacture electric vehicles and $250 million to retrofit its Indiana Transmission Plant in Kokomo for EV component production, but stated that these awards have not yet been finalized.
Stellantis expresses concern about potential financial losses to its business due to potential strikes, as per the dispute with UAW Local 230.
If the strike authorization vote is successful, it could lead to disruptions in the company's business operations and potentially impact its revenue stream.
