Automotive

Biden’s EV tax credit to determine future product at Stellantis Brampton, Unifor says

The future of Stellantis’ Brampton Assembly Plant will remain in limbo until U.S. lawmakers firm up or drop a Biden administration-backed bill aimed at boosting electric vehicles adoption south of the border, according to the union that represents workers at the plant outside Toronto.

Unifor Local 1285 President Danny Price told members last week the automaker’s COO for North America, Mark Stewart, informed union leadership the company’s product allocation choices hinge on the outcome of the U.S. bill that includes funding for automakers and incentives for American EV buyers,

“He was very candid when explaining the final decisions on product allocation,” Price said in a Nov. 22 letter to members. “These decisions are contingent on what happens with the legislation before the United States Congress.”

Stellantis refused to comment on the meeting with union leadership.

“When it comes to new investment and product allocation, many factors are taken into consideration to bolster our global competitiveness and position the company for future growth,” company spokeswoman LouAnn Gosselin said in an email.

The Brampton Assembly Plant currently builds the Chrysler 300, as well as the Dodge Challenger and Charger. It employs nearly 3,200 workers on two shifts, yet the muscle cars’ impending shift to electrified platforms has raised doubts about what role the more than 30-year-old plant will play in the future.

The Brampton plant does not have a product allocated past 2024, said Unifor spokesman Scott Doherty, adding that uncertainty around the U.S. EV tax credit has put a “damper” on the decision process.

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“They’re not going to make any major investments now, until they know what playing field they’re playing with,” Doherty, executive assistant to Unifor national president told Automotive News Canada.

The Biden administration’s proposed tax credit would give American EV buyers as much as $12,500 for purchasing a U.S.-built EV, effectively raising the cost of Canadian-made vehicles sold south of the border.

Doherty said the credits could have a “catastrophic” impact on Canada’s auto sector.

“It’s probably the biggest crisis the auto industry’s facing since the ’08 recession.”

Doherty said while Stellantis has made previous commitments to the union on upcoming investments in Brampton, the proposed tax credit has created “serious concerns.”

And the potential fallout extends well beyond Brampton.

Unifor and other industry stakeholders have been pushing all levels of Canadian government to engage with their American counterparts on the issue. Prime Minister Justin Trudeau raised the tax credits in a recent visit to Washington, but failed to convince President Joe Biden to change course.

An initial draft of the wide-ranging spending bill that includes the EV tax credits cleared the U.S. House of Representatives Nov. 19 and is now before the Senate.

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