The layoffs represent 2% of the workforce focused on engineering, software, and tech
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Stellantis will lay off 400 white-collar workers effective March 31. The affected employees work in the tech, software, and engineering fields. The layoffs represent 2% of the workforce in those areas for Stellantis. After scoring record profits last year it cited various reasons for the layoffs.
“As the auto industry continues to face unprecedented uncertainties and heightened competitive pressures around the world, Stellantis continues to make the appropriate structural decisions across the enterprise to improve efficiency and optimize our cost structure,” the company said in a statement on Friday.
Many of the workers found out Friday morning during a somewhat surprising mandatory remote work day announced on Thursday. The affected employees will receive transition assistance and a “comprehensive separation package.”
MORE: Stellantis Reverses Course, Inks Deal With California Over CARB Rules Through 2026
Stellantis tells AutoNews that these layoffs will help the brand long term. Specifically, the cuts “better align resources while preserving the critical skills needed to protect our competitive advantage as we remain laser focused on implementing our EV product offensive and our Dare Forward 2030 strategic plan,” the company said.
A source indicated that these cuts are just the first of several in the pipeline. “This isn’t going to be the last,” a person briefed on the matter said. “They are going to be doing this in waves so they can game the WARN Act.” According to legalaidatwork.org, the WARN Act requires employers to give 60 days notice to those laid off.
Of course, that only comes into play when 500 or more get laid off within a 30-day period. If Stellantis has another layoff 31 days from now of 499 or fewer people it might be able to skirt that rule. What’s clear though is that the automaker has tried to avoid layoffs in the past.
Last April it offered buyouts to 33,500 workers in an effort to cut 3,500 jobs in the USA. Then, in November of 2023, it opened up a new buyout program for 6,400 white-collar workers. All of these moves come as it posted record net profits of $20 billion in 2023. That figure represents an 11 percent increase in net profit despite a 1 percent reduction in U.S. sales.
