Jeep maker Stellantis NV is seeking the unilateral right to sell its Auburn Hills headquarters and technical center, one of 18 facilities it is selling or closing as part of its latest bid to the United Auto Workers, according to two sources familiar with it could the information.
The right to sell the transatlantic automaker’s North American headquarters, emblazoned with Chrysler’s Pentastar logo, does not mean the automaker is abandoning Auburn Hills, said one of the sources, who requested anonymity without permission to speak publicly on the subject to speak, but it would offer the company flexibility and options for the future of the 500-acre campus, which includes laboratories, technical facilities and design studios in a hybrid workplace. For example, it could sell the property and rent it back.
The proposal was part of Stellantis’ fourth counteroffer to the union Thursday night, before it called a strike at the Jeep Wrangler and Gladiator plant in Toledo, Ohio, as well as Ford Motor Co.’s Bronco and Ranger plant in Wayne and General Motors Co. exclaimed. ‘s midsize pickup truck and commercial vehicle plant in Wentzville, outside St. Louis.
The UAW represents employees at its headquarters in Auburn Hills. As a result, the union would have to agree to the proposal to allow Stellantis to sell the site that formerly served as the world headquarters of Chrysler LLC.
In a statement late Monday, Auburn Hills Mayor Kevin McDaniel said, “We are proud to host the headquarters of Stellantis North America. As Stellantis is the largest employer in our thriving community, we recognize the importance of addressing recent reports surrounding the closure of 18 US facilities. To date, we have not received any indication or information indicating that Stellantis intends to close its headquarters in our city.”
Mark Stewart, Stellantis’ chief operating officer in North America, said Saturday that the selected locations are primarily Mopar parts distribution centers that the company would like to modernize but that would not result in job cuts. The company has 20 centers in the United States and 10 of them are included in the list of 18 locations.
Stewart also mentioned underutilized locations. That includes the Trenton Engine Complex, which employs more than 600 hourly workers and whose north building is already decommissioned and used as a warehouse, according to the sources.
Also on the list is Tipton Transmission in Indiana, where nearly 300 hourly workers produce nine-speed transmissions that are also built at the nearby Indiana Transmission Plant in nearby Kokomo. Employees could change.
Stellantis would also be able to close the idled Mount Elliott Tool & Die plant in Detroit.
The shuttered Jeep Cherokee plant in Belvidere, Illinois, was also on that list. Stewart said Stellantis’ offer, however, included an unspecified “solution” for the idled Cherokee plant that was on the table if an agreement could be reached before the previous contract with the UAW expired a minute before midnight Thursday . The proposal was to use that site as a large Mopar distribution center, the sources said.
The UAW rejected that offer before the deadline and countered with one of its own, which Stewart said was not affordable. The union and Stellantis resumed talks Monday after the UAW met with Ford and GM over the weekend.
“The discussion was constructive and focused on where we can find common ground to reach an agreement that will build a bridge to the future by enabling the company to overcome the challenges of electrification,” it said a statement from Stellantis. “Together with the UAW, we have the opportunity to create a framework in this agreement that will enable the company to be competitive during this historic transformation and to take our workforce with us along the way. This includes finding a solution for Belvidere, something we have already committed to from the start and a discussion we intend to continue with the UAW.”
The 10 Mopar parts distribution centers include three in Michigan: Center Line, Marysville and Warren. The others are Atlanta PDC, Boston PDC, Chicago PDC, Milwaukee PDC, New York PDC, Orlando PDC and Sherwood PDC. The company could open new centers in Fishkill, New York, and Macon, Georgia.
“Either these are facilities that have been idle for a long time, or they are parts distribution centers – PDCs – but they are much older and need to be upgraded, or they may be in the wrong location,” Stewart said during a roundtable . “Now we are looking at our distribution chain and the ability to get products to our customers more effectively and quickly and achieve the best cost structure from a transportation perspective. We need to invest in Mopar, and in many cases that is not the case. “It makes no sense to make such investments in the location where they are located.”
CNBC was first to report the details of the 18 facilities.
Stellantis announced in May 2021 a more flexible workplace model it calls “the new era of agility” for the 15,000 employees then scheduled to work at its Auburn Hills campus. It was estimated that on average an employee would spend 70% of their time working from home and the rest in the office. Following the move, Stewart said it would reassess its real estate portfolio, including the potential leasing of space at its headquarters.
“The Chrysler Technology Center will continue to be our North American headquarters and technical center for North America,” the company said at the time.
Michigan Economic Development Corp. spokesman Otie McKinley declined to comment on ongoing negotiations but said Michigan and Stellantis are “synonymous with each other.”
An Oakland County spokesman declined to comment on the reports.
Stellantis’ Thursday offer to the union also included a 21% cumulative wage increase (19.5% not compounded), a four-year promotion to the top wage, a starting wage of $20 an hour for additional employees and $1 billion in additional wages additional retirement benefits for employees and employee pensioners.
After this weekend’s negotiations, UAW President Shawn Fain told NPR on Monday morning that there is still a long way to go before the union reaches tentative agreements with companies and ends the strikes.
“We made comprehensive offers to all three companies before the strike deadline and had minimal discussions over the weekend,” he said. “The ball is still in their court so we’ll carry on as we are and just see how things develop.”
Read more: Where UAW, Detroit Three automakers stand on important issues
The union has threatened that more sites could be added depending on how talks progress under a so-called “stand-up strike” strategy. However, Fain declined to say whether that might happen soon. He noted that the union presented its members’ demands, including economic proposals, to automakers during the week of July 30.
“We were very open from day one when we started negotiating with the companies over eight weeks ago and said, ‘If they expected to wait until the last minute and start negotiating, they would find that “They would be disappointed because we expected to listen to our members’ needs and take care of business early, so we wouldn’t be in this position,” he said. “The companies decided against it and therefore waited until last week to actually start discussions. “So we still have a long way to go and if the company does not respect the demands of our workers, we will tighten the measures.”
As a result of the strike, Ford on Friday temporarily laid off the remaining 600 workers at its Michigan assembly plant in Wayne, as the union had only laid off workers in the assembly and paint shops. General Motors Co. said its Fairfax assembly plant in Kansas, where it makes the Chevrolet Malibu sedan and Cadillac XT4 SUV, could be idle this week because of the Wentzville strike. Workers who do not qualify for unemployment will receive $500 per week, like striking UAW members.
“That’s the decision that the companies made,” Fain said of the layoffs. “Companies didn’t have to lay off these workers. It was a decision. They are trying to intimidate the workers, but we will take care of our workers no matter what we have to do.”
Fain said the 20 percent wage increases offered by automakers were “not enough” after the union made sacrifices to save the companies during the Great Recession and bankruptcies. The UAW originally asked for a 40% wage increase without compounding (46% compounding), which has since fallen to 36%.
Fain said on MSNBC’s “Morning Joe” that removing the tiers remains one of the key issues on which agreement between the parties remains difficult. The companies have proposed shortening the time to reach top wages from eight to four years, while the UAW is seeking a deadline of just 90 days.
The White House announced Sunday that it was sending senior advisers to President Joe Biden to Detroit to help reach an agreement.
“This fight is not about the president,” Fain said on MSNBC. “This is not about the former president or any other person before that. This fight is about workers standing up for economic and social justice and getting their fair share because they are tired of going backwards.”
The striking autoworkers themselves were divided over support from the Biden administration.
“It’s not a problem,” said Phil Lozier, 52, of Canton, a UAW member representative at Ford’s Michigan Assembly Plant in Wayne. “Biden is a pro-union activist. We are well.”
But Lumengo McGhee, 51, of Macomb, who has worked in the metals industry for 11 years, says the members who did the work should negotiate an agreement, not outsiders.
“You weren’t in here,” she said. “They didn’t work on these concrete floors all day. They didn’t get what we got and were trying to pay their bills.”
Twitter: @BreanaCNoble
Staff writer Kalea Hall contributed.