Key Points:
- Stellantis may lay off 50% of its North American workforce and outsource jobs due to struggles in the U.S. market.
- Jeep faces increasing competition from brands like Hyundai and Kia, threatening its market position.
- Stellantis’ issues could signal broader challenges for other U.S. automakers like GM and Ford.
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Lee and Doug discuss the challenges facing Stellantis, the company that now owns Chrysler, Jeep, and Ram, and the potential impact on the American car industry. They talk about Stellantis’ possible plan to lay off up to 50% of its North American workforce, outsourcing jobs to India and Mexico, which could have significant implications for American labor and the car industry. The conversation also touches on the increased competition Jeep is facing from other brands like Hyundai, Kia, and Ford (NYSE: F), which could further strain Stellantis’ market position. The discussion concludes with concerns that if Stellantis struggles, other major U.S. car manufacturers like GM (NYSE: GM) and Ford might also face difficulties.
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Edited Video Transcript:
So a lot of people don’t know this, but Chrysler has been owned by a whole bunch of people.
Yes, it has.
Mercedes Daimler for a while.
It’s now owned.
Chrysler is now owned by a company called Stellantis, which is based in Italy and, you know, owns a bunch of brands.
And, you know, it’s one of these multi-brand companies in a lot of ways, like General Motors or Volkswagen is.
What they found though is that owning Chrysler in the United States turned out to be a pretty crummy deal.
They’re now down to, from having a very wide array of models, they’re basically a minivan company.
So I want you to explain to me, how does this work out well in the end for Stellantis?
Well, it’s going to be an interesting story because, well, Stellantis has the Ram truck, which is probably a strong number two seller.
They have the Jeep line, which has…
You know, cult-like buyers that always want to own it.
And okay.
So that’s another product.
And yeah.
And fans, you know, they had a big sedan, you know, the three hundred or two hundred or three hundred, whatever the model number was a couple of years ago that did well for a couple of years.
And the problem that I have, got a firsthand indoctrination of when I was in Detroit recently, is they laid off a bunch of people last year and earlier this year rather.
And it was a huge layoff, and it did not go over well in the industry.
So they started to offer packages for people to get out.
And one of the people that accepted that package was my daughter-in-law’s brother.
And he got a nice package.
You know, got a good termination.
And it was just recently from the Chrysler Tech Center because he was an auto mechanical engineer.
And he ended up going to Savannah, Georgia to work for Hyundai at a much better job.
Now, the interesting thing is my brother up in Detroit has worked for Chrysler for years off and on and also worked at Roush for years.
And so when I was asking him about this and the payout and the plan to go, he told me that if there isn’t a huge amount of people that take this buyout, because it’s not technically being fired or laid off.
Oh, I get it.
But if there’s not huge participation, he said, and this is something I found stunning, so I literally asked him again, and I checked his email and it texted me.
He said that it’s very possible that Stellantis wants to lay off fifty percent of the North American workforce and they want to outsource it.
And you know, my daughter-in-law’s brother said they want to outsource his kind of job to India, you know, the engineering and the automobile engineering, and they want to outsource production to Mexico.
Which will never be allowed if Trump is re-elected because the tariffs would be huge.
So the mere fact that a major car company is considering a fifty percent layoff after just signing a huge UAW deal, which they’re being accused of, you know, not with upholding their end of the bargain.
That would be one of the biggest stories in the history of American labor.
It also tells you something about what’s happening in the American car industry.
Jeep was an iconic brand.
So was Chrysler.
But Jeep has been fairly successful up until recently.
But the number of companies that now manufacture Jeep-like cars, it used to be that that was a moderate number of companies.
Now even the two South Korean companies, Hyundai and Kia, have products that compete directly with Jeeps.
And they are, they are not products that were available in the United States until fairly recently.
So Jeep is starting to get squeezed.
Yeah.
And there, you know, there’s a new Hummer, you know, that kind of has odd-looking wheels that can turn at odd directions and, you know, worm you in and out of parking spaces.
And I think Ford makes one of the new Broncos as sort of a, you know, you know, all-terrain type vehicles.
So yeah, there is definitely a competition.
And, but again, if Stellantis attempts to lay off, if Stellantis attempts to lay off the American workforce, it will be, you will never hear the end of this.
I mean, it could clearly steer them to bankruptcy.
Clearly.
Right.
And one of the reasons to keep an eye on this is that, you know, the brands we’re talking about, Ram, Jeep, Chrysler, they’re still U.S. brands.
And if they’re struggling, that means that there are parts of likely GM and Ford that are struggling.
These car companies don’t have big problems in vacuums.
You don’t have one of them that falls apart and everybody else does well.
So this may end up being, you know, a story that eventually involves Ford and General Motors.
So let’s keep an eye on it because these are all global car companies.
None of the companies we’re talking about right now is local.
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Author: Austin Smith
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