After meeting with Trump, Stellantis chairman commits to restart of endangered Illinois plant

Under previous CEO Carlos Tavares, the company pulled the plug on a commitment with its UAW union reached in 2023. This deal foresaw building the next generation of the Dodge Durango SUV in its Detroit plant as well as a new, as-yet-unnamed midsize truck destined for its idled Belvidere site in Illinois. 

In an internal letter to staff, the parent behind popular brands like Jeep and Ram said chairman John Elkann had met last week with Trump to share the company’s enthusiasm for the incoming administration’s commitment to the U.S. auto industry and blue-collar jobs.

“John told the president that building on our proud, more than 100-year history in the U.S., we plan to continue that legacy by further strengthening our U.S. manufacturing footprint and providing stability for our great American workforce,” Jeep brand CEO and Stellantis North America operations chief Antonio Filosa said in an internal letter obtained by Fortune.

Elkann, billionaire scion of the Agnelli dynasty, which founded Italy’s Fiat, recently fired Tavares over mounting problems in the United States. 

The group’s share of the U.S. light-duty vehicle market had shrunk to just 8% from 12% under Tavares. By prioritizing profit margins over volume, he enraged franchise dealers, who rely on scale and service work to earn a living.

Tavares planned to offshore production of Jeep and Dodge models

Under the revised plan hatched by Tavares, the Durango’s production would have to be moved to Stellantis’s Windsor facility, across the border in Canada.

Trump’s announcement of 25% tariffs effective in February on goods imported from the U.S.’s neighboring country—as well as Mexico in the south—risks, however, the economic feasibility of this plan.

In addition to the next Durango being returned to the Detroit Assembly Complex, where the current generation is already being built, Stellantis said the new midsize pickup truck will be manufactured as planned at its Belvidere plant.

Previously the Illinois site was the exclusive home of the Jeep Cherokee crossover. But the factory was completely mothballed in February 2023 after the last of the series was built and the crossover temporarily discontinued. 

By that point the site had been on life support, operating uneconomically with just one shift instead of the usual two. A new Cherokee is expected to run off the line later this year—only this time its new home will likely be the Stellantis plant in Toluca, Mexico. 

UAW boss Shawn Fain celebrates blue-collar victory

When management shifts production from one factory to another without allocating a similar replacement, it can be the start of a death spiral for a site as it becomes increasingly less profitable over time. If, however, it relies on just one model—like Belvidere did with the Cherokee—instead of two or three, then it almost always spells instant doom for that facility.

Stellantis went on to say additional investments would also be made at its Jeep plant in Toledo as well as in Kokomo, Ind.

“Our plans, focused on increasing market share and growing sales volume, entail a multibillion-dollar investment in our people, great products, and innovative technology, all here in the U.S.,” wrote Filosa, who will meet with the group’s retailers this week at the industry’s annual NADA car dealer conference. 

The UAW, which had campaigned openly to oust Tavares for breaking their contract, said it considered its dispute with Stellantis resolved.

“This victory is a testament to the power of workers standing together and holding a billion-dollar corporation accountable,” said UAW boss Shawn Fain.

While pressure from Fain’s rank and file no doubt helped, it’s hard to imagine Trump’s inauguration—and his love of import tariffs—played no role in Elkann’s decision.