Stellantis to sell, close large test site to cut costs | Wilnesh News

Detroit — Automobile Manufacturer star The company plans to close and sell its massive automotive proving ground in Arizona by the end of the year, CNBC has learned.

The decision is the latest cost-cutting move by the transatlantic automaker under Chief Executive Carlos Tavares. Lacey faces pressure from Wall Street, dealers and the United Auto Workers union.

The 4,000-acre Arizona Test Site is located in Yucca, Arizona, between Phoenix and Las Vegas. Since then, Chrysler purchased the property for $35 million, and it has been used for the automaker’s vehicle testing and development. Ford Motor Company 2007.

As of July 2019, these operations had a total of 69 employees, including workers represented by local UAW chapters, According to the automaker.

The closure was confirmed by three people familiar with the program who agreed to remain anonymous because the matter is private.

Stellantis plans to use a proving site in Arizona owned by Toyota Motor The decision will begin next year, according to two people familiar with the matter. Toyota opens up its costly maintenance operations to others Used in 2021.

Stellantis confirmed the closure on Friday morning, citing cost cuts and real estate reviews as the company conducted.

“Stellantis will continue to look for opportunities to increase efficiency and optimize its footprint to ensure future competitiveness in today’s rapidly changing global marketplace,” the company said in an emailed statement.

The automaker also said it was “working with the United Auto Workers to provide special benefits to proving site employees, or they could choose to move operations and continue working,” but that employees could be laid off “indefinitely,” which would make They are entitled to salary and benefits for two years.

Like most automakers, Stellantis maintains multiple proving grounds in varying climates and geographical conditions where it develops and tests vehicles before selling them to consumers. Stellantis’ other major proving ground facility in the United States is a 4,000-acre campus west of Detroit in Chelsea, Michigan.

Stellantis’ Arizona complex is one of 18 facilities in the project The company has notified the United Auto Workers union It was possible it would close last year during the union’s contract negotiations with Stellantis.

Most of the other operations are parts and distribution centers that are expected to be consolidated into “mega-sites,” as well as the company’s massive 500-acre campus in metro Detroit that previously served as Chrysler’s world headquarters.

However, the status of other properties is unclear, but local and state politicians, including Michigan Governor Gretchen WhitmerExpressing concern that Stellantis may close its former headquarters in Auburn Hills, Michigan.

Stellantis has significantly reduced its U.S. workforce in recent years under Tavares’ cost-cutting measures.

Stellantis has reduced its workforce by 15.5%, or approximately 47,500 employees, from December 2019 to the end of 2023, including a 14.5% reduction in North America, according to public filings. This does not include further layoffs and layoffs this year.

The automaker had only about 11,000 salaried employees in the United States at the end of last year. This compares to 53,000 in 2019. General Motors Ford has 28,000.

The layoffs come as Stellantis seeks to outsource many engineering jobs to lower-cost countries such as Brazil, India and Mexico, according to several people familiar with the matter.

Bloomberg News It was reported earlier this year that Stellantis Companies are starting to recruit most of their engineering staff in these countries, where annual costs per employee are about 50,000 euros ($53,000) or less, well below similar positions in the United States and Europe.