Why Canada is Unhappy About Stellantis' $13bn US Investment

Automotive giant Stellantis made headlines in recent days when it announced an eye-watering US$13bn investment in the US.

But now the car manufacturer could be in hot water with Canada government after seemingly turning its back on the North American neighbour. 

The Canadian government is threatening legal action against Stellantis over fears it will abandon existing commitments. 

Investing in operations

Established in 2021 following a mega-merger, Stellantis' 14 brands are Abarth, Alfa Romeo, Chrysler, Citroën, Dodge, DS Automobiles, FIAT, Jeep, Lancia, Maserati, Opel, Peugeot, Ram, Vauxhall, Free2move and Leasys.

Earlier this month, the organisation announced plans to invest US$13bn in the US over the next four years in a bid to expand its domestic manufacturing footprint. 

Stellantis already has 34 manufacturing facilities, parts distribution centers and research and development locations across 14 states in the US.

"This investment in the US – the single largest in the Company’s history – will drive our growth, strengthen our manufacturing footprint and bring more American jobs to the states we call home,” said Antonio Filosa, Stellantis CEO and North America COO. 

“As we begin our next 100 years, we are putting the customer at the center of our strategy, expanding our vehicle offerings and giving them the freedom to choose the products they want and love.”

“Accelerating growth in the US has been a top priority since my first day. Success in America is not just good for Stellantis in the US — it makes us stronger everywhere."

However, the investment is being perceived as a withdrawal from neighbouring Canada, causing tension giving the country's history with many of the Stellantis brands.

Breaking supply chains

Back in July, Stellantis said tariffs implemented by US President Donald Trump's administration had cost the company US$349.2m.

The company has responded by announcing it will move the manufacturing of the Jeep Compass from Ontario to its plant in Illinois. By reopening the Belvidere Assembly Plant, it's anticipated 3,300 new jobs will be created.

However, political leaders have raised concerns that jobs in Canada are being sacrificed in favour of American expansion. 

Ontario accounts for approximately 40% of Canada's national gross domestic product. Stellantis claims it has no plans to move out of Ontario at present, but there is no public plan for what will be produced in the city Brampton in place of the Compass. 

Canada's Industry Minister Mélanie Joly said Stellantis had made a "legally binding" commitment to production in Brampton, adding that the Canadian government and Stellantis had built a strong partnership over the years.

"We were there for the company in 2009 to pull it back from the brink of bankruptcy and now we expect you to be there for Canadians," she stated, referring to when Canada helped Chrysler (now part of Stellantis) avoid bankruptcy. 

“Anything short of fulfilling that commitment will be considered a default under our agreement."

She went on to say that Canada would take legal action, if necessary, to ensure its workforce was protected.

Canada risks becoming collateral in Donald Trump’s tariff agenda, leaving workers and leaders uneasy about the implications of Stellantis’ move.

The shift strengthens US supply chains but leaves Canada’s without a clear role. Stellantis says it has no plans to exit Canada, yet it remains to be seen how the issue will be resolved.