Canada is set to declare Stellantis in breach of its funding agreements after the automaker shifted part of its production to the U.S., despite having received substantial government subsidies.
Industry Minister Mélanie Joly informed the House of Commons international trade committee that the government plans to issue Stellantis a notice of default related to federal funding for projects in Windsor and Brampton, Ontario, after the automaker shifted production to a facility in Illinois.
In October, Canada cautioned Stellantis that relocating production could lead to legal repercussions under agreements linked to taxpayer-backed support.
Stellantis declared a $13 billion investment plan in the United States in October, aimed at launching five new models, introducing a new four‑cylinder engine line, and generating over 5,000 jobs across facilities in Illinois, Ohio, Michigan, and Indiana.
The company is seeking to boost annual U.S. vehicle output by 50% compared to current levels and intends to update 19 models at all its American assembly plants, with powertrain enhancements scheduled through 2029.
As part of the strategy, Stellantis has outlined more than $600 million in investment to reopen the Belvidere Assembly Plant in Illinois.
The plant is anticipated to increase production of Jeep Cherokee and Jeep Compass models, with manufacturing currently scheduled to start in 2027.
Joly addressed a letter to Stellantis CEO Antonio Filosa, noting that the automaker had earlier committed to maintaining its Canadian manufacturing presence, including the Brampton facility, in exchange for substantial financial assistance.
Joly stated that Stellantis had agreed to preserve its entire Canadian operations in return for significant government support. Approximately 3,000 employees at the Brampton plant are currently on layoff.
Stellantis Canada’s director of external affairs, Teresa Piruzza, described the Brampton adjustment as ‘an operational pause.’
Meanwhile, Stellantis maintains operations at its Windsor plant, where it intends to hire roughly 1,500 additional employees next year.
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