The Canadian government is warning Stellantis, the automaker, of potential legal action if it fails to fulfill its commitments to Canadians, years after agreeing to an auto pact that promised significant performance incentives. Industry Minister Mélanie Joly expressed deep concern to Stellantis CEO Antonio Filosa regarding the company’s decision to relocate production of the Jeep Compass model from Brampton, Ont., to Belvidere, Ill.
This move was unveiled as part of a $13 billion US investment in the company’s American manufacturing facilities, aligning with U.S. President Donald Trump’s objective of bolstering the American automotive industry. The U.S. imposed a 25% tariff on Canadian automotive parts and vehicles in April, with exceptions for the value of U.S.-made parts.
Joly emphasized that despite the challenges posed by the current U.S. tariff situation, Stellantis has made vital commitments to Canada and its workforce. She stated that failure to honor these commitments would prompt the government to take necessary actions, including legal measures, to safeguard the interests of Canadians.
The agreement between Stellantis and the federal and Ontario provincial governments, forged two years ago, involved up to $15 billion in performance incentives. This agreement mandated Stellantis to maintain its complete Canadian presence, including the Brampton facility, in exchange for substantial financial backing. Failure to adhere to these terms would be considered a breach of the agreements.
In a press conference, Minister Joly disclosed that Ottawa had been in discussions with Stellantis for several months, anticipating the retooling of the Brampton plant. The plant has been inactive since 2023 as it undergoes upgrades for new vehicle models, for which significant investments were made based on Stellantis’ commitments.
The auto pact with Stellantis, announced in 2023, mirrored a similar deal made with Volkswagen and its subsidiary, Power Co., for an EV battery manufacturing plant in St. Thomas, Ont., with incentives of up to $13 billion. Ottawa committed two-thirds of the funding, with the Ontario government covering the remainder.
However, a spokesperson for Ontario Premier Doug Ford’s office revealed that Stellantis failed to meet the conditions stipulated in the auto pact for the Brampton plant, particularly regarding project milestones and job creation. Consequently, the company did not receive provincial funding. Premier Ford stated that no additional funding would be allocated to the Brampton plant, highlighting that the company had already obtained $55 million for its Windsor facility.
When approached for clarification on government funding and compliance with the auto pact terms, Stellantis declined to provide details on the agreements.
