Closing a US Jeep plant, Stellantis shifts EV production to Canada

(AP Photo/Alan Diaz)

It’s going to be a dreary day tomorrow, in Belvidere, Illinois. The big, old automotive plant there, that had been running for sixty years and had been the sole home of the Jeep Cherokee since 2017, will see its last shift change.

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…Sources said Belvidere was lined up to transition to an electric vehicle plant, specifically the new STLA large EV platform for the next generation Charger and Challenger. Instead, Stellantis announced in June the vehicles will be built in Windsor, Ontario, dashing the hopes of Belvidere boosters and dealing a major blow to the state’s EV manufacturing ambitions.

Stellantis is also building a $5 billion battery plant in Windsor.

“It was a big slap in the face,” said Logan, a lifelong Belvidere resident and 29-year plant veteran. “They were dangling the carrot in front of us and pulled it away. I rack my brain several times every day, driving myself crazy trying to figure out what is the fate of this facility, why is the company doing this and what is their endgame.”

In December, Stellantis announced the indefinite layoffs and the plant idling. The final shift is scheduled to punch out Feb. 28, the 5 million-square-foot auto plant will go dark and Belvidere will face an uncertain future.

For Belvidere, a city of 25,000 rising up from farm fields about 75 miles northwest of Chicago, the fear is palpable.

Was it that sales of the Cherokee were fading? Could be part of it.

…Last year, Jeep Cherokee sales fell 55% to 40,322 vehicles, according to Stellantis.

But there’s also a big shift in emphasis on the corporate side.

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The next generation of Cherokee is probably going to be manufactured in Toluca, Mexico, where the Jeep Compass is made. For sure that’s going to be cheaper to do than with the United Auto Workers union contract in the states, which, coincidentally, is still in effect for the Belvidere plant. They can’t officially shut the doors until September when the 4-year contract is up.

Mexico is also a country which has supported it natural fossil fuel industry, and kept it’s utility prices under control, unlike the push for renewables in the States. That coupled with the Ukrainian War has put a massive price squeeze on manufacturing costs.

…One aspect of this move that deserves additional attention is the U.S. and Canada focus on new energy policy, against the backdrop of Mexico telling the Biden administration the USMCA partner was going to continue development of traditional oil, coal and natural gas energy production.

Should Mexico continue to maintain a more traditional energy policy, they will likely create a greater cost incentive for all manufacturers. With electricity rates skyrocketing in the U.S. and Canada, any energy dependent manufacturer would see an additional advantage to production in Mexico.

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As with other states, Illinois has been chasing EV business, and it hasn’t always gone well.

…The state has been aggressively pursuing EV development, enacting legislation in an effort to get manufacturers and suppliers to locate in Illinois, with decidedly mixed results. It has been lobbying hard for Stellantis to electrify the Belvidere plant.

Seeing the Stellantis EV platform, thousands of jobs and billions of dollars in investment head to Canada while Belvidere sits idle was not part of the state’s development playbook.

EV firms like Rivian and Lion have relocated there, but have had a difficult time meeting production targets, and they employ nowhere near the number of workers that the plants manufacturing internal combustion engine (ICE) vehicles did. The trade-off just isn’t there.

There’s also beginning to be a good deal of open debate about how sustainable the promises of EVs taking over the world are. For example, Stellantis is shooting for 50% of their product sales in the U.S. to be electric by 2030.

Personally, I don’t see it happening. There are a ton of people who think like me.

…So, are electric vehicles about to sweep the country and become the dominant form of transportation? I bet against it. This is just a specific instance of the general principle that it is always wise to bet against central planning of the economy. EVs may be a successful niche product for a small number of wealthy consumers, but the idea that they will fully replace gasoline powered cars in short order is the dream of central planners, who think they can implement their dream by coercion. Central planning never works, and won’t work this time either. The reason is that the would-be central planners don’t know enough, and can’t ever know enough, to put together all the elements to make a fully functioning economic sector.

Mark Tapscott has an interesting piece today at PJ Media titled “Three Huge Reasons Why Electric Vehicles Will Never Dominate American Roads.” Tapscott’s reasons are all good ones, which I would summarize as (1) despite vast government subsidies and rebates, EVs are still far more expensive than gasoline-powered cars, (2) even with greatly increased sales, the existing gasoline-powered cars will not go away and will still be on the road and the dominant vehicles in 2035 and even 2050, and (3) the increased amounts of necessary minerals for the batteries, from lithium to nickel to cobalt, are never going to materialize.

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In addition, there are the people who’ve already purchased one who are finding out they are nowhere near the bill of goods they were told when they signed on the dotted line.

Electric vehicle drivers get candid about charging: ‘Logistical nightmare’
Charging on the go is neither easy nor fast.

YouTube personality Steve Hammes leased a Hyundai Kona Electric sport utility vehicle for his 17-year-old daughter Maddie for three reasons: it was affordable, practical and allowed Maddie to put her cash toward college, not fuel. Now, the upstate New York resident has a dilemma many EV owners can relate to: finding available charging stations far away from home.

“We’re going through the planning process of how easily Maddie can get from Albany to Gettysburg [College] and where she can charge the car,” Hammes told ABC News. “It makes me a little nervous. We want fast chargers that take 30 to 40 minutes — it would not make sense to sit at a Level 2 charger for hours. There isn’t a good software tool that helps EV owners plan their trips.”

They most probably never will be. This story is not an aberration, bless their hearts.

I thought it would be fun.

That’s what I told my friend Mack when I asked her to drive with me from New Orleans to Chicago and back in an electric car.

I’d made long road trips before, surviving popped tires, blown headlights and shredded wheel-well liners in my 2008 Volkswagen Jetta. I figured driving the brand-new Kia EV6 I’d rented would be a piece of cake.

If, that is, the public-charging infrastructure cooperated. We wouldn’t be the first to test it. Sales of pure and hybrid plug-ins doubled in the U.S. last year to 656,866—over 4% of the total market, according to database EV-volumes. More than half of car buyers say they want their next car to be an EV, according to recent Ernst & Young Global Ltd. data.

…Leaving Chicago after a full night of sleep, I tell Mack I might write only about the journey’s first half. “The rest will just be the same,” I predict, as thunder claps ominously overhead.

“Don’t say that!” she says. “We’re at the mercy of this goddamn spaceship.” She still hasn’t mastered the lie-flat door handles after three days.

As intense wind and rain whip around us, the car cautions, “Conditions have not been met” for its cruise-control system. Soon the battery starts bleeding life. What began as a 100-mile cushion between Chicago and our planned first stop in Effingham, Ill., has fallen to 30.

“If it gets down to 10, we’re stopping at a Level 2,” Mack says as she frantically searches PlugShare.

We feel defeated pulling into a Nissan Mazda dealership in Mattoon, Ill. “How long could it possibly take to charge the 30 miles we need to make it to the next fast station?” I wonder.

Three hours. It takes 3 hours.

I begin to lose my mind as I set out in search of gas-station doughnuts, the wind driving sheets of rain into my face.

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The Biden administration is only here for the lip service, you know. They’re all about making sure there are plenty of accessible charging stations. As always with Biden anything, it’s the follow-through that bites you in the trunk.

…[John] Voelcker [industry expert on EVs and the former editor of Green Car Reports] said he’s seen little improvement in the nation’s charging infrastructure in the last four years and frequently hears complaints of dead chargers and sticky cables.

The incentive right now is to get stations in the ground,” he said.

It’s not making sure they actually work.”

They’re not really big on making sure anything actually works.

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Beege Welborn 5:00 PM | December 24, 2024
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