BELVIDERE, Ill. (NewsNation) — Hundreds of workers are expected to be laid off when automaker Stellantis closes an assembly plant in northern Illinois early next year, citing the challenge of rising costs related to the electric vehicle market and other factors.
Stellantis said Friday that its Belvidere Assembly Plant will be idled effective Feb. 28 as the company “considers other avenues to optimize operations.”
“This difficult but necessary action will result in indefinite layoffs, which are expected to exceed six months,” Stellantis said in a statement, adding that notices have been sent to hourly and salaried workers.
About 1,350 people are employed at the plant, which produces the Jeep Cherokee. Belvidere is about 70 miles northwest of Chicago.
“The company will make every effort to place indefinitely laid off employees in open full-time positions as they become available,” it said.
Stellantis was formed last year with the merger of Fiat Chrysler and France’s PSA Peugeot.
Gov. J.B. Pritzker’s administration has assembled a response team from the Department of Commerce and Economic Opportunity to help displaced workers find new employment, said Pritzker spokesperson Jordan Abudeyyeh.
She said the administration will work with local elected officials, community colleges and others to ensure appropriate retraining programs are available, and with Stellantis to find new uses for the Belvidere plant.
In 2016, then-Fiat Chrysler announced it would invest $350 million in the plant to produce the Jeep Cherokee. Production on the Cherokee began there in 2017.
Stellantis said Friday that the automaker is not commenting on the future of the “Cherokee nameplate.”
“This is an important vehicle in the lineup, and we remain committed long term to this mid-size SUV segment,” company spokesperson Jodi Tinson said in an email.
Stellantis, which also pointed to the coronavirus pandemic and global microchip shortage as challenges to the auto industry, said it is working to identify opportunities to repurpose the Belvidere facility.
The Associated Press contributed to this report.