How Stellantis Got Cheap and Destroyed the Jeep
After years of skimping on costs, Stellantis is putting out a worse product. Workers and consumers alike are fed up.
By Katie Nixdorf and Paul Blest, More Perfect Union
After Jeep launched the much-hyped new era of the Wagoneer in 2021, it didn’t take long for customer complaints to roll in.
“It took about five hours for me to discover the first problem with it,” Matt, a longtime Jeep customer, said of the 2022 Jeep Wagoneer he purchased. “There was a mouse squeaking noise coming from right up by the windshield…within a couple days, I was noticing vibration in the steering at highway speeds.”
“Just not problems that you would expect on any new car, let alone one that costs $80,000,” he told More Perfect Union.
The long-beloved car brand was bought in 1987 by Chrysler, which was bought by Fiat in 2012, which in turn merged with French automaker Peugeot three years ago to become a new multinational corporation called Stellantis. Shortly after, workers soon saw a dip in quality assurance.
“Immediately I saw the difference,” UAW Local 869 President Romaine McKinney III, whose membership includes more than 1,000 employees at the Stellantis Stamping Plant in Warren, Michigan, told More Perfect Union. “There was an immediate slash of funding. Money became the top priority.”
“You can go in and look in the showroom and say, ‘Hey, this is a beautiful car,’” Karen Benette, who has worked at Stellantis for 13 years, told More Perfect Union. “But we probably sent out a lot of garbage because we refused to stop the line and fix certain things that needed to be addressed.”
The new regime emphasized cost-cutting in service of former CEO Carlos Tavares’ goal to make Stellantis “the most efficient automaker with regard to our capital spending.” In the first three years after the merger, Stellantis laid off more than 40,000 workers globally. That included almost half the workforce at Warren Truck in Michigan, as well as the idling of a long-running assembly plant in Belvidere, Illinois. McKinney said this has decimated the town.
“The community at Belvidere has lost millions of dollars in revenue,” McKinney said. “The barber shop, the McDonald's, the mom-and-pop diner that everybody ordered from, the car wash, the gas station — that was 2,500 people or more that went past those facilities, past those buildings, past those businesses every day.”
With all of the cost-cutting, Stellantis made $20 billion in profits in 2023 and paid out $7 billion to shareholders; Tavares, meanwhile, took home nearly $40 million that year. And the hope that the company would invest more in its workforce and the quality of its product following the 2023 “Stand-Up” strike at UAW turned out to be short-lived. Stellantis exercised a provision in the contract that the investment was dependent on market conditions and has so far “delayed” its commitment to reopen the plant in Belvidere.
In the past few years, however, the tide has turned on Stellantis’ profitability. The company has kept prices high — Jeep cars were $6,000 above the industry average in 2023 — but saw a 34 percent decline in sales since 2018.
“I would not buy another Stellantis product,” Matt, the Jeep customer, told More Perfect Union. “I think they've gotten to a point where they're marketing themselves as a premium option, and you can see that in the pricing. And maybe that will be okay if the product is delivered on the promise.”
Tavares is gone now, having hastily resigned earlier this month after a dispute with Stellantis’ board, but the company's problems remain. We talked to workers, customers, and experts about the fall of Jeep, and dug into how Stellantis skimped on cost and ruined the reputation of a once-heralded American car company. What we found is that the ruthless pursuit of vaguely defined “efficiency” has a hefty price tag — not just for the company and its consumers, but for workers and the communities where they live.