Layoffs and outsourcing to Mexico: Biden's electric car gamble begins to claim victims

In December 2021, Joe Biden signed an executive order to make half of all new vehicles sold in the United States electric by 2030. The initiative was supported by the main manufacturers in the sector, but shortly after it came into effect, it began to have negative consequences. For example, the Stellantis automotive group, parent company of Chrysler, announced the closure of its assembly plant in Illinois citing high production costs

Last Friday, the company reported that it will indefinitely close its Belvidere site, which has been in operation since 1965 and currently assembles the Jeep Cherokee. The plant's closure will take effect on Feb. 28, according to the Associated Press, and will result in around 1,350 workers losing their jobs.

Although Stellantis was affected by several factors, including the COVID-19 pandemic, the main reason for the closure is the heavy investment it made not to lose ground in converting to a more electric fleet following Biden's executive order. The company also cited the global microchip shortage.

As the news spread, Tim Ferguson, president of United Auto Workers (UAW) Local 1268, an organization representing autoworkers in Illinois, told Reuters that the company plans to move production of the Cherokee to a facility in Toluca, Mexico. "It's a pretty tough pill to swallow that they're going to ship your vehicle to Mexico," Ferguson said. He added: "For me there is no doubt about it; their plan is to close this plant."

Cindy Estrada, UAW vice president, highlighted the fact that the automotive industry is receiving "billions" from the state to try to carry out the transition to electric cars. However, it is the workers who are paying the price. "Companies like Stellantis receive billions in government incentives to transition to clean energy. It is an insult to all taxpayers that they are not investing that money in our communities," the union leader said in an official statement.