Stellantis and Samsung plan to build a second electric vehicle battery factory in Kokomo, Indiana, a city where many current Stellantis employees view these factories as a threat to their current job.
Electric vehicle battery factories are a critical part of traditional automakers’ plans to shift from gasoline-powered cars to electric vehicles in the coming decades. But they could pose a threat to existing jobs building engines and transmissions, which are not needed in an electric vehicle. Stellantis has four factories in Kokomo alone that make engines and transmissions, employing more than 5,000 hourly workers alone.
Stellantis, which builds cars under the Jeep, Ram, Dodge and Chrysler brands, alongside union rivals General Motors and Ford, is now in the fourth week of a United Auto Workers union strikeand the future of electric vehicle manufacturing jobs are a central issue in the strike.
While Kokomo’s four plants are not on strike, the union is on strike at Stellantis’ assembly complex in Toledo, Ohio, as well as 20 parts and distribution centers across 14 states.
All automakers are building battery factories for electric vehicles, and all are using joint ventures with battery makers such as Samsung to build and operate the factories. They all insisted that the factory workers would be employees of the joint ventures, not the automakers themselves. And the salary of the American battery factories for electric vehicles that have opened so far is a fraction of what UAW members get when they work for auto companies.
UAW President Shawn Fain announced Friday that GM had accepted a key union demand that employees at its electric vehicle battery plants will be part of the company’s national collective bargaining agreement with the UAW. GM has not confirmed this agreement, and details on how much these workers will be compensated and whether they will be considered employees of GM or covered by the agreement as employees of separate companies are not yet available. known.
But Fain hailed the deal as a major victory for the union and said he would now pressure Ford and Stellantis to agree to similar terms if they wanted to end the strike.
Samsung and Stellantis announced plans for its latest battery factory following this announcement.
The two companies announced Wednesday that they will invest more than $3.2 billion to build the new plant, which will open in early 2027 and have an annual capacity of 34 gigawatt hours. Its opening will create about 1,400 new jobs in Kokomo, located an hour north of Indianapolis.
StarPlus Energy, the joint venture formed by Samsung and Stellantis, had previously chosen Kokomo for its first gigafactory currently under construction and scheduled to open in 2025.
In total, the two plants will produce 67 gigawatt hours per year. “Indiana’s economy is on a roll,” Indiana Gov. Eric Holcomb said in a news release, adding that the second plant means companies are doubling their capital investments and the number new jobs created.
The factories will help Stellantis achieve its goal of having battery-electric passenger cars account for 100% of its sales in Europe and 50% of its sales in the United States by 2030. Stellantis announced in 2021 a “aggressive” investment of $35 billion for the production of electric vehicles and needs 400 gigawatt hours per year to reach its 2030 target.
Stellantis was created in 2021 by the merger of Fiat Chrysler and the PSA group, manufacturer of Peugeot, Citroën, Opel and Vauxhall cars in Europe. Shares rose nearly 2% in premarket trading.