Belvidere Chrysler Plant To Lay Off 1600 Employees

BELVIDERE, Ill. - The Belvidere Chrysler Assembly Plant will soon lay off around 1600 employees, according to a statement by Fiat Chrysler's parent company, Stellantis.

The slashing of jobs comes as a result of a nationwide microchip shortage affecting the entire automotive industry.

"As we continue to balance sales with production of the Jeep Cherokee produced at Belvidere Assembly plant, which has been further exacerbated by the unprecedented global microchip shortage, Stellantis notified affected employees, the state of Illinois, the city of Belvidere and the UAW today that that production operations at the plant will be reduced from two shifts to one as of July 26," a Stellantis spokesperson said. "This action could affect 1641 represented employees. The company will make every effort to place laid off hourly employees in open full-time positions as they become available based on seniority."

The microchip shortage caused the Belvidere Plant, one of the largest automobile manufacturing facilities in the United States, to remain closed through the entire month of April after shutting their doors for the second time this year at the end of March.

The plant had also closed for one week in February due to the same microchip issue. Production has been slowing at the plant for a number of years, and this is not the first large layoff that has occurred.

In 2019, approximately 1300 jobs were lost after the plant eliminated its third shift, according to WIFR. While the plant once produced numerous models, as of 2017, the assembly only builds Jeep Cherokees.

There has been a global microchip shortage seen throughout much of 2021, and consulting firms have estimated that the world's automotive industry could collectively lose up to $110 billion as a result.

Chrysler is just one of many auto manufacturers who are scaling back production amidst the shortage.

CNBC reported that Nissan could produce up to 500,000 fewer cars this year, and the Ford Motor Company also reported a large loss in the number of new cars that will hit the road.

Stellantis, headquartered in Amsterdam, Netherlands, was formed as a global conglomerate in 2021 and owns numerous large automotive brands, including Chrysler, Dodge, Alfa Romeo, Maserati, Fiat, and Jeep.