The federal government is threatening automaker Stellantis with legal action if the company does not “respect its obligations” to Canadians, according to a copy of a letter obtained by CBC News, years after the company agreed to an automotive pact promising billions of dollars in performance incentives.
Industry Minister Mélanie Joly wrote to Stellantis CEO Antonio Filosa on Wednesday to express “extreme concern” about the company’s plan to move production of its Jeep Compass model from an assembly plant in Brampton, Ontario, to one in Belvidere, Illinois.
The change was announced Tuesday afternoon as part of a US$13 billion investment in the company’s US manufacturing operations. The company shares US President Donald Trump’s goal of having a “strong” automotive sector in the United States, Filosa told CNBC on Wednesday.
In April, the United States imposed a 25 percent tariff on Canadian auto and vehicle parts, with an exception for the value of parts made in the United States.
“While the current US tariff environment is creating complex challenges, Stellantis has made important commitments to Canada and its workforce,” Joly wrote in the letter.
“If Stellantis decides not to honor its obligations, we will act in the interests of all Canadians and hold the company accountable and exercise all options, including legal ones.”
Canadian politicians of all stripes expressed anger and frustration that Stellantis moved Jeep production from Brampton, Ontario, to Illinois, and Ottawa is considering legal action.
The company had signed an agreement with the federal and Ontario provincial governments two years ago under which both would provide up to $15 billion in performance incentives, contingent on the automaker meeting a number of conditions that included meeting a production mandate in Brampton.
Stellantis agreed to maintain “its entire presence in Canada, including Brampton, in exchange for substantial financial support,” Joly wrote in his letter. “Anything that does not meet that commitment will be considered a breach under our agreements.”
The minister, during a news conference Wednesday, said Ottawa “has been engaging with the company for months, knowing that the Brampton facility was going to be redeveloped.” The automaker’s plant in Brampton has been idle since 2023 while it retools its assembly line for a new generation of vehicles.
“We have invested millions of dollars in that facility based on the commitment that they would invest in a new model, and so if they don’t, we will hold them accountable,” the minister said.
The auto pact between Stellantis and Ontario’s federal and provincial governments was announced in 2023. Both governments reached a similar deal with Volkswagen and its subsidiary, Power Co., for an electric vehicle battery manufacturing plant in St. Thomas, Ont., with up to $13 billion in incentives on the table.
Ottawa said it would provide two-thirds of the funding and the Ontario government would provide the rest.
But the deal was contingent on several conditions, including the automaker meeting its existing commitments in Canada, such as meeting its production mandate at the Brampton plant.
A spokesperson for Ontario Premier Doug Ford’s office told CBC News that the company’s Brampton plant did not meet the conditions set out in the auto pact, specifically those related to project milestones and job creation.
Therefore, the company has not received provincial funding, the spokesperson said.
“I’m not going to give you a dime” for the Brampton plant, Ford told reporters during a news conference Wednesday. But he added that the company had received $55 million for its Windsor plant “out of the two billion that the feds, I and the companies agreed to.” [to.]”
A Stellantis spokesperson said in an initial statement to CBC News on Wednesday that the automaker has plans for its Brampton plant that it would discuss with the federal government, but did not provide any details.
CBC News followed up to ask for clarification on how much money, if any, the company has received from the federal or provincial government of Ontario, and if it hasn’t, whether it violated the conditions outlined in the auto pact.
The company does not comment on the details of its agreements, the spokesperson said.
