UAW President Shawn Fain chairs the 2023 Special Election Collective Bargaining Convention in Detroit, Michigan, U.S., on March 27, 2023.
Rebecca Cook | Reuters
DETROIT – United Auto Workers President Shawn Fain stepped up criticism of Stellantis CEO Carlos Tavares in a video Friday afternoon, accusing the chief executive of defrauding consumers and failing to comply with parts of the union's labor contract with the automaker.
The comments are the latest in an ongoing exchange between the CEO and union leader following last year's contentious collective bargaining negotiations between the UAW and Detroit automakers, including Stellantis.
“Something is not right at Stellantis,” Fain said at the beginning of the 2:30-minute video posted Friday. “Sales are down, profits are down, and CEO pay has gone way up. The problem is not the market at GM and Ford, car sales are up, and the problem is not auto workers. The problem is this man, Carlos Tavares.”
Spokespeople for the union and the automaker did not immediately respond for comment on the allegations or the video.
Several of the criticisms, including those related to job cuts and Tarvares’ pay, are not new. But Fain’s comments on Friday took the allegations a step further, accusing Tavares of ripping off consumers in order to turn a profit. He also alleges that Stellantis is not honoring parts of the company’s workers’ contract, specifically citing that Stellantis is halting plans to reopen an assembly plant in Illinois.
“In fact, for years, Stellantis has sold fewer cars but made more profits. What does that tell you? They are price gouging. Now they have gone too far and are driving down their own sales,” Fain said. “In fact, Stellantis CEO Carlos Tavares is trying to backtrack on commitments the company made in our last contract, including stopping the reopening of the Belvedere Assembly.”
Tavares recently criticized the UAW-Stellantis workforce, pointing to quality problems at a truck plant in metro Detroit that produces the Ram 1500 pickup truck. The company has also announced thousands of layoffs at U.S. plants amid declining sales and product shifts.
“The pace of execution of some of our plans, starting with SHAP, Sterling Heights, is not good,” Tavares told reporters on July 25 while discussing the current problems with the company. “That's something we need to address with our plant management team and with our people.”
Stellantis CEO Carlos Tavares speaks to the media on June 13, 2024 after the company's investor day at its North American headquarters in Auburn Hills, Michigan.
Michael Wayland / CNBC
Tavares has been on a cost-cutting mission since the company was formed through a merger between Fiat Chrysler and France's PSA Group in January 2021. It's part of his “Dare Forward 2030” plan to boost profits and double revenue to 300 billion euros ($325 billion) by 2030.
Cost-saving measures have included restructuring the company's supply chain and operations, as well as staff reductions for both salaried and hourly workers.
Stellantis has reduced its workforce by 15.5%, or about 47,500 employees, between December 2019 and the end of 2023, including a 14.5% reduction in North America, according to public filings. That does not include further reductions and layoffs this year.
Several executives have previously described the cuts to CNBC as grueling to the point of being excessive. Last month, Tavares rejected the idea that the company's cost-cutting efforts have led to its current problems.
