Ottawa Gives Stellantis 30 Days to Fix Breach or Face Lawsuit Over Brampton Plant Sale

Canada issued a formal notice of default to Stellantis on Thursday, giving the automaker 30 days to resolve violations of a funding agreement or face a lawsuit. Industry Minister Melanie Joly stated that the government intends to recover hundreds of millions of dollars if the company does not act within the deadline. This action follows Stellantis' decision to shift planned vehicle production to the United States and sell its idled assembly plant in Brampton, Ontario.

Stellantis, the world's fourth-largest carmaker, abandoned plans to build the Jeep Compass at the Brampton facility. The company moved that production line to Illinois. As a result, more than 2,000 Canadian workers lost their jobs. In 2022, the Canadian government committed up to 529 million Canadian dollars, roughly 380 million US dollars, to help Stellantis retool its Brampton and Windsor plants for electric vehicle production. Joly said the company violated the agreement by abandoning production at Brampton without identifying a replacement vehicle.

The dispute is occurring amid pressure on Canada's auto industry from President Donald Trump's tariffs. Trump has repeatedly pushed automakers to move production south of the border. The sector is deeply integrated with U.S. manufacturing and serves as Canada's second-largest export. Prime Minister Mark Carney noted that the industry employs 125,000 Canadians directly and approximately 500,000 in related industries.

Stellantis announced on Monday that it agreed to sell the Brampton plant to Roshel, a Canadian armored vehicle manufacturer. The company offered to repay the government funding received for the Brampton project but did not disclose the specific amount. Carney accused Stellantis of betraying Canadian workers, describing the sale as a partial solution that failed to meet the company's obligations. He said the deal did not fulfill the promises made to the workforce.

Unifor President Lana Payne said a meeting on Thursday involving Stellantis, the union, and both governments failed to produce a resolution. Payne said the opportunity to stop the sale has passed. "The time to stop that was last week, the week before and the week before that," Payne said. "Now we're going to a different situation. We can't stop the sale. The sale has occurred, so we would have to reverse it, which is doubly difficult, obviously."

A message left for a Stellantis spokesperson was not immediately returned. Federal and Ontario officials plan to meet with Stellantis' global chief executive in the coming days. The 30-day clock started when Joly delivered the notice of default in Toronto. If Stellantis does not address the violations, the government will proceed with legal action to recover the funds.