Stellantis’s investments in the United States: how will Canadian consumers react?

Without a doubt, the story of the week across the North American automotive industry is the decision announced Tuesday (October 13) by the Stellantis group about its $13 billion investment in the United States.

• Stellantis moves Jeep Compass production from Canada to the United States

• Canada’s Unifor claims Stellantis is sacrificing Canadian workers

• Stellantis’ reputation at risk in Canada

Let’s not kid ourselves: this move is a direct consequence of the tariffs imposed by Donald Trump on vehicles produced outside the United States and intended for sale on American soil.

The problem is that Stellantis’ Canadian plant in Brampton, Ontario, is bearing the brunt of this decision. It’s where the company planned to assemble the Jeep Compass compact SUV. Retooling work, backed by CAD 3.6 billion in investment from the company, had even been underway before being halted earlier this year following the White House’s tariff announcements.

Jeep will now build its Compass in the United States.

The decision shocked everyone on this side of the border, as it appears that the company has capitulated to threats from the US administration, without much regard for the workers here, nor for the Canadian authorities who have supported the company for decades.

On the union side, reactions were opposed on either side of the border. As you might expect, Unifor expressed outrage, saying Stellantis sacrificed Canadian jobs on “Trump’s altar.” On the American side, the UAW (United Auto Workers) welcomed the move, which will bring 5,000 quality jobs back south of the 49th parallel, noting that the targeted tariff strategy is working for the automotive industry.

Stellantis sought to reassure the public, stating that while it was moving production of one model to the United States, Canada remained essential and that it would even add a shift at the Windsor plant to support production of the Pacifica minivan and the Dodge Charger Daytona. The company also has plans for its Brampton plant, which it will share with us later, once it concludes new rounds of negotiations with the Canadian government.

The latter, incidentally, quickly responded that he was considering suing Stellantis, which is breaking commitments it made to workers here. The government points out that it has invested CAD 1.4 billion in the Brampton project, bringing the total investment to CAD 5 billion.

In short, things are heating up.

Our angle here is to predict – at least try – how the Canadian public might react, given that tensions between Canada and the United States are at an all-time high due to the trade war initiated by the White House since the beginning of the year.

We will have to see how this all plays out, but buyers sometimes have long memories, even if a good deal is ultimately made.

A boycott?

In other words, are we likely to see a boycott of the company’s products by Canadian consumers? It’s obviously tough to predict, and we can also anticipate different reactions across the country. Ontario buyers, especially those residing in the region where Stellantis operates, will likely look elsewhere for their next vehicle. Others across the country may want to show solidarity.

To try to answer this question, we need to look back in time to see if the public has ever made a manufacturer pay dearly for a decision.

Ford’s case

Ford has already experienced public outrage, but that was 100 years ago.

At the time, the company published its own newspaper, The Dearborn Independent. In the early 1920s, it published a series of anti-Semitic articles, with the approval, of course, of the company’s CEO, Henry Ford, whose views on the Jewish people at the time are well known today.

The reaction was extreme. Several Jewish and Christian organizations organized protests, as did the Anti-Defamation League. They called for a boycott of Ford products. The media widely covered the affair that took on a magnitude that the company had not anticipated.

The consequence was immediate. The company was forced to retract its statement and permanently closed its newspaper in 1927. Its reputation had taken a severe blow.

Henry Ford and the Nazi regime

A second example can be found, again with Ford. This time, it was the founder’s sympathy for the Nazi regime that tarnished his company’s reputation. It is important to note that Ford, the company, worked with the Allies to supply equipment to fight Hitler and the Nazis.

There was no boycott this time around. Instead, it was Ford’s image that suffered. It is more difficult to assess the impact, as it can have very long-term repercussions, for example, with a father who decides not to buy Ford products in 1940 and convinces his son to do the same, then his son’s son, and so on.

In other words, Ford may still be losing sales today because of what happened 80 years ago.

General Motors (2019)

A more recent case of a boycott is also worth briefly describing. In 2018, General Motors (GM) announced the slowdown and closure of its Oshawa plant. In January 2019, Unifor launched a campaign urging Canadian and American consumers to boycott GM vehicles manufactured in Mexico, aiming to put pressure on the company and protect local jobs.

The issue received extensive media coverage, and intense pressure was exerted on the company by both public opinion and the political sphere. Negotiations followed, and GM subsequently announced investments.

Our three examples are different, and the consequences experienced were equally distinct.

It’s why it is tough to predict how consumers will react to Stellantis’ most recent decision. However, if the company reneges on specific commitments made to workers here, there will be repercussions.

These will be difficult to measure, but they will be real. Ultimately, it is the manufacturer’s image and reputation that suffer from decisions like this. While the consequences may be severe in the short term, it is the negative impression left on people that ultimately does the most damage in the long run.

And for Stellantis, which already lacks a strong reputation for goodwill, the incident will leave its mark.

However, we must not forget to consider the other side, namely the US market, where Stellantis’ move may have the opposite effect, bringing consumers back to the company’s products.

You can be sure that the matter has been discussed internally at Stellantis.