Stellantis Plans Buyouts To 6,400 Salaried Employees To Cut Costs: Report

Stellantis NV STLA reportedly disclosed its plan to offer voluntary buyouts to 6,400 U.S. salaried employees as a part of its cost-saving initiative.

The Chrysler parent is looking to cut costs amid transitioning to electric vehicles (EVs) and agreeing to a new United Auto Workers contract, according to Reuters.

The buyouts would be offered to about half the company's salaried U.S. employees (currently at 12,700) who are not represented by a union. 

The company is not offering it to around 2,500 unionized U.S. salaried workers.

Notably, the company's salaried employees must have at least five years of experience to be offered this package.

Stellantis stated that employees agreeing to take the incentive should depart the company before the end of December.

The report quoted Stellantis as saying it was taking "necessary structural actions to protect our operations and the company" and cited preparations "for the transition to EVs."

In April 2023, the company said it was offering buyout packages to white-collared and hourly workers with a minimum of 15 years of experience.

Related: Stellantis Joins Downsizing Bandwagon After GM, Ford; Eyes 3.5K Hourly US Jobs

Also, in October 2022, Stellantis offered voluntary buyouts to its U.S. salaried employees aged 55 or older and had worked for the company for at least 10 years.

Last month, Stellantis and the United Auto Workers (UAW) union reached a tentative agreement, after nearly six weeks of targeted U.S. labor strikes.

Stellantis' Chief Financial Officer, Natalie Knight, revealed the strikes would cost Stellantis less than 750 million euros in total profitability, with a total revenue impact of roughly 3 billion euros.

The automaker reported Q3 FY23 net revenue growth of 7% Y/Y to €45.1 billion and confirmed the outlook for adjusted operating income margin in double-digit and industrial FCF to be positive. 

Price Action: STLA shares closed higher by 1.55% at $19.68 on Monday.