- Canada says Stellantis breached job funding by shifting Jeep output.
- Mélanie Joly insists federal support required keeping Stellantis’ footprint.
- Three thousand Brampton workers remain furloughed as talks escalate.
This year has thrown the North American auto industry into a state of near-constant flux, with a mix of tariffs, trade wars, and flip-flopping policies that have left automakers scrambling to catch up. Nowhere has this volatility been more visible than in the standoff brewing between Stellantis and the Canadian government.
Read: Canada Threatens Stellantis After Jeep Compass Production Leaves Ontario
In the midst of the turmoil, Stellantis decided to shift some production from Canada to the USA, a decision widely seen as a gesture to appease President Trump and sidestep looming tariffs.
Now, Canadian officials say the move violates binding agreements, and they’ve responded by issuing a formal notice of default over what they call a breach of contracts worth hundreds of millions in public funding.
Trade Tensions Meet Contract Terms
Speaking before an international trade committee on Thursday, Canada’s Industry Minister Mélanie Joly framed the move as a line-in-the-sand moment. Stellantis is on the hook,” she told Parliament after confirming that a notice of default had been served to the automaker.
“Defending these jobs means defending Canada’s economic backbone and the livelihoods of countless families,” she said, adding that the government “will stand firm” against automakers shifting production out of the country.
The flashpoint stems from Stellantis’ October announcement that Compass production would move to the United States. That decision came amid President Donald Trump’s escalated tariffs and repeated boasts that Canada’s auto plants are relocating to America.
Did Stellantis Breach Its Deal?
Canadian officials argue that the decision breaches federal contracts connected not only to Brampton’s assembly plant, but also to a $500-million federal contribution for the NextStar Energy battery facility in Windsor. According to Joly, that funding came with strings attached, including job guarantees at the Brampton site.
According to CTV News, Stellantis CEO Antonio Filosa gave Joly just 24 hours’ notice ahead of the announcement.
The change caused her to review the contracts, where she found that the agreements required Stellantis to maintain its “full Canadian footprint” as a condition of receiving public funds.
Brampton Layoffs Add Fuel to the Fire
Conservative MP Adam Chambers pressed her on whether the job guarantees covered all Brampton positions. Joly wouldn’t specify numbers but insisted the contracts contain a “job guarantee.”
Roughly 3,000 Brampton workers remain furloughed. They were laid off during Stellantis’ modernization work, which has been paused since February. Ottawa has already launched a formal dispute-resolution process, warning Stellantis that “anything short” of its commitments will be considered a default.
For now, the government appears ready to fight, and Stellantis may be on the hook for hundreds of millions if it doesn’t reverse course.
Melanie Joly says in committee she is serving Stellantis with a notice of default over their contract (that she must have finally read).
Stellantis, after its appearance in the Oval Office Monday, will no doubt be quaking in its legal boots 🤦♂️ pic.twitter.com/lScPIhod41
— cbcwatcher (@cbcwatcher) December 5, 2025