The car company recruits most of its engineers from South America, India and Morocco where they cost a quarter of what they cost in France or the USA. The government goes to Beijing to close with Dongfeng: the Chinese want to circumvent the duties, but is it worth it for us? Stellantis has decided to hire most of its engineers in low-cost countries such as Morocco, India and Brazil. The indiscretion was relaunched yesterday by the Bloomberg agency, underlining that in centers such as Paris and Detroit the cost of the workforce can reach five times as much. The choice, adds the US agency, takes place in a context marked by the general decline in demand for electric vehicles and attempts to bring more accessible EV models to the market for the general public.
Electric giants such as Tesla and Volkswagen are cutting jobs and relocating production to regions where labor costs are lower, while German BMW, leader in the premium segment, is looking to India for its white-collar hiring. In this scenario, Stellantis is therefore aiming to place nearly two-thirds of its engineers in low-cost countries in the long term as it prepares to launch 25 new models, including an affordable small EV, in Europe this year. The annual compensation of engineers in the United States or France tends to be between 150,000 and 200,000 dollars including bonuses, while in countries such as Mexico, Brazil or India the company shells out 20-30% of that figure. Meanwhile, last month management announced 400 cuts in the engineering segment at its Auburn Hills, Michigan headquarters for roles related to vehicle calibration, electronics and controls, while positions were opened to recruit electronics engineers in Mexico. In South America, the goal of the group led by Carlos Tavares is to hire 500 engineers who will add to the almost 4,000 already present in Brazil, and who will work on global projects.
Stellantis' moves are fueling tensions in Italy with the unions who yesterday also asked for an institutional meeting with the government and Tavares “to obtain the right answers that workers have been waiting for too long”, we read in the national coordination document Uilm of Stellantis. If the request is not accepted, “a national strike in the automotive sector will be proposed to the trade union organizations with which we have already mobilized together”. Not only. Tavares received a compensation package of 36.5 million – the highest among CEOs of traditional manufacturers – and proxy advisor Glass Lewis warned the group of a potential “reputational risk” for the company due to the difference between the top management's compensation and the pressure on the rest of the staff (all this while on the stock market yesterday the stock lost another 4.3% on the long wave of quarterly accounts).
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