By David Shepardson and Ben Klayman
WASHINGTON/DETROIT (Reuters) -Chrysler parent Stellantis (NYSE:STLA) filed a federal lawsuit against the United Auto Workers, saying the union has violated its contract by threatening to strike over the company's delays in planned investment.
The automaker filed the suit on Thursday asking the U.S. District Court in the Central District of California to declare the decision by UAW Local 230 in Los Angeles to take a strike authorization vote violates terms of the contract reached last fall.
Stellantis seeks to hold the UAW and the local union chapter liable for any potential revenue loss and other damages resulting from lost production due to any strike.
On Thursday, a supermajority of UAW members at Stellantis’ Los Angeles Parts distribution center voted to request strike authorization if the company and union can’t settle a grievance over planned company investments.
UAW President Shawn Fain has said the company has violated the contract by backing off investment commitments, but the company argues investments were always subject to market conditions and demand for electric vehicles has slowed since the deal was signed.
"The UAW acted in bad faith by disregarding this language, filing sham grievances, and calling a strike authorization vote to pressure Stellantis to proceed with planned investments," the company said in the lawsuit.
Fain in an email on Friday to UAW members said Stellantis management had "unleashed an all-out misinformation campaign in an attempt to scare and confuse us about our right to authorize the International to call for a strike."
He called the lawsuit and other company moves "desperate actions" and added the union's lawyers have "complete confidence in our right to strike."
Fain argued Stellantis CEO Carlos Tavares wants to make sharp cuts to the company's underperforming U.S. operations.
"We will not sit back and watch this company violate our agreement and threaten our jobs, our plants and our communities. We are united and we are defiant. We will do what it takes to enforce our contracts and protect American jobs," Fain said.
In 2023, Stellantis agreed as part of the contract with the union to invest $1.5 billion in its Belvidere, Illinois assembly plant to build new mid-size trucks by 2027. That was part of $19 billion in overall investment plans by the automaker.
Stellantis in August acknowledged it is delaying some of the investments because of economic conditions but said it "firmly stands by its commitment."
The Energy Department said in July it plans to award Stellantis $334.8 million to convert the shuttered Belvidere Assembly plant to build EVs and $250 million to convert its Indiana Transmission Plant in Kokomo to produce EV components but has noted those awards are still not final.