Industry Minister Mélanie Joly says Ottawa has served Stellantis with a notice of default over conditions tied to federal funding for the Brampton plant.
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Ottawa has served Stellantis with a notice of default on a federal funding agreement after the automaker signed a deal to sell its Brampton, Ont. assembly plant to defence contractor Roshel.
Industry Minister Mélanie Joly said the federal government served the notice on Thursday, after concluding Stellantis breached conditions of a 2022 commitment tied to the Brampton facility.
Joly’s letter says Stellantis breached the agreement by halting Jeep Compass production at the plant, failing or refusing to identify a replacement vehicle, not maintaining any production at the facility, and closing the plant.
The minister said Stellantis has 30 days to demonstrate it will “correct these conditions” or Joly will declare the company is in default of its obligations.
Stellantis Canada CEO Trevor Longley said in a statement the company will “voluntarily return” $24 million in federal support received for the Brampton assembly plant’s original retooling plan, while Joly warned that further breaches could lead to penalties including termination of the federal funding deal and a requirement to repay all or part of funding plus interest.
Joly told reporters in Toronto that the government tried to find a solution for a year but that Stellantis proceeded with selling Brampton despite the conditions.
She also said she plans to meet with Stellantis global CEO Antonio Filosa and the Ontario government to find a solution.
Longley acknowledged “the disappointment and uncertainty surrounding the future of the facility,” adding that selling the plant would allow Stellantis to focus resources on sustaining Canadian manufacturing operations amid “challenging market realities.”
He said the company’s decision to sell would provide a path to return the site to productive industrial use and create new jobs, with priority hiring consideration for Brampton workers.
The notice of default comes as federal officials say the Roshel transaction reflects Stellantis not working “in good faith” to address Ottawa’s concerns since Stellantis revealed last year it would not manufacture its Jeep Compass electric vehicle at the Brampton plant.
The letter also states that “at no point” had Joly’s office indicated support for a sale to Roshel or suggested it would cure Stellantis’ existing breaches.
Federal funding committed in 2022 included up to $529 million to help Stellantis retool its Brampton and Windsor facilities to produce electrified vehicles, with the Ontario government committing $513 million in provincial support.
A retooling began at Brampton in early 2024, but Stellantis paused plans to produce the Jeep Compass there in February 2025, according to the supplied details. Stellantis later said it was moving Jeep Compass production to Illinois, leaving more than 2,000 workers laid off and the Brampton plant idled indefinitely.
Prime Minister Mark Carney said media reports suggesting the federal government played an active role in discussions between Stellantis and Roshel do not change what he called Stellantis’ responsibility to meet its obligations to workers.
Carney said the Roshel deal is a “partial solution” rather than a full one for the plant’s workers.
In a separate political response, Conservative Leader Pierre Poilievre said Ottawa should have ensured job guarantees if it knew about the sale in advance.
The supplied information also says Roshel CEO Roman Shimonov said his Brampton-based company is willing to hire back some Stellantis employees laid off when operations halted in 2023 and plans to lease about one-quarter of the site space back to Stellantis for automotive work.
Collective bargaining between Stellantis and Unifor broke down in September after Stellantis signed a memorandum of understanding with Roshel to target a sale of the facility. Stellantis workers later voted to give their union a mandate to strike, with 97.3 per cent of members who participated voting in favour of authorizing a potential labour action.
However, Unifor national president Lana Payne said Thursday that a strike would remain the union’s last resort and that the union is not yet in a legal strike position, explaining that a “no board” report would be required.
Unifor Local 1285 President Vito Beato, who represents workers at the Brampton plant, said members were “distressed” by the latest news.
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