KOKOMO, Ind. (AP) — As the automotive industry speeds ahead to produce more electric and hybrid vehicles, how will the change affect the nation’s more than 900,000 automotive manufacturing workers?
That’s a question very much on the minds of local employees working at the Stellantis plants in Kokomo and Tipton.
It’s a question that’s been looming for years, but took on a sharp focus in January when General Motors boldly announced its goal to make only battery-powered vehicles by 2035. That was followed by Ford vowing to convert its entire passenger vehicle lineup in Europe to electric power by 2030.
Matt Jarvis, president of United Auto Workers 685, which represents the plants in Kokomo and Tipton, said it has the approximately 7,100 local workers wondering: What does this mean for us?
“It’s a concern,” he said. “The employees are concerned. With the way GM and Ford are going toward electric vehicles, it’s a concern about what’s going to happen with the workforce.”
That’s because the more environmentally focused plants of the future will need fewer workers, mainly because electric vehicles contain 30% to 40% fewer moving parts than gas-run vehicles. In addition, many jobs could shift to lower pay as automakers buy parts from supply companies or form separate ventures to build components.
Most vulnerable in the transition will be the roughly 100,000 people in the United States who, like the Stellantis employees in Kokomo and Tipton, work at plants that make transmissions and engines for gas and diesel vehicles.
The future is even more foggy for the local workforce following the historic merger between Fiat Chrysler Automobiles and PSA Peugeot to create Stellantis, which is now the fourth-largest automaker in the world.
While companies such as GM and Ford are making their electric vehicle plans clear, Stellantis is still in flux as it figures out how it will move forward into the world of EV technology.
“It’s hard to project how that’s going to affect the local workforce, because they haven’t made announcements how they’re going to move forward on the EV side of things,” Jarvis said. “It’s a wait-and-see for us right now.”
And it will likely be a long wait.
While automakers are making flash announcements about the transition to selling mostly, or all, electric vehicles within the next few decades, analysts don’t expect the internal combustion engine to go away in the foreseeable future.
Bernard Swiecki, a senior automotive analyst at Detroit-based Center for Automotive Research, said they project more than 90% of vehicles will still have an internal combustion engine by 2030.
That’s because hybrids still need an internal combustion engine and a transmission, like the ones made in Kokomo and Tipton. Only all-electric vehicles don’t require a traditional engine and transmission.
“The announcements do grab a lot of headlines, but in the end, the transition is going to be gradual,” Swiecki said.
Alan Krabbenhroft, a professor of economics and dean of the School of Business at Indiana University Kokomo, agreed. He said he believes the effects of the transition to electric vehicles will not negatively affect the local workforce anytime soon, barring a major push to all-electric vehicles from the federal government or a regulatory agency.
“From a Kokomo perspective, I don’t see a huge impact — at least for a bit — on our factories here,” he said.
But it’s clear the change is coming.
Stellantis CEO Carlos Tavares said in January during a media call that every model the company releases from now until 2025 will have an “electrified” version. He didn’t clarify how many would be all-electric, plug-in hybrids or traditional hybrids that don’t need to be plugged in.
The company recently announced that the new Gen4 8-speed transmission, designed by the German-based company ZF, will go into the plug-in hybrid version of the Jeep Wrangler.
Jarvis said because the transmission will be initially used in a low volume of the SUVs, Stellantis is buying them straight from ZF. But if production ramps up, he hopes the company will bring production of the new transmission to Kokomo and Tipton.
“Our stance is that if they do advance to the Gen4 transmission, that should be built here in Kokomo, along with any other technology they come out with,” Jarvis said.
One bright spot among the uncertainty is the Kokomo Engine Plant, which is set to open later this year and supply around 1,200 workers with jobs making Global Medium Engine Turbo 4.
The engine is adaptable to a significant number of new EV and hybrid technologies, and the Kokomo facility will be the source of all U.S. production of the engine.
Jarvis said the plant is a major step in ensuring work continues on in Kokomo, and laying a good foundation for future EV technology to potentially come to the city.
“The engine plant is going to help us a lot,” he said. “It diversifies our workforce, which has traditionally been known to make transmissions.”
IUK’s Krabbenhoft said with the company investing $400 million to convert the former Indiana Transmission Plant II into the new Kokomo Engine Plant, he doesn’t see Stellantis making a hard pivot to all-electric cars in the foreseeable future.
“That engine plant is designed to develop a seamless one-unit piece together with the transmissions that are coming out of the transmission plant,” he said. “I just don’t see that level of investment having taken place unless they have a longer term plan for where those engine, transmission assemblies will be going.”
Jarvis said transitioning to EV technology was a big topic of discussion during contract negotiations in 2019 with FCA, and it’s sure to be an even bigger issue when negotiations start up with Stellantis.
He said that although it’s unclear now how the eventual move to more EV and hybrid vehicles will affect the local transmission plants, his message to the company is straightforward.
“We’re open to making anything that’s related to electric vehicles or autonomous vehicles,” he said. “We’ll make batteries, we’ll build motors, we’ll do any kind of work that we can. We’ve got a capable workforce, and employees willing to make anything thrown at us to make a quality product.”