The Automotive Industry in Flux: Labor Strikes, Retooling, and Restructuring's Impact on the Market


 The automotive industry is currently facing critical transitions that will affect manufacturers, suppliers, and procurement teams alike. With labor disputes, production retooling, and restructuring on the rise, it’s crucial for supply chain professionals to stay ahead of these developments. Below, we explore three key news stories that reveal where the industry is headed and how it will impact procurement strategies.

1. Stellantis Labor Struggles: A Ripple Effect on Supply Chains

One of the biggest challenges for Stellantis is the looming threat of labor strikes. Both U.S. and European unions are dissatisfied with the company’s workforce decisions, which include the elimination of seasonal workers and delayed reopening of key facilities like the Belvidere Assembly Plant in Illinois. Italian unions have already staged a one-day strike in protest of declining production​

These strikes could severely impact Tier 1 and Tier 2 suppliers, who may face delays in fulfilling contracts due to disruptions in Stellantis’ operations. Procurement teams should prepare for delays and investigate alternative suppliers to minimize potential disruptions.

Pro Tip: Diversify your supplier base and develop relationships with backup suppliers to mitigate the risks of labor-related disruptions.

2. GM Retooling and Layoffs: A Shift Towards EVs

General Motors is preparing for the future by retooling its Fairfax Assembly Plant in Kansas to produce electric vehicles like the Chevrolet Bolt EV and Cadillac XT4​. However, this shift also means layoffs and the cessation of production for legacy models like the Chevrolet Malibu.

For procurement teams, this moves signals a significant shift in focus toward electric vehicle components. Now is the time to secure contracts with suppliers specializing in EV technology to ensure your company remains competitive as the industry transitions.

Pro Tip: Re-evaluate your supplier partnerships to ensure alignment with future trends in electric vehicle production and battery technology.

3. Continental’s Potential Spin-off: Supplier Relations in Transition

Continental, a key player in the automotive supply chain, is exploring the idea of spinning off its automotive division into a standalone company​. This restructuring could lead to new dynamics within the supplier network, offering opportunities for deeper, more specialized relationships with the new entity.

For purchasing professionals, this presents both risks and opportunities. Monitor how the spin-off will affect Continental’s ability to deliver on contracts, and be ready to renegotiate as needed.

Pro Tip: Stay agile by keeping communication open with suppliers that are undergoing restructuring. This will help you anticipate changes and respond quickly to any disruptions.

Key Takeaways and Action Plan

To navigate these ongoing changes, procurement professionals should consider the following:

  1. Prepare for Supply Chain Disruptions: With the potential for labor strikes at Stellantis, securing alternative suppliers will be key to maintaining continuity.

  2. Shift Focus to Electric Vehicles: As GM shifts towards EV production, now is the time to prioritize contracts with suppliers that focus on electric vehicle components and technology.

  3. Monitor Supplier Restructuring: Keep a close eye on Continental’s potential spin-off and assess how this might impact your supplier agreements and strategic partnerships.


By staying proactive and informed, you can mitigate risks and seize opportunities that arise from the ongoing shifts in the automotive industry.


    Location: Michigan, USA

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