Dispute Between Stellantis and ZF Triggers Work Stoppage at Toluca Plant

Multinational automaker Stellantis has filed a lawsuit against automotive supplier ZF Chassis Modules over a payment dispute that has brought production to a standstill at its assembly plant in Toluca, State of Mexico, according to a report by the Wall Street Journal.

In the complaint filed on March 25 with the U.S. District Court for the Eastern District of Michigan in Oakland County, outside Detroit, Stellantis accuses the joint venture between ZF and Foxconn of “extorting” the automaker by demanding a one-time payment of $70 million and price increases.

According to the lawsuit, the company stopped shipping suspension modules to the Toluca plant, which has been closed since March 14. The facility produces the Jeep Compass and Jeep Cherokee models, as well as the Wagoneer S and Jeep Recon electric vehicles.

Stellantis obtained a court order on the same day compelling the supplier to continue shipping components to the plant, which is expected to resume operations in the coming days. The order expires in two weeks, and a hearing is scheduled for April 6.

The supplier had also threatened to suspend shipments to the Windsor, Ontario, assembly plant, where the Chrysler Pacifica and Dodge Charger are manufactured, but the automaker obtained an emergency injunction from the Ontario Superior Court, forcing the supplier to maintain the supply of parts.