Automaker Stellantis has filed a lawsuit against parts supplier ZF Chassis Modules in a payment dispute that has halted production at its assembly plant in Toluca, Mexico.
The Toluca plant produces the Jeep Compass and Jeep Cherokee for North and Latin American markets, making the dispute a cross-border supply chain issue affecting production and freight movements across multiple countries.
In a lawsuit filed in Michigan, Stellantis said the dispute forced a shutdown at the Toluca factory beginning March 14, according to the Wall Street Journal.
The dispute centers on pricing for suspension modules. Stellantis said it had already paid more than $26 million and agreed to price increases in December to avoid a shutdown, but the supplier later demanded an additional $70 million, prompting legal action.
The shutdown highlights how cross-border auto production depends on constant freight flows of parts moving between suppliers and assembly plants across Mexico, the U.S. and Canada. When parts shipments stop, assembly lines can idle within days, disrupting truck and rail shipments and rippling across multiple plants and suppliers.
The parts stoppage halted production in Mexico and also threatened operations at Stellantis’ Windsor, Ontario, assembly plant, where a court order temporarily required the supplier to continue shipping parts to avoid a broader shutdown affecting thousands of workers. Around 4,300 workers are employed at the Windsor facility.
Stellantis builds several vehicles in Mexico at its Toluca and Saltillo assembly plants, including the Jeep Compass, Jeep Wagoneer S, Jeep Cherokee, Jeep Recon, Ram 1500, Ram 2500/3500 and Ram ProMaster vans.
The Toluca plant employs around 2,500 workers, while the Stellantis Saltillo Truck Assembly Plant employs over 4,000 people.
In February, Stellantis produced 40,865 vehicles in Mexico, up 29.4% year over year, and exported 30,401 vehicles, a 38.6% increase, according to Mexico’s National Institute of Statistics and Geography (INEGI).
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