As we reported in our earlier blog, “Stellantis Overhauls Terms and Conditions – What You Need to Know at a Glance,” published January 19, 2022, Stellantis issued new Global General Terms and Conditions (the “New Terms”) and related purchasing guidelines at the close of 2021, with an Exhibit A rider focusing on North America (the “North America Rider”). In our prior post, we highlighted a number of the most important changes contained in the New Terms, which comprised a significant overhaul of almost every material aspect of Stellantis’ purchasing terms. These changes were, unsurprisingly, greeted with significant pushback from the supply base, particularly in North America. That feedback, evidently, was heard.
Stellantis announced on Monday, May 16, 2022, by letter to its suppliers that it has unilaterally rescinded the North America Rider to the New Terms and reinstated in its place the prior 2021 FCA US purchasing terms and conditions. Importantly, while the reversal and purported shift back to prior North American terms is retroactive to January 1, 2022, Stellantis’ action does not otherwise unwind applicability of the New Terms or other region-specific riders. It’s worth noting, of course, that the prior North American terms were and remain buyer-favorable.
Given the wide-ranging impact of the New Terms and additional complexities introduced by the unilateral and purportedly retroactive rescission of the North America Rider, suppliers doing business with Stellantis should carefully review their contractual situations and how these customer actions may affect the parties’ rights and obligations.
While not entirely unprecedented – General Motors modified its newly issued terms and conditions eight years ago in response to supplier feedback ─ this reversal is a rare, abrupt and positive response by an automotive OEM to supplier outcry. Warner’s Automotive Industry Group is experienced in working with suppliers to react to shifting contractual landscapes and strategizing accordingly. To continue a discussion of how Stellantis’ latest actions may affect your organization, please contact Michael Brady, Adam Ratliff, Daniel Bonucchi or your Warner Automotive Industry Group attorney.
