Stellantis, the trans-Atlantic automaker, is preparing to close and sell its Arizona Proving Grounds by the end of this year, as part of a broader cost-cutting initiative led by CEO Carlos Tavares. The 4,000-acre facility, located in Yucca, Arizona, between Phoenix and Las Vegas, has been a key site for vehicle testing since Stellantis acquired it from Ford in 2007 for $35 million.
Facing increasing pressure from Wall Street, dealers, and the United Auto Workers (UAW) union due to lagging financial performance and layoffs, Stellantis is reevaluating its real estate assets as part of its strategy to optimize its operations. The decision to shutter the Arizona Proving Grounds is one of several moves aimed at streamlining the company’s operations amid a rapidly changing global market.
The automaker plans to shift its testing operations in Arizona to a Toyota-owned proving grounds beginning next year. Toyota, which opened the site to other companies in 2021, has been leasing the facility to offset the high costs of maintaining such large testing grounds.
In an official statement, Stellantis confirmed the closure and emphasized its commitment to “improving efficiency and optimizing its footprint for future competitiveness.” Stellantis is working with the UAW to offer affected employees special packages, including opportunities to transfer to other operations. However, the company warned that some employees may face indefinite layoffs, which would entitle them to pay and benefits for up to two years.
Currently, 41 employees work at the Arizona facility, with 37 represented by a local UAW chapter. The union, which has been increasingly vocal about Stellantis’ layoffs and cost-cutting measures, has yet to comment on the planned closure.
The Arizona Proving Grounds is one of several facilities Stellantis has considered closing, as indicated during UAW contract negotiations last year. The company has multiple proving grounds, including a major 4,000-acre site in Chelsea, Michigan. Additionally, concerns have arisen over the potential closure of Stellantis’ former headquarters in Auburn Hills, Michigan, as the company continues to reassess its U.S. operations.
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