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Economy

Dakkota is closing its Detroit Jeep parts plant and cutting 397 union jobs

A 15-year tax-free zone and a promise to hire Detroiters first could not save the plant on the old Kettering High School site.

Dakkota is closing its Detroit Jeep parts plant and cutting 397 union jobs
Stock photo. Photo by PJ Wallace on Unsplash

Auto supplier Dakkota Integrated Systems will permanently close its Detroit plant and lay off 397 workers, according to a layoff notice the company filed with the state of Michigan on Oct. 19. The plant, built on the site of the former Kettering High School on the city's east side, makes instrument panels for the Jeep Grand Cherokee and Dodge Durango, both assembled at Stellantis's nearby Detroit Assembly Complex.

The cuts come in two waves. One production line shuts down Dec. 31, ending 205 jobs, and the second stops March 31, 2027, ending 192 more, PlasticsToday reported from the filing. The notice blames the "loss of major Stellantis contracts" for those panels.

The workers are union members. UAW Local 155 represents the affected employees, CBT News reported, and federal labor board records show Local 155 won a 64-1 election at Dakkota's Van Dyke Street plant in 2021 and was certified as the workers' bargaining agent that July.

Detroit is not the only Dakkota site going dark. A separate notice filed Sept. 9 covers 67 jobs at its Watertown Township plant near Lansing, which closes Dec. 31. Together the two closures cost Michigan 464 jobs.

A school site, a tax break and a hiring promise

Dakkota bought about 32 acres, including the empty Kettering and Rose school buildings, from the Detroit Public Schools Community District for $2.6 million. "Dakkota has agreed to give Detroiters first shot at these jobs," Mayor Mike Duggan said at the time.

Public money followed. In January 2020, state officials approved a $1.5 million Michigan Business Development Program grant and a 15-year Renaissance Zone designation, a status that exempts the site from many state and local taxes, estimated to be worth $3.5 million. The package also included an industrial property tax abatement from the city and about $833,000 in state transportation grants, with Detroit adding $268,018. In return, Dakkota pledged to interview pre-qualified Detroiters first and to hire through Detroit at Work, according to minutes of the city's Detroit Next Michigan Development Corp. board, which described the assembly jobs as UAW positions paying about $13.50 to $17 an hour.

At the plant's official opening in May 2022, Duggan, Gov. Gretchen Whitmer and Stellantis executives praised the roughly 500-worker operation, and the Detroit Free Press reported pay of $15.50 to $20.25 an hour.

The state's own report on the zone shows how little the promises bound the company. The Michigan Economic Development Corp.'s Renaissance Zone report lists 667 jobs at the site but says its job and investment metrics "are not enforced by a development agreement." We found no public record of a clawback provision tied to the Detroit plant.

Where the work is going

Stellantis has not said publicly who will build the panels. Crain's Detroit Business reported that Dakkota had already ceded Stellantis Jeep assembly work for the Detroit factories to Android Industries, and that both Dakkota and Stellantis declined to comment for that story. Neither company has made a public statement on the closure that we could find.

What the law requires

The federal WARN Act requires employers with 100 or more full-time workers to give 60 days' written notice before a plant closing or mass layoff to the workers' union (or each worker if there is none), the state and the local chief elected official. A plant closing counts when 50 or more full-time workers lose their jobs at one site within 30 days. An employer that skips the notice can owe back pay and benefits for each day of the violation, up to 60 days. Dakkota's Oct. 19 filing gives Detroit workers about 10 weeks before the first wave, so it appears to meet the deadline.

What to do if your job is next

Ask Local 155 what your contract says about severance, recall rights and transfers to other Dakkota plants, and get the answers in writing. The UAW is already pressing Detroit automakers on retirement security ahead of 2028 bargaining, and supplier workers should know where they stand now.

Save pay stubs, reviews and benefits summaries now, while you still have access. Our guide to layoff warning signs covers how to protect your income and health coverage.

Do not sign a separation agreement on the spot. Severance is often negotiable beyond the first offer. Workers 40 and older laid off as part of a group get at least 45 days to consider a release and 7 days to revoke it, along with a list of the job titles and ages of who was cut and who was kept. Before signing, check for red flags in the agreement, including gag clauses a labor board judge has struck down. More guides are at severance.law.

For more on how WARN notices work, see our story on Kroger's 3,000 AI-driven corporate job cuts.

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