Canada's federal government is escalating an ongoing dispute with Stellantis over a broken promise to build a Jeep vehicle in the country.

In October, Stellantis announced a large investment in its U.S. manufacturing footprint as a method of avoiding the brunt of 25% tariffs on imported automobiles put in place by President Donald Trump. The investment was set to bring several vehicles back to U.S. manufacturing plants for production.

The Jeep Compass, Stellantis announced, would be built in Belvidere, Illinois, and not in Brampton, Ontario, as the company had previously promised the Canadian auto union, Unifor, in a 2023 collective bargaining agreement.

Canadian workers and legislators reacted negatively to the switch, with Unifor president Lana Payne telling the Detroit Free Press in November that Canadians are "red-hot" over the "betrayal."

On Thursday, Dec. 4, Canada's Industry Minister Mélanie Joly said the Canadian government plans to serve Stellantis a "notice of default" — essentially a warning of breach of contract, preempting a lawsuit — after Stellantis renegotiated on its promises to the workforce of about 3,000 in Brampton.

Stellantis has received hefty financial aid from the Canadian government to fund automotive production in two industrial cities, Windsor and Brampton. Now the government is threatening to withhold funding — and claw back what it has already paid out — if the automaker does not get Canadian employees back to work building cars in Brampton.

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According to the Canadian Broadcasting Corporation, Stellantis was paid $222 million as part of a deal to retool its plants in Brampton and Windsor. The Canadian government is threatening to stall payments on the rest of the loans, totaling $529 million, which were slated to be used to update both plants.

Stellantis recently announced that approximately 1,500 new jobs will be added to the Windsor Assembly plant in Canada to build the new internal combustion Dodge Charger and the Chrysler Pacifica. The new third shift will begin in early 2026, Stellantis has said. Laid-off Brampton employees were offered those jobs, though Windsor is an approximately four-hour drive from Brampton.

Stellantis Canada spokesperson Lou Ann Gosselin told the Free Press in a statement that "Stellantis continues to engage with the government in the dispute resolution process under the agreement. We are working towards our shared objective of securing a long-term, sustainable future for automotive manufacturing in Canada, including in Brampton."

Gosselin said the process is "confidential" and declined to comment further.

Liam Rappleye covers Stellantis and the UAW for the Detroit Free Press. Contact him: LRappleye@freepress.com.

This article originally appeared on Detroit Free Press: Canadian lawmakers turn up heat on Stellantis over Brampton dispute