In a significant escalation of a high-stakes dispute, the Canadian government has formally served auto manufacturing giant Stellantis with a notice of default. This move comes as Ottawa accuses the company of breaching a major funding agreement by shifting production of a Jeep model from Ontario to the United States.
Contract Battle Ends With Full Disclosure to Committee
After a protracted battle lasting over a month and a half, the federal government has capitulated to parliamentary pressure. On Thursday, December 5, 2025, the Department of Industry, Science and Economic Development (ISED) provided an unredacted copy of the controversial Stellantis funding agreement to the House of Commons government operations committee.
This action puts an end to a fierce debate over Parliamentary Privilege that began when the committee first demanded the full contract on October 20. Until this week, ISED had insisted on providing only a heavily redacted version, citing the need to protect the company's "commercially sensitive" information. The complete document was not released to the public or media, remaining solely for the review of Members of Parliament.
Federal Government Moves Toward Legal Action
The notice of default, confirmed by Industry Minister Mélanie Joly before a separate Commons committee, is a critical legal step. It signals the government's preparation to potentially file a lawsuit against Stellantis for allegedly violating the terms of its 2022 contract.
That agreement promised Stellantis up to $529 million in public funds to support its automotive plants in Windsor and Brampton, Ontario. The government's dispute stems from Stellantis's October announcement of an "operational pause" at its Brampton assembly plant, which resulted in thousands of employee furloughs. The company also confirmed it would move production of the Jeep Compass to the U.S. and unveiled a massive $13-billion investment in its American operations.
Stellantis Faces Scrutiny From All Sides
The company's actions have drawn fire from both government and opposition parties. During a tense appearance before the government operations committee on December 4, Stellantis executive Teresa Piruzza faced repeated questioning from MPs.
Liberal MP Vince Gasparo pointedly asked if the company's U.S. investment announcement amounted to "blowing Canadian taxpayer dollars." The federal Liberals have already initiated a formal dispute resolution process, which began on November 3, in an effort to recover some of the hundreds of millions in public funds already transferred to the automaker.
The release of the full contract and the serving of the default notice mark a new, more confrontational chapter in the relationship between Ottawa and one of the world's largest automakers, with significant implications for Canadian industrial policy and thousands of automotive jobs.
