Stellantis takes auto supplier to court over brake rotor price dispute

Stellantis is locked in a legal battle with a Canadian auto parts supplier over the cost of brake rotors, a disagreement that could halt production at major U.S. assembly plants. Peterson Spring, which operates a manufacturing facility in Woodstock, Ontario, says it cannot keep shipping the parts at the current contract price because producing them costs more than what Stellantis pays. In court filings, the company argues the pricing structure was sustainable for the plant’s previous owner, ZF, because that larger company could offset losses with profits from other products. Peterson Spring says it doesn’t have that advantage.

Stellantis claims Peterson Spring has threatened to stop shipments unless the automaker agrees to pay double the original price, an increase the company says would total $77 million USD a year. The automaker calls the demand extortion and warns that any pause in shipments would force it to idle two Michigan assembly plants that build the Ram pickup and Jeep Grand Wagoneer. Stellantis has asked an Ontario court to appoint an independent manager to take control of the Woodstock facility to ensure production continues.

Replacing the supplier isn’t simple. Stellantis says it could take up to two years to test and approve an alternative source for the parts. The situation highlights how tightly linked and vulnerable the auto supply chain is, according to Canada’s Automotive Parts Manufacturers’ Association.
The dispute also unfolds against a backdrop of corporate turmoil. The Woodstock plant changed ownership earlier this year in a complex deal involving companies connected to auto parts executive Patrick James, who is currently facing a separate fraud lawsuit — allegations he denies.
For now, Stellantis and Peterson Spring have reached a short-term agreement allowing shipments to continue until mid-November, supported by a $7.2-million payment from Stellantis. Both companies declined to comment further while the case proceeds.