Chrysler LLC today, Nov. 1, announced plans to cut 8,500 to 10,000 hourly jobs through 2008 and reduce salaried employment by about 2,100, reducing its work force by as much as 15 percent to cut costs and match slower demand for some of its vehicles. The automaker also said it will eliminate shifts at five North American assembly plants and cut four products from its lineup.
The new round of cuts comes in addition to 13,000 layoffs Chrysler announced in February as part of a massive restructuring. Chrysler officials, who attributed the latest cuts to falling overall demand in the U.S. market, said it expects sluggish sales to continue in 2008.
Chrysler became a private company in August when Daimler AG sold 80.1 percent of the automaker to private equity firm Cerberus Capital Management. “The market situation has changed dramatically in the eight months since Chrysler established the recovery and transformation plan as its blueprint,” said Bob Nardelli, chairman and chief executive officer.
Today’s announcement came a week after the United Auto Workers approved a four-year contract with the company in the United States. As part of the plan, shifts will be eliminated at assembly plants in Sterling Heights, Mich.; Jefferson North in Detroit; Toledo, Ohio; Belvidere, Ill.; and Brampton, Ontario. Another shift will end at the Mack Avenue engine factory in Michigan.
The four models being eliminated are the Chrysler Pacifica crossover utility vehicle, the Dodge Magnum station wagon, the convertible version of the Chrysler PT Cruiser, and the Chrysler Crossfire sports car. The company plans to roll out two new products, the Dodge Journey crossover and the Dodge Challenger sports coupe, and also plans to add hybrid-powered versions of the Dodge Durango and Chrysler Aspen sport utility vehicles.