US automaker Chrysler announced plans Thursday to slash 8,500 to 10,000 production jobs and other labour force reductions to deal with a "smaller market" in the United States for automobiles.
The cuts, the first under Chrysler's new private equity owners, come on top of a reduction announced in February of 13,000 jobs including 11,000 production workers, or about 16 percent of its total labour force. Chrysler, the number three US automaker, said it was taking the actions in response to industrywide volume reductions and slower sales that call for "plant adjustments." The company said it was also halting production of four Chrysler models while adding two new vehicles and two new hybrid autos to its line-up.
Chrysler said it would cut an additional 1,000 white-collar posts and reduce the use of outside contract employees by 37 percent. It will also eliminate overtime for all employees.
The actions mark a new reorganisation under Chrysler LLC's new owners headed by Cerberus Capital Management, which bought the US automaker from Germany's DaimlerChrysler earlier this year. The actions come on top of the reorganisation announced in February aimed at restoring profitability to Chrysler through a three-year "Recovery and Transformation Plan."
"The market situation has changed dramatically in the eight months since Chrysler established the Recovery and Transformation Plan as its blueprint," said Bob Nardelli, Chrysler's chairman and chief executive.
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