scott9050

NEW YORK (CNNMoney.com) -- Chrysler Group, whose year-long slump has dragged it down to fourth place among U.S. automakers, announced plans Wednesday to cut 13,000 jobs through 2009 as it attempts to stem widening losses.

The cuts represent 16 percent of the staff at the North American unit of DaimlerChrysler (Charts), as it eliminates 9,000 U.S. factory workers and another 2,000 factory workers in Canada over the next three years.

In addition, 2,000 salaried staff cuts will be spread over the next two years.

The company also said it will close the SUV Assembly line in Newark, Del., by 2009, after eliminating one of its two shifts later this year. It also plans to eliminate a shift at the Warren, Mich., truck plant later this year and a shift at the St. Louis South assembly plant in 2008.

The factory closings and downsizings will reduce the company's capacity by about 400,000 vehicles a year.

The company did not detail how the job cuts will be made. The union-represented workers have job guarantees that pay them nearly full salary if they are laid off, but those gurantees only run until the end of the current labor contract in September.

GM and Ford made even deeper cuts in their salaried staff by offering a series of buyout and retirement packages worth up to $140,000 per employee, and both got more than 30,000 employees represented by the United Auto Workers union to leave the company under those offers.

But Chrysler's announcement did not include a similar offer, although it said "special retirement programs and other termination and attrition programs will be announced separately."

There have been some calls among German shareholders for DaimlerChyrsler to sell the Chrysler unit, undoing the 1998. While that scenario was generally seen as unlikely by many auto experts, there was a report in a German newspaper Wednesday that such a sale is still under consideration.

In response to questions about that report, DaimlerChrysler issued a statement attributed to Chairman Dieter Zetsche in which he said, "in order to optimize and accelerate the presented plan, we are looking into further strategic options with partners beyond the business cooperation partners mentioned. In this regard, we do not exclude any option in order to find the best solution for both the Chrysler Group and DaimlerChrysler."

The statement seemed to suggest a change in thinking of DaimlerChrysler management. Zetsche, who had been in charge of the Chrysler unit until last year, previously had been on the record clearly supporting the company retaining its ownership of Chrysler.

The topic was likely to be discussed further at a press conference set to start at 9:30 a.m. ET.

Earlier in the day, the company announced that Chrysler's full-year loss was $1.48 billion. In the prior year, as competitors General Motors (Charts) and Ford Motor (Charts) struggled with losses from their auto operations, Chrysler Group posted a $2.02 billion profit for 2005.

Chrysler was hurt by declining sales, particularly in its pickup trucks and SUVs, as the company lost its long-held position as the No. 3 U.S. automaker to fall behind Toyota Motor (Charts) during the year. Honda Motor (Charts) also made gains at the expense of the traditional Big Three Detroit automakers.

Revenue at Chrysler Group fell to $62.2 billion for 2006 from $66.1 billion a year earlier, as the number of vehicles sold also fell 5 percent to 2.7 million.

Still, even with the loss at Chrysler, parent DaimlerChrysler (Charts) posted 2006 operating income of €5.52 billion in 2006, or $7.28 billion, up from €5.19 billion, or $6.84 billion, in 2005. The company saw substantial earnings improvement at the Mercedes Car Group as well as further earnings gains at its truck group and financial services unit.

Net income for the company after a series of special charges came to €3.2 billion, or $4.3 billion, up from €2.8 billion, or $3.8 billion a year earlier. Based on the reported net income, earnings per share amounted to €3.16, or $4.17 a share, up from €2.80 a share, or $3.70, in 2005.

The company said based on the divisions' projections, DaimlerChrysler should achieve a significant increase in profitability in the planning period of 2007 through 2009. But it did not give any specific earnings targets.

ProudPony

Why isn't someone in this forum posting articles about the 10,000s of jobs that are being CREATED in America by car companys?

We can see the losses of 10,000 last week, 13,000 this week, 180,000 last year... but where are the "new" jobs? Supposedly the US economy is doing well, so it should be no problem to see numerous plant openings and expansions with 1000's of new jobs being created... but where are they?

Z28Wilson

Surely Toyota is scooping up all those laid off Americans and putting them to work.

georgejetson

I have heard -- from somebody in a position to know -- that the all-new Tundra was designed mostly by ex-Jeep engineers laid off by DCX a few years ago.

Chris 96 WS6

Proud...creation of jobs doesn't sell newspapers or grab TV viewers...the news media...even business news..is built on bad news.

What is never described is that jobs are created and destroyed all the time. Net job creation is the key stat when you're talking about the economy, but we're only ever concerned with cuts.

Maybe the new jobs are in OTHER sectors of the economy.

Z28Wilson

I wouldn't doubt that. The new Tundra is by far Toyota's most American product ever. From design to development to production, and to its target audience. I don't know exactly how many workers that new Texas Tundra plant employs, but obviously it doesn't make a dent in the amount of manufacturing jobs cut by GM/Ford/DCX in the last year, let alone last decade.

That was really my only point, not to get too far off topic. But that's what really grinds me when people justify their choices by saying "well the Big 3 are laying off while the Japanese are handing out jobs". A quick check of the numbers says something doesn't really add up. I'd respect people a lot more if they just came out and said they don't care, they're just buying the car (or whatever) they like best.

johnsocal

US job growth is occuring outside the auto manufacturing sector and going here -

http://web.camaross.com/forums/showthread.php?t=472859&

dream '94 Z28

I thought there were only three US automakers?

Z28Wilson

.....Which takes retraining...who's paying for the schooling so that the assembly line guy can work in a hospital? That is another big issue in Michigan, our governor wants a program to help fund retraining of auto workers for various other jobs. Guess it's coming out of my pocket. :blah:

Robert_Nashville

Proud,

Most of the "good news" in the automotive sector tends to be related to the transplants...they tend to be the ones building new plants and expanding existing capacity and you've seen first hand the kind of reaction generated on this board when those stories have been posted.

Jobs are being created all the time, inside and outside of the auto industry which is why in many parts of the country, employers are scrambling to find qualified workers for the jobs they have...also something not considere AT ALL by most stats are the jobs being created when a formerly employed worker starts his/her own business and becomes self-employed...we hear about all the big companies all the time but so often overlooked is that huge block of people in this country don't work for anyone but themselves.

johnsocal

No argument there.

Robert_Nashville

It shouldn't have to come out of your pocket or anyone elses pocket...why should anybody have to "pay for it" other than the person getting the training???

I've never epxected anyone but me to pay for my degrees - people need to stop looking to someone else for a way out and start taking responsibility for themselves.

90rocz

I know from my own experience that what jobs are usually created from these kind of cuts are, outsourced work to local firms at 1/2 the wage we make...probably why we aren't hearing a lot about them is it would just create more harsh feelings.
This is one of the biggest obstacles this country faces today!..
"He who controls what you see, controls what you think.."

Z28Wilson

I totally agree....but some don't see it that way....Especially in this day and age, auto workers better be saving for a rainy day.

ProudPony

I agree with you to a point - and you know that I am being facetious with the post above!

However, in and around my area, if ANY company is hiring ANY significant number of people (sometimes as low as 100), it is usually announced on the local news at 6pm and 11pm. And moreover, if there is a possibility of a large comapny coming into the state that will be hiringanything like 500 to 1000 people, it's all over the news! When Dell announced plans to build a facility outside Winston-Salem, it made headlines for a year... "Property has been purchased...", "Groundbreaking today...", Building almost complete...", Jobs now being filled...", Grand opening...", "First new computer out the door..." and so on. This was a "daily update" thing in our local 6 o'clock new for months. And they employed a WHOPPING big 347 people when they opened. (They are supposed to be just over 1000 by now, but I don't know if they have made it yet)
http://search.yahoo.com/search?p=del...y-vert-web-top

Your point is well-taken about "what sells" in the headlines, but there is another side too. Just like the press does not mention when a company is hiring 10 or 20 people, they also don't mention when a company lays-off 10 or 20. They only hit the "big" ones. So how many companies out there are cutting 10-20 at a time that we never know about?

I still think it's pretty lopsided - especially in manufacturing where many jobs don't require special schooling or certification like nursing or IT does.