Chrysler shuts down ALL production at 30 U.S. plants - 1 month shutdown

66dvlbrd68 · Dec 17, 2008 at 4:10 PM

CNN.com

Chrysler shuts down all production
Close of business Friday will be the start of a monthlong closure of 30 U.S. plants. Company cites 'continued lack of consumer credit.'
By Peter Valdes-Dapena, CNNMoney.com senior writer
Last Updated: December 17, 2008: 7:00 PM ET

NEW YORK (CNNMoney.com) -- Chrysler LLC announced late Wednesday that it is stopping all vehicle production in the United States for at least a month.

All 30 of the carmaker's plants will close after the last shift on Friday, and employees will not be asked to return to work before Jan. 19.

Chrysler blamed the "continued lack of consumer credit for the American car buyer" for the slow-down in sales that forced the move.

The company ordinarily shuts down operations between Dec. 24 and Jan. 5. This closure would add roughly two weeks to that shutdown.

Chrysler would not say how many fewer vehicles would be produced because of this shutdown. A total of 46,000 employees will be affected. They will be paid during the time off through a combination of state unemployment benefits and Chrysler contributions, but they will not receive the full amount of their working pay, a Chrysler spokesman said.

"Chrysler dealers confirmed to the company at a recent meeting at its headquarters, that they have many willing buyers for Chrysler, Jeep and Dodge vehicles but are unable to close the deals, due to lack of financing," the carmaker said in an announcement. "The dealers have stated that they have lost an estimated 20% to 25% of their volume because of this credit situation."

Auto sales have been hit hard by tight credit and the struggling economy. Overall auto sales in the United States were down 37% last month compared with November 2007. Chrysler's situation was especially bad. Its sales dropped 47%.

Chrysler's financing arm, Chrysler Financial, has tightened lending terms for buyers and earlier this year, it announced it would no longer offer leases.
Industry seeking help from Washington

Chrysler, Ford Motor Co. (F, Fortune 500) and General Motors (GM, Fortune 500) have approached Congress for aid to help them get through the current financial crisis. A congressional effort to establish a stopgap, $14 billion loan program to help Chrysler and General Motors at least until next month collapsed in Congress last week.

The Bush administration has said it is working on a possible plan to throw the companies a lifeline using money from the $700 billion bailout approved by Congress in October, the Troubled Asset Relief Program or TARP.

General Motors recently announced it was idling 30% of its North American manufacturing capacity during the first quarter of 2009 in response to deteriorating market conditions. That move will take 250,000 vehicles out of production.

"The speed and severity of the U.S. auto market's decline has been unprecedented in recent weeks as consumers reel from the collapse of the financial markets and the resulting lack of credit for vehicle financing," GM said in a Dec. 12 announcement, citing a 41% drop in November sales.

Both GMAC and Chrysler Financial are trying to receive federal assistance under the TARP program. GMAC is affiliated with General Motors, which owns 49% of the finance company. The other 51% of GMAC is owned by a consortium of investors led by Cerberus, which owns Chrysler and Chrysler Financial. To top of page
First Published: December 17, 2008: 5:59 PM ET

Find this article at:
http://money.cnn.com/2008/12/17/autos/chry...sion=2008121717
Click to expand...

:cold:

ChargerGirl · Dec 17, 2008 at 4:22 PM

Just glad my car's paid for. Making plans to save up for a Challenger when I finish school. And contemplating if there's another vehicle I can stomach buying if there are no more new Mopars. :blink:

cherbear · Dec 18, 2008 at 3:50 PM

I just feel bad for all those employees.

ALABAMA MSRT8 · Dec 18, 2008 at 7:58 PM

me to.

TNCHARGER · Dec 18, 2008 at 8:23 PM

Those employees will get at least 95% of their current pay....

Kevan · Dec 18, 2008 at 9:35 PM

Ummm....I think Chrysler *NORMALLY* closes up shop for 3-4 weeks at the end of the year.

I guess making it public looks good.

TNCHARGER · Dec 18, 2008 at 10:31 PM

Kevan said: ↑

Ummm....I think Chrysler *NORMALLY* closes up shop for 3-4 weeks at the end of the year.

I guess making it public looks good.
Click to expand...

Actually they close every year for about 2 weeks as stated in the article....but this is a smart move on Chrysler's part....why build inventory when nothing is selling?....probably wouldnt hurt to close for 2 months....the employees get partial wages plus state unemployment...

Kevan · Dec 18, 2008 at 10:50 PM

TNVIPER said: ↑

Actually they close every year for about 2 weeks as stated in the article...
Click to expand...

The article is from CNN, so I didn't read it.
Why not?
Because if the past is any indication, it's about 37% truth/factual, 11% pixie dust, 4% Barbarella, and 48% complete conjecture.

I did my own news gathering and spoke with an actual, currently-employed, veteran Chrysler employee today.

The "Reverend" CoolFlo · Dec 19, 2008 at 5:39 AM

no comment ...

srt-4chick · Dec 19, 2008 at 9:22 AM

Chrysler closes for 2 weeks so they added 2 weeks and Ford also closes for 2 weeks and they added 1 week to it. I agree with Larry if your not sellin em why build em...

ALABAMA MSRT8 · Dec 19, 2008 at 12:40 PM

95% of pay.that aint bad at all.

StevoSRT · Dec 19, 2008 at 12:44 PM

If you offered me 95% pay to spend 4 weeks with my family....ill sign up 10 times out of 10....it would just be nicer if they knew they would have a job in a few months....

DevssrT · Dec 20, 2008 at 2:50 PM

Wow, just wow....they shut down, but still get paid??...Thats nice job security there...

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