By Mark Huffman
ConsumerAffairs.com
December 18, 2008
Embattled carmaker Chrysler is cutting its losses, closing its auto assembly plants for at least 30 days, and hopes the U.S. government throws it a lifeline.
The company had already scheduled a two week furlough for assembly line employees. This move simply extends it for at least another two weeks. Of course, what happens after that is far from certain.
"If I were a Chrysler worker, I'd be worried that the plant won't reopen," said Brian Johnson, an industry analyst at Barclays Capital told the Washington Post.
As many as 46,000 Chrysler employees are affected by the move, which begins Friday. The affected plants will not resume production before January 19. If production resumes at all depends on what happens with negotiations between Congress and the White House.
Chrysler says it needs at least $7 billion to get through the month of December. After Congress deadlocked over a plan to rescue all three U.S. carmakers, the Bush Administration signaled its intention to step in with some sort of emergency loans, supporting the companies until President-elect Barack Obama and the new Congress take office.
Obama has said he is unwilling to let the Big 3 fail. Democrats, who generally support a Detroit bailout, will have additional votes in the new Congress.
Chrysler isn't the only automaker to idle workers at the end of the year. Ford says it will halt production in January for an extra week and General Motors reported last week that it will temporarily close 20 of its factories.
All the carmakers cite dramatically lower consumer demand as the reason for curtailing production. Sales of all vehicles, both foreign and domestic, have fallen dramatically since September, when the U.S. economy seemed to suddenly grind to a halt.
