More job cuts for Chrysler

Alisa Roth Oct 10, 2007


Lisa Napoli: A little over an hour and the United Auto Workers still haven’t agreed to a new contract yet with Chrysler — 49,000 of them could walk off the job at 11 a.m. Eastern.

Meanwhile, Chrysler’s private management has quietly been making plans to cut non-union salaried and hourly jobs. Marketplace’s Alisa Roth reports.

Alisa Roth: Unlike its rivals GM and Ford, Chrysler is not a public company. It’s owned by the private-equity firm Cerberus, which is trying to negotiate a new union contract and trim costs.

Earlier this year, Chrysler announced plans to get rid of 13,000 jobs. That includes salaried positions. Now, its new owners are chopping even more. The non-union salaried workforce will drop by 5 percent, and the contract work-force by nearly 40 percent.

Greg Gardner is analyst at Harbour Consulting. He says the announcement could be strategic.

Greg Gardner: You know it’s possible that it’s seen as part of a bargaining strategy to show the UAW that the salaried people are going to bear the pain. They’re paying a price even as the company and union try to reach agreement on their contract.

There are also reports that Chrysler’s in the process of selling off several less-profitable divisions.

In New York, I’m Alisa Roth for Marketplace.

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