Sun, Dec 24, 2006 - Page 11 News List

Chrysler to unveil restructuring plan

TIME FOR ACTION Industry analysts have predicted job losses and the possible closures of two plants after the auto giant lost US$1.5 billion over the last quarter

AP , DETROIT

DaimlerChrysler AG's Chrysler Group will unveil a restructuring plan that includes job cuts and plant closures when it releases this year's earnings in February, a company official said on Friday.

The official, who did not want to be identified because he is not authorized to speak about the plan, said the restructuring will not be as drastic as in 2001, when Chrysler shed 40,000 employees with layoffs and the sale of component plants.

Company spokesman Jason Vines would not comment on the plan, details of which were reported by the Detroit News on Friday.

Industry analysts have predicted job cuts and up to two plant closures as Chrysler moves to stem losses. The company lost US$1.5 billion in the third quarter, and its sales were down 7.7 percent through last month compared to sales in the first 11 months of last year.

Chrysler chief executive officer Tom LaSorda has said he does not expect widespread buyout and early retirement offers to be included in the restructuring.

Domestic competitors Ford Motor Co and General Motors Corp (GM) both offered buyouts to all their hourly workers earlier this year.

About 38,000 Ford workers signed up for the offers, while 34,000 GM employees have decided to leave the company.

LaSorda has been giving the DaimlerChrysler governing board updates on the restructuring at its meetings, the official said. The board last met on Wednesday.

Analysts have speculated that a Chrysler plant in Newark, Delaware, that makes large sport utility vehicles and one in St. Louis that makes pickup trucks are likely to be closed when the restructuring is announced.

DaimlerChrysler AG plans to make its earnings announcement for this year at Chrysler Group's Auburn Hills headquarters on Feb. 14.

In July, the company began to look for cuts amounting to US$1,000 per car, but expanded its cost-cutting efforts in September after the dramatic third-quarter loss.

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