Chrysler Group's turnaround plan, which likely won't be final until January, is expected to include job cuts and the closing of at least one or two of its 13 North American assembly plants.þþThe carmaker's Newark, Del., plant, where the Dodge Durango sport-utility vehicle is made, is believed most likely to be shuttered, analysts say.þþJob cuts, however, won't be on the scale of those at American rivals General Motors Corp. and Ford Motor Co. because Chrysler isn't in such dire shape and already has slimmed down.þþWhen Chrysler restructured in 2001, it eliminated 26,000 jobs, mostly union workers who were eligible for early retirement.þþGM is trimming 35,000 factory jobs, and Ford about 30,000, and both are cutting thousands of white-collar workers. GM plans to close 12 North American plants by 2008, and Ford 16 by 2012.þþÿI think Chrysler will be close to break-even in the fourth quarter, and you can make a good case that Chrysler will do better in 2007,ÿ Burnham Securities analyst David Healy said.þþChrysler Chief Executive Tom LaSorda, who is to present a turnaround plan to DaimlerChrysler's board next month, was not available for interviews on the plan.þþJason Vines, Chrysler's vice president of communications, said only, ÿWe are looking seriously at everything.ÿþþThat could include offering buyouts and early retirement to its 45,000 factory workers in the United Auto Workers union, the tactic GM and Ford used.þþChrysler is certain to push the UAW for health-care concessions similar to what the union gave GM and Ford. The agreement makes workers pay more out of pocket and forgo a $1-an-hour wage increase. The UAW rejected Chrysler's bid for similar concessions before reporting its third-quarter loss.þþThat's an upside to being in the red, Healy said.þþÿIt was hard to make a case for concessions when Chrysler was making money, and a lot easier when it isn't,ÿ he said.þþHealy doubts the Chrysler Group will be put up for sale, which became fodder for speculation Oct. 25 when DaimlerChrysler released the third-quarter results. At that time, Chief Financial Officer Bodo Uebber would not rule out a sale or aligning with a partner.þþThe company later said Chrysler is not for sale, but speculation has continued, helping drive DaimlerChrysler's stock last week to $62.24, its highest price since February 2000. It closed Friday at $59.40.þþThe fact that Chrysler and Mercedes-Benz share platforms and components suggests that the U.S. brand is an integral part of the company. Healy doubts that Dieter Zetsche, formerly Chrysler's CEO and now head of parent DaimlerChrysler AG, would sell Chrysler.þþÿThat's his baby. He made it healthy once and wants to show it can be done again,ÿ Healy said.þþUnlike Ford or GM, Chrysler doesn't have a lot of unused manufacturing capacity in North America.þþThe Harbour Report, an annual efficiency study, said Chrysler used 94 percent of its plant capacity in 2005, ranking third behind Toyota and Nissan and ahead of Honda, GM and Ford, the worst, at 79 percent.þþHarbour Consulting President Ron Harbour expects Chrysler's ranking will deteriorate this year, partly due to reduced Durango production at the Newark plant, which used only 57 percent of its capacity in 2005.þþÿThey got hit as hard as anyone because they were so heavy on the truck side,ÿ he said. ÿNewark is certainly going to be in their sightsÿ for closing.þ
Source: Chicago Tribune
