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Chrysler likely to announce more production cuts

Kenneth Hall

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1,078 views Jun 5, 2008

Chrysler likely to announce more production cuts

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Declining sales of pickups and SUVs has forced both GM and Ford to announce drastic production and job cuts and has even forced industry leader Toyota to readjust its outlook and sales projections for the rest of the year. Chrysler may be next to announce a round of cuts as its profits are heavily dependent on SUV and pickup sales, perhaps more so than any other major carmaker.

While workers are anxious and industry analysts say additional measures are inevitable, Chrysler says that its moves announced late last year are sufficient for the current climate and that it has no plans for further job or production cuts. In November, Chrysler announced it would cut 8,500 to 10,000 hourly jobs and 2,100 salaried jobs through the end of 2008.

With sales dropping 25% last month from figures just one year ago, Chrysler employees are predicting further cuts are just around the corner.

For instance, the sales of the Dodge Durango SUV (pictured) are down 44% through May when compared with the same period last year. Dodge Ram sales are down 27%, while sales of Chrysler 300 large sedans are off nearly 31%.

“All of this means further cuts are inevitable,” automotive analyst David Cole explained to the Associated Press.

GM announced Tuesday that it would close four pickup truck and SUV factories and shift more of its efforts to smaller, more fuel-efficient cars, while Ford is expected to announce up to 2,000 salary job cuts this week.