Chrysler will “idle indefinitely” its St Louis South assembly plant in Missouri from 31 October, citing “volume declines in the total minivan vehicle segment”.
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The plant currently builds the Chrysler Town and Country and Dodge Grand Caravan for North America and the Chrysler Grand Voyager for Europe.
Chrysler will now consolidate minivan output at its Windsor, Ontario, plant in Canada where three shifts currently produce the Town and Country, Grand Caravan and the Routan derivative that Volkswagen sells in North America.
Sales of the Town & Country and Grand Caravan fell 13.4% and 34.6% respectively in the first five months of 2008, according to Automotive News.
Chrysler also said it would reduce operations at its St Louis North full size truck assembly plant from two shifts to one from 2 September.
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By GlobalDataThe closures will eliminate 2,400 hourly-paid jobs – 1,500 at St Louis South, 900 at St Louis North).
“The auto industry is going through a period of unprecedented change. A dramatic US economic slowdown and an auto industry contraction leaves Chrysler – like other automakers – to face difficult issues and decisions,” the automaker said in a statement.
But it added it remained committed to the truck and minivan markets.
“The Chrysler and Dodge minivans have held a leadership share in a shrinking market and we believe in the long-term viability of the pickup market,” said Chrysler president and vice chairman Jim Press.
“These actions will help us achieve this goal.”
A union official representing the Missouri truck plant workers told Automotive News that Chrysler can make minivans in Windsor for US$1,000 less per vehicle than St. Louis South because of the savings to the company of Canada’s national health care system.
St Louis North was disadvantaged because it is smaller than its counterpart pick-up assembly plant in Warren, Michigan. And it was less politically sensitive for Chrysler to axe a plant far from Detroit than a plant like Warren or Windsor “in its own backyard”, he told the paper.
