Chrysler Group will axe an assembly shift, starting in January, at a plant that produces large engines for pickup trucks and sport utility vehicles.
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Dow Jones Newswires noted that the move reflects the pressure on Detroit auto makers as consumers flock toward more fuel-efficient models in the face of rising gasoline prices. Chrysler has seen bulging inventories of some pickup truck and SUV models.
Chrysler is cutting production by about 10% in this quarter and by a smaller amount in the fourth quarter, the report added.
Chrysler spokeswoman Michele Tinson confirmed to Dow Jones that the Mack Avenue Engine 1 plant will eliminate an assembly shift but wouldn’t say how many jobs were being cut.
But the news agency noted that the Detroit Free Press, in its Friday edition, reported that more than 300 jobs will be affected. Tinson, while not confirming the number, reportedly said some employees would go into a “jobs bank,” while others “may be offered retirement packages if it’s appropriate.” While in the jobs bank, employees collect most of their salary and benefits while idled.
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By GlobalDataDow Jones noted that Chrysler Group chief executive Tom LaSorda last week said the company is planning its business around petrol at $3 to $4 a gallon and that could signal a sustained shift away from pickup trucks and SUVs, which have been the Big Three’s main profit centres.
