DaimlerChrysler to idle some plants in next 3 weeks


Associated Press

DETROIT — The troubled Chrysler arm of DaimlerChrysler AG says it will idle a number of plants in the next three weeks to cut inventories of unsold vehicles.

The company said Friday it would idle two plants next week, one plant the week of Dec. 11 and five plants the week of Dec. 18. The first week shutdowns will affect 5,500 workers, while the second will affect 2,000 and the third will affect 19,200.

Chrysler also said its sales for November were down 5 percent, with sales of its key minivans down 16 percent.

"The industry is dealing with a highly competitive, saturated marketplace today," Chrysler President Dieter Zetsche said. "The combination of a softening market and an excess of inventory requires immediate action."

The moves comes as the company struggles to handle a slowdown in the U.S. auto market. This week Chrysler idled three plants and 13,600 workers in Detroit, Toledo, Ohio, and Ontario, Canada to cut inventories. In November, it closed seven plants for a week — a move that surprised DaimlerChrysler Chairman Juergen Schrempp and eventually led to the ouster of Chrysler President James Holden.

Next week, the Newark, Del., plant and the St. Louis North truck plant in Fenton, Mo., will be idled. The following week, the Pillette Road plant in Windsor, Ontario plant will be shut down; the week of Dec. 18, plants in Belvidere, Ill.; Detroit; Fenton, Mo.; Toledo, Ohio; and Brampton, Ontario, will not operate.

Chrysler did not say how the shutdown would affect its other parts-making plants, such as metal stamping and engine assembly, in the United States and Canada.

Workers will get 95 percent of their regular pay under contracts with the United Auto Workers.

Jamie Jameson, Chrysler’s vice president for sales and marketing operations, said the shutdowns will cut about 50,000 vehicles from Chrysler’s inventories. He said the company was aiming to have a 70 to 75 days’ supply of vehicles — 470,000 to 480,000 — by the end of December, down from about 80 days’ supply at the end of October.

The industry standard for inventory is usually 60 days’ supply, but General Motors Corp. and Ford Motor Co. also have been holding more than that in recent months. GM also has idled plants to reduce inventories, while Ford’s inventories have been affected by parts shortages.

Jameson said the 16 percent drop in minivan sales appeared to be fallout from the company’s struggles with its such sales earlier this year. The company’s minivans account for about 40 percent of the vehicles it sells each year, and make a significant share of its profits as well.

Chrysler has admitted it overestimated demand for older 2000 model year minivans, which forced it to use incentives of up to $4,000 to clear out the old models to make room for the new 2001 versions.

Copyright ©2000 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

Talk to us

More in Local News

Mel Jennings sits in his structure during a point-in-time count of people facing homelessness in Everett, Washington on Tuesday, Jan. 24, 2023. Mel has had a brain and spinal surgery, and currently has been homeless for a year. (Annie Barker / The Herald)
Annual homeless count aims to give snapshot of housing crisis

Volunteers set out into the rain Tuesday to count all the people facing homelessness in central Everett.

Catherine Berwicks loads ballots into a tray after scanning them at the Snohomish County Elections Ballot Processing Center on Tuesday, Aug. 4, 2020 in Everett, Wa.  (Andy Bronson / The Herald)
Lawmakers push to boost voting in county jails across the state

A House bill envisions an approach similar to what’s been happening in the Snohomish County Jail for several years.

Vandalism at Seaview Park on Jan. 21, 2023 in Edmonds, Washington. (Edmonds Police Department)
Police seek suspects in repeated vandalism at Edmonds parks

Vandals have done over $10,000 of damage to parks across the city, including suspected arson and graffiti with hate speech.

One worker looks up from the cargo area as another works in what will be the passenger compartment on one of the first Boeing 787 jets as it stands near completion at the front of the assembly line, Monday, May 19, 2008, in Everett, Wash. The plane, the first new Boeing jet in 14 years, is targeted for power on in June followed by an anticipated first flight sometime late in 2008.  (AP Photo/Elaine Thompson)
Boeing workers long-exposed to carcinogen far above legal limits

The company confirmed in depositions that parts of its Everett plant still don’t meet 2010 standards.

CarlaRae Arneson, of Lynnwood, grabs a tea press full of fresh tea from Peanut the server robot while dining with her 12-year-old son Levi at Sushi Hana on Thursday, Jan. 5, 2023, in Lynnwood, Washington. CarlaRae said she and her son used to visit the previous restaurant at Sushi Hana’s location and were excited to try the new business’s food. (Ryan Berry / The Herald)
Peanut the robot waitress is on a roll at Lynnwood’s Sushi Hana

She’s less RoboCop and more Rosey as she patrols the restaurant, making sure everyone has a drink and good time.

Traffic moves along Highway 526 in front of Boeing’s Everett Production Facility on Nov. 28, 2022, in Everett, Washington. (Olivia Vanni / Sound Publishing)
Boeing settles with Everett security guard claiming chemical exposure

Holly Hawthorne was assigned to Building 45-335 at the south end of Paine Field, while employees used aerosolized chemical sprays nearby.

A section of contaminated Wicks tidelands on Thursday, Jan. 19, 2023 in Everett, Washington. (Olivia Vanni / The Herald)
Port acquisition marks next step in toxic cleanup on Everett waterfront

Private owners donated land near the contaminated Wicks Tide Flats to the Port of Everett. Cleanup work could begin within the year.

FILE - In this photo taken Oct. 2, 2018, semi-automatic rifles fill a wall at a gun shop in Lynnwood, Wash. Gov. Jay Inslee is joining state Attorney General Bob Ferguson to propose limits to magazine capacity and a ban on the sale of assault weapons. (AP Photo/Elaine Thompson, File)
Democrats advance assault weapons ban, new rules for gun buyers

The measures passed a House committee without Republican support. They are part of a broader agenda to curb gun violence.

U.S. Attorney Nick Brown and the victim of a brutal attack in 2018 answer questions from reporters on Jan. 27, 2023 in Seattle, Washington. (Jake Goldstein-Street / The Herald)
White supremacists sentenced for racist beating at Lynnwood bar

A federal judge handed out stiffer sentences than prosecutors had asked for in a series of sentencing hearings Friday.

Most Read