New Chrysler Cuts Expected To Impact Canada

Canadian Auto Workers President Buzz Hargrove is calling on the federal government to take steps to revitalize the “horrible situation” faced by the Canadian auto industry after a second round of job cuts at a major automaker in two days.

Chrysler LLC said Wednesday it will cut 1,000 salaried jobs worldwide by Sept. 30, and it’s expected that those cuts will affect the company’s Canadian operations.

The announcement came a day after Ford Motor Co. announced it would delay the startup of a third shift at its Oakville, Ont., plant, leaving 350 people who were expecting to start work next week without a job.

“Every day now is more bad news in our industry,” said Hargrove.

“It’s a very stressful time for our union and especially our members and their families at GM, Ford, Chrysler and independent auto parts supplies now. It’s just a horrible situation.”

But the government “doesn’t even recognize” the problem, said Hargrove.

“We really need the feds to join with us in partnership to deal with the challenges that we face and try to bring in some programs that will help restore the strength of the industry,” he said.

It’s not certain at this point how many Canadian employees might lose their jobs, said Chrysler spokesman Dave Elshoff.

“It would be expected that (Canadian employees) would be affected, but to what degree I can’t say today,” he said.

There are about 1,000 salaried Chrysler employees in Canada.

Elshoff said the company hopes most of the cuts will be accomplished through early retirements, attrition and voluntary separation programs.

But he said involuntary layoffs will be considered if the company fails to meet its targets.

Chrysler’s U.S. sales fell 22 per cent in the first six months of this year as customers shunned its trucks and sport utility vehicles in favour of smaller, more fuel-efficient cars. Industry-wide U.S. sales were down 10 per cent, but the decline hit Chrysler harder because trucks and SUVs make up 72 per cent of the company’s U.S. sales.

The cuts come on top of 3,000 white-collar cuts made in 2007. Chrysler also plans to cut some of its 2,700 temporary workers in the new round of layoffs, on top of the 1,100 temporary workers it cut in November.

It didn’t say how many temporary jobs will be cut.

Chrysler is the latest U.S. automaker to cut its work force as high gas prices and the  weak U.S. economy continue to eat into sales. Ford Motor Co. has set a goal of cutting salaried costs by 15 per cent by Aug. 1, while General Motors Corp. said last week it plans to cut salaried costs in the U.S. and Canada by 20 per cent.

Ford and GM haven’t said how many jobs will be affected, but it’s expected to be several thousand at each company.

Chrysler’s finances have been under wraps since it was bought last year by the private-equity company Cerberus Capital Management LP.

But analysts consider the company the weakest of the Detroit Three in the current sales slump because of its dependence on the North American market and its heavy reliance on trucks and SUVs.

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