Chrysler cutting production, to shut minivan plant


Posted at Jul 01 2008 07:43 AM | Updated as of Jul 01 2008 03:43 PM


DETROIT - Chrysler LLC plans to cut production by closing a US minivan plant and extending summer shutdowns at some of its other factories as the automaker battles slow vehicle sales amid record high gas prices.

Chrysler will "indefinitely idle" the St. Louis South minivan assembly plant, effective October 31, due to volume declines in the total minivan vehicle segment, Tom LaSorda, Chrysler's senior executive in charge of manufacturing said on Monday.

Under Chrysler's contract with the United Auto Workers, it cannot unilaterally close plants, but lists them as idled indefinitely. Chrysler expects to fully close the minivan plant.

"We see no intent to re-run this plant," Lasorda said of the minivan plant referred to as St. Louis South by Chrysler.

Chrysler also plans to cut one of the two shifts at the nearby St. Louis North Assembly Plant where it builds pickup trucks. That plant will be on an extended shutdown over the summer. The shift cut is effective September 2.

Chrysler, acquired by private equity group Cerberus Capital Management last year, has seen its US sales drop 19 percent so far in 2008 -- the largest drop for any major automaker.

Executives from the No. 3 US-based automaker said Chrysler continues to meet or exceed financial targets, the company remains well-capitalized and that Cerberus is "absolutely not" considering a breakup of the company.