Holiday shutdowns worry autoworkers
By DINESH RAMDE - Associated Press - 12/19/08
Chrysler LLC said Wednesday it will close all 30 of its North American manufacturing plants for at least a month, starting Friday. The automaker blamed a lack of consumer credit that it said prevents willing car buyers from being able to close the deal.
The shutdown includes the Kenosha Engine Plant, which makes V-6 engines for a number of Chrysler and Dodge vehicles and has 850 workers.
Plant worker Anthony Davis, 54, said the news left the community “devastated,” and it is tough to remain optimistic with the plant’s future still uncertain.
“I’m concerned. We’re all concerned right now,” said Davis, whose tasks during his 36 years at the plant have included assembling connecting rods. “Times are tough for everyone, and no one can give us any answers.”
Chrysler spokeswoman Mary Beth Halprin said its plants typically shut down from Dec. 24 through Jan. 2, but this shutdown will start Friday and extend at least through Jan. 20. She acknowledged that the reopening date could be pushed back if sales continue to stagnate. “The real issue is customer orders,” she said. “It’s going to depend on the demand in the marketplace.”
The idled workers will received reduced wages plus unemployment benefits during the shutdown, Halprin said. She declined to reveal financial details, but Davis said his compensation amounted to about 85 percent of his full salary.
Chrysler’s financial situation has grown dire. Sales in November slid 47.1 percent, and the automaker has said its cash will drop to $2.5 billion by Dec. 31. That would be enough to meet payroll, pay suppliers and run the company, but it would have trouble paying bills after the first of the year.
Other production workers at the Kenosha plant were idled earlier this month as their production lines were temporarily closed. That includes Dave Smith, 48, of Kenosha, who has been off since Dec. 8 and is scheduled to return next month. He said he can’t be confident his job will exist much longer.
“It’s nerve-racking. It’s on your mind all day and all night,” said Smith, in his 30th year at the plant. “You try not to think about it but it’s all you think about.”
Chrysler is seeking $7 billion in government loans as it tries to survive the recession and the worst U.S. auto sales slump in 26 years. For the first 11 months of this year, Chrysler sales are down 27.7 percent to 1.4 million vehicles from 1.9 million for the same period last year.
Smith blames Chrysler’s slump in part on the Wall Street companies that received government bailouts earlier this year. The banks were given the money with the expectation they’d turn around and lend it to consumers, he said, but instead they’re keeping the funds from people who want to buy American vehicles.
“People want to get vehicles but they can’t get financing,” he said, his voice tinged with anger. “All the money that went to the banks, where’d that go? And now what are we supposed to do?”
Chrysler estimates that 20 to 25 percent of its potential sales have been lost due to the credit situation.
Its announcement about plant shutdowns came a week before fellow automaker General Motors Corp. was scheduled to end SUV production at a plant in Janesville. GM said the move will leave 1,200 employees out of work, and the plant is set to close completely by spring.
Kenosha City Administrator Frank Pacetti said Chrysler’s 30-day shutdown is a serious concern to the community, but he’s more worried about the long-term picture.
“We didn’t have any indication this was coming. We just hope we don’t see more of these down the line,” he said. “The focus needs to be on how we fix this situatin. What we need is a solution that doesn’t involve shuttering the plant.”
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