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Chrysler is about to begin the third round of white-collar job cuts it has made in 18 months, announcing plans to eliminate about 1,000 salaried jobs worldwide.
As the maker is primarily based in North America, most of the cutting will come at its global headquarters and technical center in the Detroit suburbs.
The latest reduction follows a dismal 22 percent decline in the automaker’s sales during the first half of 2008. But it leaves observers wondering just how much further the company can continue to cut, especially as it struggles to develop the smaller cars and crossovers it desperately needs to replace the big pickups and SUVs American motorists have largely walked away from.
“The signs of economic challenge continue for the U.S. market and as a result, further actions must be taken to improve our business and return to profitability,” Chrysler’s director of human resources, told employees in an e-mail.
The cutbacks began even before the break-up of DaimlerChrysler AG, but have accelerated since the U.S. maker was sold off by its former German partner, Daimler AG. New parent Cerberus Capital Management does not release financial figures, but it is considered likely that Chrysler is rolling up serious losses.
Chrysler is by no means alone. General Motors announced last week plans to trim salaried job costs by 20 percent, while Ford has targeted a 15 percent reduction. It remains unclear how much of those cuts will be focused on U.S. operations and Detroit, in particular.