Chrysler Draws First Blood: Axes Thousands of Jobs

Robert Farago
by Robert Farago
chrysler draws first blood axes thousands of jobs

You know, we're beginning to buy into this idea that the new Chrysler is faster than a speeding bullet– to the back of the head (of course). Five days after the United Auto Workers (UAW) ratified their new contract with the struggling domestic– a contract whose job guarantees were conspicuous by their absence– Chrysler is axing the third shift at its Jeep factory in Toledo. The Toledo Blade reports that the move will take effect in the first quarter of '08, trimming 1,000 salaried workers and 1,100 temporary workers in engineering, finance, procurement and "other areas." Although anyone who's driven the plant's products (Dodge Nitro/JeepCompass) could have seen this coming, the UAW says it was taken completely by surprise. "Local UAW officials said neither they nor local company officials were aware of the planned announcement. UAW Local 12 President Bruce Baumhower said, 'That is news to me.'" The Wall Street Journal says the cuts are actually deeper. Chrysler will also terminate shifts at three Michigan plant: Jefferson North (Jeep Commander and Jeep Grand Cherokee), Sterling Heights (Chrysler Sebring and Dodge Avenger) and their Mack Avenue engine plant. Chrysler CEO Boot 'em Bob Nardelli was taciturn on the bloodletting business. "Mr. Nardelli said the final decision on the cuts came Tuesday during Chrysler’s first board meeting as a private company. 'Those are within the confines of the board and the board’s decisions,' he said of the layoffs. Here we go…

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  • Landcrusher Landcrusher on Nov 01, 2007

    jthorner, There are a bunch of reasons that lead to bloated structures full of people with little value. I saw one first hand. We had a parallel group to our sales force that managed the distributor relationships. When I came into the sales force, the partner group was already too large, but they were always signing up more distributors and partners so they justified growing headcount. I pointed out that we were signing up too many worthless distributors and was bashed by the local manager of this group who went to my boss about my bad attitude. Fast forward four years and the two groups had practically merged. The parallel group had lost eighty percent of it's headcount to either lay off's or reassignments because the company realized they were signing up too many sub standard partners while our group was carrying most of the weight. Meanwhile, that manager who was all about spreading the business and his favorite employee had moved over to my group. Their strategy? Direct ALL the business to one partner so as to "streamline" the process and get more done. This time, I told them they were headed down the wrong path and we would lose customers because they needed competition among at least a few partners to keep growing the client base. In four years that partner group had gone from four people up to seven people and back to one. Many of them were laid off, but many were reassigned which only meant more lay offs for more groups later because those people were not the right folks for the job and they actually were often counterproductive. I was one of the last to be laid off. The manager that bashed me is now a VP. They have lost a lot of market share and their partners are no longer helping them get new business, just milking the existing accounts. I had brought in the vast majority of the new accounts in our area while I was there and had continued to grow the business while the company tanked (the large accounts were buying less overall product while simultaneously giving more of the business to our competitors). Fast forward another three years. They are exactly where they were three years ago. Finally, they have stopped the bleeding.

  • Starlightmica Starlightmica on Nov 01, 2007

    Up to 10K more job cuts? Bet the UAW didn't expect that!

  • Landcrusher Landcrusher on Nov 01, 2007

    I bet the UAW heads knew it was coming. What was their choice? Lose all the business of representing Chrysler employees, or lose some of the employees? So they took the choice that kept more money coming into their coffers. So what. They will of course deny this, and have all sorts of excuses. Still, they had to know.

  • Stuki Stuki on Nov 01, 2007

    Totally agree with Landcrusher. Nardelli might have a reputation for being a bit lacking in compassion, but the top guys on the other side of the table are no different. You simply won’t get to the top of any large social hierarchy by being the kind that pays attention to anything but the climb itself. And you won’t stay there unless all your effort is focused on just that. All you get for being a nice guy is a sharp, looking out for number 1, elbow in the face and a knife in the back. Unions are no different than management in that respect. And hence, neither are their leaders. Hopefully workers at the foreign transplants pay attention to how much job security the UAW helps provide in exchange for their dues.