Chrysler Makes Even Deeper Cuts, in "Unimaginable" Times

(MoneyWatch)  Chrysler Chairman and CEO Bob Nardelli cited "unimaginable times" for the auto industry, in announcing additional cuts that reportedly amount to an additional 5,000 white-collar jobs, on top of 29,000 blue- and white-collar jobs Chrysler has already cut in the last two years.

Employees will be briefed on their options from Oct. 24 to Nov. 5. Often when "voluntary" buy-out programs are announced, it's with the idea that if enough people accept a severance package, there will be no need for involuntary pink slips. However, this time around, Chrysler warned there will be involuntary cuts regardless, by the end of December.

Besides "voluntary" retirements and salaried-worker buyouts, Chrysler will offer "enhanced benefits," to include both cash vouchers and vouchers for new vehicles. By "enhanced" benefits, that probably means "enhanced" in terms of being more valuable than the involuntary cuts to come.

Chrysler also said it will "more diligently control spending," and cut back on "all discretionary and overhead expenses and reduce capital expenditures not connected to major product programs."

Amid widely reported rumors that Chrysler and Chrysler's parent company, Cerberus, are negotiating with General Motors for some sort of takeover or merger, Nardelli told employees that Chrysler would, "make additional organizational and restructuring announcements in the near future as the Company works to find new ways to operate."

That was in an Oct. 24 Nardelli letter to employees that was excerpted on a Chrysler blog for journalists.

"These are truly unimaginable times for our industry. We continue to be in the most difficult economic period most of us can remember. The combination of troubled financial markets, difficult credit, volatile commodity prices, the housing crisis and declining consumer confidence continues to weigh on the economy. Never before have auto industry sales contracted at such a fast rate," Nardelli said.