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Chrysler ad agency cuts Detroit workers

November 6, 2008

Chrysler’s top advertising agency BBDO Detroit today announced it was cutting its Troy staff by 145 people or 22% in response to the automaker’s “reduced levels of activity.”

The move highlights the ripple effect Chrysler’s declining business is having throughout the community.

Chrysler’s ad spending has dropped 30% during the first nine months of the year as its U.S. sales have fallen more than 25% through October.

The automaker has indicated losses of more than $1 billion during the first half of the year and analysts caution the automaker could run into a cash crunch next year.

“In all, 145 positions have been eliminated, with reductions being made across all functions driven by the reduced level of activity and changes in the nature of planned activities,” the BBDO said in a statement.

The agency’s Detroit office works solely on the Chrysler account, BBDO spokesman Roy Elvove said.

The cuts are immediate and 511 people will remain with the Detroit office, which is located in Troy, the spokesman said.

“Chrysler is our business out of the Detroit office,” Elvove said. “This only involves BBDO Detroit, it doesn’t involve any of the other partner agencies that might do media or digital.”

He stressed that the agency had not lost Chrysler as a client and that it remains the agency for Dodge, Chrysler, parts, services, corporate, financial, dealers and Jeep — excluding national brand advertising that is handled by Cutwater in San Francisco.

“This is not a loss of business whatsoever. This is an announcement regarding staff cuts we’ve had to make in response to reduced activity,” Elvove said. “Their advertising spending is down at least 30% for the first nine months of the year, they’ve announced themselves cutting 5,000 people, so we’re simply feeling that ripple affect in our Detroit office, which services all of their major brands.”

BBDO’s relationship with Chrysler dates back to 1944 when the agency did work on the DeSoto.

The cut backs come as Chrysler is launching a new marketing campaign for the redesigned Dodge Ram pickup.

BBDO was behind Chrysler’s Ram Challenge campaign, which is a reality style competition playing out on the Internet using the new pickup at Dodge’s Ram Challenge - Featuring the 2009 Dodge Ram 1500.

LINK:Chrysler ad agency BBDO cuts Detroit workers | | Detroit Free Press
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