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Chrysler has slashed workforce

July 18, 2009

Chrysler Group LLC, the U.S. automaker run by Fiat SpA, reduced employment 8.7 per cent this year as it slid toward bankruptcy and then reorganized with federal aid.

The workforce was 49,667 as of July 1, Chrysler said Friday in an e-mail. Personnel reductions at the Auburn Hills, Mich.-based automaker slowed from last year, when the company slashed jobs by 29 per cent as U.S. sales plunged 30 per cent.

The disclosure is the first look at employment at the new Chrysler, which was formed on June 10 as Italy's Fiat bought most of the assets of bankrupt Chrysler LLC and brought in all of the workers. A $4-billion injection of U.S. loans in January to avert a collapse slowed Chrysler's job cuts.

"I can't see them getting any bigger," said Sean McAlinden, labour economist at the Center for Automotive Research in Ann Arbor, Mich. "They could drop a little bit lower."

Chrysler released the labour-force figures at the request of Bloomberg News, and declined to comment further.

The company's U.S.-backed bankruptcy was designed to ensure a return to profit even with the domestic auto market at its lowest levels since the early 1980s. Chrysler LLC chopped labour costs, cut debt and ditched contracts after filing for Chapter 11 on April 30.

Much of the job cutting occurred before the bankruptcy as the third-largest U.S. automaker trimmed costs to match its dwindling share of the domestic market. Chrysler had 9.8 per cent of first-half U.S. sales, down from 11.7 per cent a year earlier.

LINK:Chrysler slashes workforce
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