Chrysler's ‘Valentine Bomb' Explodes At Auburn Hills
February 16, 2007
Valentine’s Day is supposed to be lovely. But at Auburn Hills the sentiment is on the exact opposite. Chrysler’s workers know that a vicious “Valentine bomb” is about to blast. It will not only harm them; it could shatter their future.
Early Wednesday, Chrysler’s workers received emails from the automaker’s CEO Tom LaSorda and the other from DaimlerChrysler CEO Dieter Zetsche. LaSorda and Zetsche allowed the bomb to explode not just in Auburn Hills but all over the world.
The emails said that Chrysler's plan for survival calls for 11,000 blue-collar and 2,000 salaried job cuts by 2009. The explosion hurt them but the gravest injury is to be suffered by Michigan: about 1,000 salaried jobs will be cut this year and another 1,000 next year. DaimlerChrysler AG’s announcement includes the slashing of jobs from 2007 to 2009 as part of the three-year plan to return to profitability by next year.
Onkar Nakade, worker at Chrysler’s Auburn Hills plant, said while employees seemed to understand the need for the cuts, they were still taken aback by the number and speed at which the jobs will go. "Everybody does understand that these are essential steps," added Nakade, who works in information technology. "But it's not good news. It's harsher than what I think a lot of people were expecting."
"It's pretty solemn in there right now," said Joe Kubina, an engineer who has spent 24 years in Chrysler. He survived the automaker's restructuring in 2001 and was there when Daimler-Benz AG bought Chrysler Corp. in 1998. "I don't know what to think. I'm still confused by it all."
Workers who received the e-mails said they contained no details about which jobs would be cut and when. They added the messages were to the point and meetings will take place to help inform employees. The automaker said it will announce details of special retirement and attrition programs at a later time.
Chrysler's Valentine bomb was the talk throughout Auburn Hills on Wednesday. "Business will be tougher around here," said Evaristo Garcia, president of JATO Dynamics Inc. of Auburn Hills. "It's happening to everyone. It's just happening to Chrysler later.”
But the blast is not only suffered at Chrysler’s plant alone; it gradually wrecks other industries as well. Spargo’s restaurant and other business establishments can now feel the big difference. Spargo’s, usually packed during lunch hour, was slow throughout Wednesday afternoon.
"Everybody's nervous," said Spargo's owner Nick Lulgjuraj. "There's a lot of families that are going to be affected." Lulgjuraj said his restaurant is normally overflowing by noon. On Wednesday, at least a few tables remained empty throughout lunch. Still, few were occupied by Chrysler employees. Lulgjuraj added, “They don't want to come out. You feel bad for them."
In addition to job and shift cuts, and plant closures, DaimlerChrysler intends to concentrate on producing fuel-efficient products. It is planning to invest $3 billion in powertrain technology to be blended with EBC rotors and other auto parts accessories. Said $3-billion powertrain investment includes a common axle program for all products. DaimlerChrysler earlier signed a non-binding memorandum of understanding with Getrag, a German-based supplier, to develop a more fuel-efficient transmission technology.
“The Chrysler Team worked out a comprehensive recovery and transformation plan using all resources within DaimlerChrysler,” said Zetsche. “In addition to that and in order to optimize and accelerate the presented plan, we are looking into further strategic options with partners beyond the business cooperation partners mentioned. In this regard, we do not exclude any option in order to find the best solution for both the Chrysler Group and DaimlerChrysler.”
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