Chrysler town and country

Chrysler to Cut 25% of White-Collar Jobs DETROIT (Dow Jones) — Chrysler LLC told employees Friday that it will cut 25% of white-collar jobs next month. In a letter to employees, Chief Executive Robert Nardelli said the cuts are necessary because of the deep downturn in the economy and the tightening credit situation, which is choking off auto sales.

(This story and related background material will be available on The Wall Street Journal Web site, WSJ.com.) Nardelli said the company is facing the “most difficult economic period any of us can remember.” The job reduction is expected to affect about 5,000 of Chrysler’s employees and comes on top of previous job cuts. At the end of September, Chrysler eliminated the jobs of 1,000 people. About 300 of those were fired on a single Friday morning.

Several hundred contractors also were put out of work. The employees whose jobs are being eliminated will leave the company payroll Dec. 31, Nardelli said in the letter. An unspecified number of the 5,000 employees will be offered early retirement or buyout packages. Others will be terminated involuntarily. Affected employees will be notified between Oct. 24 and Nov. 5. “These are truly extraordinary times for our industry,” Nardelli said.

“Never before have auto industry sales contracted at such a fast rate. Throughout this challenging time for our industry and our company, we have continued to face the realities of our business environment, and working as a team, we have been right-sizing our organization to become as competitive as possible.” The job cuts come as Chrysler’s majority owner, Cerberus Capital Management LP, is negotiating a deal that would merge the auto maker with General Motors Corp. (GM).