In what’s getting to be the “Death of 1, 000 Cuts” in the auto industry, Chrysler was widely reported today to be cutting 1,000 white-collar jobs, on top of previously announced production cuts, layoffs and job cuts.
The way it often works in Detroit is that when blue-collar jobs are cut, white-collar job cuts aren’t far behind. The car companies are sensitive to any suggestion that salaried workers, who are not represented by the UAW, aren’t sharing the pain with the hourly workers, who are.
It also makes you wonder whether things continue to go “according to plan,” as Chrysler’s Jim Press said earlier this month.
According to Bloomberg, Chrysler since February 2007 has announced 28,500 job cuts, including today’s announcement. Last month, Chrysler said it will indefinitely idle one of two plants that make its redesigned 2008 minivans, starting Oct. 31; cut from two shifts to one, at one of three plants that build the Dodge Ram pickup; and cut 2,400 hourly jobs.
Most of the cuts will be reached through attrition and buy-outs, but if all else fails, involuntary terminations are an option.
To be fair, Chrysler’s rivals General Motors and Ford are taking similar actions, as $4 gas has torpedoed sales of the Detroit 3’s bread-and-butter pickups and SUVs this year. (Even Toyota, Honda and Nissan have cut back, some.)
Last week, at the same time GM announced measures to raise $15 billion, including possible asset sales, the company said it was eliminating health care benefits for white-collar retirees over 65, and eliminating annual executive cash bonuses.
“For the company’s top executive officers, (that) represents a reduction in their cash compensation opportunity of 75 to 84 percent,” the company said. That can’t be pleasant. And stock-based compensation for executives probably isn’t worth what it used to be, either. But you sort of assume the top executive officers are not hurting too badly financially.