All three major U.S. automakers announced plans Wednesday to shut down manufacturing plants due to the slumping domestic auto market, including a month-long closure of 30 Chrysler plants starting Friday.
Operations at Chrysler's 30 plants will be halted at the end of business on Dec. 19 and are not scheduled to return back online until Jan. 19, 2009, or later.
Chrysler has said tighter credit markets are keeping would-be customers from their showrooms, costing the company an estimated 20 to 25 percent drop in volume. Chrysler, which is seeking $7 million in government loans, has claimed the company is nearing the minimum level of cash needed to operate the company.
Ford also announced it plans to shut down 10 of its North American assembly plants for an additional week in January instead of its normal two-week holiday stoppage. Only plants in Claycomo, Mo., near Kansas City, and in Dearborn, Mich., will be unaffected.
General Motors Corp., meanwhile, said it will halt construction of a factory in Flint, Mich., designed to make engines for the Chevrolet Cruze and the electric plug-in Chevy Volt, which is expected to travel up to 40 miles on electricity alone.
GM, which is seeking up to $18 billion in government loans, has said it needs $4 billion to continue operating through the end of 2008. The company also announced last week that it will cut 250,000 vehicles from its first-quarter production schedule by temporarily shuttering 20 North American factories.
President Bush has said he intends to save the domestic auto industry after a bill authorizing $14 billion in loans for GM and Chrysler was rejected in Congress. Ford has said it has enough capital to survive 2009.
"It's clear that the automakers are in a very fragile financial condition and they're taking steps to deal with it," White House spokeswoman Dana Perino said yesterday following Chrysler's announcement. "We're aware of their financial situation and are considering possible policy options to provide assistance in an appropriate way. As we've said, a disorderly collapse of the auto industry should be avoided."
The Associated Press contributed to this report.