Just when it seemed like things couldn’t possibly get any worse for Chrysler, they did. The Michigan-based automaker announced on Monday that it will be idling its St. Louis South minivan plant indefinitely and will also be eliminating one shift at its St. Louis North truck plant.
Beginning October 31st, Chrysler will idle its St. Louis South plant, which produces the Chrysler Town and Country, the Dodge Grand Caravan and the Euro-spec Chrysler Grand Voyager. The move will leave 1,500 workers jobless, with no timeframe – if any – to reopen the plant.
In addition to the shuttering the South plant, Chrysler will also eliminate one shift at its St. Louis North truck plant, effective September 2nd. The shift elimination at the North facility – which will soldier on with only one shift – will cost 900 workers their jobs.
Chrysler blames the production reductions on the weakening economy and record-high oil prices. “Obviously we’re at slow point,” Chrysler co-president Jim Press told Automotive News. “Consumer confidence has been hit by oil prices and the credit crunch. It has created a situation if we want to meet or exceed the targets we have to move responsibly.”
The idling of the St. Louis minivan plant makes fiscal sense for Chrysler – as it can produce the same minivans in Windsor, Ontario for $1,000 less per vehicle, thanks to Canada’s national health care system – but UAW officials are upset about the shift elimination at the truck plant. Chrysler has a similar plant in Warren, Michigan, but Glenn Kage Jr., a representative of UAW Local 136 which staffs the St. Louis truck plant, says the Missouri plant lost out because of the Warren plant’s proximity to Detroit. “Detroit’s a national industrial hub and we’re far away,” he said.
