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Chrysler LLC Adjusts Production as a Result of the Deteriorating U.S. Credit Crunch

December 17, 2008

AUBURN HILLS, Mich. — Due to the continued lack of consumer credit for the American car buyer and the resulting impact on new-vehicle sales, Chrysler LLC has announced that it will make significant adjustments to the production schedules of its manufacturing operations.

The automaker hopes the move will keep production and dealer inventory aligned with U.S. market demand. All manufacturing operations will be idled at the end of the shift Friday, Dec. 19, and impacted employees will not return to work any sooner than Monday, Jan. 19, 2009. A combination of unemployment insurance and contributions from the OEM will pay workers for the two weeks' worth of missed days, albeit at a reduced rate.

Chrysler dealers confirmed to the company at a recent meeting at its headquarters that they have many willing buyers for Chrysler, Jeep and Dodge vehicles but are unable to close deals due to lack of financing. The dealers have stated that they have lost an estimated 20 to 25 percent of their volume because of the ongoing credit crunch.

Chrysler will continue to monitor the production schedules of its manufacturing operations moving forward.

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