Chrysler expected to idle key Canadian plant

DETROIT, Oct 3, 2003; Reuters reported that the Chrysler unit of DaimlerChrysler is expected to idle a key North American assembly plant later this month in a move highlighting its poor sales performance in recent months.

Ken Lewenza, head of the Canadian Auto Workers union at Windsor Assembly -- Canada's single largest manufacturing facility and a longtime profit engine for Chrysler -- said on Friday the automaker was planning to halt production at the plant during the last week of October and the first week of November.

The plant, which builds Chrysler's upscale Town and Country minivans and the Pacifica wagon, produces 1,370 vehicles a day and employs about 6,000 people, Lewenza told Reuters.

The 2004 Pacifica, which accounts for a quarter of the Windsor Assembly's output, was billed as a sleek new product vital to Chrysler's rebound when it was launched earlier this year.

But sales of the $38,000 vehicle, a broad-shouldered cross between a minivan and sport utility vehicle, have been disappointing, adding to investor concerns about Chrysler's profit outlook after a surprising $1.1 billion second-quarter loss.

Company spokesmen declined to comment on the plant shutdown, but Lewenza said it stemmed from declining sales at Chrysler, whose new U.S. car and truck sales plummeted 15 percent last month.

That was more than double the drop in August, when Toyota Motor Corp. outsold it for the first time.

"At the end of the day it's definitely inventory and it's definitely slow sales in the last couple of months," said Lewenza.

The plant, where Chrysler launched production of its minivans about 20 years ago, has run at full tilt with three production shifts for the last five years, he said.

"This (shutdown) is incredibly unusual because of the success of the minivan," Lewenza said. "This plant is the jewel of DaimlerChrysler Corporation," he added. "Shutting it down for whatever reason is not a signal that shouldn't scare the hell out of us."