Chrysler To Close Minivan Plant In St. Louis
One of the Detroit Big 3, Chrysler LLC plans to idle its St. Louis South assembly plant that makes minivans and cut the production at St. Louis North plant as the U.S. sales for larger vehicles continue to fall.
Both the plants are located in Flenton, Missouri in St. Louis County. The tough decisions have been taken due to the slow sales of the larger vehicles in the market. The moves will affect a total of 2,400 employees in both the plants.
Chrysler LLC will close its St. Louis South assembly plant indefinitely, effective October 31.
The automaker’s co-president Tom LaSorda said that the plant is not likely to reopen in future. He further added, "We see no intent to rerun this plant. We’re idling it and it will likely be fully closed."
The third largest U.S automaker, which relied on sales of trucks, minivans and SUVs for almost 70 percent of its sales, is expected to post a significant decline in sales in June.
The St. Louis South plant assembles the Chrysler Town and Country, the Dodge Grand Caravan and the Chrysler Grand Voyager. An another assembly plant at Windsor in Ontario also makes the same vehicles on three shifts. Two of those shifts make Chrysler Town and Country and Dodge Grand Caravan minivans and the third shift assembles the Volkswagen Routan.
According to LaSorda, Chrysler had a difficult choice to make between Windsor and St. Louis South plants. He said, “When you look at one plant on three shifts and another on one, we had no choice but to go with the volume plant. We have the capacity for three shifts of work. So that’s what we did. Those are the tough decisions we have to make.”
Reportedly, the sales for the Chrysler Town & Country and Dodge Grand Caravan have declined 13.4 percent and 34.6 percent respectively for the first five months of 2008.
According to Chrysler co-president, Jim Press, “ Obviously we’re at slow point. 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. We’re a market-driven company and it’s important to match production.”
Chrysler also plans to cut shifts at its St. Louis North plant that makes Dodge Ram truck. The plant now operates two eight-hour shifts a day and will cut to just one shift this fall, effective September 2.
The plant is at a disadvantage because it is smaller than its counterpart pick-up assembly plant in Warren, Michigan. The St. Louis North plant can build only 41 pickups per hour at full capacity whereas the plant in Warren has the capacity to make 65 pickups.
