Chrysler

on Friday said it would cut a quarter of its white-collar workforce by next month, according to a published report.

About 5,000 jobs in all are expected to be shed,

The Wall Street Journal

reported. Chrysler CEO Robert Nardelli said in a memo to employees "the company is facing the "most difficult economic period any of us can remember," according to the

Journal

.

Reports have circulated that Chrysler's owners, including

Cerberus Capital

, are talking to

General Motors

, a combined

Nissan

(NSANY)

and

Renault

alliance, and others about a possible sale or merger.

Meanwhile, Nissan reportedly isn't willing to put up cash for an alliance with Chrysler. Nissan won't consider a tie-up that weakens its financial position,

Bloomberg

reports, citing people with knowledge of the matter.

Chrysler, meanwhile, said Thursday it plans to eliminate one shift at an assembly plant in Toledo, Ohio, and will speed ahead the closure of its Newark, Del, assembly plant.

The shift reduction at the Toledo plant will affect about 825 jobs. The closure of the Newark plant will affect about 1,000 jobs, Chrysler said.

This article was written by a staff member of TheStreet.com.