Updated from Wednesday, Dec. 17Chrysler says it will halt production for a month starting Friday. The automaker says it plans to shut down all manufacturing operations until Jan. 19 "due to the continued lack of consumer credit for the American car buyer and the resulting dramatic impact it has had on overall sales in the United States." The shutdown "will keep production and dealer inventory aligned with U.S. market demand, the company said in a prepared statement. Meanwhile, attempting to cut costs, General Motors ( GM - Get Report) was halting construction of a plant tied to one of its most important projects, the Volt. Ford ( F - Get Report) also said it will shut down 10 plants for an extra week in January because of sluggish sales. At a recent meeting, Chrysler dealers told company officials that "they have many willing buyers " but are unable to close the deals, due to lack of financing," Chrysler says. "The dealers have stated that they have lost an estimated 20 to 25 percent of their volume because of this credit situation." GM and Chrysler are awaiting word from the White House on a $14 billion emergency aid request. GM and Chrysler have said they will run out of money within weeks. Ford, which supports an industry bailout, has said it has access to enough cash to survive. On Friday, GM said it will temporarily close 20 factories across North America and make production cuts. Additionally, General Motors of Mexico said it will shut down three factories from Dec. 22 until early January. Options under consideration by the Bush administration include using part of the $700 billion TARP fund to provide loans to the carmakers or using money from the fund as collateral for emergency loans to the automakers by the Federal Reserve. At Ford, a company spokeswoman said Wednesday it will shut down 10 of its North American assembly plants for an extra week in January. Spokeswoman Angie Kozleski says the normal two-week holiday shutdown will be extended to Jan. 12 at all operating assembly plants except those in Claycomo, Mo., near Kansas City, and the Dearborn, Mich., truck plant. Ford will also extend the shutdown at some engine, transmission and parts stamping plants, or temporarily shut portions of them to match cuts at the assembly plants, she said. GM said Wednesday it was delaying construction of a new engine factory in Flint, Mich., in an effort to conserve cash. The plant is to make 1.4-liter engines for the Chevrolet Cruze and the Chevy Volt plug-in electric car, two key products in the century-old automaker's plan to turn itself around after relying on highly profitable truck and SUV sales.
More from Stocks
SEC Official Criticizes Money Managers for Not Supporting Political Disclosures
An SEC official says Fidelity, BackRock and Vanguard should use their influence to force companies they invest in to disclose what they spend on political campaigns.