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The Detroit News

Friday will be the final day at work for hundreds of Chrysler LLC employees, as the first group of white-collar workers taking buyouts under the automaker's latest downsizing plan exits the company.

Their departures are part of a plan Chrysler announced on Nov. 1 that will cut about 1,000 salaried jobs by year's end. Chrysler also announced it will eliminate shifts at five assembly plants, cutting up to 10,000 hourly jobs.

A second wave of white-collar workers will start receiving buyout offers this week, and will depart by the end of the year.

The number of employees who will leave in this first round on Friday is unknown, in part because some have yet to make their decision, Chrysler spokesman Mike Aberlich said.

"It's a very fluid situation," he said, but added, "We are confident that we will get very close to our goal."

The retirement packages offered to salaried workers this month mirror those offered in February, Aberlich said. The two packages offer full pensions and retiree health care benefits.

One package is available to workers 62 or older with at least 10 years of service. That "special incentive program" provides three months' salary and either a vehicle voucher worth $20,000 after taxes or a $20,000 tax-free contribution to a retirement health care account, in addition to full pension and retiree health benefits.

Most of the workers leaving Friday are taking the special incentive program.

The second package is open to workers ages 53 to 61 with at least 10 years of service who make less than $100,000 annually, as well as select workers ages 55 to 61 with 10 years of service who make $100,000 or more in salary. Called "the special early retirement program," it provides full pension and retiree health care benefits.

With some exceptions, the workers getting offers this week and departing next month likely qualified for this second package.

Typically, a worker must be 60 years old with 30 years of service to qualify for full retiree benefits.

"Our goal is to take a socially responsible approach for these programs," Aberlich said. "We know it's not an easy thing for our employees or their families."

These buyouts are unlikely to be the last among Detroit's Big Three automakers, said Fred Hubacker, executive director at Conway MacKenzie & Dunleavy, a Birmingham turnaround firm.

Auto sales are expected to shrink more in 2008, which means buyouts could continue next year.

"They are all going back to drawing board to get their cost structure in line with demand." said Hubacker, a former Chrysler executive. "I don't see a near-term end in sight."
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