Chrysler Seeks $9B of Gov't Aid in Viability Plan

In this Sept. 12, 2008 file photo, assembly line workers join the cab to the chassis of a Chrysler's...

In this Sept. 12, 2008 file photo, assembly line workers join the cab to the chassis of a Chrysler's 2009 Dodge Ram pickup being assembled at the Warren Truck Plant in Warren, Mich. General Motors Corp. and Chrysler LLC, racing to finish restructuring plans to present to the federal government, are unlikely to complete deals with debt holders and union workers by the government-imposed deadline Tuesday, Feb. 17, 2009. (AP Photo/Carlos Osorio, file)

(AP)

Chrysler LLC said it needs $9 billion of total government financing and it plans to cut 3,000 jobs and eliminate three vehicle models as part of its restructuring plan submitted to the Treasury Department on Tuesday.

Chrysler, which has been kept alive by the $4 billion in government loans it already has received, said it has implemented or reached fundamental agreements on concessions with unions, dealers, suppliers and lenders to comply with the requirements of its government loans and make its labor costs competitive with those at foreign automakers' U.S. plants.

The privately held automaker also revealed that it lost $8 billion in 2008.

"The focus of this company for the last two years and going forward is going to be to right-size for the marketplace and the realities of the economy," Chrysler Chief Executive Bob Nardelli said in a conference call with reporters.

When Chrysler originally asked for government aid in December it said it would need a total of $7 billion. But the Auburn Hills, Mich., company said Tuesday that the economy and the market for new cars has deteriorated significantly since its initial request.

"We have continued to see an unprecedented decline in the automotive sector," Nardelli said.

Chrysler said it now projects that automakers will sell 10.1 million vehicles in the U.S. this year, the lowest level in four decades. Previously, the company had predicted yearly sales of 11.1 million.

Chrysler Vice Chairman and President Jim Press said in the conference call that the company will eliminate the Chrysler Aspen, Dodge Durango and Chrysler PT Cruiser models.

The Aspen and Durango, both large sport utility vehicles, recently have been among the worst-selling vehicles in the company's lineup. The PT Cruiser, which was released to much fanfare in 2000 due to its funky styling, has also seen its sales slump.

Nardelli said Chrysler management will comply with restrictions on executive compensation. He also said the company has eliminated company matching to employee 401(k) plans, has ended merit pay increases and has made other white-collar cost cuts.