Auto crisis

Chrysler to close five more plants

“While some facilities may close, substantially all Chrysler employees will be offered employment with the new company.”

Dianna Gutierrez

Chrysler spokeswoman

NEW YORK (AP) — Attorneys for Chrysler LLC said the company will file a motion by this morning to sell substantially all of its assets to Italian automaker Fiat Group SpA, but that won’t include eight plants, including five that the automaker revealed it will shutter by the end of next year.

Though Chrysler faced its first hearing Friday in Manhattan bankruptcy court, court documents showed the ailing automaker plans to close five more plants in Michigan, Missouri, Ohio and Wisconsin that employ about 4,800 people. Chrysler said they will be offered jobs at other plants.

Two of the other plants that won’t be part of the revamped company were already closed last year, and the other was already slated to be replaced by a new factory.

The eight plants would be left out of a deal for Italy’s Fiat to buy the U.S. carmaker’s most valuable assets in bankruptcy. Instead, the “new Chrysler” would lease the plants then shutter them by December 2010.

“While some facilities may close, substantially all Chrysler employees will be offered employment with the new company,” Chrysler spokeswoman Dianna Gutierrez said. “Employees currently located at a facility identified for disposition will be offered a position at one of the facilities sold to the new company.”

A series of motions approved at Friday’s swift and short hearing launched a chain of events designed to ensure that Chrysler’s bankruptcy process is the quick and “surgical” one the company and the U.S. government have promised.

Another hearing in Manhattan bankruptcy court was scheduled for Monday morning, where Chrysler attorneys will ask Judge Arthur Gonzalez to let the ailing automaker start using $4.5 billion in loans from the Treasury Department to keep operating under bankruptcy protection.

In court documents, Chrysler said it would close the Sterling Heights, Mich., plant that makes Chrysler Sebrings and Dodge Avengers, and the Conner Avenue plant that makes Dodge Vipers in Detroit. The St. Louis North plant that makes Dodge Ram pickups would also close.

Chrysler’s Twinsburg, Ohio, parts stamping plant and Kenosha, Wis., engine plant would also close.

Two other plants that will be left out of the Fiat sale are the St. Louis South plant and an assembly plant in Newark, Del., that were idled last year. Another plant, Chrysler’s Detroit Axle plant, is already scheduled to be replaced by a new factory near Port Huron, Mich.