Chrysler LLC has sought a $1.5 billion loan from the US government's Troubled Asset Relief Programme (TARP) funds and announced an extension of a month-long shutdown of manufacturing operations at its three plants.
Chrysler has sought loans from the US government's bail-out fund through the automaker's credit arm, Chrysler Financial, following a $6 billion Treasury loan to GMAC LLC, the lender affiliated to General Motors Corp.
GMAC became eligible for treasury funds after it became a bank holding company.
The government loan would give Chrysler enough funds to make more loans to its customers and boost sales. Chrysler's US sales plunged 30 per cent last year against the industry average of 27 per cent. Chrysler's sales were down 53 per cent in December.
''We are the only company that really doesn't have an active captive finance company able to finance wholesale and retail. Our dealers in the months of November and December were really not doing much business with Chrysler Financial at all,'' said Steve Landry, Chrysler LLC's executive vice president of North American sales.
Chrysler LLC and Chrysler Financial are controlled by Cerberus Capital Management LP.
Chrysler LLC is keeping three of its assembly plants, including one in northern Illinois, and two engine plants idle for longer than planned.
Chrysler says assembly plants in Sterling Heights, Belvidere, Ill., and Toluca, Mexico, will resume production on 26 January instead of 19/20 January. Engine plants in Dundee and Trenton, slated to reopen 20 January, also will continue to remain closed.
Auburn Hills-based Chrysler says Thursday that its other plants will open on schedule.
The automaker closed all 30 of its manufacturing plants for a month on 19 December, extending the traditional two-week holiday shutdown period by two weeks in a bid to save cash and adjust production.
Chrysler, meanwhile, said it wold focus more on delivering clean, environment-friendly electric vehicles. It has added Chrysler 200C EV concept and Jeep Patriot EV to its potential electric-drive vehicle offerings.
Five distinct vehicle platforms now extent of electric-drive offerings from Chrysler LLC
Chrysler's ENVI-powered electric vehicles utilise just three primary components. These include an electric motor to drive the wheels, an advanced lithium-ion battery system to power the electric-drive motor, and a controller that manages energy flow.