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Once upon a time, the minivan saved Chrysler. In 1984, the company introduced this new type of vehicle which went on to sell by the millions, helping Chrysler emerge from near bankruptcy.

But now Chrysler finds itself with too much production capacity for all kinds of large vehicles, including minivans. Today, the automaker announced that it will close one of its two minivan plants. The St. Louis South plant in Fenton, Mo., will close within the next four months; approximately 2,400 workers will lose their jobs. Minivan production will continue in Windsor, Ontario. Chrysler also announced that it will also produce fewer units of its 2009 Dodge Ram pickup truck. Only one shift will run at the St. Louis North plant, instead of the previously planned two shifts.

This news comes as news reports indicate that June auto sales plunged in the U.S. Consumers has deserted trucks and SUVs as gas prices soar past $4 a gallon. Chrysler famously produces a higher percentage of trucks in its lineup, and is suffering accordingly. Edmunds.com is estimating that Chrysler's sales could be down 30% in June. Cerberus Capital Management, the private equity firm that owns Chrysler, continues to say that it is happy with its acquisition of the company. But with results like this, it's hard to see how that could possibly be true.

Chrysler to close plant, reduce truck output originally appeared on BloggingStocks on Tue, 01 Jul 2008 14:49:00 EST. Please see our terms for use of feeds.

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