Chrysler may fall short of 10,000 buyouts: UAW

By Kevin Krolicki

DETROIT (Reuters) - Chrysler LLC may fall short of its target of getting 10,000 U.S. factory workers to accept buyouts or early retirement, raising the prospect the automaker will have to increase its offers, a senior union official said on Wednesday.

"I don't think we will get quite 10,000," said General Holiefield, a United Auto Workers vice president. "With the economy the way it is, people are trying to hold on to what they have ... Jobs are not that easy to find."

The comments were the latest indication the Detroit-based automakers are finding fewer takers for their most recent round of buyouts and early retirement offers, even as pressure mounts on the companies to cut costs amid slumping U.S. sales.

Chrysler's larger rivals Ford Motor Co <F.N> and General Motors Corp <GM.N> are offering buyouts to all of their UAW-represented workers. Chrysler has made its offers on a plant-by-plant basis as it aims to cut 8,500 and 10,000 hourly jobs this year.

Holiefield said Chrysler, majority-owned by Cerberus Capital Management LP <CBS.UL>, might have to negotiate richer buyout offers if it falls short of its target.

"We may have to enhance the packages some or get more creative in that area, but so far I think they are doing pretty good," he said.

Holiefield declined to say if he thought Chrysler would achieve the bottom of its target range for job cuts -- 8,500. The struggling automaker is trying to cut costs and winnow slower-selling models from its lineup.

He said it would be several weeks before the union had a more complete view of the number of buyouts. "I would think that maybe in another couple of weeks or so we may have a better barometer," he said.

Holiefield, who negotiated a four-year labor contract with Chrysler last year, said the UAW was also talking to the automaker about reversing a decision to close its Newark, Delaware, assembly plant.

Chrysler, which lost $1.6 billion in 2007, said last year it planned to close the facility, which makes the Dodge Durango and Chrysler Aspen sport utility vehicles.

"As long as that plant's running, there is hope. We never say die," Holiefield said.

Ford's roughly 54,000 UAW workers have until next week to consider buyout and early retirement offers ranging up to one-time payouts of $140,000. An earlier round of buyouts cut almost 34,000 workers from Ford's payroll in 2006.

All of GM's roughly 74,000 U.S. factory workers are also eligible for early retirement packages.

UAW President Ron Gettelfinger said last month that he expected economic uncertainty and a weak housing market would limit the number of takers at GM to less than 20,000 workers.

U.S. auto sales are down by 7 percent for the first two months of this year compared with the same period last year. Analysts expect full-year sales to drop to the lowest level in a decade at 15.5 million vehicles, with some cautioning that the bottom could be lower if the economy slips into recession.

(Additional reporting by David Bailey and Soyoung Kim; editing by Jeffrey Benkoe and John Wallace)