The cuts, which amount to up to 15 percent of the company's workforce, will see the elimination of 8,500 to 10,000 hourly jobs and 2,100 salaried jobs through 2008. The company had already begun cutting 1,100 temporary workers Wednesday.
Chrysler also will cut shifts at five North American assembly plants and end production of four vehicle models with lagging sales, including the Dodge Magnum wagon, the convertible version of the Chrysler PT Cruiser, the Chrysler Pacifica crossover and the Chrysler Crossfire sports car.
Chrysler, the fourth-ranking automaker in the U.S. market, saw its sales drop 3 percent in the first nine months of 2007.
The move shows Chrysler's new private equity owner, Cerberus Capital Management, is ushering in a more wide-ranging restructuring plan than it endorsed when it acquired the automaker in August.
The new cuts come in addition to the 13,000 layoffs Chrysler announced in February as part of a massive restructuring plan. Those cuts included 11,000 production jobs and 2,000 salaried jobs.
The announcement also comes four days after workers at the automaker narrowly approved a new contract that had faced intense opposition from union rank and file.
Canadian Auto Workers union president Basil Hargrove called the job cuts an "absolute disaster," according to the New York Times.
"This is a huge hit to us," he told reporters in Toronto.
Within the same restructuring period, Chrysler plans to add the Dodge Journey crossover and Dodge Challenger sports car, along with two new hybrid models, the Chrysler Aspen and Dodge Durango.
"These actions reflect our new customer-driven philosophy and allow us to focus our resources on new, more profitable and appealing products," Jim Press, Chrysler's new vice chairman and president, said in a statement. "These product actions are all in response to dealer requests."
