Chrysler LLC urged its U.S. dealers on Sunday to cut costs and order more of its vehicles as the automaker moves to secure additional government aid.
Chrysler, whose U.S. sales are down 30 percent, told dealers it will take actions such as freezing an annual increase in payments to reimburse dealers for work they do for customers under warranty, said Steve Landry, head of North American sales, according to Bloomberg.
The company which is widely considered as the weakest of Detroit's three automakers took $4 billion in loans from the U.S. government in December and is asking for another $3 billion in loans. Chrysler faces a deadline of Feb. 17 to prove to U.S. lawmakers it can be viable.
Chrysler will also ask dealers to buy about the same amount of vehicles in coming months as it did at the end of last year.
The big ask for us today is for the dealers to order their wholesale requirement for February and March,'' Landry told reporters at the National Automobile Dealers Association convention in New Orleans.
Chrysler Vice Chairman Jim Press said the automaker will start negotiations with dealers on Monday to discuss details of the cost cuts.
They also realize they can help us save some money that will help preserve the future of the company and make us more successful, he added.