Chrysler’s bankruptcy crushes a city’s hope
When Chrysler announced it was filing for bankruptcy, the mayor here called for a new municipal requirement: All city workers who don’t drive an American car must buy one or find a new job.
In this blue-collar suburb north of Detroit -- where officials say unemployment hovers around 20% and at least one-third of the 138,000 residents rely on the automotive industry for their livelihood -- Mayor James Fouts’ wistful proviso is more than a plea for consumer patriotism.
Chrysler has two factories here, one of which opened as the Depression was winding down. The firm is the town’s second largest employer. General Motors Corp., which owns the city’s biggest parcel of commercial property, has until June 1 to present a long-term viability plan or it too could end up in bankruptcy court.
“We have to do everything we can to support the local industry,” Fouts said. “If Chrysler and GM fail, it will be disastrous.”
If there is a heart to the American automotive industry, and a place where people still pray that cars can save them, it is Warren.
Residents felt a resurgence of hope in 2003, when General Motors made a billion-dollar investment in its technical center, a square-mile research facility in the center of town. But the ensuing years brought deep salary cuts and diminished healthcare benefits to the industry.
When the United Auto Workers recently ratified an agreement that included restrictions on workers’ right to strike, in order to try to rescue Chrysler, folks here supported it. And when President Obama assured the public that Chrysler’s bankruptcy filing would not “disrupt the lives of the people who work at Chrysler or live in communities that depend on it,” they believed him.
Now that belief is crushed.
After filing for bankruptcy, Chrysler temporarily shuttered most of its factories. The company plans to sell eight of its plants, including three in the Detroit area.
Nationwide, more than 20,000 hourly workers will get 80% of their normal pay while the factories are being closed down. Last week, workers in Warren’s two plants were told that the factories would go dark for the next 30 to 60 days -- or longer.
And on Friday, an estimated 1,800 Chrysler retirees -- whose pensions were not insured -- learned that an expected payment had been voided by the troubled automaker.
Lynn Feldhouse, who spent the last 20 years managing the company’s philanthropic foundation, was paying her bills online Friday when she saw the deposit vanish from her account.
The company later assured her the money would be returned in a few weeks.
“Who knows if the check will really get here?” said Feldhouse, 58, whose nephew works at Chrysler’s truck assembly plant here. “We’d been holding our breath and hoping for the best. . . . Now, we’re assuming the worst.”
Warren has become a grim, quiet place. “For Sale” signs and boarded-up brick garages dot the west side of Mound Road, where the sounds of machine shops once filled the air.
Across the street, stretching more than a mile, are Chrysler’s stamping and truck assembly plants. Security guards cruise up and down parking lots full of new, dust-covered Chrysler trucks waiting to be shipped to dealerships.
Workers trickled in and out of the factories for the last couple of days, carrying boxes of personal items. Before they headed home, a few stopped by Nicky D’s Coney Island restaurant to say goodbye. Just in case.
Over coffee, they fretted about the future.
Darnell Pitcher, 38, an electrician at the truck plant, slipped waitress Bessie Karnaros an extra couple of dollars. “I don’t know when I’ll be here again,” Pitcher said. “If the plant doesn’t reopen soon or cuts back. . . .”
His voice trailed off. In his wallet was a to-do list. Pick up milk. Get an oil change. Find the unemployment office Monday morning.
Karnaros, 24, has been on the alert for hints that Chrysler will reopen the plants before summer. She’s also worried about workers from the nearby GM facilities, who also come here for coffee and sandwiches.
The restaurant’s owners are preparing for another auto bankruptcy: Schedules, they told the staff recently, are going to be cut back.
“Guess I won’t be spending any money on anything but rent and bills from now on,” Karnaros said.
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