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Several hundred information technology workers to be let go in shakeup
By Tim Higgins
Detroit Free Press
Published on Friday, Apr 04, 2008
DETROIT: Several hundred computer workers at Chrysler LLC will lose their jobs in a move to outsource computer system support and maintenance.
It is yet another change by Chrysler in its efforts to fix the first privately held major U.S. automaker in more than 50 years.
Information technology workers were told Wednesday that the company signed agreements with Tata Consultancy Services and Computer Sciences Corp. for the firms to maintain and support mainframe, servers and corporate computer applications, said Jan Bertsch, Chrysler vice president and chief information officer.
Chrysler lost $2.9 billion on operations and restructuring costs last year, internal numbers seem to indicate.
Since Cerberus Capital Management took control in August, thousands of jobs have been cut, four products eliminated with promises of more to come, new executives have been appointed and others departed.
Although Chrysler IT workers have been anxious for weeks about the possibility of a big change, the news still struck a nerve. Workers questioned how outside firms could be as efficient as people who had been working on the system for years.
But Bertsch said the change will improve the IT operation.
''What we determined was that we were spending too much of our base budget on core maintenance of our systems and not enough in reinvesting in our business,'' Bertsch said.
Bertsch declined to say how much money the outsourcing will save Chrysler.
Chrysler is beginning the project immediately and hopes to have it done by the end of the third quarter, she said. Some workers were told the job changes would begin in late May and end by June 30.
The automaker has about 2,100 people now handling the IT work. Of those, about 1,000 are full-time Chrysler employees and the rest are supplemental workers on contract.
About 20 percent of the 1,000 full-time employees — or approximately 200 — will lose their jobs because of the change, Bertsch said.
DETROIT: Several hundred computer workers at Chrysler LLC will lose their jobs in a move to outsource computer system support and maintenance.
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