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Chrysler set for more red?
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November 22, 2000: 4:39 a.m. ET
Report: Deficit at DaimlerChrysler's U.S. arm will rise further in 2001
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LONDON (CNNfn) - The situation at DaimlerChrysler's loss making U.S. unit may be even worse than expected, a German newspaper reported Wednesday, citing sources within the company as saying the it could fall further into the red in 2001.
People at Daimler's Chrysler arm indicated the subsidiary could lose as much as $2 billion next year, said financial daily Handelsblatt. A DaimlerChrysler spokesman refused to comment Wednesday, telling CNNfn.com that such figures were "mere speculation". 
In the third quarter Chrysler posted a deficit of  579 million ($492 million), and it's expected to report another loss for the current quarter.
The firm's woes of the firm have prompted parent DaimlerChrysler to take a firmer grip on its stalling subsidiary. Last week the German company removed Chrysler boss Jim Holden, replacing him with executives sent from Stuttgart.
This week several other top-ranking Chrysler execs were also ousted, and German bosses held a meeting with 400 senior Chrysler managers in Michigan Monday, which Handelsblatt described as "tense" and "somber".
According to the newspaper, DaimlerChrysler chief executive Juergen Schrempp indicated at the meeting that 38,000 of Chrysler's 128,000 workforce could have to go.
A sluggish U.S. auto market has forced dealers to increase the discounts on offer to shift inventory, eating into profits. DaimlerChrysler announced Wednesday that it would halt production temporarily at three North American plants to slim down its backlog of inventory. Plants in Ontario, Detroit and Ohio will shut down from Nov. 27 for one week. The plants manufacture models including Jeep Grand Cherokees and Dodge Intrepids.
The gloom afflicting the unit has caused concern among DaimlerChrysler investors, dragging the parent's shares lower. On Wednesday DaimlerChrysler (FDCX) stock tumbled 1.4 percent to 46.00, having earlier reached a year's low of 45.34. 
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