Less Cash from Chrysler for Dealers

The carmaker is set to announce $456 million worth of cuts in incentives and subsidies to its 4,400 dealers

Chrysler's suppliers and assembly workers have taken significant hits in the auto maker's turnaround plan. But on Jan. 29, it'll be its dealers' turn to feel the pain. Chrysler Senior Vice-President M. John MacDonald will inform his 4,400 dealers of a sweeping plan to cut $456 million in cash payments to dealers for advertising support and showroom subsidies, BusinessWeek Online has learned. The carmaker also plans to cut dealer margins by 3% on lucrative vehicle options such as CD players and security systems. Most of the changes will be effective immediately.

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