Chrysler takes hits at several levels

Chrysler says its dip is due mainly to lower production, model changeover costs associated with its new minivans, higher retail incentives, escalating material costs, a leaner sales mix and lower sales in Mexico. Chrysler also cites a one-time charge of $232 million ($143 million after taxes) related to plans to drop a shift at the Newark, DE, assembly plant on Aug. 14. Newark recently built the last LeBaron convertible and now produces only the Chrysler Concorde and Dodge Intrepid. "Obviously the second quarter was disappointing, but it was not a surprise to us," says Chrysler Chairman Robert J. Eaton. "The launch of our all-new 1996 minivans resulted in lower production and we took aggressive incentive actions to reduce our 1995 model inventories. The first six months of 1995 have reminded us just how competitive the auto industry can be and how quickly the market can change."