Chrysler Shutting Down for One Month

While the U.S. automakers have drawn most scrutiny because of their request for government aid, the downturn has battered Detroit's foreign competitors as well.

Honda has cut its annual forecast and said it will trim global production by more than 300,000 vehicles. Toyota said earlier this week that it will halt construction of a plant to build the Prius in Mississippi as sales of the fuel-efficient gas-electric hybrids have sagged along with gas prices and the economy.

"This is not just the Big Three who are in trouble," Virag said. "This is the entire U.S. auto industry, including domestic and transplants."

The overall downturn has made consumers skittish about big purchases, and the global credit crisis has made it harder for consumers to get loans to buy cars. Chrysler said yesterday that its dealers have lost as much as 25 percent of potential sales in recent months because buyers have been unable to line up financing.

For the first 11 months of this year, Chrysler sales were down nearly 28 percent from the same period last year.

Now, Chrysler says, it is approaching the minimum level of cash it needs and will have trouble paying its bills after Jan. 1. Chrysler is owned by private-equity firm Cerberus Capital Management, which bought the automaker for $7.4 billion in 2007.

Chrysler and GM warned last month that they could run out of cash by the end of the year without aid from the federal government. Chrysler expects to have only about $2.5 billion on hand by Dec. 31, the minimum needed to pay employees and suppliers and keep the company running.

The furloughs are "a grim reminder of a grim situation," Johnson said.

Staff writer William Branigin contributed to this report.