David Shepardson / The Detroit News Washington Bureau

Washington — Chrysler LLC is planning to send its millions of existing vehicle owners vouchers worth $1,000 that will be good through the end of June toward the purchase of a new car or truck, a person familiar with the matter said late Thursday.

Chrysler needs to clear out 44,000 vehicles held by 789 dealers that the automaker on Thursday said it wants to close as part of its restructuring. The targeted dealers represent 25 percent of Chrysler’s national dealer network. The automaker filed a motion in bankruptcy court seeking to terminate the dealer agreements. A hearing is scheduled for June 3.  

Chrysler’s sales have declined dramatically, falling 48 percent in April. The $1,000 voucher program is the latest incentive the Auburn Hills automaker has embraced to boost demand.

Chrysler spokeswoman Lori McTavish declined to confirm the new incentive plan, but said, “recognizing the value of our customers has never been more important. Chrysler is open for business and welcomes the opportunity to remind its customers just how valuable they are.”

Chrysler’s sales fell 30 percent to 1.5 million in 2008 — with 500,000 of those vehicles sold to fleet customers. Chrysler has sought to counter the wave of negative publicity over its April 30 bankruptcy filing by running a series of ads touting its pending alliance with Italy’s Fiat SpA with the message: “We’re building a new car company.”

Chrysler, which has received $4 billion in government loans, hopes to emerge from bankruptcy court protection by late June or early July. It doesn’t plan to restart production of its North American factories until it emerges from bankruptcy, allowing it to clear out unsold inventories.

Automakers have also complained that attention over a proposal in Congress to offer vouchers for older cars — dubbed “Cash for Clunkers” — has had a negative impact on sales. “We know that some people who want to buy cars are holding back,” said Sen. Debbie Stabenow, D-Lansing. “That’s why it’s critical we act.”

Dealers who met with the Obama administration’s auto task force Thursday said it appears that Chrysler’s sales in the early part of May are ahead of the company’s pace in April, suggesting the automaker’s decline may have bottomed out last month.

via Chrysler plans to offer $1K vouchers to existing customers | detnews.com | The Detroit News.

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