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CNN LIVE AT DAYBREAK

Auto Industry Layoffs

Aired October 1, 2003 - 06:16   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

CAROL COSTELLO, CNN ANCHOR: Time for a little business buzz right now, though. Thousands of workers in the automobile industry could soon be out of work.
Carrie Lee has the details from the Nasdaq market site in New York.

Tell us about it -- Carrie.

CARRIE LEE, CNN FINANCIAL NEWS CORRESPONDENT: Well a lot of pink slips looking like they are on the way, Carol. According to "The Wall Street Journal," a lot of workers will be out of work at Ford, as well as Chrysler. The news from both companies comes just after ratification of new labor agreements with the United Auto Workers.

Now these agreements give the big three automakers out of Detroit the ability to eliminate 50,000 jobs through buyouts and attrition over the next four years. And that -- it looks like it's starting to happen. Ford is going to soon announce plans to scale back its total global work force of 350,000 employees by 3 percent. Now this includes 3,000 jobs in the United States, as well as up to 12,000 cuts worldwide. The labor agreement is also allowing Ford to close four plants employing 4,600 people over the next four years. Furthermore, Reuters is now quoting a report out of the "Detroit News" saying that Chrysler is going to layoff 5,000 workers using early retirement packages.

The bottom line here is the bottom line, profits. Of course the automakers have been struggling trying to sustain some profitability. And when you cut workers, you are also cutting costs. So that is the latest story out of Detroit.

Looking at the futures, things are looking pretty bright. We could see a higher open on this first trading day of the fourth quarter of the year. Yesterday, of course, we saw a big sell off. The Dow Jones industrials ending down by over 100 points. The Nasdaq down 37 points. For the month of September, the Dow, the S&P, as well as the Nasdaq, all ended in negative territory, although for the third quarter we did see some gains.

We have a big manufacturing report coming out today. That's going to influence the session. Also one stock to watch, Levi Strauss. The company says that its fiscal third quarter profit doubled, lifting the launch of a new -- lifted by the launch of new lower priced jeans, among other things -- Carol.

COSTELLO: Yes. LEE: So stock to watch, Levi Strauss.

COSTELLO: Levis are very hip now. They've done a good job.

LEE: (UNINTELLIGIBLE).

COSTELLO: Yes.

LEE: Yes, they really had to revitalize the brand. They were kind of a lagger for a while and now getting back in the saddle, as it were.

COSTELLO: They made the ultra low rise and their stock just went way up.

Thank you.

LEE: That's what everyone likes these days, yes.

COSTELLO: Yes, at least if you are 16.

Thank you. Carrie Lee live from the Nasdaq market site this morning.

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