CHRYSLER &lt;C> DEAL LEAVES UNCERTAINTY FOR AMC WORKERS

  Chrysler Corp's 1.5 billion dlr bid to
  takeover American Motors Corp &lt;AMO> should help bolster the
  small automaker's sales, but it leaves the future of its 19,000
  employees in doubt, industry analysts say.
      It was "business as usual" yesterday at the American Motors
  headquarters, one day after the proposed merger was unveiled by
  Chrysler and AMC's French parent Renault, according to company
  spokesman Edd Snyder.
      But AMC's future, to be discussed at a board meeting today,
  would be radically different as a Chrysler subsidiary than if
  it had continued with the state-run French car group as its
  controlling shareholder.
      Industry analysts said the future of AMC's car assembly
  plant in Kenosha, Wis., and its Toledo, Ohio, Jeep plant would
  be in doubt if the overcapacity predicted in the North American
  auto industry by the early 1990s comes to pass.
      Both plants are far from "state of the art" for car
  manufacturing sites, and AMC has a history of poor labor
  relations at each.
      "Chrysler doesn't need that many new plants," said Michael
  Luckey, automotive analyst for the Wall Street firm Shearson
  Lehman Brothers. "They probably will close the Toledo plant and
  move Jeep production to Canada."
      Ronald Glantz of Montgomery Securities said that at the
  very least, the new owner of the Toledo plant would be able to
  wring concessions from the United Automobile Workers union
  local representing Jeep workers.
      "The UAW won't be able to hold them up for ransom as they
  have AMC because during a down year, Chrysler will have
  underutilized facilities to transfer production," he said.
      Analysts said they foresaw no major complications that
  would abort a combination which historians said would be the
  auto industry's biggest merger since American Motors was formed
  in 1954.
      AMC was in need of a financial savior because of its losses
  of more than 800 mln dlrs since 1980 and pressures in France
  for Renault to cut its backing. The company had said it could
  not forecast consistent profitability until 1988 at the
  earliest.
      In announcing the takeover agreement, Chrysler chairman Lee
  Iacocca cited AMC's Jeep division as well as its new 675 mln
  dlr assembly plant at Bramalea, Ontario, and its network of
  1,200 dealers as the major attractions.
      Analysts reasoned that Chrysler might feel moved eventually
  to sell off or close some of the older plants to cut overhead
  costs in view of the new debts and liabilities it would incur
  in the AMC buyout.
  

