More gloom in the auto industry. Chrysler plans to slash its workforce by 25% as part of a series of cost-cutting measures. This from Reuters:

Chrysler LLC is targeting about 5,000 white-collar job cuts, reducing capital spending and planning additional restructuring steps due to the deepening slump in the U.S. auto industry and weak economic conditions.

The continuing decline in business conditions prompted the move to cut 25 percent of its salaried and contract workforce, Chrysler Chief Executive Bob Nardelli said in a letter to employees on Friday.

“The combination of troubled financial markets, difficult credit, volatile commodity prices, the housing crisis and declining consumer confidence continues to weigh on the economy,” he said in the letter.

“Never before have auto industry sales contracted at such a fast rate,” he added.

U.S. auto sales decline to near 15-year lows in September amid the financial markets turmoil and declining consumer confidence.