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Chrysler is to cut its US capacity by 400,000 vehicles a year and shed 13,000 North American jobs in the next two years, under drastic reorganisation plans announced by its parent DaimlerChrysler.

But while the North American operation was announcing its cutbacks, the parent group was briefing journalists and analysts in Germany that "all options are open" for the future ownership and involvement of other "partners" with its troubled US arm. As recently as last October DC had ruled out finding a buyer for Chrysler, but that possibility now seems to have returned.

The North American plans are intended to return the US vehicle maker to profitability by 2009 and will mean the closure of the Newark assembly plant in Delaware. The truck plant in Warren, Michigan will lose a shift, as will the minivan assembly plant at St Louis South in Missouri.

Reduced capacity will also mean job losses in powertrain, stamping and component operations, the group said.

In all, 13,000 jobs will go, with 11,000 of them among hourly paid staff in the US and Canada and 2,000 amiong salaried staff. Around 3,000 of the job cuts are put down to productivity and efficiency improvements.

Chrysler said it was investing $3 billion in new engines, transmissions and axles that would "set the table for a product offensive of more than 20 all-new and 13 refreshed vehicles from 2007 to 2009".

Chrysler Group president and CEO Tom LaSorda said: "The key to our long-term success will be our ability to transform the organisation into a different company to achieve and sustain long-term profitability."

Chrysler said the restructuring would cost $1.3 billion in its financial results, with $1 billion of that in 2007.

Among technology changes, Chrysler has signed a deal with German transmissions group Getrag to develop dual clutch technology and has also announced a V6 engine platform called Phoenix that will reduce the number of six-cylinder engines from four to just one.

In addition, Chrysler's 2008 Dodge Durango will be the group's first two-mode full hybrid and Chrysler says it is evaluating a mild hybrid for future applications.

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