Thursday, November 6, 2008

Detroit News-Chrysler ad agency cuts staff by 22 percent

Alisa Priddle / The Detroit News

Advertising agency BBDO North America announced today it is laying off, immediately, the equivalent of 145 full- and part-time positions from the BBDO Detroit office in Troy.

That leaves 509 positions, after a 22 percent reduction in the work force, at the agency that does creative ad development and other marketing services for Chrysler LLC.

Chrysler's move to eliminate 5,000 salaried jobs, or 29 percent of its 17,300 white-collar workers by Jan. 1, and a reduction in spending by the automaker, forced the downsizing at BBDO, said Roy Elvove, director of corporate communications at BBDO North America in New York.

"It is a direct function of what is going on in the auto industry," Elvove said.

For the first nine months of this year, Chrysler has cut its ad spending by about 30 percent compared with a year ago, and spending this year reportedly might be less than $1 billion. In the first half of the year, Chrysler spent $406 million in U.S. measured media, down from $584 million in the same period in 2007, according to Advertising Age, citing figures from TNS Media Intelligence.

The most important campaign is for the all-new 2009 Dodge Ram pickup. Sources said the plan was to spend $90 million to $100 million to promote the Ram and it does not appear that has changed.

BBDO Detroit serves as the Motor City outpost of agency network BBDO Worldwide, and primarily promotes the Chrysler, Dodge, and Jeep brands. The BBDO network of more than 16,000 employees worldwide is part of global advertising services conglomerate Omnicom Group. About 2,000 employees are based in the U.S. and Canada.

In January, BBDO cut a smaller, undisclosed number of employees, Elvove said, part of a course correction as the agency set its goals for the new year. Media reports have put the figure at about 75.

The current layoffs affect every department to varying degrees, including accounts service, planning, administration, information technology and retail, Elvove said. He would not outline details of severance packages for the employees.

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