The production cuts come as Chrysler and General Motors Corp. seek up to $15 billion in emergency aid from the government to help them fund their operations for the rest of this year and into early 2009. Chrysler has asked for $7 billion in emergency loans and has warned that without the money, it could be forced to file for bankruptcy protection.

Chrysler's U.S. sales have slumped 27.7 percent this year and fell 47.1 percent in November, according to Autodata Corp.

'It's clear that the automakers are in a very fragile financial condition and they're taking steps to deal with it,' White House spokeswoman Dana Perino said Wednesday. 'We're aware of their financial situation and are considering possible policy options to provide assistance in an appropriate way. As we've said, a disorderly collapse of the auto industry should be avoided.'

Chrysler spokeswoman Shawn Morgan said the issues aren't unique to Chrysler, which continues to restructure and invest in future products.

GM and Ford Motor Co. also have slowed or stopped production, as has Nissan Motor Co. and most other automakers in response to the downturn in the U.S. market. But there remains a growing sense that the financial crisis is cutting more deeply into Chrysler. Stopping production provides a solution on many levels, said Joe Phillippi of AutoTrends Consulting Inc. in New Jersey.

'If you're not building cars for a month, you don't have new bills to pay,' Phillippi said. Some suppliers have sought cash on demand amid mounting concern they will not be paid if conditions worsen and Chrysler ends up in bankruptcy.

Chrysler met last week with hundreds of anxious suppliers who were asked not to seek changes to their regular payment schedules. A run on accounts payable could be enough to put the automaker into Chapter 11 bankruptcy.

Phillippi said shutting all the plants down on such short notice is an advantage because the parts in the pipeline have likely already been delivered. If suppliers say they won't continue to ship until they are paid, 'Chrysler can say OK because we're not building cars for a month. It's a way to stem the outflow of cash Chrysler doesn't have.'

Idling factories could help dealers. Once a new car leaves the factory and is shipped, Chrysler bills the dealer. If there's no production, there is no need for the dealer to finance receipt of further inventory.

Chrysler Financial CEO Thomas Gilman warned that loans to dealers may have to be temporarily suspended because dealers have been withdrawing heavily from an account they pay into that is used to fund the loans, according to a Dec. 12 letter to dealers.

The letter said daily requests from dealers were near $60 million, 'well above our historical daily advances.' The figure since July is more than $1.5 billion.

But dealers also face new fees next year, according to the Wall Street Journal. Beginning in January, Chrysler Financial will charge fees for unsold vehicles that sit on dealer lots too long, which could cost dealers tens of thousands of dollars in 2009 when many are already losing money.

Chrysler vehicles, on average, are taking 125 days to sell, according to Edmunds.com. Shutting down plants will thin inventory.

It is not unusual for a plant to go down this time of year as a product nears the end of its lifecycle, Phillippi said. Added Jim Hall of 2953 Analytics LLP, 'It's capital conservation, and it all comes down to how desperately you need capital.'

Even when production resumes and the credit crunch eases so money is flowing to consumers, dealers, suppliers and automakers, there is concern in automotive circles that Chrysler's financial distress has forced a moratorium on longer-term product development.

Some vehicles are too far along to stop, and the 2009 auto show circuit is expected to see the promised new Jeep Grand Cherokee and the heavy-duty version of the new Dodge Ram pickup, projects that have been in the works for some time.

But further out, there is uncertainty about programs such as the next generation of cars in the high-volume midsize car segment.

A decision on whether the replacement for the Chrysler Sebring and Dodge Avenger will be engineered and manufactured internally or by a partner will be made in the first half of next year, Frank Klegon, senior executive vice president of product planning, told The News on Wednesday.

Chrysler is now 'in the process of making various decisions for execution,' he said. 'We haven't done that yet.'

The decisions still to be made are fundamental and include whether its D-segment cars will be from a new or modified Chrysler platform or developed by a partner as well as what vehicles would come off that platform and where they would be assembled.

It has long been thought that Chrysler would tap Nissan Motor Co. to build sedans from the Nissan Altima platform given that the companies already partner on trucks and small cars. Klegon said while Nissan is a potential partner, 'There are others.'

Aaron Bragman, research analyst with IHS Global Insight, said if Chrysler proceeds in-house with replacement of the slow-selling Sebring and Avenger, it could take up to three years before it has a vehicle to show.

That is in stark contrast with the urgency Chrysler officials expressed a year ago when they said fixing the D-segment cars was a top priority, and 'Project D' was created with a mandate to do so.

But the original project leader Mike Donoughe left the company and his replacement, Mark Chernoby, was recently reassigned to oversee alliance partnerships from both the product and business side, sparking renewed speculation that the future midsize cars would be contracted out.

Bragman said he also has heard there is no product development going on at Chrysler, but that it is because of the uncertainty about the company's future and the lack of money to invest in product.