Chrysler to Freeze U.S. Salaried Pension Plan

Chrysler Group LLC says it will transfer all its longtime U.S. salaried employees to a 401(k)-type defined contribution pension plan on Jan. 1.

The roughly 8,000 workers will retain the benefits they have already accrued in Chrysler's existing defined benefit pension. The change does not affect retirees or workers hired after 2004. The latter have belonged to a defined contribution plans since they joined the company.

Chrysler also will lower the age at which salaried workers who are eligible to retire can begin collecting pension benefits to 58 years from 62. The change affects only those who retire on or after Jan. 1, 2014.

The pension changes won't have much impact on its finances, according to the company. It says the new plan will comply more fully with Internal Revenue Service regulations.

Chrysler's move echoes General Motors Co.'s shift of its salaried employees to a defined contribution pension plan last year. Ford Motor Co. stopped offering a defined benefit plan to new salaried hires in 2004 but hasn't changed plans for existing workers.

Last year, Ford and GM reduced their pension obligations by offering salaried retirees the option of taking a one-time lump-sum pension payment. Chrysler has refrained from that action.