Chrysler's sales were 25% down in May
Chrysler has announced plans to cut its production of minivans in the US as rising fuel costs have pushed consumers to switch to smaller vehicles.
One plant in St Louis will close and another will go from two shifts to one, affecting 2,400 jobs.
Rivals Ford and General Motors have also announced plans to make fewer larger vehicles.
Higher running costs have caused sales of minivans, trucks and sports utility vehicles to fall significantly.
"The market is fairly slow and consumer confidence has been down," said Jim Press, Chrysler's president.
"If we want to meet our financial targets, it is important to match our production to demand," he said.
Sales of Chrysler vehicles in the US were down 25% in May.
Earlier this month, Ford said it expected to make a loss this year and revealed plans to cut the production of trucks and large sports utility vehicles (SUVs) in favour of more fuel efficient models.
General Motors (GM) also said it was closing four SUV and truck factories in the US, Canada and Mexico in response to falling demand.
GM's shares fell to their lowest level since 1954 on Monday after oil hit another record high price and investors feared this would further depress vehicle sales.
Its shares fell as low as $10.57 on Monday, before recovering to close at $11.50, down 4%.