MARYSVILLE -- Chrysler LLC and ZF Friedrichschafen AG of Germany have formed a partnership to run a new axle plant about 60 miles north of Detroit, with production slated to begin in early 2010.

The announcement by Chrysler Vice Chairman and President Tom LaSorda suggested business continues as usual for the automaker even as its immediate future may be at risk.

The announcement came the same day the CEOs of Detroit's ailing Big Three automakers, including Chrysler CEO Robert Nardelli, were in Washington to plead for financial aid from the government as they burn through cash amid plunging sales. And Chrysler majority owner Cerberus Capital Management LP has been shopping for a buyer for Chrysler.

On the sidelines of the event in the shell of the new plant, Chrysler officials also confirmed construction continues on new engine plants in Trenton and Saltillo, Mexico, to build the new Phoenix family of V-6s. Those facilities now have floors and walls and will be the only sources of the Phoenix engine. Early production is scheduled for late 2009.

In the case of the Marysville axle plant, Chrysler owns the building and will provide the 350 workers on two shifts who will be represented by the United Auto Workers union. The equipment, which is being ordered now, will be owned by ZF and the supplier will oversee day-to-day operations.

The unique arrangement helps Chrysler retain cash in troubled economic times. LaSorda said, going forward, Chrysler will continue to put an emphasis on partnerships as a cost-effective way to build vehicles.

The plant will make three families of axles: an aluminum front and aluminum rear independent axle and a solid rear axle -- starting in 2010 for 2011 model-year vehicles.

Officials would not specify the vehicles, but the axles are for rear-wheel drive vehicles or those with all-wheel drive or four-wheel drive, said Robert Lee, Chrysler vice president of powertrain product engineering. They can be mated to engines of any displacement, including the new V-6 family. Lee said the durable, lightweight axles should improve fuel efficiency by 2--3 percent.

LaSorda said Chrysler will consolidate a number of axles in future products. Initial output will be 500,000 axle drives annually.

As the plant ramps up, operations at Chrysler's Detroit Axle plant will be phased out, a process expected to wind down by 2012. The Marysville workforce will come from the 900 on Detroit Axle's payroll. Chrysler will likely try to sell the facility.

ZF CEO Hans-Georg Haertner said he hopes to win more business with the new 700,000-square-foot plant, which could result in more jobs being added. "We want to increase our market penetration here."

That pleases General Holiefield, UAW vice chairman and director of the UAW Chrysler department. "We have a contingent from Detroit Axle ready to go."

ZF makes axles for such high-end carmakers as BMW AG, Audi AG and Mercedes-Benz AG. Haertner said this project allows the supplier to bring a "key piece of ZF technology to a huge volume of North American vehicles in a state-of-the-art facility." And he hinted that the German company would like to supply powertrains to Chrysler, as well as the eight-speed automatic transmission it is launching in Europe next year.

LaSorda said Chrysler will talk to ZF about other powertrain components in the future. Chrysler also sources axles from Dana Corp. and American Axle and Manufacturing Holdings Inc. "They are still a part of our portfolio, as we speak," LaSorda said when asked if all axle sourcing would eventually fall to ZF.

Meanwhile, Holiefield said Chrysler employees are nervous these days, given the economy, but the UAW has been happy with Cerberus as an owner and grateful that it bought Daimler AG's stake in the company a year ago.

"When the Germans wanted out, Cerberus was there for us," Holiefield said. "Hats off to Cerberus. I don't have any qualms with them. We're still building cars for Chrysler."