It was only a matter of time before the rest of the world discovered that Chihuahuas could be very well the dog version of piranhas. Like every other horror flick, the plot doesn't really matter if your monster is just scary. 

According to Undead Backbrain:

The film was written by director Jim L. Clark who among other SFX positions was a rotoscope artist on Hellboy in 2004 and, going back further, a creature animator on An American Werewolf in Paris (1997).

via Undead Backbrain (with thanks to Avery Guerra!)