Command Performance: Chrysler Group is Most-Improved Automaker in The Harbour Report 2004

- 7.8 percent improvement tops list; most improved automaker for second year in a row - Chrysler Group moves ahead of Ford Motor Company in overall productivity - New industry benchmark set in transmission productivity, led by the company's 9.2 percent improvement - Tom LaSorda: "The efforts are taking hold, helping to achieve our mid- term goal of matching the most productive performers in the world"

AUBURN HILLS, Mich., June 10 -- For the second year in a row, Chrysler Group was the most improved automaker in manufacturing efficiency in 2003 compared to 2002, with a 7.8 percent year-over-year gain in productivity, according to The Harbour Report North America 2004. The company also set a new industry benchmark in transmission manufacturing, led by a 9.2 percent gain in efficiency, and had seven plants ranked in the report's top three most productive plants, compared by vehicle segment.

Harbour Consulting President Ron Harbour lauded the Chrysler Group for improvement and consistency in the annual analysis of industry manufacturing productivity.

"Chrysler Group pulled off another impressive performance in this year's Harbour Report, validating once again that they are implementing the right processes throughout the company to help achieve their efficiency objectives," said Harbour. "These improvements directly translate into better vehicle quality for customers and aggressive cost management throughout the entire organization."

The results continue the company momentum, said Dieter Zetsche, Chrysler Group President and Chief Executive Officer. "In the midst of the most aggressive product launch in the company's history (nine new products in 2004), significant improvements in quality, and now productivity, are paying off."

Chrysler Group's commitment to manufacturing efficiency and global competitiveness has led to a two-year productivity gain of more than 16 percent in assembly, engine, transmission and stamping operations.

"For the second year in a row, Chrysler Group is the most improved automaker," said Tom LaSorda, Chrysler Group Chief Operating Officer. "The efforts of our employees throughout the plants, as well as our support teams in manufacturing, engineering and the supplier community, are taking hold. Our mid-term goal is to match the most productive performers in the world."

"We are committed to consistency within our manufacturing strategy, injecting quality, safety and flexibility into all of our operations," stated Frank Ewasyshyn, Chrysler Group Executive Vice President - Manufacturing. "We will continue to pursue the high standards we've set, and make steady progress in productivity."

Ewasyshyn also credited efficiencies across all of Chrysler Group's plants in the areas of throughput and delivery as key reasons the company was able to repeat a significant overall improvement in The Harbour Report.

The results represent the employees' hard work throughout the plants, the support from the United Auto Workers and other local unions, as well as the work of the support teams who are responsible for helping to achieve the company's productivity goals, added LaSorda.

"Machines alone can't produce vehicles; people produce vehicles, and people are behind all the improvements we are seeing in our plants."

"Our employees continually find better ways to do things, which in the end helps us to be more competitive and to build better products," stated Nate Gooden, United Auto Workers Vice President. "We're in it to be the best, and our membership is working to make it happen."

Assembly

Chrysler Group's performance in assembly was consistent with its overall efficiency gains, achieving a 7.2 percent year-over-year improvement in assembly operations. The company also had seven plants rank in Harbour Report's top three most productive plants, compared by vehicle segment:

* Belvidere (Illinois) Assembly Plant was third in the "Subcompact" category, assembling the Dodge Neon;

* Sterling Heights (Michigan) Assembly Plant was third in the "Compact" category, building the Chrysler Sebring Sedan and Convertible as well as the Dodge Stratus Sedan;

* Toledo (Ohio) North Assembly Plant, home of the Jeep(R) Liberty was third for "Small SUV" production;

* Jefferson (Detroit, Michigan) North Assembly Plant, assemblers of the Jeep Grand Cherokee, was third in the "Midsize SUV" category;

* St. Louis (Missouri) South Assembly Plant and Windsor (Ontario) Assembly Plant were second and third respectively in the "Minivan" segment. Both build Chrysler and Dodge minivans;

* and the company's former Pillette (Ontario) Road Assembly Plant was third in the "Large Van" segment, where the Dodge Ram Van was once produced.

Powertrain

Chrysler Group set a new benchmark in transmission operations by realizing a 9.2 percent improvement in hours per transmission. The Kokomo (Indiana) Transmission Plant retained its number-one ranking in the "Front-Wheel Drive Transmission" segment, and also became the second most-productive facility for "Rear-Wheel Drive Transmission" manufacturing.

The company's engine operations improved significantly by 9.5 percent. Saltillo (Mexico) Engine Plant, home of the world-famous 5.7-liter Hemi(R) Engine, was ranked third in its engine segment and Mack (Detroit, Michigan) Engine Plant I was ranked number two in its engine segment.

Stamping

Overall, Chrysler Group stamping operations delivered another solid performance by realizing an 8.5 percent productivity improvement, making it the third-most efficient stamping operations in the automotive industry. The company also improved its pieces per hour productivity by 5 percent. Investments in higher volume and higher line-speed presses have been a contributing factor to the improvements.

The Harbour Report is one of several efficiency measures the Chrysler Group uses to help improve its operations. Harbour measures hours per vehicle (number of hours worked/number of vehicles produced). Other areas that are tracked include quality, safety, cost and delivery improvements, all of which contribute to manufacturing performance.