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April 18, 2007

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Chrysler Group Boosts Michigan Economy with $1.78 Billion Investment

Chrysler Group announced today that it will boost the Michigan economy with an investment of $1.78 billion, much of it to start a multi-product “Powertrain Offensive.” The initiative will consist of the following:

  • $730 million for a new plant in Trenton, Mich., to produce the “Phoenix” family of V-6 engines

  • $700 million in Marysville, Mich., to build a new axle plant

  • $300 million in the Sterling Heights (Mich.) Assembly Plant (SHAP) to expand its paint shop

  • $50 million for retooling of Warren Truck Assembly Plant and Warren Stamping Plant for future product

“This is an important day for the future of the Chrysler Group, and in particular for the continued competitiveness of our operations in the State of Michigan,” said Chrysler Group President and CEO Tom LaSorda. “We have a vision to grow our business and transform the Chrysler Group into a stronger company that will be competitive for the long run. The investments we are announcing today prove that we are investing in this vision.”


UAW Vice President General Holyfield and Chrysler Group President and CEO Tom LaSorda

Government officials and community leaders joined Chrysler Group executives to celebrate the milestone.

The $1.78 billion Michigan program investment includes product development costs and is part of the “Recovery and Transformation Plan” that LaSorda announced on February 14.
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Under the "Recovery and Transformation Plan" umbrella is the “Powertrain Offensive” — $3 billion of investment for building and retooling existing plants that will produce more fuel-efficient engines, transmissions and axles and provide Chrysler Group with a more competitive powertrain portfolio. The Trenton Phoenix Engine Plant and Marysville Axle Plant are the first two components of several that make up the "Powertrain Offensive."

"Michigan is the best place in the country for these investments to occur and we’re proud to have worked hard to make that case to DaimlerChrysler,” said Governor Jennifer M. Granholm.

“When I met with Dr. Zetsche during my recent investment mission to Germany, I was emphatic that a strong DaimlerChrysler is important to Michigan and we stand ready to help them thrive in our state. DaimlerChrysler’s vision for growth and strength clearly includes Michigan and that’s great news for all of us for Michigan, Michigan workers and Michigan’s economy.”


UAW President Ron Gettelfinger, Chrysler Group President and CEO Tom LaSorda (middle), Michigan Governor Jennifer Granholm

Trenton Phoenix Engine Plant

The new Trenton Phoenix Engine Plant, located adjacent to the Chrysler Group Trenton Engine Plant, is expected to begin production in 2009.

The Trenton plant will have a competitive labor agreement that incorporates Smart manufacturing initiatives and flexible CNC-based machining, volume-bundled parts purchasing, volume-bundled capital investment and standardized tooling.

Over the long term, the Phoenix family of V-6 engines will reduce manufacturing complexity by paring the Company’s four current V-6 engine architectures to one.

Marysville Axle Plant

The Marysville Axle Plant will be located in the city of Marysville (St. Clair County). The $700 million investment will include engineering and development for the creation of a new family of axles that provide better fuel economy. In addition, the common axle will allow the Company to consolidate the number of axles for better economies of scale.

Sterling Heights Paint Shop

The investment at Sterling Heights Assembly Plant will include retooling that will improve the coatings process in all key areas of the paint shop including pretreatment, paint mix room and spray booths. In addition, the new technology will increase flexibility and efficiency which will contribute to improved quality and reduce costs.

The new paint shop will have the capability to paint any vehicle in the front-wheel-drive vehicle family, providing future flexibility for the Corporation. The paint shop will be completed in 2009.

Warren Truck Assembly Plant and Warren Stamping

Warren Truck Assembly Plant and Warren Stamping will receive multiple plant upgrades to improve quality, productivity and worker ergonomics. The retooling also will increase flexibility and prepare it for its role in the Chrysler Group’s 20 all-new vehicle product offensive.

Chrysler Group will announce additional details of its “Powertrain Offensive” at a later date. All of these investments are subject to final approval and incentive packages.

All Photos: Chrysler

(April 18, 2007)

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