DaimlerChrysler Announces New Seven Year / 70,000 Mile Powertrain Warranty for Chrysler, Jeep® and Dodge Vehicles in the U.S.
  • Warranty Underscores Quality Gains, $7.5 Billion Powertrain Investment
  • No-Cost Plan is Transferable to Subsequent Owners

Auburn Hills, Michigan, USA, July 08, 2002

DaimlerChrysler Corporation today announced it will provide an industry-leading seven year/70,000-mile limited powertrain warranty on its Chrysler, Jeep ® and Dodge brand vehicles in the U.S.

The warranty, which is fully transferable to subsequent owners at no extra cost, will be provided free of charge on all new Chrysler Group vehicles purchased or leased on or after July 9, 2002. Components covered by the "7/70 Powertrain Warranty" include engines, transmissions/transaxles, transfer cases and axles.

Powertrain component coverage becomes effective following the standard bumper-to-bumper coverage of three years or 36,000 miles on all other components, and extends to seven years or 70,000 miles, whichever comes first.

The 7/70 Powertrain Warranty covers all vehicle lines except select commercial fleet vehicles. Remaining 2002 models also will be covered by the new warranty.

"Simply stated, our overall quality levels have improved substantially while warranty costs have dropped 20 percent in the latest model year, and have been cut in half since 1996," said Dieter Zetsche, Chrysler Group President and Chief Executive Officer. "Our entire management group has a mindset of making quality the top priority, and this program is yet another milestone in our 'disciplined pizzazz' approach.

"Going forward, no one is better positioned to keep this priority in sharp focus as we combine American innovation and design with German quality and technology," added Zetsche. "This new warranty also enables us to break from the pack when it comes to customer peace-of-mind.

$7.5 Billion Powertrain Investment

Chrysler Group has invested more than $7.5 billion in new, state-of-the-art powertrains during the last several years. This includes a new line of multi-valve passenger car engines, as well as a new family of SUV and truck engines -- the 3.7-liter V6, 4.7-liter V8 and class-leading 5.7-liter HEMI® Magnum engine, to debut this fall on the all-new 2003 Dodge Ram Heavy Duty pickup truck.

"We have been investing heavily in developing new engines and transmissions, and that is at the very core of what is now one of the most comprehensive warranties in the industry," said Richard Schaum, Executive Vice President of Product Development and Quality. "But we are moving ahead even further by leveraging the expertise and know-how of Mercedes-Benz, which has an unequaled reputation when it comes to powertrains."

One example, Schaum noted, is the Mercedes-Benz W5A580 five-speed automatic transmission, to be built at the company's Indiana Transmission Assembly Plant starting in 2004 for use in selected Chrysler Group vehicles. DaimlerChrysler announced this program in late 2000 as one of the first component-sharing programs of the 1998 merger between the former Chrysler Corporation and Daimler-Benz AG.

"Collaborative programs such as this, along with our new product development processes announced last summer, enable us to offer a range of vehicles that can compete with any company when it comes to quality, reliability, durability and performance," said Schaum.

Marketing Plan: Merger Benefits, Quality Gains

DaimlerChrysler will begin running a multi-media communications campaign starting July 9, which will highlight the customer benefits of the 1998 merger between Chrysler and Daimler-Benz. The campaign, which focuses on the combination of American and German strengths, will begin with cross-brand radio advertisements, followed by a major print ad on July 12. Television ads for Chrysler, Jeep and Dodge will begin airing July 15.

"Our new 7/70 transferable warranty is tangible proof that the merger is paying strong dividends in the marketplace," said Jim Schroer, Executive Vice President - Global Sales & Marketing. "Our improved quality and pride-in-product will be the central themes as we communicate this new initiative.

"Our recent realignment of responsibilities within the Marketing Organization, where we created Chrysler, Jeep and Dodge brand teams to strengthen the ties between product planning and marketing goals, sets the stage for us to have three aspirational vehicle brands, that all share one thing in common: great quality and reliability."

Schroer also noted that the 7/70 Powertrain Warranty should positively affect resale and lease residual values across all three brands.

"Our research on ownership patterns and customer preferences shows that customers also want high resale value," said Schroer. "Having the ability to transfer the warranty to any subsequent owner, free of charge, will be another big customer benefit. This plan underscores both the strong consumer value and the high confidence we have in our products."

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