Chrysler Group Announces Plans to Invest $419 Million in its Belvidere, Illinois Plant

- Investment enables the addition of a second shift, 1,000 jobs - New manufacturing flexibility and operational strategy to be implemented - Local United Automotive Workers agreement reached to support investment

AUBURN HILLS, Mich., Jan. 26 -- Chrysler Group Executive Vice President of Manufacturing Frank Ewasyshyn today joined Illinois Governor Rod Blagojevich and United Auto Workers (UAW) Vice President of the DaimlerChrysler Department Nate Gooden to announce a $419 million investment in the company's Belvidere (Illinois) Assembly Plant, as well as the addition of a second shift and up to 1,000 jobs to the facility.

Also on hand for the announcement were: U.S. Representative Donald Manzullo; Belvidere Mayor Fred Brereton; Dennis Williams, Director of Region Four, UAW; C.D. Graham, President of UAW Local 1268; and from the Chrysler Group were Craig Corrington, Vice President of Assembly and Stamping Operations; and Kurt Kavajecz, Belvidere Assembly Plant Manager.

"Since Chrysler Group opened the doors at Belvidere Assembly almost 40 years ago, the plant has been a key player in our manufacturing portfolio and product offensive," said Frank Ewasyshyn. "Today, we are reaffirming our commitment to this facility and community by bringing back up to 1,000 jobs and investing $419 million, so that future production reaches new levels of operational excellence and produces world-class, quality vehicles.

"Chrysler Group's investment brings jobs to Belvidere and the surrounding areas, which helps restore confidence, attract investments and catalyze growth throughout the regional economy," said Governor Blagojevich. "It is also an investment in our hardworking men and women -- in their advanced set of skills, their dogged work ethic, and their dreams of building a better life for their families and themselves."

Investment in the future

The Belvidere investment will be used to overhaul the plant's body shop as well as modify the paint shop and final assembly area. All changes to the facility will enable greater manufacturing flexibility, while simultaneously preparing for future launches of as-yet-unannounced new products. Production is targeted to begin in early 2006.

The body shop will be retooled, utilizing a combination of new, high-tech robotics and existing plant equipment. New processes will also broaden the plant's capabilities in the types of vehicles that could be manufactured at the facility. The paint shop and final assembly areas will undergo technology upgrades, in order to achieve new levels of efficiency and quality.

Once implemented, the plant will have the capability to produce multiple vehicles while simultaneously piloting another model, minimizing production losses and down time.

Team structure to support the line operators

A new local union agreement paves the way to implementing new manufacturing practices that are key to closing the competitive gap with benchmark assembly plants.

The labor plan provides for concepts such as work teams, self-designed work stations, a framework of minimal and flexible job classifications, extensive employee training, and other elements that will provide a better work environment for the assembly line operators.

"Chrysler Group continuously looks for ways to support the men and women that work on the line day in and day out," said Nate Gooden. "Implementing a small team work structure and streamlining each line operator's activities will result in a safer, ergonomically friendly plant environment."

Commitment to continuous improvement

Belvidere Assembly was chosen for the investment, due to years of continuous performance improvements, especially in the areas of safety, efficiency and quality. The National Safety Council awarded the facility with the "Significant Improvement" award for exhibiting at least a 20 percent reduction in lost-work time injuries in 2003 compared to the prior year.

A key automotive indicator in efficiency, The 2004 Harbour Report, named Belvidere Assembly the third most productive plant in its vehicle segment and was the Chrysler Group's most efficient assembly plant. Belvidere's Stamping facility is also the only stamping facility in North America to receive Harbour Consulting's "2004 Harbour Award" for manufacturing excellence. And, the plant continues to see quality gains due to the safety and efficiency improvements.

"We have seen from the employees at Belvidere Assembly a tremendous amount of pride and commitment to the quality of the work they do everyday," said Kurt Kavajecz. "So the decision to invest here and add jobs is truly a compliment to their hard work."

Belvidere Assembly Plant currently employs more than 2,100 employees and produces the Dodge Neon for North America and the Chrysler Neon for international markets. The Neon is sold in 25 countries.