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Continental and Delco Remy Forge Alliance

11 May 1999

Continental and Delco Remy Forge Alliance

    HANNOVER, Germany, May 11 -- Continental AG and Delco Remy
International, Inc. are entering into an alliance for the
exclusive production of motors for use in the newly developed ISAD(R) system
(Integrated Starter Alternator Damper).  The two companies signed an agreement
establishing a joint venture (JV), which will be registered in Landsberg am
Lech.
    The two parent companies also intend to expand their cooperation in North
America.  The Continental ISAD system is to be exclusively and jointly
manufactured there for sale to domestic automobile and truck manufacturers.
    The electric motor, which is to be initially produced in Europe, is an
essential component of the Continental ISAD system, developed by Continental
ISAD Electronics Systems GmbH & Co. KG, Cologne, a Continental Automotive
Systems company.
    ISAD technology combines the starter and alternator functions in one
compact high-performance unit that is installed in the vehicle between the
engine and the gear box.  The Continental ISAD system generates significantly
more electrical current than conventional systems, thereby satisfying the
universal requirements of future vehicle generation.  Functions like automatic
start-stop and torsional vibration absorption offer vehicle manufacturers
additional advantages with respect to the fuel-efficiency and comfort of their
future products.
    The starter/alternator combination provides a more powerful basic
platform, offering vehicle engineers unique possibilities for redesigning many
under-hood functions.  Practically every drive element currently powered by
belts can also be powered electrically as the system's larger alternator
components now produce more electric energy.  More effective electric motor
systems, powered by Continental's ISAD system, could replace hydraulically
assisted steering systems, belt-driven air-conditioning compressors and
different fluid pumps and their components.
    Continental AG, headquartered in Hannover, is a world-renowned systems and
technology partner to the automotive industry.  The company's product emphasis
is in the area of passenger car and commercial vehicle tires and brake
systems, electronic chassis systems for passenger cars (manufactured by
Continental Teves), ISAD technology from Continental ISAD and technical rubber
and plastic products manufactured by ContiTech.  Sales worldwide amounted to
DM13.2 billion in 1998.  The company's current workforce stands at over
62,000.
    Delco Remy International, Inc. headquartered in Anderson, Indiana (USA),
designs, manufactures, remanufactures and distributes electrical,
powertrain/drivetrain and related components for automobiles and light trucks,
medium and heavy-duty trucks and other heavy-duty off-road vehicles.  Products
include starter motors, alternators, traction control systems, engines,
transmissions, torque converters and fuel systems.  Delco Remy International
serves the aftermarket and original equipment manufacturers, principally in
North America, as well as Europe, Latin America and Asia Pacific.