February 18, 2002

Magna buys Eurostar plant from Chrysler

Auburn Hills, Michigan – Chrysler Group and Magna Steyr today confirmed a business agreement for the sale of Chrysler Group’s Eurostar operations in Graz, Austria, to Magna Steyr, a unit of Magna International Inc.

Eurostar was originally a joint venture to manufacture Chrysler Voyager minivans in a partnership between Chrysler Austria Ges.m.b.H (50 percent ownership) and Steyr-Daimler-Puch Fahrzeugtechnik AG (50 percent ownership) which began in October 1991. By June 1999, the 55,500 square meter facility
was wholly owned by Chrysler Group. It assembles the Chrysler Voyager minivan and Chrysler PT Cruiser for markets outside North America.

Chrysler Voyager production will continue in Graz as part of Magna Steyr’s adjacent Graz operations, which already produce a number of vehicles for DaimlerChrysler, including Jeep Grand Cherokee. Chrysler PT Cruiser production will move to Toluca, Mexico, to be consolidated with production of that model there.

As part of the agreement, approximately 800 of the nearly 2,000 employees at Eurostar will continue to produce the Chrysler Voyager in Graz. It is anticipated that the vast majority of the remaining employees will choose to enter a “trust”, which will provide advanced training while they continue to receive their pay. A “trust” bridges the time between employers. Those in the “trust” will be employed by Magna Steyr, following the estimated eight-to ten-month transition period until the start of a new project at the facility.

“The framework for our discussions with Magna focused on two key elements — it needed to make the best business sense for the future of the Chrysler Group and be in the best interest of employees,” said Chrysler Group President and Chief Executive Officer Dieter Zetsche. “The agreement does that. It enables us to reduce production costs, streamline our asset base, and make better use of existing capacity. The proceeds from this transaction and the savings from these efficiencies allow us to invest more money into developing aspirational products. At the same time, this agreement with Magna provides a secure future for the employees.”

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