World Class 

Scott Garberding

Manufacturing

Scott Garberding

Chrysler Group LLC 2010 14 Business PlanChrysler Group LLC 2010‐14 Business Plan

November 4, 2009

World Class Manufacturing (WCM) headlines

… From Turin they remark that the essential element in order to have everything working well is the human component, since without full involvement of the workers nothing could be made.

…In the internal ranking, the Marchionne Code, which is in the company language described as Fiat Group Automobiles Production System (FAPS), finds its best application in Tychy Plant in Poland, and in Melfi Plant in Italy. Now the attempt is to elevate to acceptable standard also Pomigliano Plant…

Chrysler Group LLC 2010‐14 Business Plan November 4, 2009 2

6, December 2007

Journey to WCM

Fiat Group focus – Holistic approachWorld Class Manufacturing• 20 PillarsFiat Group p

20102004 2006 2008 20092005

WCM LaunchC au c

One common manufacturing operating system

Chrysler Group LLC

20102004 2006 2008 20092005

p g y

Chrysler Focus

• Safety

• Q lit

WCM Launch

Chrysler Group LLC 2010‐14 Business Plan November 4, 2009 3

• Quality

• Harbor Report

WCM structure & objectives

Safety

Cost 

eploym

ent

Workplaceorganization Quality Maintenance Logistic

d

Method Total industrial  Total quality  Total productive  Just in time

Focus

& std.

Productivity

engineering

Qualityimprovement

q ycontrol

Technicalefficiency

pmaintenance

Servicelevel

Just‐in‐time

Target zero waste

zero defects

zero breakdowns

zero inventory

Chrysler Group LLC 2010‐14 Business Plan November 4, 2009 4

People involvement, value creation, customer satisfactionValues

Why implement WCM?

Fatality

SevereInjury

Introduction of WCMLost Time

Injury

Recordable Injury / Illness

First Aid Cases

Near MissesNear Misses

Unsafe Conditions

Unsafe Acts

cide

nt ra

te

17%

15%

Teaching us to see new opportunities

work day inc

7%

Lost w 35% improvement

Chrysler Group LLC 2010‐14 Business Plan November 4, 2009 5

2005 2006 2007 2008 2009E ytd 2010E(NAFTA manufacturing)

Why implement WCM?

Introduction of WCM

25

26

Rigorous methodology f i t

23

24 for improvements

er Veh

icle

5.7%

21

22

urHou

rs Pe 1.3%

9%

19

20

Harbo

Chrysler Group LLC 2010‐14 Business Plan November 4, 2009 6

2004 2005 2006 2007 2008 2009 ytd 2010 2011

(Assembly)E EE

Previous StructurePrevious Structure

New leadership model

Plant Manager

Plant Manager

Previous StructurePrevious Structure

Current StructureCurrent Structure

Team LeaderTeam Leader

Team Member Team Member

Team Leader

Fully engaged workforce

Direct Communication

Quick Decision 

Chrysler Group LLC 2010‐14 Business Plan November 4, 2009 7

workforceOwnership at Operator Level

Making

WCM in action

Working together

Execution

Results

Chrysler Group LLC 2010‐14 Business Plan November 4, 2009 8

WCM in action

Before After

Level 1 Level 2 Level 3

More than 30°

15° ‐ 30° 0° ‐ 15°

Flexion angle of the waist

Level 1 Level 2 Level 3

More than 30°

15° ‐ 30° 0° ‐ 15°

Flexion angle of the waist

than 30

Chrysler Group LLC 2010‐14 Business Plan November 4, 2009 9

52% elimination of ergonomic risks

WCM in action

Before After

• Inventory reduced• Material delivered to point of use • 57% reduction in operator walk time

Chrysler Group LLC 2010‐14 Business Plan November 4, 2009 10

57% reduction in operator walk time

WCM in action

Before Afterqu

ipEquipment conditions 

Equi

Maintained for easy 

Eq

co d o shidden

po easyinspection

Chrysler Group LLC 2010‐14 Business Plan November 4, 2009 11

Equipment restored to original state

WCM in action

Before After

Improved work conditions

Chrysler Group LLC 2010‐14 Business Plan November 4, 2009 12

Prepare for

Transforming Jefferson

PlacePeople

Prepare for 

360 degree transformation

Passion

Product

Process

Chrysler Group LLC 2010‐14 Business Plan November 4, 2009 13

Chrysler Group LLC

WCM implementation

Chrysler Group LLC

SilverSilver1st Plant  re‐opensChapter 

11 begins

Chapter 11 “ends”

GoldGold

Bankruptcy 20134th Qtr ‘09 2010 2011 2012 2014

BronzeBronzeSilverSilver11 begins

3rd party audits 1st audits

Cost opportunities identified 

Management / Union 

• Every plant – Every year

• Increasing depth and rigor

1st audits 

World Class Manufacturing teams 

and training          30 Plants

leadership training and commitment

30 Plants

Learning & implementation

Methods & results

Chrysler Group LLC 2010‐14 Business Plan November 4, 2009 14

Wide expansion

Expected results for 2010

‐8%‐30%

Operating costInjuries

2009E 2010E 2009E 2010E

+10%+15%

Manufacturing first‐time quality Productivity

2009E 2010E 2009E 2010E

+80%+100%

Employee involvement Projects

Chrysler Group LLC 2010‐14 Business Plan November 4, 2009 15

2009E 2010E 2009E 2010E

One Team, One Goal, One VisionWorld Class ManufacturingWorld Class Manufacturing

Chrysler Group LLC 2010‐14 Business Plan November 4, 2009 16