Information on: Agreement Daimler-Chrysler AG (signed 23.7.2003)

1. After long and tough negotiations which were accompanied by protests and a to-ken strike of 60.000 employees of the Daimler Company, the works council of Daim-ler-Chrysler, the IG Metall and the management of Daimler Chrysler settled an agree-ment.

2. Starting point of the dispute was the claim of Daimler Chrysler, to cut back produc-tion costs in the plant of Sindelfingen (close to Stuttgart) of 500 Million € - in case of refusal, they threatened the employee to dislocate a specific production line of Mer-cedes (“C-Class”) to the Northern part of Germany (Bremen) and South Africa and to cut at least 6.000 jobs in Sindelfingen,

3. Main results of the settlement of 23. 7. 2004:
- job security for the whole employees (that are 160.000) of the company in Ger-many (not only Sindelfingen) till the year 2012 - this are more than seven years;
- no reduction of collectively agreed standard wages and salaries;
- but reduction of parts of the additional pay (pay above standard wages);
- at the same time: certain reduction of management pay (about 10 %) (including middle management) - ;
- commitment of the management to follow-up investment into new products (part of a long-term job security concept);
- paid increase of working hours for employees working in the fields of Research and Development (R&D) - from 35 hours to 40 hours weekly; (To remind you: This part of the agreement makes use of the possibilities given in our collective agreement which was concluded in February 2004 and which defines certain conditions, under which the increase of working hours is allowed.)
- new agreement for service sector of Daimler-Chrysler (about 6000 people), that are: Factory canteen (cooks, kitchen service, catering); printing-works; company security service. - All those sectors were threatened by outsourcing, which would had meant a drastic fall in income. New agreement contains:
- increase of weekly working hours by steps up to 39 hours (39 hours come into ef-fect on 1. 7. 2007), maintaining there present income level (including pension, per-formance related annual extra pay etc.);
- reduction of working hours without loss of income for employees beyond the age of 54 years by steps till 34,5 hours (34,5 hours come into effect with reaching the age of 60 years);

4. All that measures undertaken lead to a cost reduction of approximately 500 Million €.

5. Works council and IG Metall underline the importance of securing income (as far as collectively agreed standard wages and salaries are concerned) and of the long-term job-security (including long-term investment plans).