Standard Supply Chain Management (SCM) Requirements of Production Material Suppliers

1. Standard Supply Chain Management (SCM) Requirements of Production Material Suppliers As of June 2011

2. Supplier Delivery Performance Expectation A supplier’s delivery performance should be transparent to all Chrysler operations and organizations. This means that material: • arrives on time and • arrives with the right quantity and • arrives via the designated delivery method. If an issue is identified, the supplier should resolve it with as little intervention from Chrysler as possible. The supplier must proactively notify Chrysler of any issue that will impact Chrysler’s ability to build product. In those cases, the supplier must demonstrate a sense of urgency and already have begun implementing problem resolution steps. How do suppliers achieve this?

3. Chrysler Supplier Delivery Requirements Suppliers to Chrysler Need to: • Register & set-up access to the Chrysler Portal in Covisint. • Provides access to Chrysler systems / applications each supplier is required to down-load & use as part of their delivery process. • Establish an EDI X12 Interchange. • As part of a Chrysler standard requirement of suppliers an Electronic Data Interchange (EDI X12) communication link  is required to be established by all new suppliers within 30 days after a PO is received. • Complete Supplier Training. • Suppliers and their representatives are required to complete training on Chrysler systems / applications. Training is provided via “self-serve” approach. • Complete and submit a MMOG/LE Self-Assessment. • New requirement: All suppliers are required to complete a MMOG/LE Self-Assessment annually by 3/31 each year (unless deadline is otherwise set) and submit the scores into DRIVe. Please note that additional requirements may be communicated during the year as several delivery related strategy items are under development at this point.

4. I. EDI X12 Interchange Prerequisite: Electronic Data Interchange (EDI) X12 Standardfor NAFTA based OEM’s. Reason: Automated communication of pertinent & timely data for integration into Suppliers operational planning tools & systems to enable material delivery to Chrysler customer facilities. 13 EDI transactions are integral to a supplier’s delivery success.

5. EDI Message Reasons

6. II. Chrysler Portal in Covisint • Prerequisite: Register for the Chrysler Portal in Covisint & download applications. • Reason: Provides access to: • Systems suppliers are required to use to conduct business / interact with all areas of Chrysler. • Reference materials, manuals, contact lists, etc. • 20 SCM items are integral to a supplier’s delivery success • (12 applications, 1 central web-site, 7 processes/standards) • Logistics • Logistics Portal (e-Leen). • International Shipping Process • Customs Process • SDRM • 862 Common Ship and Delivery Schedule (CSDS). • Supplier Material Requirement Tracking System (SMART). • Chrysler Accounting & Material Procurement System (CHAMPS). • Premium Transportation Management (PTM). • Delivery Rating Improvement Verification (DRIVe). • SMART Scoreboard • PC Portal II • Electronic Corporate Issue Management System (e-CIMS). • Supplier Delivery Development web-site • Non-NAFTA Supply Alarm Process • Supplier Proactive Delivery Issue Communication • PP&S • Capacity Management (Capacity Database & Volume Variance). • 830 Release. • Manufacturing • Containerization Repository & Tracking Engineering System (CRATES) • Container Management System (CMS) • Material Labeling Standard & Packaging Standard • RDR Process Note: Additional applications may be necessary for other activity areas (i.e. Purchasing, Engineering, Quality, Corporate Accounts Payables, etc.) and are available via Covisint.

7. III. Supplier Training • Prerequisite: Suppliers are required to complete training on Chrysler systems / applications. • Reason:Ensure supplier personnel is capable to utilize the tools. • Training delivery methods: • Computer Based Training (CBT) • Available on-line 24-7. • Completed at own pace. • Instructor Led • Only available during Supplier Training Week (STW). • Suppliers register for / access training via www.chryslertraining.com. • 20 CBT’s cover SCM applications / processes. • Note: 1 CBT is accessed directly via the application itself (e-CIMS).

8. IV. MMOG/LE v. 3 Self-Assessment • Prerequisite: • Each supplier location is required to complete a Material’s Management Operations Guideline / Logistics Evaluation (MMOG/LE) self-assessment and submit their scoring results into the DRIVe system. • Self-assessment score submission due date is on 3/31 annually. • Reason: • Identifies current level of performance / gaps in standard processes across 6 main operational areas with ultimate goal for supplier to resolve those issues, develop contingency plans, and AVOID any impact to end customer.

9. IV. MMOG/LE v. 3 Self-Assessment (cont.) • Focuses supplier attention on SCM impact areas inclusive of: dealing with customer volume fluctuations, capacity constraints, Tier 2 capability, resource allocation, training gap, etc.

10. Performance Measurement A suppliers performance from a Supply Chain Management perspective is measured in Chrysler’s Delivery Rating Improvement Verification (DRIVe) System: • Performance of production suppliers is measured in the DRIVe system at the manufacturing location level and converted into a Delivery Performance score. • There are 4 Major Performance Categories measured: • 65% for Delivery Conformance • 35% for Response Conformance • 20% SMART Ticket Response • 15% Capacity Management Response • Less points Based on # of CLS/D Occurrences • Less points Late MMOG/LE Score submission into DRIVe 100 % DRIVe Score (shown as a 6 month weighted average). DRIVe score makes up 20 points of Production suppliers External Balance Score Card(EBSC) score. EBSC score is used by Purchasing in sourcing decisions.

11. Overview of Supplier Delivery Performance Measurement (DRIVe)

12. Overview of Supplier Delivery Performance Measurement (DRIVe)

13. Overview of Supplier Delivery Performance Measurement (DRIVe)