DATE: July 12, 2002

TO: F&I Managers

FROM: Laura K. Reardon, CPS

RE: GE Vehicle Service Contract (VSC) - Chrysler 7/70 New Car Warranty

On July 9th, Chrysler announced a 7-year/70,000 mile powertrain in addition to its standard 3-year/36,000 mile bumper-to-bumper warranty. The new warranty becomes effective July 9th for all 2002 models. Unlike other manufacturer's extended powertrain warranties, the Chrysler program is transferable.

In reaction to this move by Chrysler, GE AWS is looking into short-term and long-term solutions.

In the short-term, we recommend using the current 5-Star Wrap program with terms of 7-years/ 75,000 miles and 7-years/100,000 miles. These two plans would wrap the Chrysler warranty and provide additional non-powertrain coverage for 7-years or up to mileages selected (whichever comes first). Unfortunately, these two terms are non-transferable, unlike the Chrysler 7/70.

GE AWS is evaluating the addition of a 7/70 term and allowing for contract transfers.

If you have any questions, please do not hesitate to contact me at extension 21.

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