Fitch Downgrades Daimler Chrysler Financial Services America LLC IDR to 'B+'

Business Wire, June 4, 2008

NEW YORK -- Fitch Ratings has downgraded Daimler Chrysler Financial Services America LLC (DCFS) Issuer Default Rating (IDR) to 'B ' from 'BB-'. Approximately $6 billion of debt is affected by this action. The Rating Outlook is Negative. (See full list of ratings below.)

This action follows Fitch's downgrade of Chrysler LLC on May 7, 2008, whereby Chrysler LLC's (Chrysler) IDR was downgraded to 'B'. Fitch's criteria generally permit a one-notch differential in the IDR for a captive finance company. The downgrade of Chrysler mainly reflected decline in unit volumes and revenues resulting from weak economic conditions, modest share losses and certain strategic initiatives. In Fitch's view, DCFS' recent operating performance has been within Fitch's expectations since it was spun off from Daimler A.G. in July 2007. Nonetheless, Fitch believes DCFS' future operating performance will trend lower due to aforementioned issues with Chrysler and the weaker environment for consumer credit.

The Negative Rating Outlook reflects the more challenging environment for automotive lenders in the U.S. Industry delinquencies and losses are increasing as a result of weaker economic conditions coupled with industry dynamics such as lower used car prices.

Fitch has assigned recovery ratings to DCFS' secured credit facilities. The 'RR1' assigned to the first lien facility reflects a high expectation of full recovery based on the available collateral. The 'RR3' assigned to the second lien facility reflects an above-average recovery.

Fitch downgrades the following with a Negative Outlook:

--Long-term IDR to 'B ' from 'BB-';

--Secured first lien to 'BB /RR1' from 'BBB-';

--Secured second lien to 'BB-/RR3' from 'BB'.

In addition Fitch affirms the following:

--Short-term IDR at 'B'.

Fitch's rating definitions and the terms of use of such ratings are available on the agency's public site, www.fitchratings.com. Published ratings, criteria and methodologies are available from this site, at all times. Fitch's code of conduct, confidentiality, conflicts of interest, affiliate firewall, compliance and other relevant policies and procedures are also available from the 'Code of Conduct' section of this site.