It doesn't really aid in performance, but new bright red fluid will lubricate the tranny a lot better than burnt fluid. Also, tranny cooler cools down the fluid so that the fluid has enough lubrication to lubricate the tranny. When tranny is not lubricated, it will die very soon.
Taken from a site: (
http://www.goa-northcoastoil.com/tips/atfchnges.html )
As a rule of thumb, every 20 degree increase in operating temperature above 175 degrees F. cuts the life of the fluid in half. The approximate life expectancy at various temperatures is as follows:
175F 100,000 miles
195F 50,000 miles
212F 25,000 miles
235F 12,000 miles
255F 6,250 miles
275F 3,000 miles
295F 1,500 miles
315F 750 miles
335F 325 miles
375F 80 miles
390F 40 miles
415F Less than 30 minutes
If you think this is propaganda put forth by the suppliers of ATF to sell more fluid, think again. According to the Automatic Transmission Rebuilders Association, 90% of ALL transmission failures are caused by overheating. And most of these can be blamed on worn out fluid that should have been replaced.
On most vehicles, the automatic transmission fluid is cooled by a small heat exchanger inside the bottom or end tank of the radiator. Hot ATF from the transmission circulates through a short loop of pipe and is thus "cooled." Cooling is a relative term here, however, because the radiator itself may be running at anywhere from 180 to 220 degrees F.!
Tests have shown that the typical original equipment oil cooler is marginal at best. ATF that enters the radiator cooler at 300 degrees F. leaves at 240 to 270 degrees F., which is only a 10 to 20% drop in temperature, and is nowhere good enough for extended fluid life.
An auxiliary transmission fluid cooler is easy to install and can substantially lower fluid operating temperatures. The plate/fin type cooler is somewhat more efficient than the tube and fin design, but either can lower fluid temperatures anywhere from 80 to 140 degrees when installed in series with the stock unit. Typical cooling efficiencies run in the 35 to 50% range.