Autoliv China Presentation - May 13 2010-handout

Autoliv China Presentation George Chang May 13th 2010 Autoliv China/Management Presentation/May 10/ - 2 Copyright Autoliv Inc., All Rights Reserved Agenda 0930Hr Presentation & Q&A 1100Hr China Technical Center Tour 1145Hr ACS Plant Tour 1230Hr Light Lunch 1300Hr End of Program Autoliv China/Management Presentation/May 10/ - 3 Copyright Autoliv Inc., All Rights Reserved Presentation Content „ China Economy Overview „ China Auto Market „ Autoliv China „ Market Presence „ Organization Structure „ Customers & Sales „ Some of our new projects „ Market Share „ Living the Vision „ Plant Tour Autoliv China/Management Presentation/May 10/ - 4 Copyright Autoliv Inc., All Rights Reserved China Economy Overview „ 2009 GDP growth 8.7% • 4 trillion RMB (585 BUSD) stimulus package „ 2010 Economy Outlook • GDP growth forecast 9.5% ~ 10% 9 Q1 GDP growth at 11.9% • Gradual withdrawal of stimulus program started 9 Likely to accelerate in Q2/Q3 • Inflation is trending up 9 Apr at 2.8% 9 2010 forecast at 3.6% • New measures launched against overheating real estate • RMB likely to resume appreciation Autoliv China/Management Presentation/May 10/ - 5 Copyright Autoliv Inc., All Rights Reserved China Auto Market „ 2009 Sales • LV 10.3 million units, +53% • PV 8.4 million units. +47% „ Auto Stimulus Program • Preferential purchase tax extended to end 2010 • Trade in rebate for rural consumers extended to end 2010 • Cash for clunker increased „ 2010 LV market projection • Projected growth 10% ~ 15% 9 LV 11.3 ~ 11.8 million units 9 PV 9.2 ~ 9.6 million units • Apr 2010 sales YTD 9 LV 4.3 million units, + 52% 9 PV 3.4 million units, + 51% Autoliv China/Management Presentation/May 10/ - 6 Copyright Autoliv Inc., All Rights Reserved Passenger Car Sales & 2010 YTD Growth K 200K 400K 600K 800K 1000K 1200K Jan Feb Mar Apr May Jun July Aug Sept Oct Nov Dec 0% 20% 40% 60% 80% 100% 120% 140% 160% 2008 2009 2010 2010 Growth YTD Autoliv China/Management Presentation/May 10/ - 7 Copyright Autoliv Inc., All Rights Reserved China 2010 Q1 PV Market Share by Brand Origin Korea 10%(+2%) US 11%(0%) EU 20%(-1%) Japan 21%(-4%) China 38%(+3%) Autoliv China/Management Presentation/May 10/ - 8 Copyright Autoliv Inc., All Rights Reserved Geely 4%(0%) VW 18%(-1%) Others 16%(0%) Hyundai-Kia 10%(+2%) GM 9%(+1%) Honda 7%(-2%)Toyota 7%(-2%) Nissan 6%(0%) Chery 6%(0%) Ford-Mazda 4%(-1%) BYD 5%(+2%) FAW 5%(+1%) PSA 3%(0%) China 2010 Q1 PV Market Share Autoliv China/Management Presentation/May 10/ - 9 Copyright Autoliv Inc., All Rights Reserved China Passenger Vehicle Outlook 0 2,000 4,000 6,000 8,000 10,000 12,000 14,000 16,000 2008 2009 2010 2011 2012 2013 2014 2015 (‘000 Units) Source: CSM April 2010 CA GR 13 % +4% +8% +6% +14% + 15% +13% +48% +5% Autoliv China/Management Presentation/May 10/ - 10 Copyright Autoliv Inc., All Rights Reserved Autoliv China Aspiration To build Autoliv China as one of Autoliv global To build Autoliv China as one of Autoliv global benchmarks in all aspects of businessbenchmarks in all aspects of business ƒƒ world best product competitivenessworld best product competitiveness ƒƒ manufacturing excellencemanufacturing excellence ƒƒ business process excellencebusiness process excellence ƒƒ engineering competencyengineering competency ƒƒ market leadershipmarket leadership ƒƒ employer of choiceemployer of choice Autoliv China/Management Presentation/May 10/ - 11 Copyright Autoliv Inc., All Rights Reserved 2008 Guangzhou new plant 2007 Changchun plant JV became Autoliv wholly owned 2006 Shanghai steering wheel plant Shanghai webbing plant became Autoliv majority owned & capacity expansion 2005 In-house restraint system development capability Guangzhou seat belt & airbag plant established 2004 Autoliv China Purchasing Office Launched 3 new wholly owned companies in Shanghai - Seat Belt / Retractor - Inflator - Safety Electronics - Shanghai airbag co. became Autoliv wholly owned 2002 Airbag & Seat Belt JV in Changchun 1999 1st Airbag JV in Shanghai 1995 Seat Belt Webbing JV in Shanghai 1994 2nd Seat Belt JV in Changchun 1990 Established 1st Seat belt JV in Nanjing 2009 ACH, ACS, CTC new building/plant Nanjing plant JV became Autoliv wholly owned Autoliv China – Major Milestones 2010 In-House Airbag Cushion Autoliv China/Management Presentation/May 10/ - 12 Copyright Autoliv Inc., All Rights Reserved Autoliv in China North Seatbelts Airbags Central Head Office Seatbelts Airbags Airbag Cushion (2010) Webbing Steering Wheels (2007) Electronics (2006) Inflators (2007) Tech Center (2007) South Seatbelts Airbags (2008) Changchun Nanjing Guangzhou 10 manufacturing companies Employee z Headcount: 4,340 z Expatriate: 25 Taiwan Seatbelts Airbags Shanghai Autoliv China/Management Presentation/May 10/ - 13 Copyright Autoliv Inc., All Rights Reserved Our Customers Autoliv China/Management Presentation/May 10/ - 14 Copyright Autoliv Inc., All Rights Reserved Autoliv China – Organization President Tech CenterPurchasing Finance/IT SalesHR CHA – 30% ACX – 60% ACC – 100% ACE – 100% ACW – 100% ACI – 100% ACG – 100% ACS – 100% Quality NHA - 100% ATW – 59% Autoliv China/Management Presentation/May 10/ - 15 Copyright Autoliv Inc., All Rights Reserved 102 462 628 375 237 Actual Forecast 569 15 19 39 88 94 102 233 910 610 422 350 0 100 200 300 400 500 600 700 800 900 1000 20 00 20 01 20 02 20 03 20 04 20 05 20 06 20 07 20 08 20 09 20 10 Forecast Autoliv China Sales (MUSD) Autoliv China/Management Presentation/May 10/ - 16 Copyright Autoliv Inc., All Rights Reserved Autoliv China – Sales Composition 2009 Domestic 76% Export - Ext 5% Export - Int 19% FC Autoliv China/Management Presentation/May 10/ - 17 Copyright Autoliv Inc., All Rights Reserved Autoliv China – Domestic Sales by OEM Origin 2009 Japan 29% US 15% China 15% Europe 39% Korea 2% FC Autoliv China/Management Presentation/May 10/ - 18 Copyright Autoliv Inc., All Rights Reserved Autoliv China – Domestic Sales by OEM 2009 Nissan 11% GM 11% PSA 10% Toyota 5% Chery 5% GWM 5% Geely 1% Other CN 4% Other JP 3% Other OEM 4% Ford 4% VW 28% Honda 9% FC Autoliv China/Management Presentation/May 10/ - 19 Copyright Autoliv Inc., All Rights Reserved China (SB,AB,SW,EL) Market Share 2009 TAK 14% TRW 12% MOBIS 7% JINHENG 6% NP 4% KSS 3% TOKAI 3% Other 18% BYD 3% ALV 24% TG 6% FC Autoliv China/Management Presentation/May 10/ - 20 Copyright Autoliv Inc., All Rights Reserved China Seat Belt Market Share 2009 TAK 20% TRW 10% TOKAI 8% GUANGDA 5% YIZHONG 4% Other 10% ALV 37% SAMSONG 6% FC Autoliv China/Management Presentation/Apr 10/ - 21 Copyright Autoliv Inc., All Rights Reserved China Airbag Market Share 2009 TAK 15% TRW 13% TG 11% Jinheng 10% NP 7% KSS 4% Other 4% BYD 3% ALV 22% MOBIS 11% FC Autoliv China/Management Presentation/May 10/ - 22 Copyright Autoliv Inc., All Rights Reserved China Steering Wheel Market Share 2009 TRW 18% TG 11% TAK 10% KSS 8% DAIMAY 5% DAEYOO 4% NP 9% ALV 15% JINHENG 4% Other 13% BYD 3% FC Autoliv China/Management Presentation/May 10/ - 23 Copyright Autoliv Inc., All Rights Reserved China Electronics Market Share 2009 MOBIS 16% JINHENG 12% BOSCH 11% Calsonic K 8% SIEME 5% BYD 6% CONTI 9% ALV 16% TRW 4% Other 13% FC Autoliv China/Management Presentation/May 10/ - 24 Copyright Autoliv Inc., All Rights Reserved Autoliv in Shanghai Jiading District Jiangsu Province Zhejiang Province Hongqiao Airport Pudong Int.’ Airport Pudong New AreaShanghai City Fengxian District ACX - Webbing ACI - Inflator ACE – Electronics ACW – Steering Wheel Hangzhou Bay ACS – Airbag & Seat Belt ACH & CTC Autoliv China/Management Presentation/May 10/ - 25 Copyright Autoliv Inc., All Rights Reserved Autoliv China Headquarters, China Technical Center & Factory Relocation Project „ Land area: 61,500M2 ƒ Phase I Built-Up: 27,500M2 ƒ Start construction: Apr 2008 ƒ Construction completion: Dec 2008 ƒ Relocation completed: Mar 09 Autoliv China/Management Presentation/May 10/ - 26 Copyright Autoliv Inc., All Rights Reserved Fengxian Site Summary „ Land area: 82,500 M2 „ 3 companies „ ACE Autoliv (China) Electronics, SOP 2006 „ ACI Autoliv (China) Inflator, SOP 2007 „ ACW Autoliv (China) Steering Wheel, SOP 2007 ACE ACI ACW Autoliv China/Management Presentation/May 10/ - 27 Copyright Autoliv Inc., All Rights Reserved New Guangzhou Plant (ACG) „ Land area: 22,300 M2 „ SOP: 2007 Autoliv China/Management Presentation/May 10/ - 28 Copyright Autoliv Inc., All Rights Reserved Same Flawless Quality Customer Reject Index 0.0 0.2 0.4 0.6 0.8 1.0 2000-2004 2005 2006 2007 2008 2009 F China Autoliv China/Management Presentation/May 10/ - 29 Copyright Autoliv Inc., All Rights Reserved Same Flawless Quality - Quality Requirements 7 PPM = one rainy day since 1600 1 PPM = one rainy day since 731 B.C. (公元前７３１年) Challenges: Quality Year 1405, the Ming Xiaoling Mausoleum was finished. Confucius (孔子) was born September 28, 551 BC Autoliv China/Management Presentation/May 10/ - 30 Copyright Autoliv Inc., All Rights Reserved 268.2* 242.7 15.5** 91.4 130.4 41,600 43,443 6,376 7,931 98,738 1.26 1.85 0.22 0.93 0.45 1 : 6,400 1 : 5,600 1 : 2,400 1 : 11,500 1 : 1,300 Fatality risk per vehicle Fatalities [Mio] [Mio] Road accidents involving injuries Registered motor vehicles ~ 600 people die worldwide in traffic accidents every day Equivalent Corresponds to 2-4 major plane catastrophes every day! World Wide Road Safety 2010 CSM Active Safety Report: Safety Trends & Roadmaps Autoliv China/Management Presentation/May 10/ - 31 Copyright Autoliv Inc., All Rights Reserved Living our Vision „ Traffic Accident Research • Shanghai Road Traffic Safety Scientific Research Center • Pioneering partners:- 9 Tongji University 9 Medical College of Shanghai Jiaotong University 9 Auto. Eng. College, Shanghai University of Engineering Science 9 Ruijin Hospital 9 Shanghai Motor Vehicle Inspection Center 9 Autoliv (Shanghai) Vehicle Safety System Technical Center 9 GM (China) Investment Co., Ltd 9 Volkswagen (China) Investment Co., Ltd 9 Mercedes-Benz (China) Ltd 9 Bosch (China) Investment Ltd 9 Product Quality Supervision, Inspection and Quarantine Center Autoliv China/Management Presentation/May 10/ - 32 Copyright Autoliv Inc., All Rights Reserved Autoliv Every year, Autoliv’s products save over 20,000 lives The Worldwide leader in Automotive Safety Systems