GLOBAL INSIGHT AUTOMOTIVE SEMINAR

Transcription

1 GLOBAL INSIGHT AUTOMOTIVE SEMINAR 12 JUNE 2007 OKURA GARDEN HOTEL SHANGHAI China and India Outlook and Implications for the Global Automotive Industry Ashvin Chotai Director, Asian Automotive Industry Research

2 Asian Automotive Industry: Key Highlights and Topics of Debate: 2006/2007 How big will China become? Winners and Losers Foreign Brands vs Chinese Brands Hard Landing? Fuel Tax? Will India be the next China? What is behind the rising level of interest in India What is Tata s 1lakh rupee car? Is it for real? Potential and Obstacles to Growth? Winners and Losers How rapidly will Chinese and Indian exports grow? Can they make the same impact as Japanese and Korean brands? Resurgence in Japanese Domestic Production Strong exports encouraging capacity expansion for first time since early 1990s Japan Production Surpassed U.S. production in 2006 Global production by Japanese brands estimated at 22.3 million in 2006 Korean Industry Hit by Strong Currency and Strikes Overseas Expansion Will Accelerate Limited Growth in South Korea ASEAN Rapidly Losing Ground to India and China Mini slump in 2006 Mixed Outlook for 2007 Copyright 2007 Global Insight, Inc. 2

3 Presentation Outline Overview Global OEM Financial Performance Overview Asian developments in a global perspective Focus on China and India Sales, exports and production outlook Product and segmentation trends Key challenges / obstacles for exporters from China and India Chinese brands and their global ambitions Global OEM export plans from India Key players and performance outlook Developments in Asian Medium and Heavy Truck Market Focus on China and India Global Implications Copyright 2007 Global Insight, Inc. 3

4 Japanese Big 3 Accounted for ~84% of Global Industry Level Operating Profits Last Year Billion US$ Operating Profits Before Special items: Total of Top 17 OEMs: $39.6bn Toyota Honda Nissan Mazda Mitsubishi Suzuki Daihatsu GM Ford BMW DCX VW Renault PSA Fiat Hyundai Kia Operating Profits Japanese OEMS: $36.7 bn European OEMs: $24.4 bn U.S. OEMs: Lost $22.7 bn Korean OEMs: $1.2bn Combined operating profits of Toyota, Honda and Nissan were US$ 33.3 billion Combined net profits of 17 OEMs was $27.7 billion Japanese Big 3 combined Net Profits of $23.8 billion 86% of industry Operating income excluding special items For Japanese companies: Fiscal year ending March Exchange rate of 1US$ =116 Yen For U.S. and European companies: Calendar year Exchange rate of 1 Euro = US$1.3 Copyright 2007 Global Insight, Inc. 4

5 Japanese Big 3 and BMW Still Enjoying the Best Operating Margins COMPANY Operating Margin Net Margin Toyota 9.3% 6.9% BMW 8.4% 5.9% Honda 7.7% 5.3% Nissan 7.4% 5.0% Mazda 4.9% 2.3% Hyundai 4.5% 5.6% DCX 4.4% 2.5% Suzuki 4.2% 2.4% VW 4.2% 0.9% Daihatsu 3.3% 2.1% Fiat 3.2% 2.2% Renault 2.1% 6.9% PSA 2.0% 0.3% Mitsubishi 1.8% 0.4% Kia -0.7% 0.2% GM -3.7% -1.1% Ford -9.4% -7.9% Aggregate of Top 17 Global OEMs 2.7% 1.9% At Hyundai and Kia Contribution from Overseas plants only appears in Net Profits and Margins Renault Net Margins Boosted By Its Stake in Nissan Operating income excluding special items For Japanese companies: Fiscal year ending March Exchange rate of 1US$ =116 Yen For U.S. and European companies: Calendar year Exchange rate of 1 Euro = US$1.3 Copyright 2007 Global Insight, Inc. 5

6 2006: All Vehicles Sales of 68.7 Million Units Global Growth of 2.57 Million Units China Again the Main Growth Engine Global 2.57m units, Asian 1.2m units China:1.42m units 2006 Sales Growth/Declines By Country Strongest Performers Weakest Performers CHINA RUSSIA INDIA BRAZIL GERMANY VENEZUELA UKRAINE ITALY SOUTH AFRICA IRAN ARGENTINA COLOMBIA SAUDI ARABIA ECUADOR PORTUGAL HUNGARY THAILAND AUSTRALIA FRANCE MALAYSIA TURKEY UNITED KINGDOM JAPAN TAIWAN INDONESIA UNITED STATES Change in Vehicle Sales (Thousand units) Change in Vehicle Sales (Thousand units) Most significant declines in U.S., Indonesia and Taiwan Copyright 2007 Global Insight, Inc. 6

7 2006: Production Growth of 2.9 Million Units in Asia China Again the Main Growth Engine Global 2.9m units, Asian 2.33m units China:1.54m units 2006 Production Growth/Declines By Country CHINA JAPAN MEXICO INDIA CZECH REPUBLIC ITALY RUSSIA SOUTH KOREA ARGENTINA TURKEY POLAND SLOVAKIA IRAN COLOMBIA UKRAINE THAILAND SOUTH AFRICA GERMANY BRAZIL Strongest Performers Weakest Performers CHILE SWEDEN SERBIA PHILIPPINES NETHERLANDS SLOVENIA MALAYSIA AUSTRALIA CANADA TAIWAN UK INDONESIA FRANCE UNITED STATES Change in Vehicle Production (Thousand units) Change in Vehicle Production (Thousand units) Most significant declines in U.S., France, Indonesia and UK Copyright 2007 Global Insight, Inc. 7

8 China Market: Key Trends Changing customer mix greater diversity Traditionally SOEs, government, taxi firms Then private buyers in big cities Motorisation now spreading to small cities Ageing population will become a more dominant theme after 2010 Government encouraging independent brands Encouraging supply development in budget segments Further intensification in price competition Chinese brands accelerating motorisation rather than taking significant share from foreign JVs Market and consumer dynamics entering first stage of maturity Development of used car market now gathering momentum Brand experience and better brands consciousness in Tier 1/2 cities Energy and environmental concerns fuel prices still low Limited impact on short term demand Fuel consumption and environmental factors will constrain long term growth in motorisation Fuel efficiency standards will encourage move to smaller cars Parallel production of more than one generation of same model Repositioning of older models to lower price point or different consumer segment Copyright 2007 Global Insight, Inc. 8

9 China Production: YTD Performance and 2007 Forecast Total Production of Nearly 8.7 Million Units Vehicle Type 2006 Production Level 2006 Production Growth Jan-April 2007 Performance (Year-over year Growth) 2007 Forecast Level 2007 Forecast Growth Passenger Cars 4306K 36.4% 26.3% 5289K 22.8% Minibus 931K 14.7% 1.6% 971K 4.3% Mintrucks 298K 26.8% 29.3% 350K 17.5% Light Trucks 933K 12.9% 12.0% 1056K 12.9% Light Buses 197K 11.0% 19.2% 230K 16.8% TOTAL LCV 2361K 14.4% 8.9% 2607K 10.4% Medium Trucks 202K 2.5% 19.7% 235K 16.5% Heavy trucks 304K 31.1% 71.7% 428K 41.0% Medium/Large Buses 96K 6.0% 31.7% 107K 10.8% TOTAL HCV 602K 16.0% 48.1% 770K 27.9% ALL VEHICLES 7269K 26.8% 21.60% 8666K 19.2% Passenger Cars include SUVs and MPV but exclude Minibus Commercial vehicle data includes chassis and articulated tractor Copyright 2007 Global Insight, Inc. 9

10 China Car, SUV, MPV Sales: 2007 Sales Growth of Around 21% in 2007 to 5.27 Million Units 2005 Car Sales: 3.3 million units 2006 Car Sales: 4.4 million units Jan-April % Year-over- year Growth 2007 Estimate: Car Sales (Including Imports): 5.27m units 550 Car Sales (Thousand units) Jan Feb. Mar. Apr. May Jun. Jul. Aug. Sep. Oct. Nov. Dec Includes Cars, SUVs and MPVs But Excludes Minibuses Copyright 2007 Global Insight, Inc. 10

11 Car Price Decline Trend By Segment C-Segment Compact Cars Experiencing Biggest Falls 102 Price Index (Jan 2004=100) E/F D C B A Jan-04 Apr-04 Jul-04 Oct-04 Jan-05 Apr-05 Jul-05 Oct-05 Jan-06 Apr-06 Jul-06 Oct-06 Jan-07 Apr-07 Price Declines: Jan 2004-April 2007 Outlook Segment A: 20% Segment B: 22% Segment C: 38% Segment D: 22% Segment E/F: 9% Local companies putting further pressure on prices Weak brands and older models most vulnerable Contemporary models, stronger brands and luxury segments less vulnerable Copyright 2007 Global Insight, Inc. 11

12 China in Regions H eilon gjiang Harbin Xinjiang Gansu Tianjin C hangch un N ingxia Inner Mongolia Beijing Shanxi Hebei S h en yan g Liaoning Yantai Jilin Qinghai Xining Tibet Shaanxi Henan Anhui Jiangsu Nanjing Shanghai Sichuan Yunnan Chengdu Wuhan Chongqing Guizhou Guiyang Hubei Hunan Guangzhou Nanchang Jiangxi Guangxi Guangdong Hefei H a ng zho u Fujian Zhejian g Fuzhou Taiwan Nanning Hong Kong Macau Hainan Haikou Copyright 2007 Global Insight, Inc. 12

13 Car Ownership Levels by Region at the End of 2005 Passenger Vehicles Per Thousand People Highest Ownership Levels in North (Beijing) and South (Guangzhou) South-West Beijing /Government Purchase Influence North-West Central North-East North South Per Capita Income (Thousand Yuan) East Shanghai License plate restrictions Better public transport Copyright 2007 Global Insight, Inc. 13

14 Motorisation Now Diffusing Rapidly to Second and Third Tier Cities Per Capita Disposable Income (RMB) China s Richest 16 Cities: Population of Over 110 million Population in Million Shenzen Dongguan Wenzhou Zhuhai Shanghai Guangzhou Beijing Shoxing Ningbo Hangzhou Xiamen Nanjing Qingdao Dalian Chengdu Wuhan Copyright 2007 Global Insight, Inc. 14

15 China: Passenger Cars: B and C Segments Expected to Account for over 50% of all Growth in the Period Sales Increase ( ) A B C D E SUV MPV OTHER Growth in Period 2012 Vs 2006 Total Growth: 4.2million units Includes Cars, SUVs and MPVs But Excludes Minibuses Total Sales: 8.5million units A B C D E SUV MPV OTHER Sales Level In 2011 Copyright 2007 Global Insight, Inc. 15

16 China Production Will Overtake Japan and U.S. by 2010/2011 But Profits Under Pressure Production (Thousand Units) CAGR : 24.8% CAGR : 10.7% Car LCV Truck and Bus Rapid spread of motorisation in second and third tier cities from 2005/2006 Aggressive product and market strategies by domestic brands Fuel consumption and environment issues will be major obstacles to more rapid growth Cars 9.1 million, LCV 3.3 million, HCV : 945K Total 2012 Production: 13.4million units Million Units Incremental Year-Over Year Growth Copyright 2007 Global Insight, Inc

17 Consumers Still Have Strong Appetite for Cars But What Could Go Wrong? Economic hard landing Focus on controlling investments and exports Long term solution boost domestic consumption Government unlikely to adopt anti-consumption policies Environmental disaster Loss of confidence and impact on FDI Would trigger clampdown on industrial growth Oil supply squeeze Pump prices will need to be hiked up more aggressively Chinese oil companies investing to secure oil supplies Social or political backlash Regional disparities From Equal Poverty To Unequal Wealth Can the government achieve more balanced development Banking crisis Lower probability now as banks are better capitalised Trade backlash especially from U.S. But U.S. multinationals are the major exporters Will force a more rapid yuan appreciation Copyright 2007 Global Insight, Inc. 17

18 China: Total Vehicle Exports of 343K Units in 2006 Small Trucks Account for the Bulk of Exports Thousands Units Others (Mainly Chassis) Buses Trucks Passenger Cars 2000: US$ million 2005: US$ 1.58 billion 2006: US$ 3.13 billion Excludes engines, components and motorcycles : US$ 2 billion 2005: US$ 16.8 billion (13% of output) All Automotive Exports including vehicles, engines, components and motorcycles Thousands Units Average price of exported passenger car $7400 Top Exporter in 2006 Around 1,175 organisations exported vehicles in 2006 Over 669 of these exported less than 10 units 204 companies exported just 1 unit 10 0 CHERY HARBIN HAFEI GREAT WALL HONDA CHANGAN FAW GEELY JIANGLING ANHUI JIANGHUAI CHANGHE Copyright 2007 Global Insight, Inc. 18

19 China Exports: Still Significant Obstacles Growth Unlikely to be Spectacular Foreign OEMs 50% cap on foreign ownership of assembly ventures is restrictive Does not encourage global OEMs to hike vehicle exports Complicated to integrate China operations into regional and global networks under current ownership structure India, Thailand, Mexico, Brazil and S. Africa are attractive alternatives with fewer restrictions Current focus of exports is on components Exception is Honda Chinese OEMs Chinese brands still have major hurdles to overcome Upstream: Product quality and refinements Regulatory: Homologation, Safety and Emissions Downstream: Branding, Distribution Network, After-Sales, Warranties So far an opportunistic approach by Chinese brands Deals with inexperienced operators unable to grapple with all the product, regulatory, brandbuilding issues Need a coherent strategy and greater direct OEM presence in key export regions International mindset Alliances and rebadging relationships will provide learning experience and reduce risks e.g. Chery and Chrysler Chery and Fiat Copyright 2007 Global Insight, Inc. 19

20 Chinese Assemblers Striving to Develop Independent Development Capability: Key Development Stages Imitation Reverse Engineering and Adapting of China Use of Design Houses for Interior and Exterior Styling Use of Design Houses to Develop Own Platform and Powertrain Development In-house Capability to Manage Design and Development of All Core Parts of the Vehicle Globally Competitive Development Capability & Product Portfolio and Renewal Generally use of many of the original suppliers of copied models Use of Local Suppliers to commodity parts Relationship with foreign suppliers for critical parts Powertrain generally outsourced e.g. Pininfarina, Bertone, IDEA, Guigaro E.g. AVL, Ricardo. Lotus, Magna, Tier 1 Suppliers Build Up Low Cost Development Capability Many players still at this stage Changfeng Zhongxing Great Wall Changan Brilliance Geely Chery Copyright 2007 Global Insight, Inc. 20

21 Chinese Brands: Examples of Other Development Strategies Acquisition of foreign companies to accelerate development SAIC purchase of Rover and Ssangyong Nanjing acquisition of some Rover technology Rely on foreign JV partner to transfer technology FAW obtaining access to VW, Toyota, Mazda platform Copyright 2007 Global Insight, Inc. 21

22 China Exports: Commercial Vehicles Dominate.Passenger Car Export Take-off from 2009/2010 Total Exports: 343K in Around 1 Million in 2011 Thousands Others (Mainly Chassis) Buses Trucks Passenger Cars Copyright 2007 Global Insight, Inc. 22

23 Growth Prospects by Company: Sino-Foreign JVs Sino-Foreign JVs: LV Production Increase of 2.6 Million Units* in the Period VW GROUP TOYOTA GM SGM WULING HYUNDAI HONDA NISSAN PSA 2006 Production Production Growth FORD SUZUKI MAZDA DAIMLERCHRYSLER Increase in Vehicle Production (000 units) 2012 vs 2007 Based on Ownership of Technology * SGM Wulin counted under Domestic Brand Total Copyright 2007 Global Insight, Inc. 23

24 Growth Prospects by Company: Domestic Brands Domestic Brands LV Production Increase of 3.3 Million Units* in the Period CHANGAN CHERY FAW GEELY GREAT WALL SAIC SGM-WULIN ANHUI JIANGHUAI DONGFENG BEIJING AUTOMOTIVE AVICHINA LIFAN GROUP CHINA BRILLIANCE NANJING AUTOMOTIVE BYD AUTO Production Production Growth All Light Vehicles < 6 Tonnes GVW Current Production minicommercial future cars Increase in Vehicle Production (000 units) 2012 vs 2007 Based on Ownership of Technology * SGM Wulin counted under Domestic Brand Total Copyright 2007 Global Insight, Inc. 24

25 China Component Industry: Opportunities and Challenges for Global Suppliers OE competitive dynamics changing rapidly Unique mix of OE customer base in China U.S., European, Japanese, Korean and Chinese platforms in production Challenge is to have diversified customer base and leverage regionally and globally Greater competition and concerns of intellectual property Investment by Japanese and Korean suppliers has accelerated significantly in recent years Tread carefully between protecting strategic technologies and maintaining good relations with jv partners and government Logistics Management and Tier 2/3 Supply Management are becoming key success factors Component trade surplus of around $8.7billion in 2006 Trade surplus in suspension and electronic parts.deficit in driveline and engine components Surplus vs U.S. but deficit vs Japan, Korea, Germany Integration into regional and global supply chain China s role rising rapidly Bosch, Delphi, Visteon, Borg-Warner, Conti-Teves, Federal Mogul, PPG, Goodyear all have their Asia-Pacific HQ in Shanghai Copyright 2007 Global Insight, Inc. 25

26 Revival of Interest in India But Will Not Match China s Growth Strong economic performance Real GDP growth of >8% for four consecutive years After years of underperformance healthy signs that vehicle market growth is accelerating Many companies have made investments in China and now regard India as the next natural step Also reflects some disillusionment with China Greater focus on fuel efficiency and small cars Bottom line India will not match China s auto industry growth rates Only companies with strong small car product line will achieve significant scale India will be the second biggest growth market on 5 and 10 year horizons Greater transparency and level playing field More attractive to establish export strategy and integration with global supply chain Offers significant scope for leveraging on low cost component production and engineering services for global operations Copyright 2007 Global Insight, Inc. 26

27 Tata Plans to Target 2-Wheeler Owners with its Microcar (1 Lakh Car) Other OEMs Now Beginning to Take Note Styling work completed Prototypes being tested Rear engine 4 5 seat car with 600cc Euro IV compliant 30hp engine Planning a diesel version Innovative production concept and supplier relationship Mother plant in West Bengal and satellite assembly locations across India Target price of base version expected to be $2500 (125,000 rupees) about half the price of the Maruti Alto Attractive financing will play a key role in supporting sales Tata expanding its vehicle finance network in rural areas Tata Microcar will target buyers of Two-Wheelers Tata targeting 1 million units Copyright 2007 Global Insight, Inc. 27

28 India Gaining Popularity as an Attractive Export Base for Global OEMs Few restrictions on foreign ownership of assembly ventures Full management control Easier to integrate into global strategy and supply chain India gradually positioning itself as global production hub for small cars Several global OEMs planning large export operations Hyundai already the largest exporter raising exports levels Suzuki will ramp up exports post 2009 GM will commence Matiz/Spark exports from 2009 Renault and Nissan have ambitious export plans Toyota and Honda most likely export small cars post 2010 Poor infrastructure and logistics costs are main obstacles Copyright 2007 Global Insight, Inc. 28

29 Vehicle Exports from India Beginning to Take-off Around 240K in 2006 Expected to Rise to Over 800K Units by 2012 Export Ratio of Production of around 17% in Thousand units OTHERS HONDA NISSAN GM RENAULT TATA MARUTI HYUNDAI Copyright 2007 Global Insight, Inc. 29

30 India: Small Car Makers Best Placed for Growth Light Vehicle Production Increase of 2.7 million units in the period Tata 1 lakh Car Provides a Major Boost Post 2009 TATA SUZUKI HYUNDAI GM MAHINDRA RENAULT TOYOTA HONDA VW GROUP FORD FIAT GROUP Logan plus its derivatives 1 Lakh Car (Microcar), Ace New Plant, Diesel Engines,SX4 sedan, Zen Estillo, New Wagon R New Plant, Add Aveo and Spark Ingenio in 2008 Plans to Launch Small Car Delayed to 2009 New plant and Small Car in 2010 New Plant, More Export Production 2006 Production Production Growth Production (000 units) Copyright 2007 Global Insight, Inc. 30

31 Indian Auto Industry: Opportunities and Challenges for Global Suppliers Significant scale disadvantage versus China $11 billion output in vs $57 billion in China in 2005 Major reason for cost disadvantage in many component areas Strong growth in component imports from China More attractive for engineering and development activities More stable OE competitive dynamics but small cars mean thin margins Consolidated industry dominated by Maruti, Tata and Hyundai Other companies now raising their profile Other OEMs to watch GM, Honda, Renault-Nissan Challenge is to scale up for global sourcing demands $4.4 billion (component industry) investment in the last fiscal year Global Tier 1 suppliers now accelerating expansion plans Bosch, Delphi, Visteon have significant presence Japanese suppliers have weak direct presence A competitive engineering and development base Indian suppliers are becoming global forces Bharat Forge, Taco Copyright 2007 Global Insight, Inc. 31

32 Medium and Heavy Trucks: Key Developments Japan and Korea: Legislation Driven Cyclical India and China Infrastructure Development Haulage Fleet Formation Hub-spoke distribution system Tighter control on overloading Upgrade from farm vehicles Tighter Emissions Aggressive Product Renewal of Major OEMs Japan Truck Sales (000 units Old Models '00'02'05'06'07'09'12'17 Technically and economically outdated Heavy axles to cope with overloading Crude Trucks, operated by owner-drivers Focus on Medium Trucks Asia (excl. JPN) Sales (000 units) Western OEMs testing waters in India and China 394 Copyright 2007 Global Insight, Inc '00'02'05'06'07'09'12'17 New Models Define Product Benchmark New generation, technically and commercially upgraded Professional fleet usage Life-cycle costing High "value for money" Multi-axle Trucks more competitive

33 China Truck Demand: Correction in 2005 But Recovering Strongly Since Second Half of 2006 Gradual Investment Slowdown Key Trends Truck and Bus Sales (Thousand Units) Trucks 6-15T GVW Trucks >15T GVW 2000 Medium and Large Buses Strong investments and infrastructure construction supporting demand Overloading restriction fuelled major boom in 2004 Correction in 2005 and recovery in 2H of 2006 Road Tolls Charging discouraging overloading Demand for large (>25t) Artic tractors is especially strong Migration from farm vehicles supporting medium truck sales Copyright 2007 Global Insight, Inc. 33

34 China Truck Market Changing Market Dynamics CNHTC and Shaanxi Enjoying Strong Growth CBU Imports High import content Trucks Specialist Applications e.g. Mining industry Specialist Applications Less Price Sensitive Volvo, Mercedes- Benz, MAN Anhui Hualing Value of Money Advanced Trucks Low end Heavy Trucks Low end Medium Trucks Now Rapidly Becoming Core Segment Traditionally the Core Segment Now Migration to Advanced trucks Static /Declining segment Some migration from farm trucks CNHTC, Shaanxi enjoying strong growth FAW, Dongfeng, Foton FAW, Dongfeng, Nanjing, Foton Farm truck companies entering this segment Copyright 2007 Global Insight, Inc. 34

35 India Truck Sales: Strong Up Cycle Continuing New Entrants Will Struggle to Build up Volumes HCV Sales (Thousand Units) Medium Trucks Heavy Trucks Bus 2012 Key Trends Infrastructure development a major driver Strong industrial performance Overloading restrictions boosted 2006 performance Less dependent on agricultural sector and monsoons HCV Production (Thousand units) FORCE/MAN SWARAJ EICHER MAHINDRA ASHOK LEYLAND TATA Key New Players Force Motor -- MAN: Joint Venture: Aiming for high local content Mahindra & Mahindra and International: Joint Venture: Aiming for high local content Volvo 100% Owned Subsidiary: low volume DaimlerChrysler 100% Subsidiary: Very low volume Copyright 2007 Global Insight, Inc. 35

36 Top Six Countries Will Account for 60% of Global Production in 2012 Major Markets for OEM Parts CHINA UNITED STATES JAPAN GERMANY INDIA S KOREA FRANCE CANADA BRAZIL SPAIN MEXICO RUSSIA THAILAND UK ITALY IRAN TURKEY Global production: 69.8 in Million units in Million Units of Growth India and China will account for 57% 17 Countries with production over 1m units in 2012 will account for 90% of global production in 2012 China, Japan, Korea and India will account for nearly 40% of global vehicle production in Production Production Growth Vehicle Production (Million units) Including Passenger Cars And Commercial Vehicles Copyright 2007 Global Insight, Inc. 36

37 Global Production Growth Performance (2012 vs 2006) 15.6 Million Units (Net of Double Count) Increase in the Period Million Units in Asia TOYOTA GM FORD VW GROUP DAIMLERCHRYSLER HYUNDAI HONDA PSA NISSAN RENAULT FIAT GROUP SUZUKI BMW MAZDA MITSUBISHI Increase in Vehicle Production (000 units) Total Production (Excluding Double Counting) 2006: 69 million units 2012: 84.7 million units North America South America West Europe East Europe Japan China Rest of Asia Middle East/Africa Copyright 2007 Global Insight, Inc. 37

38 Global OEM Global Production Mix: 2006 COMPANY NORTH AMERICA WEST EUROPE EAST EUROPE JAPAN CHINA REST OF ASIA SOUTH AMERICA MIDDLE EAST/AFRICA TOTAL Percentage of Global Production (All Vehicles) TOYOTA 16.8% 5.8% 3.0% 54.9% 3.1% 13.1% 1.8% 1.6% 100.0% GM 53.2% 17.8% 3.4% 0.0% 5.2% 11.2% 8.3% 0.8% 100.0% FORD-MAZDA 40.0% 28.9% 4.2% 13.0% 2.7% 4.1% 6.0% 1.2% 100.0% RENAULT-NISSAN 19.3% 32.8% 10.3% 24.2% 3.9% 4.4% 2.9% 2.2% 100.0% VW GROUP 6.0% 50.9% 16.9% 0.0% 12.0% 0.2% 11.6% 2.3% 100.0% DAIMLERCHRYSLER 61.1% 31.3% 0.4% 3.1% 0.3% 1.1% 1.9% 0.8% 100.0% HYUNDAI 5.4% 0.0% 3.6% 0.0% 9.4% 71.7% 0.1% 9.8% 100.0% HONDA 38.1% 5.1% 0.5% 36.7% 9.7% 7.7% 2.2% 0.0% 100.0% PSA 0.0% 70.0% 7.3% 0.0% 5.8% 0.1% 5.5% 11.4% 100.0% FIAT GROUP 0.0% 50.8% 21.8% 0.0% 1.9% 0.1% 24.5% 0.8% 100.0% SUZUKI 0.6% 0.2% 6.2% 48.5% 7.2% 37.3% 0.0% 0.0% 100.0% BMW 7.5% 85.9% 0.3% 0.0% 1.8% 0.3% 0.0% 4.2% 100.0% MITSUBISHI 8.1% 6.8% 0.0% 57.4% 4.7% 19.4% 2.6% 0.9% 100.0% TOTAL 22.8% 23.2% 7.6% 16.4% 10.4% 12.5% 4.6% 2.5% 100.0% >50% 25-50% 10%-25% Copyright 2007 Global Insight, Inc. 38

39 Global OEM Global Production Mix: 2012 COMPANY NORTH AMERICA WEST EUROPE EAST EUROPE JAPAN CHINA REST OF ASIA SOUTH AMERICA MIDDLE EAST/AFRICA TOTAL Percentage of Global Production (All Vehicles) TOYOTA 20.2% 5.8% 2.7% 45.0% 6.7% 15.8% 2.2% 1.5% 100.0% GM 48.6% 16.6% 4.9% 0.0% 7.0% 13.9% 8.4% 0.6% 100.0% FORD-MAZDA 33.5% 27.8% 5.9% 11.8% 6.6% 7.4% 5.9% 1.2% 100.0% RENAULT-NISSAN 16.0% 26.3% 10.7% 19.4% 5.7% 12.7% 3.6% 5.7% 100.0% VW GROUP 6.9% 46.5% 17.6% 0.0% 14.9% 2.4% 8.9% 2.9% 100.0% HYUNDAI 7.2% 0.0% 13.5% 0.0% 12.6% 63.1% 0.2% 3.5% 100.0% DAIMLERCHRYSLER 53.8% 34.0% 0.4% 3.5% 2.7% 1.7% 2.1% 1.7% 100.0% HONDA 38.5% 4.1% 2.0% 30.4% 11.8% 11.1% 2.1% 0.0% 100.0% PSA 0.0% 61.6% 13.0% 0.8% 9.6% 0.2% 6.2% 8.5% 100.0% FIAT GROUP 0.0% 48.1% 21.5% 0.0% 4.0% 1.6% 22.0% 2.9% 100.0% SUZUKI 1.4% 0.0% 5.4% 40.7% 9.3% 43.0% 0.0% 0.2% 100.0% BMW 13.0% 79.8% 0.6% 0.0% 3.0% 0.6% 0.0% 3.0% 100.0% TATA 0.0% 0.0% 0.1% 0.0% 0.0% 99.7% 0.1% 0.2% 100.0% TOTAL 20.0% 20.3% 8.2% 13.6% 15.7% 15.6% 4.2% 2.4% 100.0% >50% 25-50% 10%-25% Copyright 2007 Global Insight, Inc. 39

40 GLOBAL INSIGHT AUTOMOTIVE SEMINAR 12 JUNE 2007 OKURA GARDEN HOTEL SHANGHAI Thank You Ashvin Chotai Director, Asian Automotive Industry Research