www.autofacts.com Autofacts Industry Update September 10, 2015
1 Global Global 2
1 Global Regional outlook The lion s share of the new volume is expected to come from developing markets, and in particular developing Asia- Pacific, providing nearly 65% CTG** from 2014-2021. Regional Contribution to Growth* 2014 2021 (percentage share) Americas Europe, Middle East & Africa (EMEA) Asia-Pacific North America South America European Union Eastern Europe Middle East & Africa Developing Asia-Pacific Developed Asia-Pacific 13.6% 5.5% 10.4% 6.0% 4.5% 64.8% -4.8% Regional Topline Comparison & Volume Change 2014 vs. 2021 +3.1m +1.2m +2.3m +1.3m +1.0m +14.4m -1.0m 2021 2014 20.2m 5.0m 19.0m 4.6m 2.9m 44.4m 12.4m 17.1m 3.8m 16.7m 3.3m 1.9m 30.0m 13.4m Source: Autofacts 2015 Q3 Forecast Release *Region size not to scale **CTG = Contribution to Growth 3
1 Global Alliance group outlook Despite calls for industry consolidation, particularly in China, the global automotive market is expected to remain highly diversified throughout the forecast window, with little to no M&A activity at the automaker level. 53 Alliance Groups (24%) 56 Alliance Groups (22%) Source: Autofacts 2015 Q3 Forecast Release *RN = Renault-Nissan **FCA = Fiat-Chrysler Automobiles 4
1 Global Supplier consolidation on the rise 2015 will likely be a record year for automotive supplier deal value. PwC is forecasting $48b in closed transactions for the full year. Source: Thompson Reuters, CapIQ, Other publicly available sources, Strategy& Analysis 5
1 Global Powertrain outlook A myriad of technologies will be used as the industry balances consumer demands with global emission standards. Market share for alternative propulsion vehicles is expected to reach 6.7% in 2021, more than doubling from 2014 (3.3%). 2021F 2014 Source: Autofacts 2015 Q3 Forecast Release *Includes mild & full hybrid 6
North America 7
Increased sales expected, but at a slower rate While a record sixth consecutive year of sales growth is all but certain for the U.S. in 2015, a slowdown and eventual downturn is on the horizon. Light Vehicle Sales by Country 2006 2021(millions) 25 20 15 10 5 16.5 16.1 13.4 10.4 11.6 12.7 14.4 15.5 16.4 17.1 17.3 17.3 16.5 16.9 17.2 17.3-2006 2007 2008 2009 2010 2011 2012 2013 2014 2015F 2016F 2017F 2018F 2019F 2020F 2021F US Canada Mexico Source: Autofacts 2015 Q4 Preliminary Forecast Release 8
Low rates continue to drive sales Auto interest rates remain near their historic low levels, thanks in part to aggressive measures taken by the Federal Reserve, however with the Fed likely to raise rates this year, the good times aren t likely to last for consumers. Source: Federal Reserve G20 Report, Autofacts Analysis, Oxford Economics 9
Industry nearing a tipping point Consumers are likely to feel increased upward pressure on the amount financed as average selling prices continue to rise, helping to drive the total amount of outstanding auto loan debt to record highs. Source: NADA, Federal Reserve Bank of New York 10
What goes around, comes around While the U.S. auto industry is enjoying one of its most successful periods in recent memory, history also reminds us that the good times can t last forever. U.S. Economic Recessions 1960 2021 Source: Autofacts 2015 Q3 Forecast Release 11
Import share continues to erode Driven by increased localization of assembly within the region, non-nafta U.S. light vehicle imports are expected to see a YoY (year-over-year) decline for the 5 th time in the last 6 years. Source: Ward s Automotive Reports, Autofacts Analysis *Non-NAFTA **Thru August 2015 12
Big 3 import markets still dominating While Japan, South Korea and Germany still represented the countries of origin for over 90% of vehicle imports in 2014, the drop in import volume for those OEMs who localized assembly is telling of the direction the industry is heading. Source: Ward s Automotive Reports, Autofacts Analysis *Includes Audi & Porsche **Includes Kia 13
US imports poised for a sharp decline Taking into account both announced and forecasted capacity expansion through 2021, Autofacts estimates that US imports could see a decline of nearly 50% from current levels. North America Capacity Expansion by Company 2015 2021 2.65m *.84 = 2.23m 2.23m *.83 (US regional sales share) = 1.85m Source: Company Announcements, Autofacts 2015 Q3 Forecast Release, Autofacts Analysis 1 Includes Kia 2 COMPAS = Cooperation Manufacturing Plant Aguascalientes) 3 Includes Audi & Porsche 14
Steady growth anticipated for exports Increased global demand for large CUVs and SUVs, many of which are sole sourced from North America, are expected to result in export growth for the foreseeable future. Fiat-Chrysler Automobiles WA Plant: Jefferson North (Detroit, MI) MT Vehicles Produced: Jeep Grand Cherokee, Dodge Durango ND 2014 Assembly: 364,000 OR Non-NAFTA Export Estimate: 93,000 (26%) ID SD MN WI MI NY VT NH ME Fiat-Chrysler Automobiles Plant: Toledo Supplier Park (Toledo, OH) Vehicles Produced: Jeep Wrangler / Wrangler Unlimited 2014 Assembly: 235,000 Non-NAFTA Export Estimate: 34,000 (14%) MA WY General Motors NV Company NE Plant: Arlington (Arlington, UT TX) CO Vehicles Produced: Cadillac, Chevrolet, GMC SUVs CA 2014 Assembly: 300,000 Non-NAFTA Export Estimate: 33,000 (11%) AZ NM KS OK IA MO AR IL MI OH IN KY TN WV SC VA PA NC DE MD NJ RI CT BMW Plant: Spartanburg (Spartanburg, SC) Vehicles Produced: X3, X4, X5, X6 2014 Assembly: 344,000 Non-NAFTA Export Estimate: 241,000 (70%) MS AL GA Daimler AG TX LA FL Plant: Tuscaloosa (Vance, AL) Vehicles Produced: C, GLS, GLE-Class 2014 Assembly: 230,000 Non-NAFTA Export Estimate: 122,000 (53%) Source: Autofacts 2015 Q3 Forecast Release, Autofacts Analysis 15
North America forecasted to remain highly utilized OEMs have shown considerable restraint in over-expanding their assembly footprint in the North American region, leading to a highly utilized market. Source: Autofacts 2015 Q3 Forecast Release 16
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