VF de The Worldwide market for Assembly business

MARKET OVERVIEW

Global Market Evolution

91

85

77

73

71

69

64

55

28

21

20

21

16

17

15

13

21

17

16

19

Source: S&P Global Mobility (ex IHS Markit) forecast dated May 2022 (vehicles segment in line with CAAM for China, i.e. excluding vehicles >3.5t)

Growth of nearly 6 million units from 2019 to 2027 with 91 million vehicles

Recovery of 2019 volumes not expected before 2024

China dominates the market followed by South Asia (India and ASEAN)

North America expected to saturate (2027 vs. 2019)

Europe – decline outlook (2027 vs. 2019)

2027

9.7 M

1.2 M

2022

6.3 M

31%

6.1 M

30%

6.1 M

0.7 M

32%

38%

34%

25%

5.9 M

25%

4.7 M

70%

40%

28%

34%

66%

60%

35%

72%

41%

67%

58%

Growing Modular

outsourcing trend

Growing

outsourcing trend

No

outsourcing trend

Growing

outsourcing trend

Outsourced CP

In House CP

No CP Approach

Source Data: SAS Competition Data Base

Accessibility per Region

ACCESSIBILITY PER REGION,

COMPETITION LANDSCAPE

Accessibility per Region

Cockpit Module competitor landscape

Competitors Landscape

TAKE AWAY

2022

2025

3,5 bn€

3,0 bn€

Source Data: SAS Competition Data Base. Volumes based on IHS April 2022.

Accessibility per Region

2027

2022

4.7 M

5.9 M

0.7 M

6.1 M

6.3 M

1.2 M

9.7 M

25%

28%

30%

31%

40%

32%

38%

34%

72%

67%

66%

70%

• Growth Potential exist with Outsourcing trend in the Region SAS operates.

• Especially in China, where Outsourcing trend is combined with Modular approach increase.

60%

58%

41%

35%

• Top 4 player capturing 75% of Market today.


• SAS will be CP Player No. 1 in 2025 with a Market Share of 25% (coming from 20% market share in 2019 and 23% in 2022).

• Mobis, Marelli CP business mainly focused on single customer approach HKMC and RNM.

• Yangfeng main activity in CHN with more than 50% market share, but majority just labor providing.

Growing

outsourcing trend

No

outsourcing trend

Growing

outsourcing trend

Growing Modular

outsourcing trend

No CP Approach

Outsourced CP

In House CP

Source Data: SAS Competition Data Base

OEM TREND VS IN/OUT SOURCING

OEM Cockpit assembly outsourcing strategy

Trend analysis by OEM

In-House Cockpit Modules

Outsourcing Cockpit Modules w/ preferred supplier

No Cockpit Modules

Outsourcing Cockpit Modules

THE DIFFERENT BUSINESS MODELS

Cockpit Module assembly:
Business Models and their Responsibilities

--

LOW

Desoursing risk

MODERATE

LOW

Desoursing risk

HIGH

--

Business Model 4

System integration

Responsibilities

Participates to product/process development

Business Model 3

Stocks

Supplier control

Business Model 1

Responsible for stocks in terms of cash and management

Coordinates logistic and quality of over above 40 suppliers

Business Model 2

Process

Log.

Responsible for DFA

Manages complete supply chain and designs logistic

Assembly

Capex

Assembly

Capex

Labour provider

Responsible for investments

Labour provider only

Responsible for investments

Business Model

Module Assembly owner

Full Module Service without System Integration

Pure Labor provider

Full Module Service with System Integration

Cockpit Module assembly:
Business Models types per Region (2022)

NORTH AMERICA

EUROPE

Clear trend to Full Module Service

4.7 M. vehicles

Total outsourced market:

N/A

Pure Labor provider:

Module Assembly Owner:

(16%)

0.8 M. veh.

Full Module Service w/o S.I.:

(54%)

2.5 M. veh.

Full Module Service w/ S.I.:

1.4 M. veh.

(30%)

Source Data: SAS Competition Data Base. Volumes based on IHS April 2022.

EUROPE

NORTH AMERICA

Clear trend to Full Module Service

Total outsourced market:

5.9 M. vehicles

(2%)

0.1 M. veh.

Pure Labor provider:

Module Assembly Owner:

(6%)

0.3 M. veh.

Full Module Service w/o S.I.:

(34%)

2.0 M. veh.

Full Module Service w/ S.I.:

3.5 M. veh.

(58%)

Source Data: SAS Competition Data Base. Volumes based on IHS April 2022.

CHINA

CHINA

No clear trend

Total outsourced market:

6.1 M. vehicles

(27%)

1.6 M. veh.

Pure Labor provider:

Module Assembly Owner:

(23%)

1.4 M. veh.

Full Module Service w/o S.I.:

(23%)

1.4 M. veh.

Full Module Service w/ S.I.:

1.7 M. veh.

(27%)

Source Data: SAS Competition Data Base. Volumes based on IHS April 2022.

SOUTH AMERICA

Clear trend to Full Module Service

Total outsourced market:

0.7 M. vehicles

N/A

Pure Labor provider:

Module Assembly Owner:

(19%)

0.14 M. veh.

Full Module Service w/o S.I.:

(11%)

0.08 M. veh.

Full Module Service w/ S.I.:

0.5 M. veh.

(70%)

Source Data: SAS Competition Data Base. Volumes based on IHS April 2022.

SOUTH AMERICA

SAS POSITIONING VS BUSINESS MODELS

Cockpit Module assembly:


SAS positioning vs each Business Model

NORTH AMERICA

EUROPE

Take away

SAS positioned in Europe with Business models giving more content and Lower desourcing Risk.

Full Module Service w/o SI

Module Assembly Owner

Pure Labor provider

Full Module Service w/ SI

Market Size

(accessible)

4.7 M veh

1.4 M veh

0.8 M veh

0

2.5 M veh

SAS Share

58%

16%

66%

17.089

118.716

Related Sales

(Fcst 04) 2022

339.422

475.227

Source Data: SAS Competition Data Base. Volumes based on IHS April 2022.

NORTH AMERICA

Take away

SAS operates in

the biggest market where more responsibilities allow Lower desourcing Risk.

Full Module Service w/o SI

Module Assembly Owner

Pure Labor provider

Full Module Service w/ SI

0.1 M veh

3.5 M veh

0.3 M veh

Market Size

(accessible)

2.0 M veh

5.9 M veh

EUROPE

SAS Share

14%

37%

169.311

Related Sales

(Fcst 04) 2022

76.547

245.858

CHINA

Source Data: SAS Competition Data Base. Volumes based on IHS April 2022.

CHINA

Take away

SAS operates with one customer only.

Growth potential is important but SAS must insure competitiveness.

Full Module Service w/o SI

Module Assembly Owner

Pure Labor provider

Full Module Service w/ SI

Market Size

(accessible)

6.1 M veh

1.7 M veh

1.4 M veh

1.6 M veh

1.4 M veh

SAS Share

57%

Related Sales

(Fcst 04) 2022

85.504

Source Data: SAS Competition Data Base. Volumes based on IHS April 2022.

SOUTH AMERICA

Take away

In South America SAS prefers Business Model nb. 2, in regards to Risk Mitigation.

Business Model nb.4 driven by Mobis, Marelli and Faurecia (Jeep).

Full Module Service w/o SI

Module Assembly Owner

Pure Labor provider

Full Module Service w/ SI

0

0.5 M veh

0.14 M veh

Market Size

(accessible)

0.08 M veh

0.7 M veh

100%

SAS Share

38.878

3.699

Related Sales

(Fcst 04) 2022

42.577

Source Data: SAS Competition Data Base. Volumes based on IHS April 2022.

SOUTH AMERICA

GROWTH AMBITIONS

Europe

Americas

• 55,2% Sales growth until 2027 representing
CAGR of 9,2% (2022-23: 32% 2023-27: 4,2%)

• Important growth in 2023 linked to nominated/delayed projects and Tesla Volumes increase in Berlin

• Our traditional customers show a flat to moderate growth

• New customer: Renault (Maubeuge)

• New modules/services: Front End in Palmela and Vitoria, LOG with Tesla in Berlin

0,75

CAGR 9,2%

0,75

0,45

0,7

• 49,7% Sales growth until 2027 representing CAGR of 8,4% (2022-26: 5,5% 2026-27: 21%)

• VW and Tesla are the main contributors for Americas revenue stream

• Exponential Growth with VW associated to Chattanooga, Stellantis (Toluca)

• New customer: GM (FE business in partnership with FCM in Arlington (TX)

CAGR 8,4%

0,37

0,6

0,35

0,5

0,32

0,3

TARGETED

AWARDED

ACTUAL

TARGETED

AWARDED

ACTUAL

China

0,21

• Strong growth in China from no presence in 2019
to 211 M€ Sales in 2027 and operating 4 Plants plus shared Honda business in 2 more plants

• 147% Sales Growth until 2027 representing CAGR of 19,7%

• New customers: FAW (Changchun), Audi (Changchun), Honda (Wuhan), Daimler (Beijing), Li Auto (Changzhou)

CAGR 19,7%

0,19

0,18

0,17

0,11

0,09

TARGETED

AWARDED

ACTUAL

Regional Growth Plan

Sales by regions

Sales and Programs

Ambition

Strategic Activities

Customer portfolio

Increase Sales 22-27 by +600 M €

Customer portfolio enhancement mainly in China with Honda, Li auto, AUDI, FAW.

Ambition to achieve 1.390 M Euros product sales in 2027 (790 M in 2022)

Topline CAGR 12%

Product Services

Regions

Customer

SAS keeps market share with its traditional customer (VW, Ford, Daimler, Stellantis), as well as with Tesla

Europe: Maintain our market share with our traditional customers. Diversify product/services offer

New Products / Services: Cooperation with other suppliers to offer optimized components (CCB, WH…) and improved automation

Realize high level of recurring inflation passthrough

Use Group electronic competences to offer new services with eCheck

Americas: VW and Tesla being the main contributor, Chattanooga growth and Highland CP nomination are priority

China: Customer breakthrough by using existing group JVs and partnership with other BGs

New modules / Services: Front End with VW in Palmela, Daimler in Vitoria, and FAW in Changchun, and Logistic Service business with Tesla in Berlin

QUESTIONS

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WE NEED TO INSURE THE GROWTH?

1

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2

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3

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