POWERTRAIN SYSTEMS - Valeo · powertrain systems business group ... 2015 2021 +4% per year 11. 2016 2026 wave wave wave 12. wave wave ... in torque converter launch of e-cvt launch

POWERTRAIN SYSTEMS

BUSINESS GROUP PRESIDENT

POWERTRAIN SYSTEMS BUSINESS GROUP

R&D AND PRODUCT MARKETING DIRECTOR

2

3

€ BN

% OF SALES

4

SALES

HEADCOUNT

SALES

HEADCOUNT

SALES

HEADCOUNT

SALES

HEADCOUNT

SALES

HEADCOUNT

5

ANNUAL GROWTH OVER

2014 - 2020 PERIOD

EBITDA MARGIN IMPROVEMENT

FROM 12.3% IN 2014 TO

IN 2020

2016 EBITDA

ANNUAL GROWTH FROM

2015 TO 2016

6

7

8

9

0,0

30,0

60,0

90,0

120,0

2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026

Conventional ICE (incl. Stop-Start) Mild Hybrid (12V+48V) High Power (PHEV, Full hybrid & BEV)

M CARS

60%

18%

22%

Cars Containing Internal Combustion Engine

10

SOURCE: VALEO

*STRATEGIC PRODUCTS AND SERVICES THAT ARE POSITIONED IN GROWING MARKETS OR GENERATE A SIGNIFICANT INCREASE IN GROUP SALES

2015 2021

+4%

PER YEAR

11

2016 2026

WAVE

WAVE

WAVE

12

WAVE

WAVE

WAVE

2016 2026

13

JV WITH KAPEC

ACQUISITION OF FTE

LAUNCH OF BLADE

DAMPER

LAUNCH OF DUAL

WET CLUTCH AND

PENDULUM DAMPER

REVOLUTION

OF MANUAL

TRANSMISSION

LAUNCH OF

e-CLUTCH

°

REVOLUTION

IN CVT

REVOLUTION

IN BEV

WAVE

°IN HYDRAULIC

ACTUATORS

°IN TORQUE

CONVERTER LAUNCH OF e-CVT

LAUNCH OFe-TRANSMISSION

*Pending regulatory approvals

**

14

0.1

2.5

2016 2021

4

20

2016 2021

WAVE°

15

+

+

€

WAVE

*Pending regulatory approvals

*

*

16

LAUNCH OF

GASOLINE LOW

PRESSURE EGR

SYSTEM

LAUNCH OF

NEW POLYMER

ACTUATOR

LAUNCH OF

ELECTRIC

SUPERCHARGER

LAUNCH OF

AIR PUMP

LAUNCH OF

HIGH TEMPERATURE

EXHAUST GAS

SENSORS

LAUNCH OF

SMART

GASOLINE

THROTTLES

WAVE

17

0.05

1.0

2016 2021

7

19

2016 2021

WAVE

18

MARKET CAGR

2016 - 2026

8%

14%

11%

27%

WAVE

19

WAVE

WAVE

WAVE

2016 2026

20

Invention of 48V

Mild Hybrid

« Hybrid4All »

World’s first 12V

Stop Start.

MORE THAN 3 MU

PRODUCED SINCE

World’s first 12V Mild

Hybrid on Nissan

Serena

12V SMART HYBRID

on SuzukiMaruti Ciaz

World’s first aircooled

48V BELT STARTER

GENERATOR AND DCDC

CONVERTER

World’s first electric

Supercharger on Audi

SQ7

°°

WAVEWAVE

21

• ZERO EMISSION (ZE) AREAS

• SHORT TRIPS

• EASY PLUG-IN

• LOW COST

• ALREADY LOW CO2

• COMMUTERS

• ALTERNATIVE TO DIESEL

• PRICE CONSTRAINT

• COMMUTERS

• LONG HAUL

• HIGH EMISSIONS

• HIGH PRICE

• NEED TO ENTER ZE AREAS

• PERFORMANCE

• ACCELERATION

• GREEN LUXURY

SMALLMEDIUM

LARGEPREMIUMCITY

HIGH

POWER

LOW POWER BEV (Battery Electric Vehicle)

12V MILD

HYBRID

HIGH POWER BEV(Battery Electric Vehicle)

PHEV(Plug-In Hybrid Vehicle)

48V MILD

HYBRID

WAVEWAVE

22

• ZERO EMISSION (ZE) AREAS

• SHORT TRIPS

• EASY PLUG-IN

• LOW COST

• ALREADY LOW CO2

• COMMUTERS

• ALTERNATIVE TO DIESEL

• PRICE CONSTRAINT

• COMMUTERS

• LONG HAUL

• HIGH EMISSIONS

• HIGH PRICE

• NEED TO ENTER ZE AREAS

• PERFORMANCE

• ACCELERATION

• GREEN LUXURY

SMALLMEDIUM

LARGEPREMIUMCITY

HIGH

POWER

LOW POWER BEV (Battery Electric Vehicle)

12V MILD

HYBRID

HIGH POWER BEV(Battery Electric Vehicle)

PHEV(Plug-In Hybrid Electric Vehicle)

48V MILD

HYBRID

WAVE WAVE

23

WAVE

WAVE

WAVE

2016 2026

24

LOW POWER BEV (Battery Electric Vehicle)

12V MILD

HYBRID

48V MILD

HYBRID

CAGR

~15%

CAGR

~26 %

CAGR

~51%

2016 2026Low Power BEV

Mild Hybrid 48V

Mild Hybrid 12V

ICE Conventional (incl. Stop Start)

PERCENTAGE OF TOTAL CAR PRODUCTION

BASED ON 2016 PRODUCTS (PRICE & TECHNOLOGY)

WAVE

x x x

2%

10%

6%AVERAGE

CONTENT

PER CAR

25

40%*

48V HYBRID SYSTEM

60%*

*WORLWIDE MARKET SHARE IN 2020

48V HYBRID

TRANSMISSION48V ELECTRIC

REAR AXLE

48V PERFORMANCE

PACK

48V E SUPERCHARGER

WAVE

26

WAVE

WAVE

WAVE

2016 2026

27

AVERAGE

CONTENT PER CAR

CAGR

~26%

BASESCENARIO

ON BEV

TAKE RATE

HIGHSCENARIO

ON BEV

TAKE RATE

HIGH POWER BEV (BATTERY ELECTRIC VEHICLE)

PHEV (PLUG-IN HYBRID ELECTRIC VEHICLE)

CAGR

~34%

CAGR

~23%

CAGR

~20%

HIGHSCENARIO

ON BEV

TAKE RATE

BASESCENARIO

ON BEV

TAKE RATE

2016 2026 2026

PHEV HP BEV

PERCENTAGE OF TOTAL CAR PRODUCTION

x7

BASED ON 2016 PRODUCTS (PRICE & TECHNOLOGY)

WAVE

AVERAGE

CONTENT PER CARx9

28

INVERTER ELECTRICMOTOR

ON-BOARD CHARGER

INVERTER& DC/DC

FULL DRIVETRAININTEGRATION

DC/DCCONVERTER

ON-BOARD CHARGER& DC/DC

GENERATOR

WAVE

29

TECHCENTERS

PRODUCTION

WAVE

30

€

WAVE

31

0

5

10

15

20

25

30

35

40

45

2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026

€bn

CAGR: 6.3%CAGR: 5.8%

WAVE

32

WAVE

WAVE

WAVE

33

34

xxxxx

WAVEWAVE WAVE

x

AVERAGE CONTENT PER CAR BASED ON 2016 PRODUCTS (PRICE & TECHNOLOGY)

35

~€*

~*

€

*INCLUDING VALEO-KAPEC & FTE

JV CONSOLIDATED ON EQUITY

36

Statements contained in this press release, which are not historical fact, constitute "Forward-Looking Statements". These statements include

projections and estimates and their underlying assumptions, statements regarding projects, objectives, intentions and expectations with

respect to future financial results, events, operations, services, product development and potential, and statements regarding future

performance. Even though Valeo's management feels that the Forward-Looking Statements are reasonable as at the date of this press

release, investors are put on notice that the Forward-Looking Statements are subject to numerous factors, risks and uncertainties that are

difficult to predict and generally beyond Valeo's control, which could cause actual results and events to differ materially from those

expressed or projected in the Forward-Looking Statements. Such factors include, among others, the Company’s ability to generate cost

savings or manufacturing efficiencies to offset or exceed contractually or competitively required price reductions. The risks and uncertainties

to which Valeo is exposed mainly comprise the risks resulting from the investigations currently being carried out by the antitrust authorities

as identified in the Registration Document and risks relating to legal action resulting from such investigations, risks which relate to being

a supplier in the automotive industry and to the development of new products and risks due to certain global and regional economic

conditions. Also included are environmental and industrial risks as well as risks and uncertainties described or identified in the public

documents submitted by Valeo to the French financial markets authority (Autorité des marchés financiers – AMF), including those set out

in the “Risk Factors” section of Valeo’s Registration Document registered with the AMF on March 26, 2016 (under no. D.16-0211).

Valeo has recognized an expense of 99 million euros in its consolidated financial statements to cover the main risks resulting from

investigations currently being carried out by the antitrust authorities, as identified in the Registration Document, and risks relating to legal

action resulting from such investigations.

The company assumes no responsibility for any analyses issued by analysts and any other information prepared by third parties which may

be used in this press release. Valeo does not intend or assume any obligation to review or to confirm the estimates of analysts or to update

any Forward-Looking Statements to reflect events or circumstances which occur subsequent to the date of this press release.

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