Automotive Market in China 2011

1. Automotive Market - China August 2011

2. Executive Summary Since China joined the Organization 1, x years ago, its automotive industry has accomplished its most outstanding and fastest development in its history Market Annual double digit percentage sales growth, nearly y%, has been achieved in the automobile sector from20-- to 20-- China is the largest automaker in the world Drivers: Challenges: Huge population and low penetrationRising urban middle class populationGrowing luxury car market Unstable market position of each manufacturerOvercapacity Drivers &Challenges Restrictions imposed on car ownershipReduced prices led by intensified competitionHigh dependency on depleting oil reserves Auto dealers to open more outletsImproved public transport infrastructureAvailability of low-cost skilled labour China promotes alternative energy vehicles Increasing market share of the domestic OEMsOEMs are expanding through mergers and acquisitionsSupport Programs of the Government 20-- - 20--zth Five-Year Plan for the Automotive IndustryGovernment initiatives for EVs Trends Government Initiatives Market comprises of a large number of domestic players as well as foreign players mainlythrough JVs with their domestic partners Competition Some of the major players in the market company 1, company 2, company 3, company 4,company 5, company 6, company 7, company 8, company 9, company 10, company 11 etc. 2 AUTOMOTIVE MARKET IN CHINA 2011.PPT

3. •Market Overview •Export-Import •Drivers & Challenges •Trends •Government Initiatives •Competition •Key Takeaways 3 AUTOMOTIVE MARKET IN CHINA 2011.PPT

4. China is the largest auto maker in the world Growth of Automobile Production Automotive Market - Overview •Automotive industry has become a leading industry in China's national economy and is playing a guiding mn units a6 30 p% a5 and supporting role in the overall national economicsituation 25 a4 20 a3 15 • China surpassed country 1 to become the world's No. x vehicle market in 20-- and passed the United States to be the biggest in 20-- a1 a2 10 5 0 20-- 20-- 20-- 20-- 20--e 20--e Automotive Market Segments Annual Auto Market Segment (Sales) Sub-segment 1 mn units Sub-segment 2 b7 Automotive 15 b5b3 10 b1 b2 Segment 1 Segment 2 5 b6 b8b4 Sub-segment 1 Sub-segment 2 0 20-- 20-- 20-- 20-- Source: 4 AUTOMOTIVE MARKET IN CHINA 2011.PPT

5. Automobile manufacturers earn revenues by exporting their products to various countries around the world Country-wise Imports (20--) Growth in Total Imports USD mn 40,000 e6% Country 1e5% Country 2 c5 30,000 q% e1% e4% Country 3Country 4Country 5 20,000 c3 c4 c2 e3% 10,000 c1 e2% Others 0 20-- 20-- 20-- 20-- 20-- Growth in Total Exports Country-wise Exports (20--) Country 6 Country 9 Country 12 Country 15 r% Country 13 OthersCountry 14 USD mn Country 7 Country 10 d3 d5 d4 Country 8 Country 11 15,000 d2 f1% f2% 10,000 d1 Region 1 g5% f3%f4% 5,000 g1% f6% Region 2 g4% f5% f7% Region 3 f9%f8%f11% f10% 0 Region 4 g3% 20-- 20-- 20-- 20-- 20-- g2% Region 5 Source: 5 AUTOMOTIVE MARKET IN CHINA 2011.PPT

6. Drivers & Challenges - Summary Challenges Unstable Market Position of Manufacturers Drivers Huge Population and Low Penetration Overcapacity Restrictions Imposed on Car Ownership Rising Urban Middle Class Population Reduced Prices Led by IntensifiedCompetition Growing Luxury Car Market Auto Dealers to Open More Outlets High Dependency on Depleting Oil Reserves Improved Public Transport Infrastructure Availability of Low-cost Skilled Labour 6 AUTOMOTIVE MARKET IN CHINA 2011.PPT

7. Summary - Trends China promotes alternative energy vehicles Trends OEMs are expandingthrough mergers and acquisitions Increasing market share of the domestic OEMs 7 AUTOMOTIVE MARKET IN CHINA 2011.PPT

8. Major Domestic Players in the Market (1/10) Company Snapshot: Company 1 Corporate Information Financial Performance Headquarters City 1Founded 19-- Revenue Revenue Profit USD mn USD mn Profit / Loss 5,000 a4 800 4,000 600 Commercial and passenger vehicles, autocomponents a3a1 a2 400 Products 3,000 2,000 200 1,000 Key People Person 1 - MD 0 0 20-- 20-- 20-- 20-- Business Highlights • Company offers type 1 vehicles, type 2 vehicles,type3, type 4, type 5, type 6,type 7, type 8, and other components, aswell as light, medium, and heavy-duty type 9 and it also provides special vehicles, including type 10, such as type11,type 12, and type 13; and type 14, which include type 15, type 16, type 17, type 18, type 19, type 20, type 21, and type 23 vehicle • In Jul 20--, it is reported that the company is planning USD x mn investment together with subsidiary company 2 • Company 2 will spend USD y mn on a R&D capability upgrading program on DCT automatic transmissions and company 1 will spendUSD z mn on auto body mold fixtures of type 24 and USD w mn on auto body mold fixtures of type 25 • In Dec 20--, company announced that it plans to set up type 26 Car Branch Source: 8 AUTOMOTIVE MARKET IN CHINA 2011.PPT

9. Other Major Domestic Players in the Market (4/5) Company Snapshot: Company 2 Corporate Information Business Highlights • It manufactures type 8 and type 9, including light type 10 and type 11, type 13 and type 14 vehicles Headquarters City 2 Founded 19-- • It started construction of a new manufacturing base in Zengcheng Type 1, type 2, type 3, type 4 and Products development, type 6 • Company expects to finish the first phase of the manufacturing base, which has an investment of up to USD x mn, by the end of 20-- Key People Person 2 -President • New plant will mainly produce its own-brand vehicles,including type 15, type 16 and other type 17, and willeventually have an annual production capacity of yvehicles • In 20--, BAIC inaugurated a new plant in Zhuzhou,Hunan province and rolled out its first own-brand automobile, the brand 1 Planning to buy a type 7 plant with its joint venture partner, the motorcycle maker company 3 Source: Press Articles; Company Website 9 AUTOMOTIVE MARKET IN CHINA 2011.PPT

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