Asia Overview

1. Asia Overview Rakesh Makhija President, Asia

2. Presentation contents • SKF’s presence in Asia – History and presence • Asia direction and ambition • China highlights • India highlights • Opportunities and challenges

3. 1 • SKF in Asia – History and presence

4. SKF in Asia – Globalized from inception • Established: 1916-1991 • Sales 2009: SEK 12.7 billion • Employees: About 9,000 • Production sites: 19 manufacturing sites in 6 countries • SKF presence: All major Asian countries • Distributors/dealers: over 600 locations • Global certificates: ISO 14001 • OHSAS 18001 certification

5. Establishment of companies Iran Kenya Malaysia Singapore Finland Unit. Arab Emirates Philippines Thailand Korea Taiwan Vietnam Croatia Latvia Slovenia Macedonia Slovak Rep. Albania Bosnia Herzegovina Kazakhstan Ukraine Italy Australia Mexico Switzerland Poland Yugoslavia India Greece Bulgaria Romania Spain Bolivia Portugal Colombia Venezuela Turkey Hungary New Zealand Japan Zimbabwe Zambia 1919 1920 1920 1921 1922 1922 1923 1924 1925 1925 1925 1927 1927 1927 1927 1928 1928 1928 1932 1954 1963 1970 1973 1973 1973 1974 1988 1988 1988 1988 1989 1991 1922/1991*) 1993 1922/1993*) 1922/1994*) 1995 1995 1922/1996*) 1996 1996 1996 Sweden France Germany USA UK Denmark Belgium Brazil Netherlands Norway Russia South Africa Argentina Austria Chile China Canada Uruguay Peru Czech Republic Indonesia 1907 1908 1908 1909 1910 1913 1914 1914 1914 1914 1914/1991 *) 1914 1916 1916 1916 1916/1988 *) 1917 1917 1918 1919 1919 *) first and second establishment

6. SKF Sales development in Asia SKF Asia revenue of SKF Group, 2009 SEKm 23% 13% annual growth in the last 10 years!

7. Net sales 2009 • Rest of Asia 32 • China 49 19 • India

8. SKF Nankou TBU SKF Wazhou Large Size Bearings Large Size Bearings Seals Seals Seals linear motions Actuation & Motion Control DGBB DGBB /TRB/HUB DGBB DGBB Hub units/auto prods. Asia manufacturing footprint Beijing Wafangdian Dalian Taegu Qingdao Busan Haridwar Shanghai Wuhu Pinghu Taipei Ahmedabad Pune Bangalore Medium Size Bearings Nilai Jakarta

9. Asia – Other activities Tianjin Solution Factory SKF College Campus SKF College Campus Pune Solution Factory Wafangdian Beijing Tianjin Dalian Japan Technical Center Seoul Qingdao Busan Uttarkhand Shanghai Global Technical Center Wuhu Pune International Warehouse (Planned) Pinghu Taipei Ahmedabad Shanghai International Warehouse Bangalore Application Development Center Pune Singapore Solution Factory (Planned) Bangalore Shanghai Solution Factory Singapore Global Technical Center Taipei Solution Factory Singapore International Warehouse Nilai • Technical Centers • International Warehouses • Solution Factories • SKF College Campus Jakarta Australia Solution Factory (Planned)

10. 2009 status: 70 Black Belts 570 Green Belts 780 projects closed Asia Six Sigma Hard savings 2006: SEK 19 m 2007: SEK 23 m 2008: SEK 69 m 2009: SEK 102 m 4 dimensions: ”Standard” Six Sigma, Design for Six Sigma, Lean Six Sigma and Six Sigma for Growth

11. SKF Community engagement • India • SKF Sports Academy • Nachiket Balgram • Udyogdham • Rainwater harvesting • China • Hope School • New Hope Foundation • ORBIS • Local orphanages Malaysia, volunteer

12. 2 • Asia – Direction and ambition

13. SKF Competitive advantage • SKF Brand • SKF engineering knowledge • Technology leadership • Unmatched distribution channels • Range of value added products/services and solutions • Excellent logistics

14. SKF in Asia – Overall ambition • Clear leadership in Asia region • Focus on building a strong Asian infrastructure: - Competitive local technology and low cost manufacturing - Account management & relationship skills - High customer and distributor satisfaction - Build high retention and CoMo levels among employees - Grow non-bearing platforms • Leverage the SKF brand • SKF Care and Six Sigma/Business Excellence as guiding principles in all operations

15. The Asia mission • Create an environment to drive and nurture • INNOVATION • PERFORMANCE • ATTRACTIVE EMPLOYER • VALUE LEADERSHIP • SUSTAINABLE PRACTICES

16. 3 • China highlights

17. Net sales development - SKF China SEKm 1999 – 2009 Net Sales +24% per year

18. Wind Energy - Partnership agreement Sinovel/SKF 14 September 2009 Sinovel Wind Co. Ltd and SKF have signed an Memorandum of understanding to strengthen the cooperation between the companies further! Sinovel Wind Co. Ltd delivered wind turbines equipped with SKF advanced technology to Asia’s first off-shore wind farm at Shanghai Donghai Bridge.

19. Remote Diagnostic Room Show Room Wind Energy Solutions Inauguration of ‘Wind Industry Service Centre’ in SKF Solution Factory, Shanghai on 14 April 2010

20. 4 • India highlights Dun & Bradstreet – Rolta award 2009 Three years in a row – top company in bearings sector

21. Net sales development SKF India SEKm 1999 – 2009 Net sales +11% per year

22. 1st Quarter highlights 2010 • Overall business growth 58% (y-o-y) and growth in profit is 200% The best quarter ever • Haridwar and Ahmedabad factories commence commercial production in March • SKF Class E Grease Seals manufactured at 3SI Bengaluru has been granted unconditional approval by AAR (Association of American Railroads). Order for 590 k pcs from Indian Railways – contract valueSEK20 m (INR 120 m) • Agreement with Enercon India to supply slewing bearings for pitch and yaw applications. Contract value SEK 80 m (INR 480 m),2010 – 2012

23. Global two-wheeler centre, Bangaluru (ADC) • Rocker arm and bearing for two-wheelers • Rollers for clutch applications in two-wheelers • Piston pins and crank pins for two-stroke engines in lawn mowers • Clutch lifter bearings for two-wheelers • Cam followers for diesel fuel injection pumps • One way clutch for motorcycles

24. Cairn India – Rajasthan Operations • Oil & Gas – Complete Condition Monitoring Services • Customer need: • Several successful oil & gas discoveries in the area, CAIRN Energy is in the process of development of the Mangala Oil and Raageshwari Gas Fields. • SKF will manage Condition Monitoring & related services for the Rajasthan Assets. • SKF Solution: • Single source service provider for a comprehensive range of Predictive Maintenance Practices covering Vibration Analysis, Motor Signature Current Analysis, Thermography, In-Situ Dynamic Balancing, Laser Alignment, NDT Services, Electrical Predictive Maintenance for Transformers, Breakers, Relays, etc.. • Customer benefits: • Single service provider for taking care of all condition monitoring requirements spanning mechanical, electrical and static equipments, including pipelines. • SKF benefits: • The combination of services offered enables SKF to uniquely differentiate itself as a complete condition monitoring solutions provider for the industry. Contract Month: February 2010 Contract duration: 12 months Order Value: INR 20 m/year Contract date: - Contract duration: - Sales revenue: - Operating profit( %): -

25. 5 • Asia – opportunities and challenges

26. Developed • Developing • Emerging • Undeveloped China - Regional development • The development will continue. • Development needs are dramatic and business opportunities tremendous. • Our task is to turn all challengesin China into business opportunities for SKF.

27. Strategic imperatives • Intellectual workforce in Asia (primarily Asians) • Local leadership • Cost competitiveness • Strong manufacturing footprint in Asia to support development. • Value selling and account management skills

28. War for Talent - People strategy in Asia • SKF Values & Code of Conduct - embedded in Asian organization • Excellence in leadership capability – ‘SKF College’ • Growth, innovation and learning – key elements to employee retention • Effective reward policies in Asia • All possible sources for recruitment on global basis