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Daimler AG DDAIF US OTC Olivier Fontenelle 10/30/2013

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Main Business Lines

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Key future success drivers Significant product launches Recent revenue and profit growth New China strategy Positive macro environment Turnaround story

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Recent Results September sales were all time highs: 142,994 vehicles WW Driven by sales of E-Class, A-Class and CLA-Class 5% YoY increase in Q3 revenues 53% YoY rise in Q3 profits

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New Products Automotive industry is highly cyclical, the development schedule drives sales. MB is in the middle of a huge product refresh, with highly competitive vehicles. GLA Small cross- over CLA Driving US sales S Class 30,000 in 3 months C Class All new model

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CLA and GLA Both based on new small compact platform, shared with A and B class. 90% YoY WW increase for the class. CLA - $29,900 starting price, the first car >30k for MB. Audi A3 was pricing reactionary, matching CLA. GLA small crossover to take on high volume market Competing with BMW X1, Audi Q3, Range Rover Evoque Gen Y appeal

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S-Class Top of the line model, highest profit margins Extremely positive industry reviews 30,000 sales in 3 months! 2012 sales of only 65,000 cars. Expected to be #1 in class by a wide margin.

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Problems in China Mercedes-Benz has struggled in China since the start of 2012, when overall demand for luxury cars began weakening amid an economic slowdown in the world's second-largest economy that affected luxury car brands in general. Mercedes fared worse than most because of a dearth of new or redesigned models and what industry insiders and key operators of Mercedes-Benz dealers described as a short-sighted volume grab that hit the brand's profitability. Mercedes-Benz's sales rose just 4 percent to 206,150 cars, last year. By contrast, sales of Audi cars rose 32 percent to 407,738 cars, while BMW's volume increased 41 percent to 313,638 cars.

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New China Strategy Goal: Boost sales to 300,000/annually by 2015 How? $2+ billion investment in China-based manufacturing: 70% cars sold in China to be made in China by 2015. (cost reduction) Includes GLA By comparison, Audi builds 90% cars it sells in China, in China. 12% equity investment in BAIC -> planned IPO Doubling dealer network from 100 to 200.

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Integrated Sales Strategy

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The macro-environment European economy is rebounding, and care sales are following. The situation is clearly improving, Carlos Da Silva, a Paris-based analyst with IHS Automotive, said in an e- mail. Europe is not in brilliant shape, yet the underlying trend of the market is calling for a certain dose of optimism. Investor confidence in Germany, Europe's biggest economy and largest car market, rose to a three-year high this month. Consumer confidence in the UK, which ranks second in the region's car sales, was at a six-year high in September.

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Chinese Market >10% Growth YoY

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MB International Exposure Strong growth in UK (+28%), Turkey (+31%), Russia (+20%), China (+26%) Still #1 in Germany with 9% market share. #1 in Japan (+32%)

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Why not other automakers? Mercedes is coming back from the bottom. They: - Had declining sales - Had the lowest profit margins of the major luxury brands. - Lost the ultra-luxury war (RIP Maybach). - Declining quality perception. - Missed the boat on China, especially to Audi. - Not been #1 since 1999 - Currently beating BMW by ~2500 cars in the US. #3 Lexus by 25,000

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Important Indicators Q3 Sales MB Cars: up 14%, Trucks: up 4%, Vans: up 17%, Buses: 17% Profit Margins: Q1 2013 Profit Margin: 3.4% (one time costs included) Q2 2013 Profit Margin: 6.6% Q3 2013 Profit Margin: 7.3% Long-term target: 9-10% Audi/BMW ~ 10%+ EBIT YoY growth of 15%

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Momentum Trade

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Financial Indicators and Proposal TTM P/E: 10.16 Forward P/E: 14.76 PEG: 10.58 Proposal: ~$3000 or 37 shares *OTC Trade poses little/no risk thanks to the high liquidity of DDAIF

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Risks China is very competitive. They could flounder their new strategy and not catch up with Audi and BMW. Global macroeconomy is still not stable, especially in Europe. China poses macroeconomic risk. New entry-level products could erode short term profit margins more than expected, and will not be offset by sales volume. Truck demand could decrease due to weak heavy industry demand. India is down >10% YoY, and Russia is missing forecasts in this business unit.

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#1 reason dat mustache