scope of operations
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Certain information regarding Linamar set forth in this presentation and oral summary, including management’s assessment of the Company’s future plans and operations may constitute forward-looking statements. This information is based on current expectations that are subject to significant risks and uncertainties that are difficult to predict. Actual results may differ materially from these anticipated in the forward-looking statements due to factors such as customer demand and timing of buying decisions, product mix, competitive products and pricing pressure. In addition, uncertainties and difficulties in domestic and foreign financial markets and economies could adversely affect demand from customers. These factors, as well as general economic and political conditions, may in turn have a material adverse effect on the Company’s financial results. The Company assumes no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those reflected in the forward-looking statements.
February 2008
Scope of Operations
71% Powertrain/Driveline
45
% L
ight
Vehic
le
13% Med/Heavy Duty Truck
13% Off Road
Transmission
Engine
22% Aerial Work Platform
Driveline
7% O
ther
In
dust
rial P
rodu
cts
29% Industrial
February 2008
design test & analysis prototype machined components
simple assembly
modules powertrainsystems
1 off vehicles engineered products utilizing
powertrain systems
warranty failure/ analysis
Scope of Capabilities
February 2008
Global Presence & Operational PhilosophiesManufacturing Facilities (38); Sales Offices (10): Technology Development Centres (5): Employees (11,752)
Manufacturing Facilities (25)CANADA
Manufacturing Facilities (4) MEXICO
Manufacturing Facilities (2)JV Manufacturing Facility (1)USA
Manufacturing Facilities (1)GERMANY
Manufacturing Facilities (3)HUNGARY
Manufacturing Facilities (1)KOREA
Manufacturing Facilities (1)CHINA
OPERATIONAL PHILOSOPHIES• Small manageable autonomous profit centres• Product focused factories utilizing flexible equipment wherever possible• Plant clusters (link and leverage).• Decentralized organization.• Commitment to continuous improvement.• Stepping Stool goal setting & performance measurement system.
24 Facilities ISO/TS 16949 10 Facilities QS 900025 Facilities ISO 14000
February 2008
Our People
Technical Workforce 1,177 technical
employees Average seniority, 9.8
years Apprentice workforce
grew 37.0% in last 12 months. (+57)
Training 104,782 training hours
logged YTD in 2007. Management Depth
Average seniority, 9.97 years
Diversity 51 first languages
spoken at Linamar
February 2008
Contributors to Linamar’s Success
Relentless drive to improve competitiveness.
Focus on maximizing opportunity.
Strong culture
February 2008
Competitiveness
Innovation
Efficiency
Speed
Opportunity
Sell
Quote
Speed
Strategy
Culture
Communication
Reward Desired Behaviour
Demonstrated Behaviour at Most
Senior Levels
Competitiveness, Opportunity & Culture
SMART CAPABLE PEOPLE WITH A SKILL BASED FOUNDATION
February 2008
Competitiveness
Innovation
Manpower Utilization
Product Innovation
Process Innovation
Continuous Improvement
Efficiency
Availability of PeopleCost of Living
= Government
Speed
Planning
Purchasing
Efficient Taxation &Regulatory Environment
Labour Cost & Efficiency
Labour Rates
Consumer Good Costs Schools
Immigration Policy
Personal Taxation
SMART CAPABLE PEOPLE WITH A SKILL BASED FOUNDATION
February 2008
Competitiveness
Innovation
Manpower Utilization
Product Innovation
Process Innovation
Continuous Improvement
Efficiency
Availability of PeopleCost of Living
= Government
Speed
Planning
Purchasing
Efficient Taxation &Regulatory Environment
Labour Cost & Efficiency
Labour Rates
Consumer Good Costs Schools
Immigration Policy
Personal Taxation
SMART CAPABLE PEOPLE WITH A SKILL BASED
FOUNDATION
February 2008
Serious Shortage in Ontario of Skilled Workers
Fewer and fewer skilled workers actively working in Ontario
Apprentice registration growing but not quickly enough
Average age of an apprentice in Ontario 28 vs. 16 in Europe
February 2008
Steering Committee Established to Address the Problem
Chair IT/High Tech Paul Tsaparis, CEO HP Canada Chair Business/Retail Annette Verschuren – CEO, Home Depot Canada Chair Manufacturing Elyse Allen, GE Canada Chair Construction Ed Newton, President of Kiwi Newton Group of Companies Chair Colleges John Tibbits, President of Conestoga College
Chair Marketing Steve Jones, Chair of Ontario Chamber of Commerce and Vice-President, Marketing & Communications Promotivate International Inc. David Johnston, President of University of Waterloo Alistair Summerlee, President of University of Guelph
Co-Chairs Universities
February 2008
The Solution
Skills based education for all employees. Secondary and Post Secondary School level
engagement. Build on Success of Specialist High Skills
Major Program (SHSM). Top to bottom skills integration:
Secondary School
College University
February 2008
Building On Our Successes . . .
Specialist High Skills Major Program (SHSM) Recently launched by Government of Ontario. Encourages high school students to select a major in a skill
area and complete course work and practical experience in accordance.
Expand Concept to Next Level. Ensure course load creates full flexibility around eligibility for
university, college, apprenticeship or work: 1 path 4 destinations
Create trade and non trade majors. Trade majors utilize 3rd, 4th and 5th years of high school to allow
for close to 50% of required apprentice hours to be completed. Incorporate authentic/real life settings and tasks Develop a multi disciplinary reach
Manufacturing Construction IT Media Arts & Culture Business/Retail
February 2008
Vision
Create a more flexible secondary school system that graduates students with the skills that align them with real-world opportunities and demand
Have a society that equally values careers built on skilled trade designations, college diplomas or university degrees
February 2008
Goal
A skill based workforce that drives innovation and competitiveness and stimulates our economy to thrive globally
Every student, every school
February 2008
Key Elements of the Program
BALANCE - Balance our secondary school curriculum around our students skills, interests and aptitudes
FLEXIBILITY - Develop course content that sufficiently allows graduate to go to work, finish apprenticeship, or attend college or university
TARGETED - Enhance the curriculum in high schools to match the current and future employment demands
CREATIVE & PRACTICAL - Establish learning that is creative, innovative, appealing to the student and practical, based on authentic, real-life activities
FOCUSED - Guide/encourage students to pick a sector and skill area to major in at an earlier stage
COMPREHENSIVE - Teach sector specific courses, academic courses contextualized for that sector, and on the job training that includes completion of a portion of apprenticeship hours for trade majors
February 2008
Grades 5 - 8 Introduction to hands on learning & technology
Grades 9 – 12/13 Science, Trade & Technology Major Pathway
Grades 9 – 12General Pathway
University
• More technically focused classes (English, math, science via contextualized units)
• Trade & non trade majors
• Best & brightest students, the high achievers
• Theory taught around a skill
• Trade majors – utilize 3rd - 5th years to log between 2,100 & 3,800 on the job apprentice hours*
College
Apprenticeship/Work
OSSD
STTM
OSSD
* Remaining hours to 8,000 required can be completed through 6-7 coop terms at university or college or 2 years of full time work
February 2008
Some Practical Examples
CarpenterConstruction Engineering TechnologistArchitectCivil Engineer
College
University
MachinistMechanical Engineering Technology, Automated ManufacturingMechanical Engineer
College
University
ITComputer ProgrammerSoftware Engineering TechnologySystems Engineer
College
University
Business & RetailMerchandising/Marketing
Bachelor of Commerce
College
University
Media Arts & Culture
Theater ArtsTechnical ProductionBachelor of Arts
College
University
February 2008
Example:
On-site Early shop floor experience Hands-on training with theory Project and problem-based curriculum: An
authentic business development project. Identify a problem and design a product to fill
that market. Build a business plan. Design a manufacturing process. Build the product. Entrepreneurial business models – building a
business on your ideas Robotics competitions
integrating programming Environmental issues / product development Executive in Residence Programs – learning from
the entrepreneurs
school for innovationin manufacturing
February 2008
Example: School for Young Writers Media Arts & Culture Stream
What If? Magazine Radio Broadcasting
- national schools’ web-streamed radio station managed from SJK
Writer-in-Residence programs
New Media websites / animation ...
Community arts involvement Elora Writers’ Festival, Eden
Mills Festival
Multiple majors in some sectors – writing, drama, choral music–possible. Decisions informed by local industry needs, labour market trends
February 2008
Pilot Projects
Target more than 1 Secondary School in Ontario.
In advanced discussion with St. John’s Kilmarnock School to be a pilot site.
Proposing pilot concept to other school boards currently.
February 2008
Time Line
Stage 1 – Planning & Establishing FrameworkFeb 2007 Advisory Council FormedFeb 2007 Steering Committee FormedFeb 2007 Steering Committee Meetings StartedAug 2007 Update to Advisory CouncilStage 2 – SJK LaunchSept 2007 SJK’s Fifth Year Program IntroducedSept 2008 SJK - Manufacturing / Arts & Culture Major
launchedSept 2009 SJK - Construction / Information Technology Major
launchedSept 2010 SJK – Business/Retail Major launchedJune 2011 SJK - First Science, Trade & Technology Major
Graduating Class (4 year)Stage 3 – 2008+ Promote Beyond SJK2008+ Share Program success to inspire other schools in
Ontario & Canada to follow suit.
February 2008
Benefits STTM Program
INDUSTRY System generates people needed to build our business.
GOVERNMENT Increased competitiveness; growth creates jobs.
UNIVERSITYStudents with a hands on aptitude ready to build on those skills through theoretical study in a university degree program.
STUDENTSTangible immediate success to motivate them to further development, apprenticeship pay creates sense of self sufficiency and funds their future.
SECONDARY SCHOOLS
Chance to contribute to economy’s needs in a unique, ground breaking way that will become a Global Benchmark.
COLLEGESStudents already conversant with skills motivated to complete their skills education or build on those skills in an applied program.
February 2008
Top to Bottom Skills Integration
Closing the loop on a skill based workforce to drive Innovation and
Competitiveness
Secondary School
College University
Certain information regarding Linamar set forth in this presentation and oral summary, including management’s assessment of the Company’s future plans and operations may constitute forward-looking statements. This information is based on current expectations that are subject to significant risks and uncertainties that are difficult to predict. Actual results may differ materially from these anticipated in the forward-looking statements due to factors such as customer demand and timing of buying decisions, product mix, competitive products and pricing pressure. In addition, uncertainties and difficulties in domestic and foreign financial markets and economies could adversely affect demand from customers. These factors, as well as general economic and political conditions, may in turn have a material adverse effect on the Company’s financial results. The Company assumes no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those reflected in the forward-looking statements.