the european outbound vehicle logistics sector ecg - march 2010

The EuropeanOutbound Vehicle

Logistics Sector

March 2010

Sole author: Massimiliano Fuccio

Financing the Recovery: A Comprehensive Analysis in

Support of Sustainable Growth

THE EUROPEAN OUTBOUND VEHICLE LOGISTICS SECTOR:

A WORTHY CASE FOR RECONSIDERATION.

Brussels March 2010

The European vehicle logistics sector has been through dramatic times since the economic crisis took hold in the last quarter of 2008.

This is a sector that is almost exclusively designed and run for the purpose of moving vehicles from their place of production to the place of final sale across the globe.

Its ships, railway wagons, barges, road transporters, workshops and storage locations are dedicated to the fast and damage-free handling of passenger and commercial vehicles. Its people

are trained and employed for their specialist knowledge and experience. Their task is to ensure that the millions of vehicles that are transported across Europe each year are moved as

efficiently as possible, to protect the brand values that their customers have so carefully created.

There is no question that the crisis has hit our business hard. ECG estimates that up to 20% of the transport capacity for new vehicles has been decommissioned or permanently destroyed

as demand has plunged and companies have downsized savagely in order to survive. The sector has held the line, but it is still struggling for traction as the downturn continues.

What is more, the battle for survival has taken a toll of its financial reserves at exactly the moment when it should be investing for the future. ECG estimates that the sector needs to spend

E4bn to E7bn over the short to medium term simply for asset renewal. Yet when we turn to the banking sector for financing, we find ourselves almost reflexively labelled a poor credit risk

because of scepticism over the economic condition of the wider automotive industry and a lack of reliable information on our sector.

This report aims to correct that misperception, to demonstrate through hard data that this is a sector with sound foundations and a robust business model that is also flexible enough to

respond quickly and effectively in difficult times. I believe it also shows that, in terms of credit-worthiness, the vehicle logistics sector deserves to be reappraised on its own merits.

1

respond quickly and effectively in difficult times. I believe it also shows that, in terms of credit-worthiness, the vehicle logistics sector deserves to be reappraised on its own merits.

The European Commission has pointed out many times through this economic crisis that transport is of paramount importance for European development. Logistics, meanwhile, is the

physical backbone of todays economy and as such it has an enormous impact on the economic development and cohesion of the European Union.

As the debate on Europes transport future reaches a critical moment, it becomes ever clearer that plotting a healthy way forward for the outbound vehicle logistics sector also touches on

key issues of public policy. It is about creating jobs in this sector and beyond. It is about using technology to create efficiencies. And it is about reducing emissions as part of a drive towards a

more sustainable transport system.

European automotive production and sales will recover as the global crisis recedes. But as demand picks up, the manufacturers will have an urgent need for new transport equipment to

handle their surging distribution requirements. There are no possible substitutes: these dedicated assets have to be built specifically for vehicle transport. In the case of ships, from initial

order to first deployment can take up to three years and cost tens of millions of euros.

We need to make these investments for ourselves, for our customers, and for Europe as a whole. The ability of the manufacturers to exploit an eventual upturn will depend, at least in part,

on their ability to get vehicles from their plants to their customers as quickly and efficiently as possible, and with minimal impact on the environment. But as vehicle logistics providers, our

ability to do that will depend on access to finance, and ultimately on the willingness of the financial industry to take a fresh look at this vibrant and adaptable sector.

I urge you to study this detailed analysis and to reconsider your risk ratings so that Europes vehicle logistics operators can play their part in the economic recovery.

Finally, I would like to express my thanks to the Team that has worked on the development of this document. A Team composed by ECG People and Grimaldi Group People. In particular I

would like to highlight and deeply thank the Grimaldi Group (with Headquarter in Napoli, Italy, but operating almost worldwide) that has allocated the time of its people on a Pro-Bono base.

It is the most detailed account ever prepared of the European vehicle logistics sector and the Team worked many nights and weekends to complete it.

Costantino BaldissaraPresident

Agenda

This document presents an overview of the European Vehicles Logistics

sector, together with forecasts for its development. It also includes a

comparative study of the European Automotive Industry.

2

comparative study of the European Automotive Industry.

Note: Information included in this document may be dated since relevant events may have occurred after its publication which might alter its accuracy

Executive summary

ECG - The Association of European Vehicle Logistics in brief

European automotive market: overview

European automotive outbound logistics market: overview

3

European Outbound Logistics Operators average financial performances (2008-2009)

Main European Automotive Manufacturers financial performances (2008-2009)

EU plus EFTA: New Vehicles historical registrations (1999 2009 by year & month)


European automotive outbound logistics sector: potential

Appendix:

Executive summary (1 of 11): The automotive industry has experienced its strongest market decline since the early 1990s

Europe 281: Vehicle Registrations

8.000

10.000

12.000

14.000

16.000

18.000

20.000

HCV/B

LCV/MB

Cars87,2% 86,5% 86,0% 85,1% 85,5% 85,8% 86,0% 85,0% 84,5% 84,6% 83,9% 84,0% 14,49

9,6%

10,0%

10,3% 11,0% 10,7% 10,7%10,5%

11,2% 11,6%11,3%

11,8%

11,4%3,2%

3,5%

3,7% 3,9% 3,8%3,5%

3,5%3,7% 4,0%

4,1% 4,3%

4,6%

15.380

in 000s

16.60417.525 17.327 17.330 16.790

17.53918.048 18.060

18.693 19.068

17.55513.815

8,0%5,5% -1,1% 0,0% -3,1% 4,5%

2,9% 0,1%3,5% 2,0%

-7,9%-7,6%

The banking crisis that started at the end of 2007 stalled economies: Consumers and

businesses struggled to access credit

There is no

Credit crunch

1,8% 0,0%

1,290,44

. .

Actual YTD

Actual YTD

Actual 11monts

Actual 11monts

Note: this growth rate is not fully reliable because HCV/B

and LCV/B 2009 registration

figures were available only for

the first 11 months

20.000

4

CAGR 97-02% changeYoY

-

2.000

4.000

6.000

1997 1998 1999 2000 2003 2004 2005 2006 2007 2008

Cars

Lithuania

Poland

RomaniaHungary

LatviaBulgaria

Czech Rep

Estonia

EU152

Slovenia

Slovak RepMalta

Cyprus

EU253

1) Europe 28

Austria

Belgium

Denmark

Finland

France

Germany

Greece

Ireland

Netherlands

Portugal

Spain

Sweden

UK

ItalyLuxembourgPart of the EU27

but not consideredby AAA-ACEA

2001 2002

Norway

Switzerland

Iceland

EFTA34

(1-E12)2009

EU(15) + EFTA(3) Total EU25+EFTA(3)

There is no precedent in the automotive industry for the market distortions experienced The most

severe crisis since WWII

Source: ACEA, AAA, ECG2) EU15: Member Countries in the EU prior to the accession of ten candidate Countries on 1 May 2004 3) EU25: After the 2004 enlargement4) European Free Trade Association (EFTA)4 Members: Iceland, Liechtenstein, Norway and Switzerland

. .

Artificially stable segment (vs 08) in 2009 the car segment has

benefited from local government support including car scrapping schemes

CAGR 97-02 CAGR 03-E08

Actual YTD

Actual 11monts + Provisional ACEA for December

HCV/B: Heavy Commercial Vehicles/BusesLCV/MB: Light Commercial Vehicles/Mini buses

Executive summary (2 of 11): Expected upside sale potential for the Global and European automotive industry from 2010

Based on expectations on key car demand drivers, car sales can be forecasted

The market

Cars

LCV/MB

2010 expectationsAll

CarsPrivate Cars

Corporate Cars

Consumer confidence

Replacementdemand

Mobilitytrends

Creditavailability

Scrapincentives

Replacementdemand

Asia

N. America

W.Europe

S. America

Russia

OtherE.Europe

Key car demand drivers: expectations

Other E.Europe

Russia

S. America

Western Europe

N. America

Asia

-2,9%

-11,1%

3,0%

1,1%

20,6 20,0 20,1 21,5 23,2

15,912,2 14,2

15,916,6

15,4

15,2 14,114,9

15,6

4,1

3,5 3,53,7

3,83,0

1,7 2,12,5

2,92,8

2,4 2,1

2,32,4

0,0

10,0

20,0

30,0

40,0

50,0

60,0

70,0

61,854,9 56,0

60,764,4

-23,4%

-1,4%

0,5% 7,0% 7,9%

4,0%

4,7%

6,1%

8,4%2,0%

16,9%

-7,4%

12,3%

5,9%

1,1%

0,3%

-2,1%

-1,3%

-3,6%

Unit sales in mil.

Credit Suisse: Cars and LCV 2009-12 global sales forecast3

-14,8%

-43,3%

-14,6%

2,2%

16,3%

8,0%

23,5%

-14,6%

0,3%5,4%16,7%

9,8%

5

The market is set to rebound in many Countries, though medium-term sales trends are likely to be divergent across regions

Source: ECG, ACEA, Credit Suisse1) EU15: Member Countries in the EU prior to the accession of ten candidate

Countries on 1 May 20042)European Free Trade Association (EFTA) 4 Members: Iceland, Liechtenstein,

Norway and Switzerland3)CS forecast combined car and LCV volume expectations while the 6 drivers

shown on the left side of this slide are mostly correlated with Car demand. However, since ECG values CS as highly credible global research house, (also taking in consideration that LCV volumes are marginal when compared with cars) a decision to show the 2 vehicle typologies together has been taken

2011-12 expectationsAll

CarsPrivate Cars

Corporate Cars

Consumer confidence

Replacementdemand

Mobilitytrends

Creditavailability

Scrapincentives

Replacementdemand

Asia

N. America

W.Europe

S. America

Russia

OtherE.Europe

CAGR 08-12E% changeYoY

0,02008 2009E 2010E 2011E 2012E

3,3 4,1 3,0 3,2 3,3

2,32,2

2,1 2,2 2,4

2,52,6

2,5 2,6 2,6

2,4 2,22,2 2,4

2,5

1,4 1,11,2 1,4

1,4

3,5 3,03,1

3,2 3,5

0,0

2,0

4,0

6,0

8,0

10,0

12,0

14,0

16,0

18,0

2008 2009E 2010E 2011E 2012E

Other W.Eur.SpainUKFranceItalyGermany

15,4 15,214,1

14,9 15,6

Austria

Belgium

Denmark

Finland

France

Germany

Greece

Ireland

Luxembourg

EU152

Netherlands

Portugal

Spain

Sweden

UK

Italy

1) Western European

Norway

Switzerland

Iceland

EFTA33

Credit Suisse: Cars and LCV 09-12 W.Europe1 sales forecast3

-1,4%-7,4% 5,9%

4,7% 0,3%

-12,1% 0,6% 5,0% 10,0%0,5%

-20,3% 11,6% 11,2%3,1% 0,5%

-11,8%4,0% 5,4% 4,3% 0,2%

3,6% -3,8%2,1%

0,0% 0,4%

-6,0% -6,8%7,3% 6,8% 0,1%

24,6%-26,8% 7,2% 2,9% 0,1%

Based on expectations

2010 expectations

Industrial confidence

Replacementdemand

Asia

N. America

W.Europe

S. America

Russia

Other E.Europe

Key HCV/B demand drivers: expectations

Executive summary (3 of 11): Expected upside sales potential for the Global and European automotive industry from 2010 (2 of 2)HCV/B

Credit Suisse: HCV/B 2009-13 W.Europe1 sales forecast

-3,6%

CAGR 08-13E

% changeYoY-5,3% 3,4%400

300

200150

250

9,6% 10,6%350

-30,0%350

245 232 240263

291

2009E 2010E 2011EAsia -5% -3% 6%North America -10% 15% 17%Western Europe -30% -5% 3%South America -12% 5% 6%Eastern Europe -35% -5% 5%

Global -12.4% -0.1% 7.4%

Credit Suisse: HCV/B 2009-13 Global sales forecast

6

expectations on key HCV/B demand drivers, sales can be forecasted

2011-13 expectations


Replacementdemand

Asia

N. America

W.Europe

S. America

Russia

Other E.Europe

Source: ECG, ACEA, Credit Suisse1) EU15: Member Countries in the EU prior to the accession of ten candidate

Countries on 1 May 20042)European Free Trade Association (EFTA) 4 Members: Iceland, Liechtenstein,

Norway and Switzerland3)NAFTA: Canada, Mexico, United States

Credit Suisse: HCV/B 2009-13 NAFTA2 sales forecast

Unit salesin 000

6,5%

CAGR 08-13E

% changeYoY

-10,4% 6,5%

15,7%16,8%

5,4%7,1%

02013E2008

600

500

400

300

200

100

2012E2011E2010E2009E

384344

398465 490

525

Austria

Belgium

Denmark

Finland

France

Germany

Greece

Ireland

Luxembourg

EU152

Netherlands

Portugal

Spain

Sweden

UK

Italy

1) Western European

Norway

Switzerland

Iceland

EFTA33

02013E2008

150

50

2012E2011E2010E2009E

100

Main Storage facilities used in Outbound Automotive Logistics

Executive summary (4 of 11): The European Automotive Outbound Logistics Sector is part of the Automotive Industry

The European Automotive Outbound Logistics Sector exclusively supplies both transport and industrial services to Automotive Manufacturers using assets that are specifically designed to

transport or store vehicles and that cannot be employed for any other use

The Finished Vehicle Logistics Sector as relevant part of the Automotive Industry

Main modes of transport used in Outbound Automotive Logistics

Specialized

Heavy Trucks on Roads

I . . . . . . . . . .. .. . . .

1) Port Terminals 2) Inland Compounds

(not facing the sea)

. .

. .. .. .. .. .

. .. .. .. .. .. .. .. .

. .. .. .. .

. .. .. .. .. . . . . . . . River

Located in strategic locations for easy distribution to final customers

Fully Multimodal

V

7

Source: ECG

Specialized Ships on Sea

Barges on Rivers

Specialized Train Wagons on Rail

IV

III

II. . . . . . . .

. .. .

. .. .

. .

. .

. . . . . . . . . . . . . .

. . . . . . . . . . . . . . . .

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Rail

Road

Sea

Fully Multimodal

Port Terminal

The European Automotive Outbound Logistics Sector is part of the Automotive Industry and consequently has suffered too but a positive rebound is expected from 2010

Specialized Wagons on Rail

Heavy Trucks on Roads

II

I. . . . . . . . . .

. .. . . .

. . . . . . . .

. .. .

. .. .

. .

. .

Modes of transport used in Outbound Automotive

Logistics

ECG segmentation of the European Outbound Automotive Logistics sector

Pure Trucks Trucks & Ports

Trucks & Wagons

MostlyShips

Ports & Terminals

Pure barges Multimodal

I I

II

I I

II

I

63.355

9,8% (9)

9,8% (9)

6,7%11,5%

6,5% (6)

26,1%

32,0%

23,4%

1,0%

0,4%

2,4%

21,7%(20)

35,2%

43,7%

31,3%

40,0%

50,0%

60,0%

70,0%

80,0%

90,0%

100,0%

Multimodal

Pure barges

Ports & Terminals

Mostly Ships

Trucks & Wagons

Trucks & Ports

Pure trucks

92 13,1Mil 63.067.454

European Outbound Automotive Logistics: key market figures and segment breakdowns

0,06%

0,04%

0,3%5,4% (5)

2,2%(2)

Executive summary (5 of 11): The European Automotive Outbound Logistics Sector market segmentation and key market figures

8

Source: ECG

Specialized Ships on Sea

Barges on Rivers

IV

III . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . .

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. . . . . . . . . . . . . . . .

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Ports and terminals

V

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V

IV

V V

III

IV

III

V

Wallenius Wilhelmsen Logistics(2wglobal.com)

Finnlines(finnlines.com)

Hegh Autoliners(hoegh.com)

Grimaldi Group(grimaldi.napoli.it)

When ships are mostly owned and not chartered and represent the relevant fixed assets of the company they are classified as Mostly ships

ECG Members classified in this segment are:

When a different mix of transport and warehousing assets are used to satisfy the logistics need of clients and there is not a great prevalence of one mode over another then the firm is considered Multimodal

Examples of ECG Members classified in this segment are:

Volvo Group Belgium(volvo.com/logistics/global/en-gb/services)

GEFCO(gefco.net)

Groupe CAT(groupecat.com)

Horst Mosolf(mosolf.de)

Bertani Trasporti(bertanitrasporti.it)

Sntax Logstica(sintax.com)

44,6% (41)

23,4%

11,2%

19,3%

7,5%

5,6%

11,9%

6,7%

7,0%

0,0%

10,0%

20,0%

30,0%

Number of ECG member

companies in 2009

Employees from ECG

survey 2008 (data 2007)

Total turnover from ECG

survey 2008

Total vehicles processed from

ECG survey 2008

(Data 2007)

Data from ECG members can be considered representative of the Continental Europe Outbound Automotive Logistics market ECG Members volumes represent approximately 80% of the new vehicles

processed by the entire European Finished Vehicles Logistics industry

16,7%1,8%

0,8%

5,3%

8,6%

10,4%

1,0%

1,0%

0,9%

0,1%

0,1%

0,1%

5,0%

1,5%

2,4%

0,3%

0,1%

0,2%

6,8%

5,7%

11,5%

5,1%

4,8%

6,8%

0,0%

0,0%

0,0%2,7%

1,1%

2,6%1,1%

0,4%

0,8%

6,6%

2,6%

6,8%

0,8%0,2%

0,1%

60,0%

70,0%

80,0%

90,0%

100,0% Ukraine

United Kingdom

Turkey

The Netherlands

Switzerland

Sweden

Spain

Slovenia

Russian Federation

Romania

63.355 13,1Mil 63.067.454

European Outbound Automotive Logistics: key market figures and country breakdowns

(from ECG 08 survey with 07 data)

Sweden Members: 2

Finland Members: 4

France Members: 6

Belgium Members: 2

Austria Members: 4

Spain Members: 7

Germany Members: 10

NetherlandsMembers: 6

Italy Members: 6

Ireland Members: 2

Greece Members: 3

ECG 2009 Members: national and regional breakdown

EU15164,1%

18,5%

6,5%

10,9%NonEU

EFTA3

EU15 (+ NewEU= EU25 = 82,6%)

EU15

ECG 2009 Members regional breakdown

Members: 59

92Note for the correct

understanding of the figures shown in the right box

Almost all ECG members operate on an international scale

Country breakdowns shown in the right box

Executive summary (6 of 11): The European Automotive Outbound Logistics Sector key market figures by region and by country

9

0,0%

5,4%2,7% 3,8%

1,6%8,7%

1,1%

0,0%

0,0%

0,4%

0,3%

0,0%

6,1%

3,1%

12,9%

22,4%

17,8%

22,4%

15,1%

21,0%

0,5% 1,4%0,4% 0,4%

14,7%

8,0%

0,5%

10,0%

20,0%

30,0%

40,0%

50,0%

60,0% Romania

Poland

Norway

Lithuania

Italy

Ireland

Greece

Germany

France

Finland

Estonia

Czech Republic

Belgium

Austria

Employees from ECG

survey 2008 (data 2007)

Total turnover Total vehicles processed

0,5%

4,9%

UK Members: 7

Sweden Members: 2

Czech RepMembers: 2

Estonia Members: 1

Poland Members: 2

Norway Members: 5

SwitzerlandMembers: 1

Ukraine Members: 1

Romania Members: 2

Slovenia Members: 1

Turkey Members: 3

Russia Members: 6

Lithuania Members: 9

Source: ECG1) EU15: Member Countries in the EU prior to the accession of ten candidate Countries on 1 May 2004 2) EU25: After the 2004 enlargement3) European Free Trade Association (EFTA)4 Members: Iceland, Liechtenstein, Norway and Switzerland

EU252

EFTA23

NonEU

Members: 92Members: 76

Members: 6

Members: 10

shown in the right box on this slide include consolidated data and refer only to the country of incorporation of the ECG members Data shown on the right does not show in which countries the different figures were generated but only where they are consolidated

Data from ECG members can be considered representative of the Continental Europe Outbound Automotive Logistics market ECG members volumes represent approximately 80% of

the new vehicles processed by the entire European Finished Vehicles Logistics industry

0,9%0,2%

Breakdown of the total number of vehicles processed by segment and by sector (from ECG 08 survey with 07 data)

Transport is on a local or a national scale

Big differences appear when segments are analysed

Multimodal operators process the highest number

Breakdown by segments

63.067.454 12.152.943 7.515.000 7.255.500 14.750.614 1.486.846 160.000 19.746.551

19,3% 11,9% 11,5% 23,4% 2,4% 31,3%

Pure trucks

Trucks & Ports

Trucks & Wagons

Mostly Ships

Ports & Terminals

Pure barges

Multimodal

03%Total vehicles

processed

90%

100%100% 100% 100% 100% 100% 100% 100% 100%Breakdown by

national or international

type of transport

Total number ofvehicles processed

44,6% (41)

9,8% (9)

9,8% (9)

6,5% (6)

21,7%(20)

5,4% (5)

2,2%(2)

Breakdown by

segments

Total number of companies

Average number of vehicles

processed per company

92

296.413 835.000 806.167 2.458.436297.369

80.000

987.328685.516 Breakdown

by segments

Executive summary (7 of 11): The European Automotive Outbound Logistics Sector key market figures (1 of 2)

10

Source: ECG

highest number of cars as a segment followed by ships, and then by mostly ships and pure trucks operators

Mostly ships operators stand out in term of average number of vehicles processed per company

Vehicles: International transportation (%)

Vehicles: National transportation (%)

European Outbound Automotive Logistics

sector

Trucks & Ports

Trucks & Wagons

Mostly Ships

Ports & Terminals

Pure trucks Pure barges Multimodal

49% 49%

67%

34%

2%

56%

51% 51%

33%

66%

98%

44%

0%

10%

20%

30%

40%

50%

60%

70%

80%

Breakdown N.A.

Breakdown N.A.

transport

Breakdown of modes of transport by segment and by sector (from ECG 08 survey with 07 data)

Total number ofport compounds / port terminals

Total numberof inlandcompounds

Total numberof barges

Total numberof ships

41.127 2.7727.817 13.031 422 14 13 17.058

40,0%

50,0%

60,0%

70,0%

80,0%

90,0%

100,0%

98,5% 97,2%

49,6%

0,0%0,0%

81,7%

57,0%

0,1%0,0%

0,0%

0,0%

76,5%

0,1%0,8%

0,0%

0,0%

0,0%

0,0%

100,0%

0,2%1,1% 1,9% 0,4%

7,1%

0,0% 1,3%0,4% 0,0% 0,9% 0,0%

9,2%

92,9%

0,0%

0,4%

1,5%

7698 2693

700420.379

10650

337

323

1442

13

29464

118 54 47

30

214146

25

39

13

681

0

0

0

0

0

0

0

0

0

0

0

0

In numerical terms, trucks and wagons operated by ECG members dominate

In terms of market value ships dominate

N.A. (very often government concessions)

N.A.

10.000 15.000

Aprox value (in /000)

Number ofassets used

Executive summary (8 of 11): The European Automotive Outbound Logistics Sector key market figures (2 of 2)

11

Source: ECG

of ships

Total numberof wagon

Total numberof trucks

0,0%

10,0%

20,0%

30,0%

Pure trucks

Trucks & Ports

Trucks & Wagons

Mostly Ships

Ports & Terminals

Pure barges Multimodal

Modes of transport or wharehousing used

(from ECG 08 survey with 07 data)

48,0%

17,9%

7,1%0,0%

0,0%

41,1%

0,0%

0,0%

0,0%

0,0%

0,0%

7,1%

0,0%

19.759

2334

30

0 0

9729

1

0

0

0

0

0,0%

0

0

58.756

9.887 11.131 5.529 9.034 2.616 -

20.560

859

210 204 106 49 45

-

247

3.000

13.000

23.000

33.000

43.000

53.000

63.000

Total square meters available to ECG Members

Pure trucks Trucks & Ports Trucks & Wagons Mostly Ships Ports & Terminals Pure barges Multimodal

Sqm/000 ofworkshop 2007

Sqm/000 ofstorage area 2007

59.615

10.096 11.335 5.635 9.082 2.661

20.806

N.A.N.A.N.A.

Breakdowns of the Sqm available by segment and by sector (from ECG 08 survey with 07 data)

dominate followed by barges

Sqm available to ECG members are mostly for car storage

Sqm/000

40.000 65.000

150

170

The European Outbound Automotive Logistics industry key

Ability to reach increasingly more distant markets

I

II

Need to invest in assets offering an increasingly more flexible transport capacity:

European Outbound Automotive Logistics industry: key trends

. . . . . . . . . .. .

. . . .(Car Set up)

. .

.Flexible

Vehicle Manufacturers: key trends

Development of a single car model for the world market to reduce manufacturing costs and optimize production efficiencies

Production relocation to regions (mostly in Eastern Europe or Asia) where the cost of labour is lower than that of richer regions (where most vehicle demand is still located)

Traditional European operators, previously concentrated on western markets, were forced to develop new activities in the east

Need for manufacturers to quickly fulfill newer consumers aspiration/fashion requirements (mostly because of the increasing level of competition in the global automotive market)

Consequent necessity:o To produce new car models more often

Executive summary (9 of 11): The European Automotive Outbound Logistics Sector key trends

12

Source: ECG1) Approach where a product is scheduled and built in response to a confirmed order received for it from a final customer

industry key trends are almost entirely dependent on related Automotive Industry key trends

IV

III

capacity: Capability of taking onboard a larger mix of car/LCV/HCV models

Delivery time reliability and lead time accuracy

Progressive necessity to monitor and reduce the pollution impact of the logistics business

(HCV Set up)

(LCV Set up)

.Flexible assets

.. .. .

o To produce new car models more often then before (Shortening of individual model life-cycle)

o To increase the degree of car personalization

Need to substantially cut lead times:To satisfy the built-to-order1 concept To keep the marketing promise related to quick vehicle delivery times made by dealers to final consumers

Executive summary (10 of 11): The European Automotive Outbound Logistics Sector has a different risk profile to the related Automotive Industry

Business diversification

Driver

Demand steadiness

The European Automotive Manufactures Industry

Automotive troubles today do not stem from market trends, but from structural production overcapacity

Manufacturers with longer production lead times are able to satisfy demand better by putting a stock buffer in the supply chain

The European Automotive Manufactures Industry sells vehicles and financing to both private and corporate clients:

Private and corporate customer willingness to buy vehicles is highly correlated with the economy, but it is more volatile

Captive financial operations of Automotive Companies are highly correlated with the economy

Active in different businesses segments, but final diversification is not high since all segments are highly correlated with the economy

High volatility in new vehicle demand

The Finished Vehicle Logistics Sector has a different risk profile to the Automotive Industry

The European Automotive Outbound Logistics Sector sells services to both new and used vehicle industries:

The new vehicle industry is highly correlated with the economy The used vehicle industry is correlated with the economy, but very stable and predictable

The European Automotive Outbound Logistics Sector

More predictability in sales volumes due to the mix of higher diversification combined with final lower volatility

Manufacturer overproduction generates a cycle of stocking and destocking at the plant that results in more constant demand for a mix of transport and warehousing services

Supply chain stock buffer created by manufacturers generates storage and post-production demand that is not dependant on production volumes

More stability in Logistics Services demand

13

Source: ECG1) S&P, Moodys and Fitch

Geographical flexibility

High volatility in new vehicle demand More stability in Logistics Services demand

Assets residual value In case of market downturn or change in strategic decisions, effective execution of asset disposal or sale may be quite difficult

Assets used in Automotive Outbound Logistics can be sold or disposed of with a positive residual value

More flexible in terms of asset disposal or sale

Automotive Industry has often faced political opposition to capacity closure and its assets can be sold only in an M&A transaction

Financial benchmark

Profitability vs Market share To gain market share, quite often profitability needs to be sacrificed

Automotive Outbound Logistics operators do not work with exclusive agreements. They can divert profitable services to where demand is healthier.

It is very likely that profitability and market share are positively correlated (eg.: their values can move together and in the same direction)

Western European markets are quite mature and also highly competitive, while emerging markets are less mature but still highly competitive

Many times smaller, but with stronger financial metrics combined with financial P&L flexibility and a constant lower debt to equity ratio

Titans with robust financials but currently with a credit rating1 between a lower medium grade and a speculative investment grade

The glocal strategy: be smart and act global but always think local

The vast majority of fixed assets used in Automotive Outbound Logistics are fixed only from an auditing point of view. But in reality they are fully moveable where demand is growing (they can be relocated from one day to another to or from anywhere in Europe (and for ships anywhere globally)

More flexible in dynamic allocation of assets to new and more attractive routes connecting vehicle production plants in Western Europe to emerging markets

The Automotive Industry is following a Glocal strategy, locating production where costs are lower, pushing distribution where demand is rising, and customising based on local demand

Executive summary (11 of 11): The European Automotive Outbound Logistics Sector has a different risk profile to the related Automotive Industry

The European Automotive Outbound Logistics Sector deserves a higher credit rating from Financial Institutions than that given to the European Automotive Industry

Exclusively supplying services to Automotive Manufacturers using assets1 specifically designed to transport or store vehicles and that cannot be employed for any other use

The Finished Vehicle Logistics Sector is a relevant part of the Automotive Industry

The Finished Vehicle Logistics Sector has a different risk profile to the Automotive Industry

However the European Automotive Outbound Logistics Sector is more diversified, stable and flexible than the related Automotive Industry:

A) more predictability in sales volumes selling services to both new and used vehicle industries B) more stable business due to:

1) the overproduction2 of the automotive manufacturers

14

Source: ECG1) Road car transporters, specialized rail wagons, river barges and car-carrying ships2) Stocking and destocking

ECG highlights how the European Automotive Outbound Logistics Sector merits the confidence of

the International Banking Sector as it looks to fund new investments

The European Automotive Outbound Logistics Sector is more stable than the Automotive Industry but its significant growth

potential may remain unrealised unless the banking system provides the necessary financing

1) the overproduction2 of the automotive manufacturers2) outbound supply chain used as a stock buffer by manufacturer

C) more geographically flexible due to the opportunity to relocate asset1 where the demand isD) more flexibility in asset disposal or sale main modes of transport1 can be easily sold or disposed ofE) profitability and market share are positively correlated operators do not work with exclusive agreements F) smaller, more robust and financially flexible due to:

1) generally stronger financial metrics (profitability, efficiency and credit metrics)2) more flexibility in the P&L due to an (on average) higher share of variable costs 3) generally private ownership combined with a constantly lower debt-to-equity ratio

Executive summary




15






Appendix:

Founded in 1997 and headquartered in Brussels (Belgium)

Lobbying for the interests of associates operating in the field of outbound logistics for the European Automotive Sector

92 members in 2009 incorporated in 23 Eurasian countries:

o Operating on a regional (road, rail, river and sea shipping) or a global scale (only

sea shipping)

o Aggregate turnover of more than 15,5Bil

o More than 63Mil vehicles processed

o More than 60.000 direct employees

o Different transportation assets operated by members:


ECG (European Association of Finished Vehicles Logistics Providers)

16

o Different transportation assets operated by members:

13.000 owned trucks and 7.000 subcontracted

20.000 rail wagons

330 ships (owned and chartered)

40 river barges

146 port terminals and 460 inland compounds

58 million square metres of vehicle parks and 1mil square metres of

workshops

o Mostly offering multimodal transportation (deep sea, short sea, inland waterways,

rail and roads) and additional services:

Storage in special compounds

Quality control and damage inspection at the end of the assembly line

Value added services (Pre-Delivery Inspections [PDI], de-waxing, body &

paint repair, customisation)

Source: ECG

In 2009 the Association of European Vehicle Logistics is composed of 92 members based in 23 Countries

EU252

UK Members: 7

Sweden

Wallenius Wilhelmsen Logistics(2wglobal.com)

SkandiaTransport(skandiatransport.se)

Members: 2FinlandAvelon Autologistics(avelongroup.com)

Finnlines(finnlines.com)

Freeport of Finland(freeport.fi)

SE Mkinen Logistics(se-makinen.fi)

Members: 4

BelgiumVolvo Group Belgium(volvo.com/logistics/global/en-gb/services)

ICO terminals(icoterminals.com)

Members: 2

AustriaFRIKUS Friedrich Kraftwagentransport/Speditions(frikus.com)

Hdlmayr International (hoedlmayr.com)

Lagermax Autotransport(lagermax.com)

VEGA International Car Transport & Logistics(lagermax.com)

Members: 4 SpainBerg Automotive Logistics(bergeycia.es)

Autoterminal(autoterminal.es)

Setram(autoterminal.es)

Sntax Logstica(sintax.com)

Toquero Express(toquero.com)

Tradisa OperadorLogstico(tradisa.es)

Trapiser(trapiser.com)

Members: 7 Czech Rep

Litra Autotransport(litra.cz)

Helicar(helicar.cz)

Members: 2

Estonia

O Toptrans Baltic (toptrans.ee)

Members: 1

Lithuania

Bleiras

Autoverslas(autoverslas.lt)

Omnitrans(N.A.)

AUTO1(auto1.lt)

Litaksa(litaksa.com )

Seslita(seslita.lt)

Manvesta(manvesta.com)

Members:

PolandAdampol(adampolsa.com.pl)

Wega(wega-a.pl)

Members: 2

Norwayivind Johansen Transport(ojt.no)

UECC (United European Car Carriers)(hoegh.com)

Hegh Autoliners(hoegh.com)

Autolink(autolink.as)

Auto Transport Service (autotransport.no)

Members: 5

Switzerland

MAT Transport(viamat.com)

Members: 1

Ukraine

Avtologistika Group(avtologistika.com)

Members: 1

RomaniaEverest Management Group(verest-management.org)

Kefalonia(kefalonia.ro)

Members: 2

Slovenia

AvtoTransporti Kastelec(avtotransporti-kastelec.si)

Members: 1

Russia Members: 6

EFTA23

NonEU

EU151

ItalyGrimaldi Group(grimaldi.napoli.it)

Autotrade & Logistics(autotradeandlogistics.it)

Bertani Trasporti(bertanitrasporti.it)

F. LLI ELIA -Ambrosettiautologistics(ambrosettiautologistics.it)

Members: 6

Ireland

Motor VehicleTransportation(mvt.co.uk)

NVD(nvd.ie)

Members: 2

GreeceNeptunes Lines(neptunelines.com)

Global Maritime Agency(glomar.gr)

Hellenic Logistics(helleniclogistics.com)

Members: 3

Tru

cks

Wagons

Ship

s

Barg

es

Port

Tru

cks

Wagons

Ship

s

Barg

es

Port

Tru

cks

Wagons

Ship

s

Barg

es

Port

Tru

cks

Wagons

Ship

s

Barg

es

Port

Tru

cks

Wagons

Ship

s

Barg

es

Port

Tru

cks

Wagons

Ship

s

Barg

es

Port

Tru

cks

Wagons

Ship

s

Barg

es

Port

Tru

cks

Wagons

Ship

s

Barg

es

Port

Tru

cks

Wagons

Ship

s

Barg

es

Port

Tru

cks

Wagons

Ship

s

Barg

es

Port

Tru

cks

Wagons

Ship

s

Barg

es

Port

Tru

cks

Wagons

Ship

s

Barg

es

Port

Tru

cks

Wagons

Ship

s

Barg

es

Port

Tru

cks

Wagons

Ship

s

Barg

es

Port

Tru

cks

Wagons

Ship

s

Barg

es

Port

Tru

cks

Wagons

Ship

s

Barg

es

Port

Tru

cks

Wagons

Ship

s

Barg

es

Port

Tru

cks

Wagons

Ship

s

Barg

es

Port

Tru

cks

Wagons

Ship

s

Barg

es

Port

Part ofthe EU25 but not in the ECGHungary

BulgariaSlovak Rep

Sia Doas(dozhas.com)

9

17

UK

Spirit Autologistics(spiritautolog.com)

AutoLogic Holdings(autologic.co.uk)

D F Services(N.A.)

ECM (VehicleDelivery Service)(ecmvds.co.uk)

Ontime Automotive(ontime-auto.com)

Brit European Transport (briteuropean.com)

Medway Ports(medwayports.com)

Members: 7France

Walon France(walon.fr)

TEA(N.A.)

STVA(stva.fr)

GEFCO(gefco.net)

Khler France(kohlerfrance.eu)

Groupe CAT(groupecat.com)

Members: 6HERTRANSUS

Hertransus(hertransus.lt)

Bleiras(bleiras.lt)

TurkeyME-PAR(me-par.com)

Ile Transportation(ilce.com.tr)

Matrix Logistics(ilce.com.tr)

Members: 3

Russia

Gema-Trans(gema.ru)

Inter-Auto(inter-auto.info)

OOO APPAREL 2000(apparel-ltd.ru)

RTL (RussianTransport Lines)(rtlgroup.ru)

RailTransAuto(railtransauto.ru)

LLC Rolf Logistics(rolf.ru)

Members: 6

GermanyBLG Automobile Logistics(blg.de)

Werner Egerland(egerland.de)

Terra Handels- undSpeditionsgesellschaft(terra-spedition.de)

Michael Grning(groning.com)

Manheim DefleetDeutschland(dentwizard.com)

Internationale SpeditionWilli Betz(willibetz.de)

Horst Mosolf(mosolf.de)

Helf Automobil-Logistik(helf-al.de)

Brockmller Spedition(central-asia.de)

ATG Autotransportlogistics(atglogistics.com)

Members: 10

Netherlands

F. Elbert B.V.(elbert.nl)

Broekman Group(broekman-groep.nl)

Interrijn(interrijn.com)

Koopman Logistics Group(koopman.nl)

Lucas Logistics Autotransport(lucaslogistics.nl)

Verbrugge Terminals(verbrugge.nl)

Members: 6

i-FAST Automotive Logistics(i-fast.it)

Tru

cks

Wagons

Ship

s

Barg

es

Port

Tru

cks

Wagons

Ship

s

Barg

es

Port

Tru

cks

Wagons

Ship

s

Barg

es

Port

Tru

cks

Wagons

Ship

s

Barg

es

Port

Tru

cks

Wagons

Ship

s

Barg

es

Port

Tru

cks

Wagons

Ship

s

Barg

es

Port

Portugal

Luxembourg

Part ofthe EU15 but not in the ECG

Denmark

Source: ECG1) EU15: Member Countries in the EU prior to the accession of ten candidate Countries on 1 May 2004 2) EU25: After the 2004 enlargement3) European Free Trade Association (EFTA)4 Members: Iceland, Liechtenstein, Norway and Switzerland

1) 23 Continental Europe Countries

2) 92 Members: 41 Pure Trucks 9 Pure Trucks & Ports 10 Trucks & Ports 1 Pure Wagon 6 Mostly Ships 2 Pure Barges 3 Ports & Terminals 20 Multimodal Operators

in 2009

SADA(sadagroup.com)

ECGs impressive growth is a sign of the widespread appreciation for its effective lobbying for the interests of the Automotive Logistics sector

Historical trend in ECG Members vs Europe271 GDP growth

The importance of the Association of European Vehicle Logistics is demonstrated by the impressive growth in members currently

A sector in crisis smaller operators

are disappearing 20.000 jobs lost Between 20% and

30% of transport capacity has been slashed by operators in order

Implications of the credit

crunch

42

51

64

73

96101

92

60

80

100

120

ECG membership % changeYoY

6,0%

EU27 GDP Growth (%)EU27 GDP Growth (%)

4,0%

ECG members

On average, ECG memberships have shown a yearly growth rate 15% times higher than that of the EU27 GDP growth

A sector currently in crisis The automotive industry

has experienced its strongest market decline since the early 1990s

The relevance of the ECG

association in the European Automotive

Logistics scenario

Between 4-7 bill. in financing to enable the sector to provide assets required in the medium term (trucks, railwagons, barges and ships scrapped last year)

Overall sector investment need and rationale

Current ECG main lobbying activity

The global economy and European automotive production and sales will recover soon. Then there will be an urgent need to invest in European Vehicle Logistics

18

Lithuania

Poland

Romania

Hungary

LatviaBulgaria

Czech Rep

Estonia Slovenia

Slovak Rep

Malta

Cyprus

1) Europe 27

Source: ECG, Economist Intelligence Unit

1)EU27: Current member states of the EU (at 12/2009) Three more Countries have applied for EU membership: Croatia, Turkey and the Former Yugoslav Republic of Macedonia2)EU15: Member Countries in the European Union prior to the accession of ten candidate Countries on 1 May 2004

Austria

Belgium

Denmark

Finland

France

Germany

Greece

Ireland

Netherlands

Portugal

Spain

Sweden

UK

ItalyLuxembourg

representing approximately 80% of the number of new vehicles processed by the entire European Finished Vehicles Logistics industry

slashed by operators in order to survive

financial resources have been drained

difficulties in financing new and existing operations

Approximately 83% of active players have cancelled all existing and future investment plans

18 22 2124

3136

42

0

20

40

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

22,2% -4,5% 14,3% 29,2% 16,1% 16,7% 21,4% 25,5% 14,1% 31,5% 5,2% -8,2%

-4,0%

-2,0%

0,0%

2,0%

4,0%

EU152

2,9% 3,0%

4,0%

2,0%

1,2% 1,3%

2,5% 2,1%

3,2%

2,8%

0,7%

-4,1%

scrapped last year) and avoid a future capacity disaster

New and used vehicle industries will find themselves with a transport shortage capacity soon A risk of a serious

bottleneck because Outbound Vehicle Logistics capacity cannot grow at the rate of the expected economy recovery

Executive summary




19






Appendix Economic scenario and forecasts for ECG Countries

The European automotive industry is made up of numerous players

Automotive industry players in Europe Fifteen international players:Over 250 plants in 18 EU CountriesA supply chain involving metals, plastics, chemicals, textiles and electric & electronic systems

The worlds largest vehicle producer base18.4 million vehicles produced in Europe in 2008o 7% fewer than in 2007

Generating a turnover of 551 billion in 2008 A robust export sector:

Exports are valued at over 70 billion annuallyOver 40 billion in net trade contribution

12 million direct and indirect jobs A leading force of innovation with yearly investments of 20 billion in R&D

Committed to a model of sustainable mobilityInvesting in cleaner and safer vehiclesPremium producers (such as BMW and Mercedes) are spending 4 times more in R&D per unit than mass producers (like Volkswagen) o also a function of the lack of economies of scale of premium makers

Key facts

20

Source: ACEA, Credit Suisse

o also a function of the lack of economies of scale of premium makers Vehicle taxes generating more than 400Bil in government yearly revenues A volume business where economies of scale are significant

to be profitable, volumes must be highvery few niche makers are profitable with two exceptions (Porsche and Ferrari)

Barriers to entry are high in the automobile industrythe market is rather concentratedthe product cycle is long at around 10 years (3 to develop and 7 to the mkt)development costs are high o 1bn for a car, including production tools, and roughly the same amount

for engines or gearboxes o emissions and fuel consumption issues increase development costs and

favor the most solid companies benefiting from high volume and lower cost per unit

Scale and technology leadership will remain critical to successInnovation and quality leadership will continue to be critical success factorsIncreasing interest in ways of reducing or sharing costso deeper cooperation between industry players (whether cemented by equity

stakes or not) to share costs (R&D, purchasing and Capex)o focus on increasing volume per platform and chasing commonalityo model proliferation of recent years to reverseo high profile model casualties are likelyo plants in mature markets will likely close or be relocated to low-cost

countries

Several stakeholders influence the European automotive industry

Austria

Belgium

Denmark

Finland

France

Germany

29 Countries where the European Automobile Manufacturers

Association (ACEA) is present

Hungary

Latvia

Bulgaria

Cyprus

Czech Republic

Estonia

EU151 EU272

Key stakeholders

European Commission

National and regional governments

Road authorities

The energy supply industry and infrastructure owners

Key influence

Determining priorities for selecting the R&D

Responsible for national transport policies (strategic funding for R&D, and major road infrastructure projects as well as programmesfor general and scientific education)

Managing traffic on the urban and interurban road network

Ensuring there is adequate supply and infrastructure of fuels and other energy carriers for the future that is ecologically sustainable and politically acceptable

Responsible for the development and manufacture of vehicles that are efficient, safe, environmentally friendly and The automotive

21

0

Source: ACEA - EU1)EU15: Member Countries in the European Union prior to the accession of ten candidate Countries on 1 May 20042)EU27: Current member states of the EU (at 12/2009) Three more Countries have applied for EU membership: Croatia, Turkey and the Former Yugoslav Republic of Macedonia

Germany

Greece Lithuania

Malta

The Netherlands

Norway

Poland

Portugal

Romania

SloveniaSpain

Sweden Switzerland

TurkeyUnited Kingdom

Slovak Republic

Ireland

Italy

LatviaEU151 EU272

NonEU

The suppliers of the automotive industry

Vehicle users

Road infrastructure research institutions

Telecom and ICT industries

Public transport operators

vehicles that are efficient, safe, environmentally friendly and affordable

Co-responsible for developing, manufacturing and distributing vehicles

Choosing and using of vehicles has a great impact on safety, traffic, fuel usage and consumption, noise and the environment in general

Contributing to seamless communication, using different technologies and the development of open platforms for unimpeded information exchange between systems

Contributing towards improved road design and road surface materials

Responsible for optimising public transport systems and making the most appropriate choices, also in terms of vehicle procurement

The automotive industry

Luxembourg(Part of the EU15 but not of ACEA)

High employment levels in the European Automotive Industry have always provided a guarantee of government action at times of economic recession

Direct and indirect1 employment in the EU Automotive sector in 2007

Vehicle manufacturing supports over 2Mil European jobs with an additional

2.2 Mn Jobs

9.8 Mn Jobs 12.1 Mn Jobs

2

4

6

8

10

12

Automotive Industry (production operations)

Related industriesTotal

Automotive sector

Mil jobs

Manufacturing Activities

18,3%

81,7%

Implications for the sector

Starting at the end of 2008, EU Governments and the EU itself acted fast to underpin the financial viability of the sector through loan guarantees and incentives for vehicle

Government intervention

Tangibly showing desire of national authorities to support the sector

Scrap and tax incentives perceptibly helping sales

Direct and indirect

Stimulating auto demand is a powerful way to protect jobs, support GDP, and ultimately

Automotive sector as an

instrument of the state

22

Source: Eurostat1) Indirect employment data does not report employment in raw material sector (e.g. steel, aluminum, glass, etc.), textile, driving schools, licensing activities, vehicle testing, vehicle

insurance and financing, etc.

additional 10Mil citizens employed in closely related sectors

Automotive Industry (production operations) Automobile manufacturing Equipment and accessories Bodywork, trailers, caravans

Manufacturing Activities Manufacture, retreading and rebuilding of rubber tyres

and tubes Manufacture of bearings, gears, gearing and driving

elements Manufacture of cooling and ventilation equipment Manufacture of computers and other information

processing equipment Manufacture of electric motors, generators and

transformers Manufacture of electrical equipment for engines and

vehicles (not elsewhere reported)

Automobile use Sale and distribution of motor vehicles Maintenance and repair of motor vehicles Sale of motor vehicle parts and accessories Sale of motor fuels Renting of automobiles

Transport Road transport (passengers and freight)

incentives for vehicle purchases Short-time working

schemes, direct government loans and scrap discounts have all served to protect the industry

Direct and indirect government support has also allowed carmakers to avoid wide-spread restructuring and escape (or re-emerge from) insolvency

and ultimately garner votes

Germanys 2009 scrap scheme has been very popular with voters

The automotive industry is characterised by different vehicle categories

Sub-main vehicle categories

Main Vehicles categories

Heavy Commercial Vehicles

Buses & Coaches

III

IV

Buses&Coachesover 3.5t

Total Commercial Vehicles over 3.5

Heavy Commercial Vehicles over 16t -

Heavy Buses & Coaches over 16t

Total HeavyCommercial Vehicles, Heavy Buses & Coaches over 16t

ECG classification

IV-c

IV-b

IV-a

III-b

HCV/B

Also called High and

23

Source: ACEA, ECG2) EU15: Member Countries in the EU prior to the accession of ten candidate Countries on 1 May 2004

LCV/MB

Cars

Passenger Cars

Light Commercial Vehicles

Vehicles

I

II

Passenger Cars

Light Commercial Vehicles up to 3.5t

Mini-buses up to 3.5t

Total Light Commercial Vehicles up to 3.5t

Commercial Vehicles over 3.5t

Vehicles over 3.5

I-c

II-a

III-a

II-b

I-b

I-aMass passenger Cars (average selling price 15.000)

Mid passenger Cars (average selling price 30.000)

Premium passenger Cars (average selling price 50.000)

. .

. . . .

High and Heavy

The automotive industry has experienced its strongest market decline since the early 1990s

Europe 281: Vehicle Registrations

8.000

10.000

12.000

14.000

16.000

18.000

20.000

HCV/B

LCV/MB

Cars87,2% 86,5% 86,0% 85,1% 85,5% 85,8% 86,0% 85,0% 84,5% 84,6% 83,9% 84,0% 14,49

9,6%

10,0%

10,3% 11,0% 10,7% 10,7%10,5%

11,2% 11,6%11,3%

11,8%

11,4%3,2%

3,5%

3,7% 3,9% 3,8%3,5%

3,5%3,7% 4,0%

4,1% 4,3%

4,6%

15.380

16.60417.525 17.327 17.330 16.790

17.53918.048 18.060

18.693 19.068

17.55513.815

8,0%5,5% -1,1% 0,0% -3,1% 4,5%

2,9% 0,1%3,5% 2,0%

-7,9%-7,6%

The banking crisis that started at the end of 2007 stalled economies: Consumers and

businesses struggled to access credit

There is no

Credit crunch

1,8% 0,0%

1,290,44

. .

Actual YTD

Actual YTD

Actual 11monts

Actual 11monts

Note: this growth rate is not fully reliable because HCV/B

and LCV/B 2009 registration

figures were available only for

the first 11 monthsin 000s

24

Lithuania

Poland

RomaniaHungary

LatviaBulgaria

Czech Rep

Estonia

EU152

Slovenia

Slovak RepMalta

Cyprus

EU253

1) Europe 28

Austria

Belgium

Denmark

Finland

France

Germany

Greece

Ireland

Netherlands

Portugal

Spain

Sweden

UK



Norway

Switzerland

Iceland

EFTA34


CAGR 97-02% changeYoY

-

2.000

4.000

6.000

1997 1998 1999 2000 2003 2004 2005 2006 2007 2008

Cars

2001 2002 (1-E12)2009


There is no precedent in the automotive industry for the market distortions experienced The most

severe crisis since WWII

. .

Artificially stable segment (vs 08) in 2009 the Car segment has

benefited from local government support including car scrapping schemes

CAGR 97-02 CAGR 03-E08

Actual YTD

Actual 11monts + Provisional ACEA for December

HCV/B: Heavy Commercial Vehicles/BusesLCV/MB: Light Commercial Vehicles/Mini buses

Europe 281: New Passenger Car registrations

000 units

It cannot be looked at as a single market:

It is made up of 28 markets

The European car market

Cars

The automotive industry has experienced its strongest market decline since the early 90s: Cars

8.000

10.000

12.000

14.000

16.000

New EU Members

EFTA(3)

Other EU15 (8)

Belgium

Netherlands

Spain2.171 2.247 2.198 2.222 2.459 2.564 2.579 2.567 2.440 2.345 2.404 1.844

1.7131.944 2.148

2.1342.255 2.145 2.009 2.014 2.068 2.001 2.065

2.050 2.040

1.016

1.1931.406

1.3811.426

1.332 1.382 1.517 1.529 1.635 1.615

1.161 862

478

543611

598530

511 489 484 465484 506

500380

396

452490

515489

468 459 485 480526 525

536449

1.298

1.448

1.639 1.668 1.489 1.457 1.441

1.529 1.574 1.583 1.609

1.522

1.134

411

429

434 427 416

391 370 397 393

396 430

408

333

871825 749

1.056 1.210

1.179

792

13.416

14.369

15.06614.747 14.818

14.399

15.08415.350 15.254

15.819 16.003

14.740

13.417

7,1%

4,9%-2,1%

0,5% -2,8%4,8%

1,8% -0,6%3,7% 1,2%

-7,9%

-9,0%

- -2,7% - - -1,0%-

-

11,5%13,2%

1,8% -10,7% -2,2%-1,1% 6,2%

2,9% 0,6%1,6%

-5,4%

-5,2%

- --

- -0,3%

-

-2,3%-

--4,3% -1,0%

- -

-17,9%-1,8%

3,2%-6,6%

3,8% 9,8% 0,8%6,9% -1,2% -

28,1%

-

13,5% 10,5%-0,7%

5,7% -4,9% -6,3% 0,2% 2,7% -3,3% 3,2% -0,7%

-0,5%

3,5% -2,2% 1,1%10,7% 4,3% 0,6% -0,5% -5,0% -3,9%

2,5% -11,3%

CAGR 97-02

CAGR 03-09

-5,2%40,9% 14,6%

-32,8%1,2%

1,4%6,0% 5,3%

7,3%0,7%

8,6% 5,0%

18,5%

25,5%

14,1%

8,3%5,1% 4,3%

1,9% 5,7%1,0%

9,6% 2,1%

16,2%13,5%

12,6% 11,3%3,7% 3,8% 4,0% 4,5% 1,1%

24,1%17,3%

25,8%

-9,2% -2,6%

4,3%

% changeYoY

25

markets Each market has its own dynamics

Lithuania

Poland

RomaniaHungary

LatviaBulgaria

Czech Rep

Estonia

EU152

Slovenia

Slovak Rep

Malta

Cyprus

1) Europe 28

Austria

Belgium

Denmark

Finland

France

Germany

Greece

Ireland

Netherlands

Portugal

Spain

Sweden

UK


but not consideredby AAA-ACEA Norway

Switzerland

Iceland

EU253 EFTA34

0

2.000

4.000

6.000

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 1 - 11/09

France

United Kingdom

Italy

Germany

2.132

3.528 3.736 3.802 3.378 3.342 3.253 3.237 3.267 3.319 3.468 3.148 3.090 3.592

2.404 2.3792.338

2.423 2.413 2.280 2.247 2.265 2.2372.326

2.4932.162

1.992

2.564 2.579 2.567 2.440 2.404 1.844


0,6% -0,5% -5,0% -3,9%

-13,5%

-1,0% -1,7% 3,6%

-0,4% -5,5% -1,4% 0,8% -1,2% 4,0%7,2%

-13,3%-7,9%

5,9% 1,8%-11,1%

-1,1% -2,7% -0,5% 0,9% 1,6% 4,5% -9,2% -1,8% 16,2%

-1,9%1,4%


Unlike commercial vehicle and bus segments, the car segment has

Cars

The European automotive industry: channel mix in the car segment

56% of the new passenger Cars registered in EU28 in 2008

(14,7Mil of units)Unit

sold in Mil

EU281: 2008 channel mix in the car segment for the 6 Main European Automotive brands

50%

75%

100%

49%

8,201,80

39%

1,25

48%

1,05

40%

0,76

58%

0,73

54%

2,59

57%

Car sale channels

Each sale channel is characterized by its own specific demand

Implications

The split in private and fleet demand has been historically

EU281: Historical channel mix evolution

in the car segment

44% 45% 48% 50%

50%

75%

100%100% 100%100% 100%

% of sales

% of sales

26

Lithuania

Poland

RomaniaHungary

LatviaBulgaria

Czech Rep

Estonia

EU152

Slovenia

Slovak RepMalta

Cyprus

EU253

1) Europe 28

Austria

Belgium

Denmark

Finland

France

Germany

Greece

Ireland

Netherlands

Portugal

Spain

Sweden

UK



Norway

Switzerland

Iceland

EFTA34

segment has two important sale channels

Source: Credit Suisse2) EU15: Member Countries in the EU prior to the accession of ten candidate Countries on 1 May 2004 3) EU25: After the 2004 enlargement4) European Free Trade Association (EFTA)4 Members: Iceland, Liechtenstein, Norway and Switzerland

6 Main automotive brands unit

sales in EU181

0%

25% 51%

Average selling

price/000

Corporate Private

PSA

61%

14

15

Renault

52%

14

15

Fiat

60%

13

13,5

BMW

42%

32

30

Daimler

46%

37

35

VW

43%

17

16

specific demand drivers and business dynamics

historically balanced 56% 55% 52% 50%

0%

25%

2005 2006 2007 2008

Corporate (also called fleet market)

Private (also called mass market)




LCV/MB

The automotive industry has experienced its strongest market decline since the early 90s: LCV/MB

Europe 281: New LCV and MB Registrations

000 units

414 433404

381408 419

439461

459215

254308

298 287 268 297

333 386 274276

166

96

81

96

9996 83 80 76

8665

6481

85

50

45

50

5854 60 49 51

5962

60

68

68

51

229

261

286 325 259 233

221

250 266

283

293

233

130

49

50

50

54 57

45 46

54 60

69

74

63

43

-

86

100 101 156

185

194

97

1.000

1.500

2.000

New EU Members

EFTA(3)

Other EU15 (8)

Belgium

Netherlands

Spain

1.473

1.660

1.805

1.908 1.8601.804

1.843

2.0222.087 2.104

2.242

2.006

1.292

% changeYoY

CAGR 97-02

CAGR 03-09

12,7%

8,7%5,7%

-2,6% -3,0%

2,2%

9,7%3,2%

0,8%6,6%

-10,5%

-35,6%

0,5%54,3%

18,5%4,8%

-19,8%0,3%

15,4% 8,0%

-15,3%

13,8%

9,7%

13,6%

-20,4%-9,9% -5,3% 13,0%

6,6%6,6%

3,4%-20,4%

11,5% -17,6%

-3,1%-12,9% -3,7%

26,5%

18,2%

21,3%

-3,4%

-3,6% -6,5% 10,5% 12,4%

15,8%-29,1% 0,6% -39,8%

4,5%-6,7% -5,7%

7,0%2,8% 4,8%

4,8%-0,3%

-49,9%

-31,6%

-44,4%

-24,9%

-40,9%

-42,1%

16,7%

1,7%

0,3%

9,1%4,4%

19,2%

9,7%

11,1%

15,6%

-7,0% 4,3%14,7%

5,5% -2,7% 12,6%-0,7%

17,8%

2,9%

-4,7% 12,6%

-24,3% -2,0%4,7%

27


Malta

Cyprus Part of the EU27 but not consideredby AAA-ACEA

Lithuania

Poland

RomaniaHungary

LatviaBulgaria

Czech Rep

Estonia

EU152

Slovenia

Slovak Rep

1) Europe 28

Austria

Belgium

Denmark

Finland

France

Germany

Greece

Ireland

Netherlands

Portugal

Spain

Sweden

UK

ItalyLuxembourg

Norway

Switzerland

Iceland

EU253 EFTA34


174 191 205 201 195 183 177 186 194 198 222 224 156

140 171189 224 229 271 203 214 209 232

243 224

158

228241 235

243 257269

306 332 325330

341292

174

312346

375414 433

404381

408 419

336

96

0

500

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 1 - 11/09

France

United Kingdom

Italy

Germany

- 5,8%4,1%

11,1%

8,2%10,6%

4,5%-6,7% -5,7%

7,0%

-26,7%

5,8%

-2,3% 3,1%5,7% 4,7%

13,9%8,4% -2,0% 1,3%

3,4%-14,5%

-40,2%

21,9% 10,3%18,8% 2,4% 18,3% -25,4% 5,8% -2,4% 10,7%

4,9% -7,7%

-29,4%

9,9% 7,4% -2,4% -2,9% -6,1% -3,3% 5,0% 4,4% 2,0% 12,3% 0,8% -30,2%





HCV/B

The automotive industry has experienced its strongest market decline since the early 90s:HCV/B

Europe 281: HCV and B Registrations

000 units

94

106 113 113101 90

94111 107 108

118

42

51

62 66 68

65 6772

79 80 8863

27

34

3234

33

27 2628

28 3830 36

18

20

2222

23

19 1920

2320 24 24

16

53

61

75 75

70

60 65

73

74 78 82 83

49

17

19

17 19

21

17 17

19

21 21 22 24

17

25

48

51 85

128 112

36 400

500

600

700

800

New EU Members

EFTA(3)

Other EU15 (8)

Belgium

Netherlands

Spain

491

575

654 672 653

587613

676

719

769

822 809

436

% changeYoY

CAGR 97-02

CAGR 03-09

17,0%

13,8%2,8%

-2,8% -10,1%

4,3%

10,4%

6,3%

7,0%

6,9% -1,7%

-46,1%

88,1%

6,8%

66,0%

51,0%-12,9%

3,2% 3,0%

23,3%

-1,2% -6,1%

-14,6%

8,5%

13,3%1,1%

4,3%5,8%

1,4%

18,5% 1,3%

4,6% -3,1%-20,9% 18,7%

22,5%

22,0%

6,0%2,7%

-4,6%

4,1%7,8%

8,9%1,1% 9,9% -28,6%

23,1%

12,6%

6,9% -0,4%-10,8%

-10,3% 4,5%

17,5%-3,2% 0,8% 8,7%

7,2%

-10,2%

16,4% 8,9%

-19,4%

-0,2%9,6%

11,4%

9,7%

-30,1%

16,3%

-41,4%

12,1%

10,7%

-1,1% 3,8%

-17,0%

0,4%4,2%

15,2%

-11,5%

-32,9%

26,4%

-5,3%-16,3%

-6,7%7,6%

0,8%37,4%

-35,9%

-63,3%

-68,1%

28


Malta

Cyprus Part of the EU27 but not consideredby ACEA


Lithuania

Poland

RomaniaHungary

LatviaBulgaria

Czech Rep

Estonia

EU152

Slovenia

Slovak Rep

1) Europe 28

Austria

Belgium

Denmark

Finland

France

Germany

Greece

Ireland

Netherlands

Portugal

Spain

Sweden

UK

ItalyLuxembourg

Norway

Switzerland

Iceland

EU253 EFTA34


134 159181 176 158 136 139 156 162

174 185 184

100

4445

66 7374

74 6770 70

69 69 66

34

8092

92 9495

89 9797 101

97 86 100

58

76

72

232316

0

100

200

300

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 1- 10/09

France

United Kingdom

Italy

Germany

-5,5%3,7%

23,1%

15,4%

0,1%

2,5% 0,9% -6,2%9,2% -0,6%

4,5% -4,2%-10,9% 15,6%

0,7%48,6%

9,9%1,0% 0,6%

-9,3% 3,8%-0,1% -0,9%

-0,3%-3,8%

18,7%13,6%

-2,5% -10,7%-13,7% 2,1% 12,3%

3,8% 7,8% 6,2%-0,8%

-40,9%

-38,4%

-42,1%

-48,3%

The European Automobile Industry also operates on a global scale

% breakdown of EU252 Automobile Exports

Global reach NAFTA 36%

South America 2%

EFTA, CIS & Others* 24%

Asia 21%

Others 17% (Africa + Oceania)

EU253

0%

20%

40%

60%

80%

100%100%

85%

15%

Cars

29

Source: ACEA - Eurostat , CCFA, OICA2)EU15: Member Countries in the European Union prior to the accession of ten candidate Countries on 1 May 20043)EU25: After the 2004 enlargement

In 2008 almost 15% of the turnover of ACEA members

derived from exports

1) Europe 25

*Croatia, Serbia, Macedonia, Bosnia Herzegovina

0%ACEA

Members2008

turnover

ACEA Members

2008 turnover in EU25

Imports from non-EU25 countries in 2008 ran to almost 7% of the turnover of ACEA members

Lithuania

Poland

RomaniaHungary

LatviaBulgaria

Czech Rep

Estonia

EU152

Slovenia

Slovak RepMalta

Cyprus

EU253

Austria

Belgium

Denmark

Finland

France

Germany

Greece

Ireland

Netherlands

Portugal

Spain

Sweden

UK

ItalyLuxembourg

Part of the EU27 but not consideredby ACEA

ACEA Members

2008 turnover out fromthe EU25

Car and LCV/MB industries in non-Western European Countries are experiencing a strong market decline too

Strong market decline in all non Western European

Cars and LCV 2005-8 global sales and 2009 expectations

2,6 3,14,0

4,1

3,5

1,6 2,02,6

3,0

1,7

2,42,5

2,92,8

2,440,0

50,0

Other E.Europe

Russia

43,6 45,048,0 46,4

39,8 -2,3%

-14,8%

-43,3%

-14,6%

-14,3%

7,3%

2,2%

-1,3%3,8%

15,4%

-3,4%

-3,4%

27,3%

30,7%

15,5%

6,6%

17,8%

27,6%

6,3%

3,2%

Unit salesin mil.

Cars

LCV/MB

Non Western European Car and LCV/MB markets

30

European regions:

A cumulative -9,0% (CAGR 07-09E)

Source: ACEA, Credit Suisse

17,3 18,119,6 20,6 20,0

19,8 19,318,9 15,9

12,2

3,5

0,0

10,0

20,0

30,0

2005 2006 2007 2008 2009E

Russia

S. America

N. America

Asia

CAGR 05-09E% changeYoY

3,8%-2,9%

-23,4%

-11,5%

4,9%

-16,1%

8,5%

-2,0%

4,9%

-2,6%

HCV/B 1995-8 NAFTA1 sales and 2009 expectations

CAGR 95-09E% changeYoYUnit salesin 000

HCV/B

700

2000 2001 2002 2003 2004 2005 2006 2007 2008E 2009EAsia 5% 15% 23% 9% 24% -10% 13% 22% 10% -5%Eastern Europe 28% 5% -2% 4% 18% 5% 27% 40% 5% -35%North America -10% -24% -7% 2% 30% 16% 10% -29% -16% -10%South America 4% 3% -6% -1% 35% 11% 5% 25% 11% -12%Western Europe 3% -3% -9% -5% 9% 7% 3% 1% 1% -30%Global 0.5% -2.7% 5.3% 4.0% 23.0% 0.4% 11.1% 7.2% 3.8% -12.4%

HCV/B 1995-8 yoy % Global sales change and 2009 yoy % change expectations

Strong Global markets

Non Western European

HCV/B markets

HCV/B industry in non-Western European Countries has experienced a strong market decline too

31

Strong market decline in all NAFTA regions:

A cumulative -18,7% (CAGR 06-09E)

Source: Credit Suisse1) NAFTA: Canada, Mexico, United States

0,0

700

600

500

400

300

200

100

641

395 395427

484

593

538

404375 384

502

581

459

384344

0,0%8,1%

13,3%

22,5% -9,3%

-24,9%

-7,2% 2,4%30,7%

15,7%

10,3%

-28,4%

-16,3%-10,4%

-1,0%NAFTA1 HCV/B

markets

markets decline

Credit availability

Some customers can not buy cars until credit is available to help finance the purchase

Total cost of ownership sensitivity to finance costs

Key Automotive demand drivers: Cars and Commercial Vehicles

Car demand is driven by a mixture of :1) aspiration/fashion

analogous to mobile phones

2) replacement need analogous to

washing machine replacement

Private Cars demand

1 Consumer confidenceCustomers will not buy a car until they feel confident in their ability to pay for it

feel secure in their jobs

Economic leading indicators

2 Replacement demandSome customers will not buy a car until the maintenance costs of their existing vehicle outweigh the incremental costs of trading up to a new vehicle

Average age of car park (and vehicle density)

3

4Cars

There are five key drivers for private car demand in terms of both volume and mix

All correlated to consumers willingness, need and ability to buy a car

Key private car demand

drivers

Mobility trends

Some consumers may decide not to own a car, instead choosing to utilize public transport or short-term car-lease schemes (especially in urban centers)

Increase with market maturity

Cars

Incentive schemes put in place a state-

Driver Driver rationaleAnalytical predictors

Private

Private cars are both consumer goods and domestic utilities consumers can

generally postpone the decision to buy a new car

Private Cars

32


Customers will not buy commercial vehicles until they feel confident in their ability to obtain a significant return on the investment in the following years

Industialleading indicators (capex cycle)

Source: Credit Suisse, ECG

Commercial Vehicles

Commercial vehicle demand is driven by a mixture of:1) Corporate economic

trends2) Replacement need

Commercial vehicle demand

8

Key demand drivers

There are two key drivers for commercial vehicle demand in terms of both volume and mix

LCV/MB

HCV/B

Scrap incentives

Incentive schemes put in place a state-funded price cut on sales (it is a relevant % on small and lower-mid Cars)

5Incentive relevance and length

Replacement demand

Since CV/B are intensively used investment goods, ageing trucks need to be replaced before the cost of repair and maintenance gets too high Trucks need to be replaced every 35

years, depending on miles driven

Total cost of ownership (TCO)

9

Commercial vehiclesare intensively used investment goods Unlike car

demand, CV are bought based on a total cost of ownership (TCO) rationale

6 Business confidenceEconomic leading indicators

Driver Driver rationaleAnalytical predictors

Corporate

Corporate car demand is driven by a mixture of:1) Corporate

economic trends2) Replacement need

Corporate car demand

There are two key drivers for corporate car demand in term of both volume and mix

Key corporate car demand

driversCorporate cars are investment goods Unlike private

car demand, they are bought based on a TCO rationale

Corporate Cars

Customers will not buy until they feel confident of a positive business environment in the succeeding years

7 Replacement demandAs an investment, ageing cars need to be replaced before the cost of repair and maintenance gets too high

Total cost of ownership (TCO)

Expectations

Western European1 car sales, 19602018E

The European car industry sales trend and upside potential (a lesson from history)

16.000

14.000

12.000

10.000

1970's Oil Shock I:

1970's Oil Shock II:Peak to trough drop= -6%

1990's recession /German reunification:Peak to trough drop= -17%

2008-10E credit crisis:CS estimated peak totrough drop = -18% over3 years

What toexpect next?

Correction to this negative trend will start when: Credit flows to consumers, dealers and industry

Unemployment stabilises

There are signs that markets are stabilising: however, developed markets will take many years to recover to pre-downturn levels

Expectations

Cars(Private)

33

Source: ACEA, Credit Suisse1) EU15: Member Countries in the EU prior to the accession of ten candidate

Countries on 1 May 20042)European Free Trade Association (EFTA)4 Members: Iceland, Liechtenstein,

Norway and Switzerland

8.000

6.000

4.000

1970's Oil Shock I:Peak to trough drop= -12% However:

commercial banks are currently limiting lending for tooling and capital investment programs

the end of the cheap credit era poses a fundamental obstacle to mature markets returning to previous volume and mix peaks

1) Western European

Norway

Switzerland

Iceland

EFTA33

TODAY

Austria

Belgium

Denmark

Finland

France

Germany

Greece

Ireland

Luxembourg

EU152

Netherlands

Portugal

Spain

Sweden

UK

Italy

Cars

Type of sector

The European car sector is cyclical but more volatile than leading economic indicators

High correlation2 of new car sales

New Passenger Car Registrations vs. GDP Growth in Europe 281

16.500.000

16.000.000

15.500.000

15.000.000

14.500.000

14.000.000

4,5

3,5

2,5

1,5

New PC Registrations - EU EU GDP Growth (%)

The European automotive sector is cyclical (it is highly correlated2 to economic fluctuations) and consequently: Sales trends can be predicted using economic leading indicators

When one of these indicators grows car sales

16(Corporate)

(Private)

34

Source: Eurostat/ACEA/AAA2) In statistics, correlation indicates the

strength and direction of a relationship between two random variables

correlation of new car sales with:

GDP Growth

13.500.000

13.000.000

12.500.000

12.000.000

11.500.000

11.000.000

0,5

-0,5

-1,5

-2,5

New PC Registrations - EU EU GDP Growth (%)

indicators grows car sales also grow while when they fall car sales fall

Implications

Economic leading indicators have recently been very low hence very poor sales

Austria

Lithuania

Poland

Romania

Hungary

LatviaBulgaria

Czech Rep

Estonia

Belgium

Denmark

Finland

France

Germany

Greece

Ireland Slovenia

Slovak RepNetherlands

Portugal

S