Company Presentation KSPG Group. August 2014

Company Presentation KSPG Group August 2014

Company Presentation KSPG is part of the Rheinmetall Group Rheinmetall AG The technology group for security and mobility Sales: 4.613 billion Employees: 21,081 KSPG AG International first-tier supplier of engine components and systems Sales: 2.458 billion Employees: 11,744 Rheinmetall Defence European supplier of army technology Sales: 2.155 billion Employees: 9,193 Datenbasis: Geschäftsjahr 2013, Mitarbeiter: 31.12.2013 KSPG AG 2014 www.ms-motorservice.com 2

Company Presentation Three strong divisions Divisions Hardparts Mechatronics Aftermarket Small Bore Pistons Pump Technology International Business Units Bearings Castings Large Bore Pistons Automotive Emission Systems Solenoid Valves Actuators National Commercial Diesel Systems KSPG AG 2014 www.ms-motorservice.com 3

Company Presentation Product variety for engines and motor vehicles Buchsen Bushings für for Heckklappen tailgates Recirculating water pumps (residual heat, standby heater, cooling system) Control Regelventile valves Motorblock Engine blocks Pistons Exhaust-gas recirculation Structural Strukturparts bauteile Pumps (oil/water/vacuum) Bushings for Buchsen shock für Stoßdämpfer absorbers Lager Bearings für for Sitzverstellungen/Türen seat adjusters/doors Buchsen Bushings für for Einspritzpumpen injection pumps Lager Bearings für for aktive active Motorhauben engine hoods (Fußgängerschutz) (pedestrian protection) Actuators/ throttle bodies Cylinder heads Engine bearings Secondary-air systems Turbo control valves/ divert-air valves Bildquelle: Shutterstock KSPG AG 2014 www.ms-motorservice.com 4

Company Presentation Global Presence: more than 36 locations woldwide USA Auburn Hills Greensburg Greenville Marinette France Lyon Paris Thionville Spain Abadiano Great Britan Kirtlington Czech Republic Ústí n. L. Germany Asperg Berlin Dormagen Hartha Neckarsulm Nettetal Neuss Neuenstadt Papenburg St. Leon-Rot Walldürn Japan Hiroshima Odawara Tokio Mexiko Celaya Italy Lanciano Livorno Turin China Shanghai Kunshan Yantai Brazil Malta St. Julians Turkey Istanbul India Pune New Delhi Nova Odessa Inkl JVs in Greensburg / Yantai / Shanghai und Equity Holding in New Delhi KSPG AG 2014 www.ms-motorservice.com 5

Company Presentation Division Aftermarket Sales organisation for the worldwide aftermarket activities of KSPG AG Independent Aftermarket OES (OE Service) for the brands KOLBENSCHMIDT and PIERBURG SOE (Special OEM) for the brands KOLBENSCHMIDT and PIERBURG KSPG AG 2014 www.ms-motorservice.com 6

Company Presentation Locations of Motorservice Group worldwide * 14 Shared Service employees MS Motorservice France Location: Paris Employees: 47 MS Motorservice International Headquarterst: Neuenstadt Employees: 233 MS Motorservice Deutschland Location: Asperg Employees: 63 Intec France Location : Lyon Employees: 8 MS Motorservice Asia Pacific Location: Shanghai Employees: 60* MS Motorservice Istanbul Location: Istanbul Employees: 23 MS Motorservice Brazil Location : Nova Odessa Employees: 78 MS Motorservice Iberica Location : Abadiano Employees: 12 BF Engine Parts Location : Istanbul Employees: 2 Datenbasis: 31.12.2013 KSPG AG 2014 www.ms-motorservice.com 77

Company Presentation Sales per Region of Motorservice Group North America 3 % Europe 47 % Eastern Europe 15 % Latin America Africa 8 % Middle East 12 % Far East 7 % 9 % Stand 31.12.2013 KSPG AG 2014 www.ms-motorservice.com 8

G S P General System of Preferences Tax Optimized International Wareflow

Customs controlled duty/tax optimizing procedures Customs procedures Simplifications & Permissions Customs Bonded Warehouse Outbound procedure (Passive Veredelung) Inbound Procedure( (Aktive Veredelung) General System of Preferences (GSP) Lateral Agreements Bi-Lateral Agreements Multi-Lateral Agreements (economic areas, cumulation) Temporarily Export Temporarily Import

GSP General System of Preferences World Trade Organisation & Preferential Agreements Preferential Origin means low resp. no duty to pay for the importer of records for goods covered by a preferential certificate icate of origin to be imported in a country which is partner in the general system of preferences i.e. Germany: Zölle sind Steuern im Sinne der Abgabenordnung die beinhaltet Vorschriften/Definitionen u.a. zu => Verfahrensanweisungen => ABGABENKÜRZUNG => Strafvorschriften

General System of Preferences i.e. Germany

Extract of an overview to preferential agreements between countries or economic areas of Mendel- Verlag The overview shows Lateral Bilateral Multilateral agreements

P o l i t i c a l D i m e n s i o n Political Agreements Same or similar regulations Cooperation because of duty (=tax) reduction as result of political cooperation Growing dependence from each other to be supposed because of financial & know-how invest

C o m p a n y A s p e c t Company Departments and leadership involved: Sales Department = Sales Management Purchase Department = Purchase Management Production Management Logistics Management Strategic Planning Management IT Management A N D T E A M S

C o m p a n y S t r a t e g i c R e q u i r e m e n t s Sales : Customer Country Duty Rates versus Preferential Duty Rate Purchase : Lower Landing Cost because of Preferential Duty Rate Production : Preferential Origin of Components and Final Product multi-national production with preferential low duty rates Logistics : Incoming Process & Prefential Origin & Stocking Strategy : Future Markets and Preferences Supposed IT : How to Realize Preferences Masterdata in Sales, Purchasing, Production, Logistics, Strategy

M a s t e r d a t a o f P r e f e r e n t i a l O r i g i n Commodity Code Number Percentage rate of Added Value acc. to the Rules of the specific Preferential Agreement Country of Origin Status of Prefential Origin = Yes/No Preference Calculation Kind of processing (minimal, set, production) s

I T - R e q u i r e m e n t s MO S T I M P O R T A N T in case of international tional value chain One material number and n-numbers of origin Also n-numbers of prefential status Can be handled in the IT-System

Preview Increasing Number of Prefential Agreements i.e. Canada, USA, India, China??? Increasing Influence of the Prefential Agreements on Value Chains Increasing Influence on Pricing respec. Market Position

Preview Increasing Number of Prefential Agreements i.e. Canada, USA, India, China??? Increasing Influence of the Prefential Agreements on Value Chains Increasing Influence on Pricing respec. Market Position

Recommendation Qualify the teams with Know-How of the GSPs Found a team with participants of each department beiing in touch with topics of GSP to come to decisions taking into regard requirements of GSP Implement a IT-Tool or IT-solution to handle preferences

One solution to handle Preferences i.e. SAP Production Batch to each incoming delivery Before implementation analysation of number of incoming deliveries, effect on stocking, processes => possibilty to handle the complex masterdata of GSP IF PREFERENCES SHOULD OR WILL BE DECLARED

Company Presentation Website Visit us at www.ms-motorservice.com KSPG AG 2014 www.ms-motorservice.com 23

Disclaimer This presentation contains forward-looking statements. Forward-looking statements are sometimes, but not always, identified by their use of a date in the future or such words as will, anticipates, aims, could, may, should, expects, believes, intends, plans or targets. By their nature, forward-looking statements are inherently predictive, speculative and involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future. There are a number of factors that could cause actual results and developments to differ materially from those expressed or implied by these forward-looking statements. In particular, such factors may have a material adverse effect on the costs and revenue development of the KSPG group. All written or oral forward-looking statements attributable to KSPG AG or any group company of KSPG AG or any persons acting on their behalf contained in or made in connection with this presentation are expressly qualified in their entirety by factors of the kind referred to above. No assurances can be given that the forward-looking statements in this presentation will be realized. Except as otherwise stated herein and as may be required to comply with applicable law and regulations, KSPG AG does not intend to update these forward-looking statements and does not undertake any obligation to do so. KSPG AG 2014 www.ms-motorservice.com 24

THANK YOU FOR YOUR ATTENTION VIELEN DANK FÜR IHRE AUFMERKSAMKEIT QUESTIONSß FRAGEN? ANKE SCHUMM Email: Anke.Schumm@de.kspg.com PHONE: (0049)07139/9376-2912

Chapter Title of presentation KSPG AG 2014 www.kspg.com 26