VÄLKOMMEN TILL STORA LEVERANTÖRSDAGEN Volvo Group Trucks
Agenda Volvo Group Trucks Volvo Group Trucks Footprint Asia & Product Segments Next Steps
Volvo Group brands
Volvo Group Trucks Group Trucks Sales & Marketing EMEA Group Trucks Sales & Marketing Americas Group Trucks Sales & Marketing and JV s APAC Group Trucks Operations Group Trucks Technology Construction Equipment Business Areas Finance & Business Support
Volvo FH wins International Truck of the Year 2014 - sets a new benchmark in the automotive industry
Renault Trucks - an impressive delivery The end of a massive investment in renewal of our product portfolio
Quester made to go that extra mile The end of a massive investment in renewal of our product portfolio
Agenda Volvo Group Trucks Footprint
Global Operations GTO s larges sites Columbus Macungie Radford Middletown Hagerstown New River Valley Baltimore Greensboro Eskilstuna Tuve Flen Göteborg Köping Headquarters Skövde Ghent Blainville Limoges Lyon Umeå Bourg-en-Bresse Kaluga Ageo Gunma Bangalore Bangkok Mixed Cab & Vehicle Powertrain Logistic Services Curitiba Pretoria Durban Brisbane
Net sales by Market Area North America Sales 23% Europe Sales 37% Asia Sales 23% South America Sales 9% Other Markets Sales 8% No. of Employees: 98,717 No. of Temporary Employees and Consultants: 16,548 Source: Volvo Group Quarterly Report 2012 Q4
Significant growth in Asia 2011 Asia Asia Multibrand Global Volvo brand only Europe/NA focus
Agenda Key figures scope
Volvo Group Trucks supply chain Key figures 80 billion SEK Automotive Purchasing annual spend 2,400 suppliers in serial production 1,9 billion parts delivered to Group Truck plants annually 28,500 parts PPAP past 12 months 200,000 part numbers with delivery schedule 115,000 persons (FTE annual average) working to deliver parts to Volvo Quality Year Parts per million (PPM) 2000 2087 2006 214 2013 84 Delivery precision Year Delivery precision (%) 2000 91 % 2006 94 % 2013 97 %
2012 Purchasing Spend Indirect Products & Services 28,0 BSEK Sourcing Vehicle 30,8 BSEK Direct Material / Factory: 75,0 BSEK Sourcing Powertrain 20,8 BSEK Sourcing Common Components 18,0 BSEK Vendor 5,2 BSEK Aftermarket 10,0 BSEK total:112,8 BSEK
around the world: 1,400 purchasing employees located in 23 countries and 52 sites Other Europe: 110 employees Other North America: 20 employees Sweden: 400 employees North America: 220 employees Other Asia: 20 employees Japan: 100 employees France: 300 employees India: 150 employees China: 100 employees Brazil: 100 employees Australia: 15 employees
Agenda Asia & Product ranges Asia Market Outlook Product Ranges
World MD/MHD total market* ( 2011 sales volume) China 241 934 India US Other Asian EU27 Brazil Russia Africa 102 775 98 905 60 993 59 920 53 595 36 382 34 220 Others LAM Africa 4% 4% Russia 5% Brazil 7% Middle East 4% Japan 3% China 31% Others LAM Middle East Japan 32 329 31 846 28 523 EU27 8% Other Asian 8% US 13% India 13% 0 50000 100000 150000 200000 250000 * Definition of MD/MHD varies, mainly covering 5-15.9t. Data source: GTT LTVP 2012
World s largest truck markets > 14 tons 1,000 units, 2011 China 881 EU29 India North America South America Russia 242 237 216 162 81 Germany 61,000 France 41,000 UK 30,000 Spain 13,000 Italy 13,000 India 12% Other 6% EU29 13% Russia 4% North America 11% Middle East Africa 57 27 China 46% South America 8% Japan 25 0 100 200 300 400 500 600 700 800 900 1000 1100
Chinese makers dominate the market with ~ 95% of the volumes sold European ~ 1.6% ~12,000 ~900,000 ~4,250 ~11,000 ~2,100 ~20,000
and the Japanese brands dominate SEA VT 1,138 RT 55 VT 1,151 VT 523 China ~12,000 Korea VT 298 RT 125 UD 293 ~900,000 ~4,250 VT 205 RT 35 UD1,108 Thailand ~11,000 ~2,100 Taiwan VT 582 RT 193 UD3,996 ~20,000 Malaysia Indonesia *Figures including China, Taiwan, Indonesia, Korea, Malaysia, Thailand Volvo group brands volumes are invoiced numbers
Growth from the Japanese & local high end segment Local upgrade segment is growing fast, with emerging local high-end sub-segment AS markets HD market structure Chinese/Indian OEMs are developing more advanced models Increased tie-ups between European, Japanese and Korean makers with Chinese/Indian players Several new advanced products with competitive prices launched
We have the product ranges for all customer categories Premium segment Vocational High-endsegment Japan Value segment Basic segment Expectation on total solutions
Clear position for each brand gives coverage A PREMIUM SEGMENT (> 95%) Price level Vocational B HIGH-END SEGMENT (95-85%) C VALUE SEGMENT (85-65%) Japan Technology level D (65-40%) E BASIC SEGMENT (<40%) Essential solutions Total solutions INCREASING SOLUTION REQUIREMENT
...but essential to leverage portfolio A PREMIUM SEGMENT (> 95%) Price level PREMIUM-END I. Image driven II. Technology driven III. Holistic approach B C HIGH-END SEGMENT (95-85%) VALUE SEGMENT (85-65%) VALUE I. Operational cost driven II. Network oriented HIGH-END I. Holistic approach II. Operatrional cost driven III. Network oriented Technology level D (65-40%) VALUE BASIC I. Operational cost driven II. Sticker price driven E BASIC SEGMENT (<40%) BASIC I. Sticker price driven Essential solutions Total solutions INCREASING SOLUTION REQUIREMENT
New multi-brand dealers up and running
Agenda Next steps DongFeng Commercial Vehicles Joint Ventures
Volvo Group acquires 45% of Dongfeng Commercial Vehicles
Business Opportunities for Volvo and Suppliers Major shareholding in China s leading manufacturer of commercial vehicles DFCV Strong foothold in and share of the world s largest truck market: DFCV delivered 142,000 HD trucks and had a 16% market share in 2011 plus 17% MD Market Share Benefits from cooperation in transmissions, engines, components and future technology Sharing of development costs for the next-generation of engines Building Stronger Partnerships
DFCV: A well invested industrial footprint Urumqi Xinjiang A.R. Special purpose trucks and KD assembly Main industrial site: Shiyan Hubei province Beijing Cab plant Frame plant Final assembly plant Heavy-duty CV plant Engine plant No 1 foundry No 2 foundry New HD truck plant Suizhou Hubei province Trucks and superstructures Shanghai Wuhan Hubei province Xiangfan Hubei province Axles Hong Kong Shenzhen Guangdong province Special purpose trucks and superstructures
JVs strengthen Volvo Group in China - one of our home markets Total operations 2011, including our partners Total 34,000 employees Dual brand strategy; Volvo and SDLG 12% market share 2011 47,000 Volvo & SDLG machines sold in 2011 # 1 position Construction Equipment 41 bn 20 bn 1 bn 4 bn JV with SAIC for city buses JV with SAIC for development of electrical and hybrid buses DFCV: 142,000 HD trucks 49,000 MD trucks Net sales 39 bn RMB DND: assembly of UD trucks Volvo Group: Direct import of Volvo, Renault & Mack trucks Buses Trucks Engines Volvo-Deutz JV Off-road MD engines 80 000 units in plan Off-road engine hub in Asia
SHAPING Thank you! ANOTHER FUTURE