Aptiv Plc · NYSE:APTV
Aptiv — Delphi Automotive — Investor Day (April 2016)
114 slides from Aptiv's investor day presentation, Apr 13, 2016
Slide 1: Delphi Investor Update
Delphi Investor Update April 13, 2016 Making it possible.
Slide 2: Welcome
Welcome Elena Doom Rosman Vice President, Investor Relations
Slide 3: Forward-looking statements
Forward-looking statements This presentation, as well as other statements made by Delphi Automotive PLC (the “Company”), contain forward-looking statements that reflect, when made, the Company’s current views with respect to current events, certain investments and acquisitions and financial performa
Slide 4: Agenda
Agenda Strategic overview Electronics & Safety overview Kevin Clark Jugal Vijayvargiya President and Chief Executive Officer Senior Vice President and President, Electronics & Safety Technology overview China overview Jeff Owens Simon Yang Chief Technology Officer President, Delphi China and Managin
Slide 5: Auto Connected Car Awards
AUTO CONNECTED CAR AWARDS Best Autonomous Car of 2015
Slide 6: Strategic overview
Strategic overview Kevin Clark President and Chief Executive Officer
Slide 7: Evolution of Delphi
Evolution of Delphi DLPH evolution Highlights 2010 - 2015 2010 - Private company; aligning cost footprint and product portfolio Booked over $130 billion of business 2011 - Initial public offering; value creation opportunity for shareholders Developed and launched advanced technologies 2012 - MVL acq
Slide 8: Delphi business model
Delphi business model Innovation Collaboration Excellence • 19,000 scientists and • Developing strategic • Flawless execution through engineers customer relationships EOS Foundation • 14 major technical centers • Leveraging technology • Delivering quality at across the globe capabilities across the
Slide 9: Delphi Enterprise Operating System
Delphi Enterprise Operating System Flow 1 Flow 2 Flow 3 Flow 4 Flow 5 Managing Developing Developing Providing Pursuing stakeholders’ strategies & products & goods & business requirements capabilities processes services Set Advanced Sell Design Build and ship requirements technology products product
Slide 10: Value enhancing portfolio modifications
Value enhancing portfolio modifications Acquisition Divestiture Investment 2015 2015 2015 Software-as-a-service for data management 2015 Enhanced position in electrical architecture Reception Systems 2014 Software for dynamic cylinder divestiture deactivation Unwired Refocused E&S portfolio Expanded
Slide 11: Optimizing cost structure while investing for growth
Optimizing cost structure while investing for growth Integrating Continuing Material Further optimizing Enterprise footprint rotation cost improvement productivity Operating System Cost structure improvement Reduced high cost Increased revenue Over $350 million in Reduced manufacturing country footp
Slide 12: Today's Delphi
Today’s Delphi More technology More diverse More balanced More efficient More profitable More cash generative More predictable Well positioned to drive value
Slide 13: Delphi investment thesis
Delphi investment thesis Portfolio Organic growth Margin Capital management acceleration expansion allocation • Portfolio aligned to • Growing faster than • Optimized cost structure • Balanced, predictable megatrends served markets cash deployment • Enterprise operating • Increasing exposure to • Ta
Slide 14: Convergence: The catalyst for intelligent driving
Convergence: The catalyst for intelligent driving China Emissions: 117 CO2 g/km – 2020 EU Emissions: 95 CO2 g/km – 2021 US Fuel economy: 54.5 mpg – 2025 2010 2015 2020 2025 Assisted ADAS Semi Fully automation expansion automated automated Increasing levels of electrification Electrical architecture
Slide 15: Further diversifying customer revenue mix
Further diversifying customer revenue mix Customer revenue mix FCA 5% Daimler 5% Daimler SGM VW Ford PSA FCA Ford 5% Ford 6% 5% 9% 8% VW 6% VW 9% 7% PSA 8% SGM 5% 10% PSA 5% 5% GM 21% Hyundai 4% Geely 4% SGM 4% GM GM 14% 2010 2015 Geely 3% 12% 2020E Daimler 3% FCA 4% Chang’an 2% Hyundai 3% Chang’an
Slide 16: Further diversifying regional revenue mix
Further diversifying regional revenue mix Regional revenue mix Asia Asia 31% Asia 25% Americas 16% 41% 2010 2015 2020E Americas 40% Americas 36% Europe Europe Europe 35% 33% 43% Continue rotation to high growth markets
Slide 17: Track record of outperformance continues
Track record of outperformance continues Revenue growth Operating margin 200 Delphi Market 16% Delphi Auto peers 180 14% Accelerate 160 introduction of 12% Investments market relevant for 140 technologies growth 10% Volume, operating leverage, footprint 120 optimization 8% Increase 100 software and
Slide 18: Strategic imperatives towards 2020
Strategic imperatives towards 2020 • Enhance portfolio of market relevant products Disciplined • Balanced regional growth revenue growth • Further diversify customer base and platform mix • Continue footprint rotation to best cost countries Cost structure • Further integrate EOS across the enterpris
Slide 19: Delphi growth drivers: next 5 years
Delphi growth drivers: next 5 years Incremental Segment opportunity Key growth drivers Electrical Architecture • Optimized vehicle architectures enabling high-speed connectivity ~$3B • Faster digital data demands advanced cabling solutions • Accelerating demand for electrification and diagnostics Po
Slide 20: Moving at the speed of software
Moving at the speed of software Influence of Silicon Valley Delphi’s technology acceleration 2010 2015 2020 Lines of code 200M 20B 200B shipped daily Software <$50M $500M $1.5B revenue Software 2,000 5,000 8,000 engineers Key 15+ 30+ 60+ partnerships Software 150+ 300+ 400+ launches Creating tomorro
Slide 21: Cost structure optimization
Cost structure optimization Material performance Manufacturing performance 2010 – 2015 (6 years) 2010 – 2015 (6 years) $350M average annual savings $165M average annual savings 2016 – 2020 (5 years) $580M 2016 – 2020 (5 years) $400M average annual savings Annual saving next $180M average annual savi
Slide 22: Cash flow deployment
Cash flow deployment Operating cash flow growth Cash priorities Capital deployment 2015-2020 cumulative: $15B ($ billions) • Maintain investment grade 22 ratings ~$3.2 M&A and • Disciplined re-investment in share repurchases ~$2.6 business to drive growth and ~45-55% increase returns $1.7 • Pay a co
Slide 23: Strengthening technology portfolio
Strengthening technology portfolio Areas of focus • Enhance competitive position Strategic • Strengthen product portfolio • Diversify customer and regional mix • Solid operating systems Operating • Strong management team and cultural fit • High confidence integration plan • Enhance growth and return
Slide 24: Returning value to shareholders
Returning value to shareholders Share repurchase history TSR since IPO ($ billions) (Total shareholder return) 320% $1.2 $1.0 160% $0.5 $0.4 2012 2013 2014 2015 Auto peers DLPH Significant return to shareholders Note: Total shareholder return (TSR) is from 11/17/11 to 12/31/15 Auto peers: Aisin Seik
Slide 25: Long-term outlook
Long-term outlook 2016E 2018E 2020E Sales growth1 ~8-10% organic growth ~8-10% CAGR ~30-60bps >100bps >150bps Operating margin expansion2 versus 2015 versus 2015 versus 2015 Earnings per share2 Mid-teens growth Double-digit growth Operating cash flow ~12% of revenue ~13% of revenue ~14% of revenue M
Slide 26: Why Delphi will outperform
Why Delphi will outperform Track record of delivering on commitments Macro trends are a catalyst for growth Disciplined cost focus translates into more margin expansion Effective and accretive cash deployment Well positioned in a transformed and growing industry Consistent strategy; delivering outpe
Slide 27: Innovation winners
IN NOVASETON WINNERS
Slide 28: 2015 GM Supplier of the Year Award for V2V
2015 GM SUPPLIER OF THE YEAR AWARD FOR V2V
Slide 29: Technology overview
Technology overview Jeff Owens Chief Technology Officer and Executive Vice President
Slide 30: Accelerating macro trends create new challenges
Accelerating macro trends create new challenges Regulated Active Safety growing Best-value electrification required to IoT driving connected car to new with increased consumer awareness meet step function change in regulation levels & creating new challenges More safe More green More connected CO2 g
Slide 31: Macro trends create OEM challenges
Macro trends create OEM challenges… Cause Effect OEM challenge Delphi opportunity • More software • Automotive grade Exponential • More content • Future-proof designs computing power • More requirements • Affordable complexity • More brought-in devices • Flawless connections Expansion • Connectivity
Slide 32: Complete system technology integrator
Complete system technology integrator Macro trends are creating OEM challenges and consumer demand Flexible system designs Best-value innovations Solving customer Vehicle integration expertise problems Intelligent Driving Agile software solutions Delphi responding to opportunities with end-to-end so
Slide 33: Macro trends driving key growth technologies
Macro trends driving key growth technologies Infotainment Software Active Safety GDi Electrification Common Rail Valve Train Growth $0.7B $0.5B $0.5B $0.3B $0.4B $0.3B $0.2B (2015 - 2018) Delphi CAGR 20% 25% 50% 40% 50% 10% 20% (2015 - 2018) Market CAGR 5% 10% 20% 18% 22% 4% 5% Driving revenue growt
Slide 34: Macro trends and disruptors create new growth opportunities
Macro trends and disruptors create new growth opportunities Market challenge Delphi portfolio expansion Delphi solution • A safer ride • Increasing regulation Active Safety Automated Driving • Power for functions Engine 48V hybrid • More stringent systems electrification regulations Connected car •
Slide 35: Future solutions enabled by industry-leading architectures
Future solutions enabled by industry-leading architectures 2015 2020+ Moves information at Data speeds will less than 65 increase 2000%+ Mbps using a to 1.5 Gbps using language created high speed Ethernet in the 1980s Centralized Distributes multi-domain decision-making across 100 controllers will m
Slide 36: Creating a cost-effective, safer driving experience
Creating a cost-effective, safer driving experience Lower levels of automation deliver 80% of the safety benefit for 20% of the cost of fully autonomous driving 100% 10x Safety benefit Cost Safety benefit Cost 1x 0 1 2 3 4 None Assisted Monitored Conditional Full Levels of automated driving Active S
Slide 37: Building blocks of Automated Driving
Building blocks of Automated Driving Optimized Connected Vehicle Architecture Infotainment Multi-Domain Controller Integrated Cockpit Controller High speed electrical architecture BYOD Engine management system Cloud computing Manage complexity Features & functionality & performance Active Safety Lot
Slide 38: Continuing to advance automated driving technology
Continuing to advance automated driving technology V2cloud V2P V2I V2V Vehicle to pedestrian Vehicle to infrastructure Vehicle to vehicle I’m green for the next Okay! We’ll stop 5 seconds at the green light We’re to let you go crossing the through safely street We’ve got to go through the intersecti
Slide 39: Active Safety enables cost-effective fuel savings
Active Safety enables cost-effective fuel savings Delphi’s intelligent solutions are applicable to safe vehicle platooning Cloud link Platooning 3 Cloud link vehicles results in 6-8% fuel Radar savings Annual fuel savings of ~$3,000 – $11,000 per vehicle Key enablers Radar Cloud link Sensor fusion V
Slide 40: Electrification provides more power and closes regulation gap
Electrification provides more power & closes regulation gap Stringent regulatory fleet targets cannot be achieved with engine systems alone US Fuel economy: 54.5 mpg – 2025 EU Emissions: 95 CO2 g/km – 2021 China Emissions: 117 CO2 g/km – 2020 Best-value electrification: 48V mild hybrid Stringent reg
Slide 41: Creating intelligent electrification with Delphi's 48V solution
Creating intelligent electrification with Delphi’s 48V solution 48V electrification Enabling intelligent electrification Optimized electrical architecture is the foundation Improved functionality, better performance, greater efficiency Builds on electrical solution competency Software, software, sof
Slide 42: Consumer demand is driving connected car capability
Consumer demand is driving connected car capability World-class connectivity helps address safe & green challenges Big Security Data BYOD 10110001100000 10110001111010100000 OTA The IoT is disrupting traditional automotive
Slide 43: V2cloud powered by CONTROLTEC
V2cloud powered by CONTROLTEC CONTROLTEC acquisition broadens Delphi’s “Big Data” capability Today Tomorrow Safety Powertrain Infotainment One system servicing Electrical all domains simultaneously Leverages real time data and the cloud to identify & solve issues Expanding usage with global OEMs acr
Slide 44: Secure connectivity enables cloud computing
Secure connectivity enables cloud computing Cybersecurity Over-the-Air (OTA) updates Delphi WiFi and cellular unauthorized access OTA makes upgradeable technology possible protected On Board Diagnostics II Driver Home Infotainment/ Electronic Gateway Control Engineer Service Telematics Unit Communic
Slide 45: System provider of choice solving customer challenges
System provider of choice solving customer challenges 2016 14 major global technology centers 20,000 scientists, engineers & technicians worldwide, supporting ~1,300 product launches Mature global resource developing and integrating innovative solutions • Well positioned in automotive space to incor
Slide 46: Safe, green and connected converge
Safe, green and connected converge… V2E vehicle 2 everything™ V2safe V2green V2connected …for an intelligent driving experience
Slide 47: PACE Winner Finalists
PACE WINNER Dual Media Module FINALISTS Inverter Power Device for Electrified Vehicles High Voltage Connection
Slide 48: Electrical Architecture overview
Electrical Architecture overview Majdi Abulaban Senior Vice President and President, Delphi Electrical/Electronic Architecture and President, Delphi Asia Pacific
Slide 49: Electrical Architecture overview
Electrical Architecture overview Financials Segment focus Revenue ($B) Operating margin 2 ~$10.5 $8.2 • Leading market position in NA, China, EU Growth $5.6 • Diversified customer base ~14.5% 13.4% 11.8% 2010 2015 2018E • Leader in electrification, safety, connectivity Geographic mix Business mix In
Slide 50: Complexity and content drive growth
Complexity and content drive growth 2015 2020+ 280 connections 25% to manage power, increase in diagnostics connections and signal – up to 350 communication Primarily 12V 1.5 miles of Increase in 67% increase powering the cabling per Electrification in cabling – up vehicle vehicle – up to 600V to 2.
Slide 51: Managing ever increasing complexity and customization
Managing ever increasing complexity and customization 2010 2015 2020 2025 Architecture complexity 1x 2x 10x 15x Global vehicle launches result in 1000 part variations for a single model
Slide 52: Electrical Architecture portfolio
Electrical Architecture portfolio Electrical Distribution Systems Connection Systems Cable Management Systems Manages vehicle complexity and content High performance systems Best-value innovations Delivers higher power & faster data Customized power management Manages complexity and performance Enab
Slide 53: Winning with Innovation: Media Module Dual Role Hub
Winning with Innovation … Media Module Dual Role Hub Dual Role Chip Technology: Enabling Apple CarPlay functionality at lowest cost • Only single chip hub solution in market • Enabling latest consumer technology with OEMs • Proprietary ASIC1 • Industry leading packaging and lowest cost • Awarded con
Slide 54: Winning with Innovation: Full electrification portfolio
Winning with Innovation ... Full electrification portfolio Delivering improved functionality, better performance, greater efficiency Electrical architecture wins on all current production models Gen-4 global platform ... Battery pack wiring system Volt & Bolt … A broad portfolio of electrical archit
Slide 55: High content launches
High content launches Power and Data- Connection Electrical Cable Product signal systems centers connectivity management Major launches distribution & high power Chevy Volt Tesla Model X Chevy Volt Tesla Model X/S Mercedes Benz M-Class Toyota Tacoma MB M-Class Toyota Ta
Slide 56: HellermannTyton
HellermannTyton Highlights Future opportunities • Worldwide leader in cable management solutions • Broad portfolio of highly engineered solutions Rationale • Strengthens leadership in electrical architecture • Market leader with worldwide brand • End-market expansion opportunity • Diversified region
Slide 57: Proven track record of winning in the market place
Proven track record of winning in the market place World-class portfolio Winning with innovation Unmatched customer intimacy Industry-leading cost structure Global leader … positioned for sustainable growth
Slide 58: 2015 FCA Excellence Award for Outstanding Partnership
2015 FCA EXCELLENCE AWARD FOR OUTSTANDING PARTNERSHIP
Slide 59: Powertrain overview
Powertrain overview Liam Butterworth Senior Vice President and President, Delphi Powertrain Systems and Delphi Product & Service Solutions
Slide 60: Powertrain overview
Powertrain overview Financials Segment focus 2 Revenue ($B) Operating margin ~$5.5 • Driven by CO2 and toxic emissions regulations $4.1 $4.4 Growth • Gaining share on GDi, Valve TrainandElectronics • Launching new and complementary components 5.3% 12.6% ~14.0% 2010 2015 2018E • High-pressure solenoi
Slide 61: Powertrain portfolio
Powertrain portfolio Gas Diesel Content growth from GDi, Valve Train and Electronics Expanding portfolio with components 2015 2018 2015 2018 2015-2018 market CAGR = 5% 2015-2018 market CAGR = 2% Powertrain growing >3x vehicle production 1. Adjusted for FX and commodities
Slide 62: Regulations drive growth
Regulations drive growth NOx emissions regulations Innovative solutions to reduce CO2 0.6 Improvement ‘05 to ‘21 Baseline: 4-cyl. turbo GDi with dual cam phasing 84% 0.4 g / km 72% 0.2 84% 0 64% 2000 2010 2020 2030 CO2 regulations ~27% ~39% ~28% reduction reduction reduction ‘15 to ‘21 ‘15 to ‘25 ‘1
Slide 63: Gasoline Engine Management System solutions
Gasoline Engine Management System (EMS) solutions EMS solutions Emissions reduction results • Increased fuel pressure (400 bar) to meet Turbo GDi yields: ~15% ↓ CO2 Turbo GDi Euro 6c emissions + fuel systems • High-precision fuel delivery for optimized 2-step VVA yields: ~5% ↓ CO2 combustion and low
Slide 64: Tula Dynamic Skip Fire
Tula Dynamic Skip Fire (DSF) Enhancing 2-step technology with dynamically adapting software Baseline: 4-cyl. PFI engine CO2 reduction per dollar on cost Turbo Diesel GDi with Turbo and Dynamic Skip Fire Downsizing • Demonstrated 15% CO2 reduction in an 8-cylinder GMC Denali • VW Jetta 4-cylinder tur
Slide 65: Selective Catalytic Reduction (SCR)
Selective Catalytic Reduction (SCR) Partnership enables complete SCR system Delphi content Engine Control Unit Partner content CAN Optimized SCR system reduces NOx Doser drive Tank emissions by Low Pressure SCR Doser ~85% Key enablers DOC Coolant Low-pressure doser Mixer Feed-line Close-coupled engi
Slide 66: High content launches
High content launches Gas Product Software Valve Train GDi electronics Diesel HD Diesel LD Major launches GM SGE GM SGE Honda 1.6 Diesel Honda 1.6 Diesel VW MDB 2.0 BiT LCV VW MDB 2.0 BiT LCV PSA DPCA EB E6.1 PSA DPCA EB E6.1 VW EA 211 VW EA 211 Volvo Truck Volvo Truck Launch
Slide 67: Uniquely positioned to win in the market place
Uniquely positioned to win in the market place Strong financial performance Aligned to favorable megatrends Leveraging hardware and software convergence World-class footprint Balanced portfolio generating sustainable above market growth
Slide 68: Society of Plastics Engineers Most Innovative Use of a Plastic Award
SOCIETY OF PLASTICS ENGINEERS MOST INNOVATIVE USE OF A PLASTIC AWARD Powertrain category for the Multec® 3.5 Heated Tip Port Fuel Injector
Slide 69: Electronics & Safety overview
Electronics & Safety overview Jugal Vijayvargiya Senior Vice President and President, Delphi Electronics & Safety
Slide 70: Electronics & Safety overview
Electronics & Safety overview Financials Segment focus 2 Revenue ($B) Operating margin ~$4.0 • Systems integrator of choice $2.8 $2.8 ~13.5% Growth • Increase share of wallet & expand in Asia 6.5% 11.6% • Scalable, intuitive Infotainment solutions 2010 2015 2018E • Further accelerate software transf
Slide 71: A Driverless Car Saved My Life
A Driverless Car Saved My Life - No, Really. Joann Muller
Slide 72: Electronics & Safety portfolio: V2everything
Electronics & Safety portfolio: V2everything™ Active Safety Infotainment Body & Security Mobility Services V2safe V2connected V2secure V2cloud IoT Technology & fusion leader Integrator of choice Full range provider Provider of end-to-end connected Automated driving capabilities Increased software an
Slide 73: Creating a safer driving experience: V2safe
Creating a safer driving experience V2safe Sensor fusion combines data from multiple sensors to enable safety features: Blind spot warning Collision Mitigation Lane Departure Warning Automatic Emergency Braking Forward Collision Warning Adaptive Cruise Control Radar Radar + Vision Radar + Vision + L
Slide 74: Redefining connected Infotainment: Integrated Cockpit
Redefining connected Infotainment: Integrated Cockpit V2connected Creating a “touch-free” user experience Eye glance Gesture control Voice recognition Enhanced connectivity powered from 48V system technology
Slide 75: Providing an end-to-end connected vehicle platform
Providing an end-to-end connected vehicle platform V2cloud Vehicle Business performance Intelligence data vehicle health Mobility services Vehicle performance & maintenance System upgrades 3rd party services Data intelligence for pre-sale validation and post-sale mobility services
Slide 76: High content launches
High content launches Product ADAS Infotainment Body & Security Other Major launches Volvo V90 Volvo V90 Haval H8 Great Wall H Series Audi A4 Audi A4 VW Golf VW Golf Ford Explorer Ford Explorer BMW 7 series BMW 7 Series Delivering significant value to OEMs across
Slide 77: Uniquely positioned to lead the market
Uniquely positioned to lead the market Most relevant portfolio in the industry Software capability + systems integration Innovating with our customers and partners Positioned for profitable growth Strong win rates accelerating growth
Slide 78: CES 2016 Innovation Awards Honoree
CES 2016 INNOVATION AWARDS HONOREE Delphi Gesture Recognition
Slide 79: 48V mild hybrid system
48V mild hybrid system Under Hood Trunk 4X the power. Think of the possibilities.
Slide 80: China overview
China overview Simon Yang President, Delphi China and Managing Director, Asia Pacific Connection Systems
Slide 81: Delphi has built significant presence in China
Delphi has built significant presence in China China presence Footprint 2010 2015 2018 Baicheng Revenue $1.7B $2.9B ~$4.4B Changchun Nantong Suzhou Shenyang Localized product lines 73% 90% 100% Beijing Wuhu Tianjin Yantai Tech centers 2 3 4 Shanghai Wuhan Chengdu Engineers 1,050 2,900 3,500 Chongqin
Slide 82: China economy is shifting to 'New Normal'
China economy is shifting to ‘New Normal’ GDP growth Service sector contribution Private consumption (Quarterly YoY growth, %) (%) ($ trillions) 12 60 3.5 Tertiary 10 50 (Service) 3.0 2.5 8 40 Secondary (Industrial) 2.0 6 30 1.5 4 Forecast: 20 5%-7% 1.0 2 10 Primary 0.5 (Agriculture) 2012 2013 2014
Slide 83: China still represents largest global growth opportunity
China still represents largest global growth opportunity Economic performance1 Vehicle production growth2 CO2 regulatory environment CO2 g/km S. America 250 Country GDP Growth S. America N. America 200 N. America USA $17.3T 2.4% 150 Europe CH 117 Europe 100 US 90 China $10.3T 7.3% EU 95 50 2005 2010
Slide 84: Driven by urbanization, growing middle-class
Driven by urbanization, growing middle-class Urbanization increasing Middle class growing China cities with >1.5M people Higher income households >$20k1 disposable income 107 49% 82 24% USA 2015 40 cities >1.5M 2015 2025 2015 2025 3x per capita consumption urban vs. rural Shifting to consumption-dri
Slide 85: Tier 2-3 cities fueling future growth
Tier 2-3 cities fueling future growth Passenger vehicle penetration1 Light vehicle registrations2 Tier 2-3 city auto demand (Vehicles per 1,000 people) (% of total) (Millions of units) 18 263 16 231 Tier 5 Other Tier 1 3% 10% 14 14% 12 ~150 National average Tier 4 Tier 2 ~100 18% 35% ~75 Tier 3 20%
Slide 86: Favorable demand trends to drive content growth
Favorable demand trends to drive content growth Premium/mid class production Vehicle segment growth Electric vehicles (Millions of units) (2015 YoY production growth) (Millions of units) 46% 8.8 7.9 34% 6.6 1.7 0.9 -6% -10% 0.2 -24% 2015 2018 2020 SUV MPV Sedan Other CV 2015 2018 2020 % of China: 27
Slide 87: Delphi is growing faster than China market
Delphi is growing faster than China market China vehicle production Delphi China revenue (Millions of units) ($ billions) $5.5 31 28 25 $4.4 $2.9 2015 2018 2020 2015 2018 2020 Positioned to continue outperforming the market Source: March 2016 IHS Automotive
Slide 88: Broad exposure to global, local OEMs
Broad exposure to global, local OEMs Global OEMs – 2016E revenue $2.3B (Millions of vehicles produced) 4.0 10 out of 10 are Delphi customers 2.0 0.0 GM VW Hyundai-Kia Renault/Nissan Ford Honda Toyota PSA BMW Daimler Local OEMs – 2016E revenue $1.0B (Millions of vehicles produced) 1.5 10 out of 10 1.
Slide 89: Right portfolio, flexible operations further drives growth
Right portfolio, flexible operations further drives growth Local competencies cover Flexible cost structure and local operations all Delphi portfolios • Most flexible cost structure ‒ 80% variable cost in China • Local design and development capabilities ‒ 3 tech centers growing to 4 by 2018 • Local
Slide 90: Delphi China key takeaways
Delphi China key takeaways Leveraging strong presence in China for next wave of growth “New normal” remains significant growth opportunity Well positioned in higher growth segments Flexible operating model to quickly adapt to market dynamics Right footprint and portfolio for continued profitable gro
Slide 91: Great Wall Motors R&D Innovation Award
GREAT WALL MOTORS R&D INNOVATION AWARD technology development
Slide 92: Financial overview
Financial overview Joe Massaro Chief Financial Officer and Senior Vice President
Slide 93: Performance highlights 2010-2015
Performance highlights 2010-2015 Revenue Operating income2 Free cash flow3 ($ billions) ($ billions) ($ billions) $15.2 $1.0 $2.0 $12.3 $1.1 13.0% $0.5 8.8% 2010 2015 2010 2015 2010 2015 Track record of strong financial performance 1. Adjusted for FX, commodities, the E&S divestiture and significant
Slide 94: Financial strategy remains unchanged
Financial strategy remains unchanged • Enhance portfolio of market relevant products Disciplined • Continue rotation to high growth regions revenue growth • Further diversify customer base and platform mix • Continue footprint rotation to best cost countries Cost structure • Maintain flexibility of
Slide 95: Bookings growth
Bookings growth ($ billions) Booked 2010-2015 bookings by region over $130B Asia 28% $26 $24 $24 $22 Americas $20 37% $18 Europe 35% 2010 2011 2012 2013 2014 2015 Continued shift to Asia and strong revenue growth 1. At constant foreign exchange rates Note: Bookings represent lifetime gross program r
Slide 96: Macro update
Macro update Europe North America Prior Current Prior Current China ‘15-’18 ’14-’17 ‘15-’18 ’14-’17 Prior Current 2% 2% 2% 2% ’14-’17 ‘15-’18 7% 4% South America Global Markets Prior ’14-’17 93.6 Prior Current mil 0% Current ’14-’17 units ‘15-’18 ‘15-’18 3% 2% (2%) Positioned to deliver in a changin
Slide 97: Net new business
Net new business ($ billions) 2016-2018 net new business by segment Powertrain Electronics & $1.5 25% Safety 38% $1.4 $1.4 Electrical Architecture 37% 2016-2018 net new business by region Americas 30% Europe 22% Asia 48% 2016 2017 2018 ~$4.3 billion of cumulative net new business
Slide 98: Further improving cost structure
Further improving cost structure Manufacturing expense % of revenue Net engineering spend1 ($ billions) 19.5% 17.6% $1.5 ~16% $1.2 2010 2015 2018 Material cost % of revenue $0.9 52.2% 49.1% ~48% 2010 2015 2018 % advanced engineering 15% 20% 25% 2010 2015 2018 Lean cost structure allows for investmen
Slide 99: Key outlook assumptions
Key outlook assumptions 2016 outlook Geographic growth (millions, except per share amounts) 2016 ’15–’18 Delphi ’15–’18 Delphi 2016 revenue production revenue Region production growth1 CAGR CAGR1 Reported sales $16,600 - $17,000 Adjusted growth1 8% - 10% North America 3% ~8-9% 2% ~7-9% Operating inc
Slide 100: Revenue and margin outlook
Revenue and margin outlook Revenue Operating margin2 ($ billions) >14.5% ~$22.5 ~$20.0 $16.8 13.5% Price / Growth Leverage Performance Portfolio economics investment/ volume including modifications engineering growth restructuring 2016 2018 2020 Revenue CAGR1 8-10% 8-10% 8-10% EBITDA margin2 17.5% >
Slide 101: Outlook by segment
Outlook by segment Revenue Operating income2 2015-2018 CAGR1 ($ billions) 2016 2018 2016 2018 Electrical $9.5 ~$10.5 7% 14.0% ~14.5% Architecture Powertrain $4.5 ~$5.5 7% 12.8% ~14.0% Electronics $3.0 ~$4.0 14% 12.0% ~13.5% & Safety Strong revenue growth and margin expansion across all segments 1. A
Slide 102: Robust business model
Robust business model Revenue Opportunities ($ billions) + Additional volume $22 ~$20 $16.8 +/-10% + Operating leverage $18 + Acquisitions Risks - Lower industry volume 2016 2018 2018 - Foreign exchange headwinds EBITDA1 % 17.5% >18% Upside ~19% Downside ~17% - Commodity headwinds Positioned to seiz
Slide 103: Capital structure
Capital structure ($ millions) Dec 31, 2014 Dec 31, 2015 Maturity schedule ($ millions) 4.250% Sr notes Cash1 $860 $536 (As of 12/31/15) 1.500% Euro Sr notes 4.150% Sr notes Debt $2,426 $4,008 5.000% Sr notes Net debt $1,566 $3,472 $791 $757 3.150% Sr notes $693 $645 $646 Debt-to-EBITDA2 1.6x 2.1x T
Slide 104: Capital allocation
Capital allocation 2011-2015 capital allocation 2016-2018 operating cash flow ($ millions) ($ billions) $0.9 $0.2 ($0.2) ($0.3) $2.6 ~$4,000 $2.0 ~$4.0B cash returned to shareholders 2016 Higher Restructuring Taxes WC/ 2018 since 2011 OCF Income Other OCF ~$2,500 ~$2,000 2016-2018 capital deployment
Slide 105: Continuation of capital deployment strategy
Continuation of capital deployment strategy Share repurchase program Dividend increase • New share repurchase program • Previously announced increase to annual dividend payout to $1.16 per share – $1.5B opportunistic program – Represents ~15% of our 2016 operating – Reflects continued confidence in
Slide 106: Capital spending
Capital spending Capital spend 2016 major programs ($ billions) • Gas Direct injection programs $0.8 $0.8 $0.7 • Euro 6 diesel programs • Restructuring and integration capital • IT investments and facility expansions 2016 spending profile Growth Maintenance 50% 30% Footprint/ restructuring 10% 2014
Slide 107: Portfolio realignment track record
Portfolio realignment track record Acquisition/ 2015-2018 2015-2018 Synergy Explanation divestiture date revenue CAGR EBITDA Margins achievement EBITDA margins over plan MVL Q4 2012 ~5% ~30% 1.5x Synergies in excess of plan Bookings ahead of plan Q4 2014 ~30% ~20% 1.5x Revenue growth well over plan
Slide 108: Valuation metrics
Valuation metrics 2016 revenue growth 2016 EBIT margin 2016 P/E multiple Auto peers median Diversified Industrials Tech peers 23.3x 13.9% 15.7% 13.5% 17.5x 10.8% 12.2% 11.6x 12.2x 7.4% 5.0% 13.1% 14.8x 2.9% 1.7% 7.7x 0.0% 0.8% Auto peers Other groups Delphi Auto peers Other groups Delphi Auto peers
Slide 109: Why Delphi will outperform
Why Delphi will outperform Track record of strong financial performance Accelerating revenue with new business wins Continuing to optimize cost structure while investing for growth Significant operational and financial flexibility Strong cash generation and accretive deployment plan Consistently del
Slide 110: 2015 Automotive & Transport North American Excellence Award
2015 AUTOMOTIVE & TRANSPORT NORTH AMERICAN EXCELLENCE AWARD For the coast to coast automated drive
Slide 111: Appendix
Appendix DELPHI
Slide 112: Non-US GAAP financial metrics
Non-US GAAP financial metrics ($ millions) 2015 2010 Net income attributable to Delphi $1,450 $631 Income tax expense $263 $226 Interest expense $127 $30 Other (income) expense, net $88 ($35) Noncontrolling interest $85 $72 Equity income, net of tax ($16) ($6) Income from discontinued operations, ne
Slide 113: Non-US GAAP financial metrics
Non-US GAAP financial metrics ($ millions) 2015 2014 Net income attributable to Delphi $1,450 $1,351 Income tax expense $263 $255 Interest expense $127 $135 Other expense (income), net $88 $8 Noncontrolling interest $85 $89 Equity income, net of tax ($16) ($20) Income from discontinued operations, n
Slide 114: Non-US GAAP financial metrics
Non-US GAAP financial metrics ($ millions) 2015 2014 Net income attributable to Delphi $1,450 $1,351 Income from discontinued operations attributable to Delphi, net of tax ($262) ($42) Income from continuing operations attributable to Delphi $1,188 $1,309 Adjusting items: Restructuring $177 $140 Oth