Dana Incorporated · NYSE:DAN
Dana — Investor Day (March 2019)
131 slides from Dana's investor day presentation, Mar 11, 2019
Slide 1: Investor Day March 11, 2019
Investor Day March 11, 2019 Exhibit 99.1
Slide 2: Safe Harbor Statement
Certain statements and projections contained in this presentation are, by their nature, forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on our current expectations, estimates and projections about our industry and
Slide 3: Agenda
9:00 – 9:15Business Overview 9:15 – 11:00Enterprise Strategy Overview Leverage The Core 9:15 – 10:15 Drive Customer Centricity Expand Global Markets Deliver Innovative Solutions 15 Minute Break Electrification: An Expert Perspective Lead Electric Propulsion 11:00 – 11:30Financial Summary 11:30 – 12:
Slide 4: Business Overview
Honesty and Integrity | Good Corporate Citizenship | Open Ci ication | Conti | Business Overview Hepa Findlineg of Beller Way’
Slide 5: Dana Snapshot
Founded in 1904 2018 sales: $8.1 billion ~36,000 people 25 technical centers 145 33 6 major facilities countries continents customers in countries 141 Dana Snapshot ~15,000 13% increase from prior year
Slide 6: Global Footprint
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Slide 7: Mission, Vision, Values
Mission, Vision, Values Our Mission Our talented people power a customer-centric organization that is continuously improving the performance and efficiency of vehicles and machines around the globe. We will consistently deliver superior products and services to our customers and will generate except
Slide 8: Business Overview
Regions North America South America Europe Asia Pacific 45% 28% 6% 21% Business Overview Technologies Drive Axles, driveshafts, transmissions, hydraulic wheel and track drives, drive units for electric and hybrid vehicles Motion Winches, slew drives, planetary gearboxes, hydraulic pumps, motors and
Slide 9: Product Overview
Motion Transmission Driveshaft Axles Product Overview Sealing & Cooling Active Warm Up Transmissions Hydrostatic Hydrodynamic Hydromechanical High Performance Aluminum Driveshafts Steel Driveshafts Industrial Driveshafts Universal Joints Constant Velocity Joints Drive Axles Steer Axles AWD System Di
Slide 10: Sustainability Through Electrification
645,000+ tonnes of CO2 diverted from cities ~12,000 vehicles on the roads today Sustainability Through Electrification ~585 million customer kilometers driven with TM4 motors Over 95,000 tonnes of CO2 saved since 2014 with Dana products
Slide 11: Employee Engagement
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Slide 12: Oerlikon Drive Systems Acquisition
Enhances Propulsion Technology Portfolio Oerlikon Drive Systems Acquisition Increases Asian Market Capabilities Delivers Significant Long-Term Value Extends Off-Highway Market Presence
Slide 13: Enterprise Strategy
Honesty and Integrity | Good Corporate Citizenship | Open Ci ication | Conti | Enterprise Strategy Hepa Findlineg of Beller Way’
Slide 14: Exceeding Original 2019 Targets
Exceeding Original 2019 Targets On track to surpass top and bottom line long-term targets by more than 30% sales +$2.4 billion 35% 36% diluted adj. earnings per share +$0.85 adj. EBITDA +$275 million 32% See appendix for comments regarding the presentation of non-GAAP measures
Slide 15: Business Dynamics
Business Dynamics Market Demand Electrification Adoption Commodities Global Trade ➨ Business Acquisitions
Slide 16: End Market Demand
End Market Demand Light Trucks Commercial Vehicle Off-Highway Market Growth Sales & Adjusted EBITDA1 Sales $ in billions Adj. EBITDA $ in millions 1. Today’s outlook includes Oerlikon Drive Systems sales and adjusted EBITDA Increased demand and acquisitions key to exceeding long-term financial targe
Slide 17: Commodity Costs
Commodity Costs Steel Aluminum Commodity Cost Increases Specialty Steel Market Prices Today's Outlook $ in millions Positive Change Negative Change Adjusted EBITDA Sales $300M+ Cost Headwinds Delivering 100 bps profit margin expansion in spite of commodity costs ➨
Slide 18: Electrification and Acquisitions
Electrification and Acquisitions Core Market xEV Adoption1 Electrification Accomplishments 1. Includes BEV, PHEV, and HEV. Off-Highway excludes forklifts and scissor lifts Positioned for significant growth as electrification adoption accelerates Today's Outlook ~12,000 500+ vehicles on the road toda
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Slide 20: Strategy Evolution
Strategy Evolution Established enterprise strategy Reversed years of revenue declines Initiated focus on electrification Established and exceeded financial targets Delivered ~$2B+ of sales growth Expanded profit margin by 100bps Added $100M of adj. FCF Strategy to drive sales to ~$10B+ and cumulativ
Slide 21: Leverage The Core
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Slide 22: Leverage The Core
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Slide 23: Leverage The Core
Leverage The Core Increase synergies Position portfolio Amplify innovation Utilize capabilities in power conveyance, thermal management, and mechatronics across all three mobility markets to deliver a sustainable competitive advantage
Slide 24: Create Value with Multi-Market Presence
Create Value with Multi-Market Presence Sealing Drive Motion Electrodynamic Digital Thermal Technology investment magnified by shared R&D Cost efficiencies delivered through core technologies Speed of innovation accelerated through knowledge sharing
Slide 25: Core Engineering
Core Engineering Driveshafts Axles Shared expertise is leveraged across the enterprise Research and development Product design Application engineering Core technologies spread to all end markets: light and commercial vehicles, off-highway equipment Modular designs applicable to all end markets Suppl
Slide 26: Purchasing and Supply Chain
Purchasing and Supply Chain Global commodity buyers leverage common purchases across all segments and regions Matched pairs: engineering and purchasing functions formally teamed to reduce complexity through modular design and use of common parts across end markets International purchasing offices to
Slide 27: Manufacturing
Manufacturing Real-time asset performance management driving 3% productivity improvements Digital scheduling and inventory management enabled through connected manufacturing systems Preventative and predictive maintenance analytics delivering 10% downtime reduction Multiple variant analytics and mac
Slide 28: Mechanical Technology
Mechanical Technology Historical competence centered around perpendicular transfer of high torque through hypoid gears Brevini and Fairfield acquisitions provide planetary gear capabilities highly relevant for heavy vehicle e-Propulsion Graziano acquisition also delivers leading parallel torque tran
Slide 29: Electrodynamic Technology
Electrodynamic Technology TM4 delivered high-voltage permanent magnet motors and power electronics SME brings low-voltage induction motor technology with power electronics ODS augments motor and controls capabilities via Ashwoods and VOCIS Creates complete in-house suite of motors and power electron
Slide 30: Mechatronics Competence
Mechatronics Competence Mechatronics Electro- dynamics Motors Mechanical Power Electronics e-Propulsion Systems Capabilities Full suite of power electronics Inverters Converters Software Controllers Broad range of motor types Permanent magnet Induction Synchronous reluctance Precision mechanical gea
Slide 31: Thermal Technology
Thermal Technology Thermal Management for e-Propulsion Developing e-Propulsion systems requires strong thermal management capabilities as motor and inverter temperatures must be managed for optimum performance Thermal competency of Power Technologies is leveraged across business units to enhance the
Slide 32: Integrated e-Propulsion Systems
e-Drive Unit e-Axle Motors Gears Power Electronics Coolers Integrated e-Propulsion Systems
Slide 33: Digital Technology
Digital Technology Digitally Enabled Products Digital Services Growth Vectors Physical products are enhanced by digital solutions such as sensors and controls that enable: Remote fleet management Data- and analytics- driven decision making Advanced diagnostics and prognostics Digital service offerin
Slide 34: Additive Manufacturing
Additive Manufacturing Traditional Additive Axle Arm Application Additive manufacturing technology allows for completely new approach to component design, engineering, and manufacturing compared with traditional methods Applicable for tooling and lower volume production and service parts Benefits in
Slide 35: Create Value with Multi-Market Presence
Create Value with Multi-Market Presence Leveraging the core yields $175M in annual embedded cost synergies Speed of innovation accelerated through knowledge sharing Technology investment magnified by shared R&D Sealing Drive Motion Electrodynamic Digital Thermal Cost efficiencies delivered through c
Slide 36: Drive Customer Centricity
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Slide 37: Drive Customer Centricity
Drive Customer Centricity Leverage global footprint Engineer solutions Digitize customer experience Drive Customer Centricity 2 Positioned to win more than fair share of drive systems business across all three mobility markets as OEMs deploy capital towards megatrends of mobility, autonomous driving
Slide 38: Gain Share Through Customer Centricity
Gain Share Through Customer Centricity Why John Deere Just Spent $305 Million on a Lettuce-Farming Robot September 6, 2017 October 3, 2018 Honda to Invest $2.75 Billion in GM’s Self-Driving Car Unit 1. Europe & North America OE Captive Share1 Electric Digital Mobility Autonomy …and redeploying capit
Slide 39: Global Platforms
Global Platforms Key Vehicles Footprint in all four major regions enables light vehicle business to be a leader in the compact truck segment with driveline content on 9 of the top 10 global programs Leveraging global presence in commercial vehicle to build stronger relationships in underserved marke
Slide 40: Customer Relationships
Customer Relationships Acquisitions bring new customer access across all markets via: Existing programs New electrification wins Complementary footprint Acquired companies leverage Dana capabilities to create new relationships Brevini and ODS acquisitions increase presence in off-highway markets SME
Slide 41: Differentiated Performance
Differentiated Performance Customer Recognition Experienced high level of end-market demand over the last two years Light vehicle up 10% Commercial vehicle up 32% Off-highway up 22% Delivery and quality performance for customers has been exceptional, resulting in multiple customer recognitions Stron
Slide 42: E-Vehicle Level Integration Partner
E-Vehicle Level Integration Partner Full Electrified Powertrain Offering e-Propulsion System Battery Management System Customers are requiring complete electric powertrains for multiple vehicle architectures e-Propulsion and battery management systems must be integrated into the vehicle controls to
Slide 43: Hybrid Electric System Partner
Hybrid Electric System Partner Class 8 Truck Application Entered strategic partnership with system integrator Hyliion Hyliion system turns a traditional 6x2 truck into a hybrid by adding an electric rear axle, battery, and energy-management system Dana develops / supplies the fully integrated e-Axle
Slide 44: Off Road, High Performance, Formula-e
Off Road, High Performance, Formula-e Pushing the Limits to Improve Product Offerings Applications that demand extreme performance drive innovation Direct marketing to high-profile enthusiast markets highlights brands and technology and stimulates pull-through sales Formula-e racing creates brand ex
Slide 45: Aftermarket 'All Makes'
Aftermarket ‘All Makes’ Full Driveline Product Offering Extends Spicer aftermarket offering to include full range of driveline components including those of competitors Axle gear sets Universal joints Driveshaft end yolks Products engineered to provide dependable performance Product lines are purpos
Slide 46: Aftermarket e-Commerce Platform
Aftermarket e-Commerce Platform DanaAftermarket.com Web-based, global platform is leveraged across all mobility market segments to improve customer satisfaction Ease of use helps to reduce vehicle downtime for operators Comprehensive and consistent user experience delivers competitive advantage: Int
Slide 47: Gain Share Through Customer Centricity
Gain Share Through Customer Centricity Driving customer centricity yields more OEM outsourcing opportunities 1. Europe & North America Electric Digital Mobility Autonomy OEMs faced with emerging megatrends… Why John Deere Just Spent $305 Million on a Lettuce-Farming Robot September 6, 2017 October 3
Slide 48: Expand Global Markets
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Slide 49: Expand Global Markets
Expand Global Markets Disproportionately invest in capabilities to drive growth in Asia-Pacific market with highest growth rates and earliest electrification adoption Forge partnerships Expand inorganically Grow organically Expand Global Markets 3
Slide 50: Deliver Growth by Investing in APAC
Deliver Growth by Investing in APAC xEV1 ICE Units in millions Gaining fair share represents opportunity in APAC markets Mobility markets are growing rapidly in APAC APAC is leading in the adoption of electrification 1. Estimate for China LV and CV markets APAC Production Volume APAC xEV Adoption Op
Slide 51: Joint Venture Partners
Joint Venture Partners Spicer India Limited: JV with Anand for production and sale of universal joints, driveshafts, light axles, transfer cases, and components for the Indian market Axles India Limited: manufactures axle housings and beams for medium and heavy- duty commercial vehicles DDAC: JV wit
Slide 52: Supplier Partners
Supplier Partners Key Market Drivers High level of market demand driving need for improved supply chain efficiencies Fostering supplier relations in best cost and quality locations to source components for final assembly in end markets Cost, capacity, and delivery performance while maintaining the h
Slide 53: Acquired Internal Supply
Acquired Internal Supply Key Market Drivers Manufacture components in strategic regions and ship to end markets for final assembly for key high-value products Specialization creates a more efficient supply chain, allowing for improved cost, capacity, and delivery performance while maintaining qualit
Slide 54: Acquired Local Market Presence
Acquired Local Market Presence Key Asian Markets Suzhou, Changshu, Shanghai ODS acquisition adds manufacturing plants and tech centers in Asia that serve domestic customers in all end markets Acquisitions further differentiate Dana in domestic markets: Significant Asian manufacturing capacity Local
Slide 55: Organic Local Market Presence
Organic Local Market Presence Expanding Footprint Experience serving and managing complexity of global customers across multiple regions Expanding, sharing, and optimizing global footprint to drive growth Recent investments include: Chongqing: New plant to produce Dana's most advanced AWD system Yan
Slide 56: Aftermarket Distribution Network
Aftermarket Distribution Network Opportunity for expanded growth Enhancing capabilities of local Service and Assembly Centers (SAC) and Product Distribution Centers (PDC) by adding service, sales, and engineering competencies across the globe Expanding SAC footprint for greater customer access Asia
Slide 57: Deliver Growth by Investing in APAC
Deliver Growth by Investing in APAC Gaining fair share represents opportunity in APAC markets Mobility markets are growing rapidly in APAC 1. Estimate for China LV and CV markets Investment in capabilities yields double-digit organic sales growth in APAC APAC is leading in the adoption of electrific
Slide 58: Deliver Innovative Solutions
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Slide 59: Deliver Innovative Solutions
Deliver Innovative Solutions Evolve Enhance Create Physical Digital Deliver Innovative Solutions 4 Capitalize on secular growth trends that expand our addressable market by increasing content per vehicle as physical products evolve toward digital solutions
Slide 60: Increase Content Through Innovation
Increase Content Through Innovation +20% ≤4 Cylinders 10% >4 Cylinders 13% Source: IHS Engine downsizing, driveline enhancement offer significant opportunity Digitally enabling our physical products is driving higher CPV Digital solutions provide new growth vector Engine Downsizing: 2018-2023 AWD Ad
Slide 61: AdvanTEK Ultra
AdvanTEK® Ultra™ Most efficient axle for automotive application – 30% better than current best-in-class solution Delivers fuel economy savings equivalent to a 200-lb weight reduction as estimated by the EPA Cuts noise in half over traditional design Launching globally on Ford’s transverse AWD vehicl
Slide 62: AdvanTEK Heavy Duty Single Axle
AdvanTEK® Heavy Duty Single Axle Commercial vehicle axle utilizes AdvanTEK® gearing technology Opportunity for growth in a key region and with a key customer in Europe Enables hybrid systems by converting a 6x2 into a 6x4 configuration by adding an electric rear axle Tailored designs to match the ge
Slide 63: Wheel and Track Drives
Wheel and Track Drives Planetary Hub Drives Planetary Hub Drive Application Expanding full range of planetary hub drives for tracked vehicles Leveraging Brevini, ODS, and Spicer technology and brand reputations Expands the addressable market to cover a full range of uses from small utility applicati
Slide 64: Advanced Motion Systems
Advanced Motion Systems Slew Drive and Winch Application Motion systems allow Dana to provide new integrated solutions to existing driveline customers Systems include controls and valves, motors, pumps, slew drives, and winches Hydraulically and electrically powered technology Deliver greater value
Slide 65: Transmission Separator Plates
Transmission Separator Plates Allows high-efficiency CVT and double clutch transmissions to achieve required higher pressure levels and eliminate leaks Applicable for electric vehicle transmissions that require better sealing solutions for high operating pressures Requires fewer bolts to assemble tr
Slide 66: Software-Controlled Driveline
Software-Controlled Driveline 2019 Edge Offers fuel economy of FWD with safety and control of AWD through a disconnecting driveshaft Significant content per vehicle (CPV) increase for sedan, CUV, and SUV as FWD architecture augmented by driveshaft and rear axle Full systems solution, including front
Slide 67: Enhanced Off-Highway Drivelines
Enhanced Off-Highway Drivelines TBD Independent suspension axles with hydraulic actuation that deliver tailored levels of technology by region and customer Allows regional customers to improve quality, reliability, and technology to compete with global competitors Scalable to meet the needs of a vas
Slide 68: Advanced Transmissions
Advanced Transmissions Transmissions distribute power for driving functions and motion systems of the vehicle Offering multiple technologies to meet different performance requirements and fuel-efficiency standards Dana Rexroth, a JV in Europe with Bosch Rexroth, produces hydromechanical variable tra
Slide 69: Digital Service Offering
GOOD AS NEW CHANGE IN 3,500 MILES CHANGE IN 10,000 MILES SLIGHT TREAD WEAR REPAIR IMMEDIATELY Digital Service Offering TBD Cloud-based tire maintenance and management software that digitizes traditional manual process Real-time alerts enable proactive fleet management and improved total cost of owne
Slide 70: Increase Content Through Innovation
Increase Content Through Innovation Engine downsizing, driveline enhancement offer significant opportunity Digitally enabling our physical products is driving higher CPV Digital solutions provide new growth vector Source: IHS Delivering innovative solutions yields market expansion and higher CPV +20
Slide 71: Electrification – The future of vehicle propulsion
Dana Investor Day New York, NY – March 11, 2019 Electrification – The future of vehicle propulsion
Slide 72: Brandon Boyle, Partner, Roland Berger
Brandon Boyle Partner Automotive Competence Center Detroit, MI
Slide 73: Disclaimer
© 2019 Roland Berger LLC. All rights reserved. Disclaimer. The information on this slide including without limitation all projections and estimates and any oral discussion concerning same (collectively, “Information”) may not be stripped of any protection, used, or relied upon, in whole or in part,
Slide 74: Focus of today's discussion
Electrification – The future of vehicle propulsion Focus of today's discussion What are the drivers of electrification? How will the drivers manifest regionally and by segments? What are the key capabilities and components for an e-propulsion system? How will the roles in the value chain shift over
Slide 75: Global adoption of electrified propulsion driven by combination of factors
The global adoption of electrified propulsion is being driven by a combination of factors Global drivers of electrification Regulation Emission / fuel consumption targets Minimum xEV shares (e.g. CARB ZEV regulation) City access limitations (e.g. London, Paris) Potential fast policy shift in China C
Slide 76: Percentage of electrified vehicles growing in all vehicle segments
The percentage of electrified vehicles is growing in all vehicle segments 13.2 0.6 0.6 0.6 59.8 1.4 56.1 1.7 62.3 1.3 0.3 12.3 0.4 12.9 0.4 0.2 0.2 0.2 Electrified vehicles (FH/PHEV/BEV/FCV) xx Total sales volumes, Units [EU, NA, CN] Passenger vehicles1) (PV) Heavy Duty Trucks (HDT)3) Light Trucks2)
Slide 77: Light Truck segment expected to develop slower than broader LV segment
The Light Truck segment is expected to develop slower than the broader LV segment – Regulation and customer pull are driving pace of change North America 4% 7% 6% Percentage electrified, 2023 Light trucks Source: IHS, Roland Berger 1) Mini/Compact/Full-Size Full-Frame vehicles and large unibody vehi
Slide 78: TCO main driver for MDT xEV adoption
Total Cost of Ownership is the main driver for MDT xEV adoption across regions, supported by incentives – City regulation as additional driver 17% 13% 8% Medium Duty Trucks Percentage electrified, 2023 Source: IHS, Roland Berger Region and segment development Drivers CN EU NA Fuel economy targets in
Slide 79: HDT segment TCO benefits apply to selected niche applications
Within the HDT segment, Total Cost of Ownership benefits apply only to selected niche applications in North America and Europe BEV/Hybrid forecast [000 units] Drivers CN EU NA Fuel economy targets in NA and China can be met without xEVs; EU is discussing framework CO2 targets are being set in all re
Slide 80: Growth of xEV buses driven by subsidies in China
Growth of xEV buses is driven by subsidies in China – Significant upside potential based on evolving city regulations in EU Source: IHS, Roland Berger Buses Percentage electrified, 2023 74% 39% 31% Region and segment development BEV/Hybrid forecast [000 units] Drivers CN EU NA Fuel economy targets i
Slide 81: Adoption of OH xEV expected in select applications
Adoption of OH xEV is expected in select applications Off-Highway Source: Roland Berger Region and segment development Subsegment trends Drivers CN EU NA City regulations on pollution & noise not yet in place but could evolve – Would mainly impact compact CE and selected MH equipment (e.g. AWP) Key
Slide 82: Carefully manage the transition period to xEV
It will be important for OEMs and suppliers to carefully manage the transition period to xEV Today Future Transition period Downturn ICE Development dynamics xEV Production volume ICE: Internal Combustion Engine EV: Electric vehicle Transition development Value chain shift Source: Roland Berger
Slide 83: OEM and supplier domain focus will shift over time
OEM and supplier domain focus will shift over time with suppliers gaining significant share of value-add in propulsion systems Body structures Propulsion Electrics/ Electronics 22% 15% Chassis 78% 85% 49% 64% 51% 36% 16% 16% Most mechanical products are already manufactured by suppliers Investment-i
Slide 84: Suppliers take more prominent role in xEV value creation
While suppliers will take a more prominent role in the value creation of xEV systems, it will largely depend on OEMs’ strategies Systems Modules Vehicle Components Shift sensor Shift actuator Rotor Reduction Gearbox Electric Motor Power Electronics Other mechanical parts: Axles, half shafts, propsha
Slide 85: Range of motors and power electronics required
A range of motors (low and high voltage) and power electronics will be required to serve the full range of applications and vehicle architectures 3 000 3 500+ 150 200 250 Continuous Power [kW] 50 100 E-motor power and torque range by segment – Illustrative 500 1 000 1 500 2 000 2 500 Torque [Nm] Sou
Slide 86: Implications for suppliers
Implications for suppliers The development of electrification is happening across all mobility markets – while passenger car is the largest xEV segment there are applications within commercial vehicle and off-highway with higher levels of adoption Regulations and customer pull are driving the develo
Slide 87: Roland Berger
Roland Berger r
Slide 88: Lead Electric Propulsion
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Slide 89: Lead Electric Propulsion
Lead Electric Propulsion Boost Propel Drive Hybrid Electric Vehicle Lead Electric Propulsion 5 Develop and deliver fully integrated e-Propulsion systems to capture opportunity to double CPV as core markets shift from internal combustion engines to electric propulsion
Slide 90: Double Content Through Electrification
Double Content Through Electrification ~585 million customer km driven with TM4 motors 300+ electrification-focused engineers ~12,000 vehicles on the road today Electrification creates significant opportunity in driveline Leverage deep expertise in electrifying our core markets… …because EV adoption
Slide 91: Wide Range of Vehicle Segments
Wide Range of Vehicle Segments Target Electrification Segments Low-voltage segments tend to require smaller packaging, lower costs, and greater maneuverability High-voltage segments tend to require higher torque, greater range, and low-voltage auxiliary systems While some of these segments will adop
Slide 92: Electrodynamic Technology
Electrodynamic Technology Low Voltage Dana offers motors and power electronics for both low-voltage and high-voltage applications Lower-voltage power electronics are integrated into one unit, while higher-voltage inverters and controllers are separate Dana offers a range of electrodynamic products,
Slide 93: Electric Motor Topology
Electric Motor Topology Power & Efficiency Cost Effectiveness 2 - 40 kW Round-wire copper design Extremely reliable, low-cost solution Induction Copper Wire Vehicle auxiliaries and traction for low-speed electric vehicles Permanent Magnet Rare Earth Metals 4 - 250 kW Round and rectangular wire desig
Slide 94: Power Electronics Topology
Power Electronics Topology Low Voltage Inverters Low Voltage High Voltage High Voltage Inverters CO200 CO300 Inverters 150 - 350kW TM4 "Reflex" technology optimizes motor control Tailored to application based on in-depth market knowledge, enabling optimized performance LV, CV, and larger OH machines
Slide 95: Electric Propulsion Product Portfolio
Electric Propulsion Product Portfolio Mild hybrid Battery Electric Vehicle (BEV) Independent e-Axle Plug-in Hybrid Electric Vehicle (P/HEV) Hybrid Axle Wheel Drives Hybrid Transmission Power Electronics Direct Drive Technology Solutions e-Drive Unit Rigid e-Axle Recreational Utility City Delivery Me
Slide 96: Electrification Product Applications
Electrification Product Applications Mild hybrid Battery Electric Vehicle (BEV) Plug-in Hybrid Electric Vehicle (P/HEV) Technology Solutions Independent e-Axle Hybrid Axle Wheel Drives Hybrid Transmission Power Electronics Direct Drive e-Drive Unit Rigid e-Axle P0 / P1 P2 / P3 P3.5 P4 Architecture T
Slide 97: Power Electronics: Mild Hybrid
Power Electronics Mild Hybrid Inverters and software that provide start/stop functionality via an integrated starter generator for mild hybrid and hybrid vehicles Targeted toward commercial-vehicle segment, including buses and trucks Product is compatible with current ICE and hybrid architectures, a
Slide 98: Battery Electric Power Electronics
Battery Electric Power Electronics SME acquisition positions Dana to offer low-voltage auxiliary systems, expanding content in key end markets Includes motors and inverters for electronic hydraulic power steering, lift pumps, and e-Compressors for braking and climate systems Focused on commercial-ve
Slide 99: Hybrid Transmission
Hybrid Transmission Automated high-efficiency drive unit with integrated hybrid module and electric motor in P2 or P2.5 layouts Targets front or mid-engine extended range hybrid passenger cars Developed with a modular approach to reduce one-off designs Full hybrid functions including: Engine crankin
Slide 100: Hybrid Axles
Hybrid Axles Hybrid Unique solution for rear-wheel-drive high-performance vehicles Efficient torque management to meet varying driver requirements Provides 150kW of instant power and reduces fuel consumption up to 20% Functionalities include full electric mode, energy recovery mode, and boost mode C
Slide 101: Independent Electric Axle
Independent Electric Axle Adds secondary electric axle to a front- wheel-drive hybrid vehicle, creating AWD capability without adding mechanical connections Option for torque vectoring e-Axle that scales from traditional axle products Target applications include CUV and SUV market to achieve on-dema
Slide 102: Independent Electric Axles
Independent Electric Axles CUV and SUV e-AWD Application Dual torque vectoring independent e-Axles provide full electric propulsion Additional content in AWD configuration Offers Dana opportunity to target core light commercial-vehicle market and further expansion into electrified products for passe
Slide 103: Electric Direct Drive
Battery Electric Electric Direct Drive Direct drive motors where an electric motor directly interfaces with a traditional axle and driveshaft to power the vehicle Allows OEMs to immediately electrify an existing chassis Maximizes Dana content by adding electric components to mechanical system Target
Slide 104: Electric Drive Unit
Electric Drive Unit Battery Electric Electric-drive systems for growing low speed electric-vehicle market Targets fully battery-electric small passenger and utility vehicle market Enables access to high-growth market of new mobility for city transportation and utility-vehicle market Emerging Indian
Slide 105: Rigid Electric Axles
Battery Electric Rigid Electric Axles Electric motor is fully integrated into the axle; combines all functions of the engine and transmission into the drive axle Applications in all mobility segments; currently targeting commercial vehicle bus, medium-duty truck, and off-highway end markets Compact
Slide 106: Rigid Electric Axles: Full-Frame Truck
Battery Electric Rigid Electric Axles Full-Frame Truck Application Electric motor is fully integrated into the axle; combines all functions of the engine and transmission into the drive axle Applications in the full-frame truck market, including pickup trucks and light commercial vehicles Compact de
Slide 107: Wheel-End Electric Drives
Wheel-End Electric Drives Electric motor connected directly to wheel drives Integrate ODS and Brevini product portfolio into Dana's system approach to penetrate new markets Allows Dana to capitalize on two rapidly growing off-highway segments: construction and material handling Leverage acquired mot
Slide 108: Motion Electric Systems
Motion Electric Systems Deliver greater value to customers by selling electrified motion systems with drive systems, as performance can be optimized between systems Integrate ODS' product portfolio into Dana's system approach to enter new markets Leverage acquired motor technology for electric mini
Slide 109: Battery Cooling
Battery Cooling Thermal management is a critical function in all hybrid and electric vehicles Battery solution provides both cooling and heating functionalities Numerous patented designs that optimize the temperature distribution across the cold plate Utilizes a proprietary and flux-free aluminum br
Slide 110: Electronics Cooling
Electronics Cooling Electronics thermal management is increasingly critical as quantity and performance requirements of electronics multiply due to electrification and autonomous driving Dana developed a unique solution that provides two-sided chip cooling that optimizes heat transfer and durability
Slide 111: Hydrogen Fuel Cells
Hydrogen Fuel Cells Victor Reinz® Hydroseal™ Fuel cells expected to become more relevant as adoption increases over next 15+ years, specifically in mass transit segment Fuel-cell capabilities provide the flexibility to address core market needs regardless of energy source Co-developing future soluti
Slide 112: Double Content Through Electrification
Double Content Through Electrification Electrification creates significant opportunity in driveline Electrification yields more than $100 million of sales today ~585 million customer km driven with TM4 motors 300+ electrification-focused engineers ~12,000 vehicles on the road today Leverage deep exp
Slide 113: Five strategic pillars
Leverage The Core 1 Drive Customer Centricity 2 Expand Global Markets 3 Deliver Innovative Solutions 4 Lead Electric Propulsion 5
Slide 114: Financial Summary
Honesty and Integrity | Good Corporate Citizenship | Open Ci ication | Conti | Financial Summary Hepa Findlineg of Beller Way’
Slide 115: Enterprise Strategy Financial Impact
Enterprise Strategy Financial Impact 4 1 2 3 $700M backlog 2019-2021 5 $500M sales in 2023 Embedded Multi-Market Cost Synergies $175M $200M+ Outsourcing 2018 2023
Slide 116: Electrification Leadership Evolution
Electrification Leadership Evolution 20181 2023 1. Dana metrics pro forma for acquisitions. 2. Light-duty truck based on mini/compact/full-size full-frame vehicles and unibody vehicles; CV volumes based on North America, EU, and China; OH volumes global and include construction equipment and mining
Slide 117: 2019 Guidance vs. 2016 Original Targets
2019 Guidance vs. 2016 Original Targets 2019 Sales 2019 Adjusted EBITDA 2019 Adjusted Free Cash Flow 2019 Diluted Adjusted EPS $ in millions $ in billions $ in millions +$2.4B Delivering dramatically improved financial results compared to targets provided at 2016 Investor Day Augmented by strategic
Slide 118: Key Financial Metrics Trends
Key Financial Metrics Trends Sales Adjusted EBITDA Adjusted Free Cash Flow1 Diluted Adjusted EPS $ in millions $ in billions $ in millions ~2x / 14% CAGR Note:. A=Actual; T=Target; E=Estimate 1. 2019T adjusted FCF excludes pension termination impact +$3.2B / 9% CAGR 2019 includes 10 months of ODS, w
Slide 119: 2020 Growth Drivers
2020 Growth Drivers Backlog Conversion Market Demand Commodity Costs ➨ Cost Synergies ➨ ➨
Slide 120: 2019-2021 Sales Backlog: $700 Million
2019-2021 Sales Backlog: $700 Million Backlog positions us to outperform market through 2021 Backlog includes booked incremental new business net of any lost replacement business Backlog is incremental to 2018 sales, holding both foreign currency exchange rates and vehicle production volumes constan
Slide 121: 2020 Mobility Market Demand Outlook
2020 Mobility Market Demand Outlook North America South America Overall Dana Impact ($200M) Asia Pacific Europe Off-Highway Light Vehicle Commercial Vehicle Full Frame Truck Medium Duty Heavy Duty Agriculture Construction Mining YoY ∆ Legend <+3% >(3%) Flat Primary Third-Party Sources <(3%) >+3% ➨
Slide 122: Commodity Costs Outlook
Prices in all key commodities have increased faster than projected at previous Investor Day Driving $300M+ cost headwinds expected through 2019, with nearly $100M impacting profitability Forecasting modest cost reductions in 2020 – price give-backs provide ~25 bps of Adjusted EBITDA margin improveme
Slide 123: 2020 Sales and Profit Changes
12.3% 12.8% ~Flat 2020 Sales and Profit Changes ~+25 bps ODS cost synergies and commodity cost reduction = +50 bps Organic sales likely to remain flat as softening of market demand will be offset by conversion of sales backlog ODS is expected to accrete ~$140M of sales and ~$40M of profit, mainly du
Slide 124: 2020 Adjusted FCF Growth Drivers
$ in millions 2020T B / (W) 2019T 2020T than 2019T Adjusted EBITDA ~$1,125 ~$1,180 ~$55 One-Time Costs ~(95) ~(40) ~55 Interest, net ~(105) ~(110) ~(5) Taxes ~(185) ~(185) ~0 Working Capital / Other ~(50) ~0 ~50 Capital Spending ~(415) ~(380) ~35 Adjusted Free Cash Flow ~$275 ~$465 ~$190 % Margin ~3
Slide 125: 2023 Sales Potential
2023 Sales Potential Market and new business growth to propel sales to ~$10B+ Third-party sources forecasting overall growth in addressable markets Current secured backlog balance scheduled online in 2021 – assumes future 2022-2023 backlog will be in line with 2021 Anticipating electrification sales
Slide 126: Managing Through the Cycle
Managing Through the Cycle Cycle Mitigating Factors Proven and consistent track record of generating new backlog growth Strong backlog already established three years forward Diversification across end markets and regions lessens impact of softness in any one sector Embedded cost synergies and flexi
Slide 127: Capital Allocation
Capital Allocation 5-Year Illustrative Capital Allocation Cumulative Adj. FCF ~$2B Anticipating cumulative adj. FCF of ~$2B for 2019T-23E Includes capex at normalized levels of ~4% of sales, as largest programs have refreshed Pragmatically reducing debt and pension liabilities Shareholder return wil
Slide 128: Capital Structure
Capital Structure Debt Capital 2019T debt includes acquisition financing for ODS Planning to designate majority of 2019 free cash flow for discretionary pension termination Forecasting substantial paydown of term debt related to ODS in 2020 Expect robust long-term free cash flow profile to allow for
Slide 129: Investment Highlights
Investment Highlights Global Presence 1 Substantial Free Cash Flow Generation Broad Customer Base Elevated Capital Returns Strong Balance Sheet Leading Technology Solutions Significant Sales Backlog Dramatic EPS Growth 2 3 4 5 6 7 8
Slide 130: Appendix
Pecpe Finding ff Otter War?
Slide 131: Non-GAAP Measures: Adjusted EBITDA
The preceding slides refer to adjusted EBITDA, a non-GAAP financial measure which we have defined as net income before interest, taxes, depreciation, amortization, equity grant expense, restructuring expense and, non-service cost components of pension and other postretirement benefits (OPEB) cost an