Autoliv, Inc. · NYSE:ALV

Autoliv — Non-Deal Roadshow (September 2017)

58 slides from Autoliv's roadshow presentation, Sep 28, 2017

  1. Slide 1: Copyright Autoliv Inc., All Rights Reserved

    1 Copyright Autoliv Inc., All Rights Reserved

  2. Slide 2: Welcome: Creating more value, Saving more lives

    Welcome Creating more value US NDR – Post CMD’17 Saving more lives Jan Carlson Chairman, President & CEO 2 Copyright Autoliv Inc., All Rights Reserved

  3. Slide 3: Agenda

    Agenda 09:45-10:30 Welcome Investors and Analysts 10:30-11:15 Formal Presentation – Jan Carlson (Chairman, President & CEO) 11:15-11:45 Q&A 11:45-12:00 Wrap-Up Copyright Autoliv Inc., All Rights Reserved

  4. Slide 4: Safe Harbor Statement

    Safe Harbor Statement* This presentation contains statements that are not historical facts but rather forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include those that address activities, events or developments t

  5. Slide 5: Automotive industry in its largest transformation ever

    Automotive industry in its largest transformation ever Automotive Mega trends AUTOMATED DRIVING & CONNECTIVITY NEW MOBILITY CLEAN MOBILITY 5 Copyright Autoliv Inc., All Rights Reserved

  6. Slide 6: A historical decision that resulted in a world leader

    A historical decision that resulted in a world leader Autoliv Group US$ (millions) The air bag revolution The China car market The Digital revolution revolution 10,000 Merger with Morton ASP 8,000 6,000 Autoliv spin-off from Electrolux 4,000 2,000 ,0 1982 1985 1988 1991 1994 1997 2000 2003 2006 2009

  7. Slide 7: Autoliv – Stronger than ever

    Autoliv – Stronger than ever WORLD LEADING QUALITY LEADER in all PEOPLE AND CULTURE INNOVATION FOOTPRINT parts and aspects of our We rely on the skills of our builds the long term in manufacturing and business people success engineering 7 Copyright Autoliv Inc., All Rights Reserved

  8. Slide 8: Our Strategies to Stay Ahead

    Our Strategies to Stay Ahead RECALLS* MARKET SHARE 2016** Quality – Zero defects by Autoliv Global 39% flawless execution 2% Europe One Product One Process to improve ~ 170M Americas cost effectiveness recalled and robustness since 2010 Japan China Innovation to lead industry Rest of Asia in Real Li

  9. Slide 9: Autoliv stronger than ever – with sustainability in focus

    Autoliv stronger than ever – with sustainability in focus Autoliv’s vision of Saving More Lives Innovate Life- Commit to Saving Products our Employees Directly supports the UN Sustainable Development Goal no 3, Good Health and Well-being, focused on reducing global deaths and injuries from road traf

  10. Slide 10: A decade of transformation

    A decade of transformation  Company transformed for the digital  Invested in vertical integration for age cushions and inflators in China  Made substantial investments in  Supported the industry in difficult times technology, capacity and operational efficiency  Investment in technology for sma

  11. Slide 11: A decade of transformation

    A decade of transformation Built a new company and strengthened existing business further A decade of growth investments Sales 1,600 16% Electronics Passive Safety 1,400 14% 1,200 12% 1,000 10% 8,000 800 8% 2,000 600 6% 45% 400 4% 39% share 4,000 32% share 200 2% share** 0 0% 0 0 2008 LTM* 2020 2008

  12. Slide 12: A decade of transformation while creating Shareholder Value

    A decade of transformation while creating Shareholder Value Increasing shareholder returns with a strong balance sheet and FCF conversion An accumulated $2.6B returned to shareholders Net Debt* / EBITDA US$ Millions Times 3,000 2.5 Leverage Ratio* 2,500 2.0 2,000 1.5 1,500 1,000 Long-term Target Lon

  13. Slide 13: Our Transformation continues

    Our Transformation continues 13 Copyright Autoliv Inc., All Rights Reserved

  14. Slide 14: Strategic review of transition to stand alone entities

    Strategic review of transition to stand alone entities Passive Safety Electronics Standalone Standalone 14 Copyright Autoliv Inc., All Rights Reserved

  15. Slide 15: Different success factors shaping the future

    Different success factors shaping the future PASSIVE SAFETY ELECTRONICS MARKET & TECHNOLOGY KEY PRIORITIES CRITICAL COMPETENCES ATTRACT TALENT MANAGEMENT WORKING ENVIRONMENT KEY SELLING POINTS CAPITAL MARKETS ATTRACTION 15 Copyright Autoliv Inc., All Rights Reserved

  16. Slide 16: Passive Safety never in a better position

    Passive Safety never in a better position 16 Copyright Autoliv Inc., All Rights Reserved

  17. Slide 17: A Winning Business Formula

    A Winning Business Formula Number of units (million)* 350 Statistically, more than 3 airbags and seatbelts from Autoliv have 300 been delivered to every vehicle 250 produced globally last 10 years CAGR 200 ~12%** 150 1.3B 1.2B 100 Airbags* Seatbelts* CAGR 50 ~5%** 0 1997 07' 08' 09' 10' 11' 12' 13'

  18. Slide 18: A Winning Business Formula: 39% global market share

    A Winning Business Formula 7% 5%5% Today the global leader in passive safety 8% 5% 32% 7% 7% Frontal Side 12% 49% 40% 39% global market share Airbags 13% Airbags 15% 21% 14% 35% 30% 11% 10% 25% 3% 4% 7% 9% 32% 39% 20% Steering Seatbelts 16% 10% Wheels 15% 15% 20% 24% 10% 5% Serving 1,300 models and

  19. Slide 19: Passive Safety Technology – Our Industry Firsts

    Passive Safety Technology – Our Industry First’s First Seatbelt Belt Steering Wheel with Side Curtain Safety Active Bag-in-Belt Steering Wheel with (2-point static) Grabber* Integrated Sensor Airbag* Passenger Seatbelt Hand Sensor Vent Airbag* Detection* Knee Fixed Hub Seatbelt Airbag* Steering Lock

  20. Slide 20: Passive Safety a ~$25B Market in 2025

    Passive Safety a ~$25B Market in 2025 Market is expected to grow 1 pp faster than the underlying LVP LVP CAGR: ~2% US$ (Billions) New opportunities in the AD World CAGR: ~3% 26 ~$25B 24 ~$23B RoW 4.7 22 India ~$20B 4.3 20 0.7 China 3.8 0.5 Triad 18 16 0.3 6.5 5.3 14 4.4 12 12.9 13.1 11.5 10 2017 202

  21. Slide 21: Passive Safety – Market Trends and Growth Drivers

    Passive Safety – Market Trends and Growth Drivers Content per Vehicle* $ 2017 300  Increasing GDP/capita in growth markets 250  Higher LVP in Growth Markets  More stringent safety rating & regulations 200 ‒ China NCAP 2018 ‒ Regulations in India 150 ‒ Additional crash test in Triad  Consumer dem

  22. Slide 22: Passive Safety – Airbag and Seatbelt Markets and Installation Rates

    Passive Safety – Airbag and Seatbelt Markets and Installation Rates Passive Safety Market* US$ Billions CAGR* % 2017-20 Continued market potential beyond 2020 from increasing installation rates* ~4.7% Driver and passenger airbags Side airbags 90% 90% 25 Active Seabelts ~11% ~$23 60% 60% 0.5 ~$20 3.3

  23. Slide 23: Passive Safety: ~50% of Industry Order Wins

    Passive Safety ~50% of Industry Order Wins in 2015 to 2017 YTD Order Intake* Billions $2.4 $2.2 $2.3 Stand alone targets 2020:  >$10B = 8% CAGR** 2017 - 2020 ~51% ~50% ~50% ~48% ~50%  ~13% adj Operating Margin*** $1.3 ~50% ~50% ~37% Beyond 2020: ~37% ~37%  At least maintain market share and grow

  24. Slide 24: Cost Efficiency: Growth Within Existing Footprint

    Cost Efficiency: Growth Within Existing Footprint Freeing-up factory space lowers CAPEX and improves RoCE Pyrotechnic inflator plant in Taketoyo, Japan Reduce Line ADP No of production lines Expanding prototype area from 6 to + 50% No of products / 9 lines Line Frontal Line Frontal production m2 Lin

  25. Slide 25: Electronics - built for the future

    Electronics - built for the future 25 Copyright Autoliv Inc., All Rights Reserved

  26. Slide 26: Autoliv Electronics – Our Journey so far

    Autoliv Electronics – Our Journey so far Zenuity JV US$ (Millions) (2017) ANBS 2,500 JV 2,000 Volvo IP License, MACOM Visteon Radar, 1,500 Aztyx/Hella Divest IP Telematics 1,000 Visteon Sagem / Restraint Tyco Nokia Electronics Radar JV’s ,500 ,0 1997 '98 '99 2000 '01 '02 '03 '04 '05 '06 '07 '08 '09

  27. Slide 27: Autoliv Electronics: Close to Customers

    Autoliv Electronics Close to Customers Brake systems 22% Restraint Sales* Control $2,260 45% million Active Safety 33% 7,100 EMPLOYEES 3,200 ENGINEERS 31 OEM CUSTOMERS 20 FACILITIES in 10 countries of which 65% software and 7 new entry customers * Last Twelve month sales June 31, 2017 27 Copyright A

  28. Slide 28: Safety Electronics – Our Industry Firsts

    Customer trust Safety Electronics – Our Industry First’s* Mono FIR Sensor Fusion Regenerative Night Vision System FIR / NIR Night Vision System Braking System Active Safety and Braking 4 Corner Radar Short & Medium AEB And Pre-triggering Range Radar Radar and Mono Vision Passive Safety Pedestrian Wa

  29. Slide 29: One of the world's broadest safety electronics product range

    One of the world’s broadest safety electronics product range Brake systems Restraint Control Active Safety 29 Copyright Autoliv Inc., All Rights Reserved

  30. Slide 30: Autoliv Electronics – Market Shares 2016

    Autoliv Electronics – Market Shares 2016 RESTRAINT CONTROL SENSING ACTIVE SAFETY BRAKE CONTROL Autoliv 5% Autoliv Autoliv 26% 18% Others 30 Copyright Autoliv Inc., All Rights Reserved

  31. Slide 31: Customer trust

    Customer trust Our Passive Safety quality journey extends really well into Electronics All Safety Products Electronics Autoliv Autoliv 2% Electronics <1% ~ 170M ~ 32M recalled recalled since 2010 since 2010 Scope: Japan, Canada, US, China, South Korea, Australian, EU, UK, DE AB, SB, Electronics 31 2

  32. Slide 32: Robustness never more important

    Robustness never more important Electronics products needs Robustness at least as much as Passive Products Rarely Constantly Copyright Autoliv Inc., All Rights Reserved

  33. Slide 33: Electronics success factors – Technology, Innovation and Agility

    Electronics success factors - Technology, Innovation and Agility 33 Copyright Autoliv Inc., All Rights Reserved

  34. Slide 34: Electronics – a ~$43B Market in 2025

    Electronics – a ~$43B Market in 2025 ~10% CAGR 2017 to 2025 Electronics TAM* US$ (Billions) CAGR: ~10% 50 45 ~$43 40 35 ~$32 30 ~$28 25 ~$20 20 15 10 5 0 2017 2020 2022 2025 *) TAM (Total Addressable Market), CAGR (Compound Annual Growth Rate), **) Active Safety Market includes Radar (Front/side/rea

  35. Slide 35: Electronics – Market Trends and Growth Drivers

    Electronics – Market Trends and Growth Drivers Increasing levels of software in the future are required to enhance safety  Safety Market Growth ‒ AEB* Content per Vehicle $US ‒ Blind Spot 450 ‒ Lane Keep 400  Comfort and assistance 350 ‒ Traffic Sign Presentation 300 ‒ Road Surface detection 250 ‒

  36. Slide 36: Active Safety Sensor market

    Active Safety Sensor market CAGR: 23% Active Safety* US$ (millions) 25,000 20,000 15,000 Night Vision 10,000 ADAS ECU LiDAR Radar Systems 5,000 Vision Systems 0 2017 2018 2019 2020 2025 *) Active Safety Market includes Radar (Front/side/rear), Forward looking Cameras (Mono/Stereo/Night Vision, Other

  37. Slide 37: Electronics – Market Trends and Growth Drivers

    Electronics – Market Trends and Growth Drivers Increasing levels of software in the future are required to enhance safety Market Growth Content per Vehicle $ 250  Consumers are ready 200  Safety 150  Comfort and assistance  Convenience (AD) 100  Technology is ready 50 CPV AS* 0 2017 2018 2019 2

  38. Slide 38: Clusters for AD

    Clusters for AD 38 Copyright Autoliv Inc., All Rights Reserved

  39. Slide 39: The developing eco-system

    The developing eco-system Cloud Partner Sensors Actuators Decision & Control Sensor Fusion Partners Partner System Partner 39 Copyright Autoliv Inc., All Rights Reserved

  40. Slide 40: ZENUITY – the technology

    ZENUITY – the technology  World-class driver-assistance Concrete ADAS offer in production now More than 200 designed customer features  Self-driving technologies Complete, from raw sensor data to vehicle actuators Volvo Drive-Me as development platform Deep learning integration demonstrated Automo

  41. Slide 41: ZENUITY – the customers

    ZENUITY – the customers Ambition I N N O VAT I O N LEADERS AMBITIOUS& EMERGING FAST OEMS  Exciting business model FOLLOWERS  Impressed by feature offer FOLLOWERS  Legislation positive for ADAS Internal capability  Total system key for AD  ZENUITY media positioning  • SYSTEM OFFER  Followers,

  42. Slide 42: Technology Cooperations

    Technology Cooperations Recently announced LiDAR COMPUTING PLATFORM DRIVER MONITORING CLOUD SOLUTIONS Volume production of Collaborate on AI Collaboration to develop Zenuity are collaborating to automotive grade LiDAR computing platform driver monitoring systems develop Connected Cloud systems Compr

  43. Slide 43: Autoliv Electronics to expand Optics Competence

    Autoliv Electronics to expand Optics Competence 43 Copyright Autoliv Inc., All Rights Reserved

  44. Slide 44: Electronics Active Safety – Building for the long-term

    Electronics Active Safety – Building for the long-term OUR FOOTPRINT Recent JVs WITHIN THE PYRAMID Autonomous and M&A Driving Partners Automated Route Automated Route In-house 2013 (Trained) (Destination) Automated Automated City Automated Valet Evasive Highway Driving Driving Parking Maneuvers AEB

  45. Slide 45: Electronics Active Safety – Building for the long-term

    Electronics Active Safety – Building for the long-term OUR FOOTPRINT Recent JVs WITHIN THE PYRAMID Autonomous and M&A Driving Partners Automated Route Automated Route In-house TODAY (Trained) (Destination) Automated Automated City Automated Valet Evasive Highway Driving Driving Parking Maneuvers AEB

  46. Slide 46: Copyright Autoliv Inc., All Rights Reserved

    2013 2015 2017 46 Copyright Autoliv Inc., All Rights Reserved

  47. Slide 47: Active Safety – Customer snapshot

    Active Safety – Customer snapshot Customer RADAR VISION* ADAS ECU LIDAR Customer 1 2013 Customer 2 Customer 3 Customer 4 Customer 5 Customer 6 Customer 7 Customer 8 Represents >90% of global light Customer 9 vehicle production Customer 10 Customer 11 Customer 12 Awarded Customer 13 business Customer

  48. Slide 48: Active Safety – Customer snapshot

    Active Safety – Customer snapshot Customer RADAR VISION* ADAS ECU LIDAR 2017 Customer 1 Customer 2 YTD Customer 3 Customer 4 Customer 5 Customer 6 Customer 7 Customer 8 Represents >90% of global light Customer 9 vehicle production Customer 10 Customer 11 Customer 12 Awarded Customer 13 business Cust

  49. Slide 49: Active Safety - Selected Customer Launches

    Active Safety - Selected Customer Launches Vision Radar 24 GHz NB  Europe (SOP 2018)  Europe (SOP 2020)  Europe (SOP 2019)  Asia (SOP 2019)  Asia (SOP 2018)  North America (SOP 2019) ADAS ECU Radar 77GHz  Europe (SOP 2019)  Europe (SOP 2019)  Asia (SOP 2019) Night Vision  North America (SO

  50. Slide 50: Active Safety – Order Intake

    Active Safety – Order Intake Expect to increase sales beyond 2018 ALV Active Safety – Order Intake* US$ (Millions)  Due to a significant broadening of the 400 product offering and customer bid-list, order intake in 2016 increased substantially over previous years  Active Safety order intake in 201

  51. Slide 51: Autoliv Active Safety Sales Growth

    Autoliv Active Safety Sales Growth 2020 Sales target of >$1B Active Safety Sales – US$ Billion CAGR* ~23%  High market growth  Strong product offering 2025 Ambition  Strong bid-list presence ~2  Active Safety sales ~$4B  New order wins during 2016-17 0.74 0.75 >1 0.61 0.49 2014 2015 2016 LTM**

  52. Slide 52: Active Safety Revenue by OEM group

    Active Safety Revenue by OEM group 2022 Sales 2020 Sales LTM Sales ~$2 B >$1 B $0.75 B 52 Copyright Autoliv Inc., All Rights Reserved

  53. Slide 53: Electronics – Our Growth Outlook

    Electronics – Our Growth Outlook Expect to increase sales in all three sub-segments over the next 5 years ALV Electronics – Order Intake* US$ Millions 1,000  Due to a significant broadening of the product offering and customer bid-list, 800 order intake in 2016 increased substantially over previous

  54. Slide 54: Autoliv Electronics Sales Growth

    Autoliv Electronics Sales Growth 2020 Sales target of ~$3B corresponds to a ~10% CAGR from 2017 Electronics Sales – US$ Billion CAGR* ~15%  High market growth CAGR* ~10% 2025 Ambition  Strong product offering  Electronics sales >$6B  Strong bid-list presence LVP* ~4 >2%  Active Safety sales ~$4

  55. Slide 55: Autoliv Electronics – RD&E for investment to capture growth

    Autoliv Electronics – RD&E for investment to capture growth Engineering headcount has more than doubled since 2014 RD&E Headcount 3,500 Medium term profitability impacted by: 3,000  Continued high investments in new technology 2,500 to secure long-term success 2,000  Limited sales growth in 2018 d

  56. Slide 56: Targets Stand Alone Passive Safety and Electronics

    Targets Stand Alone Passive Safety and Electronics CMD 2017 – Target Update 2020 Target 2022 Target  Sales – at least hold market share and at least grow LVP plus Autoliv  Sales >$10B 1% Passive Safety  Adj. Operating margin* ~13%  Adj. Operating Margin* – at least maintain margins from 2020 lev

  57. Slide 57: More to Learn at CES 2018!

    More to Learn at CES 2018! 57 Copyright Autoliv Inc., All Rights Reserved

  58. Slide 58: Each year, Autoliv's products save over 30,000 lives

    Each year, Autoliv’s products save over 30,000 lives autoliv.com Internal

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