AUTO INDUSTRY 2020 AND BEYOND

DON WALKER CEO

Topics for Today

• CAPC

• USMCA

• BCC

• Global Automotive Industry

Competitiveness Innovation Talent Investment

Priorities

CAPC VISIONTo be the location of choice for automotive manufacturing within North America, driven by an environment that is globally competitive, promotes research and innovation, and develops the people, skills and technology necessary to succeed today and in the future.

Competitiveness

Manufacturing Competitiveness Dean Stoneley, Ford

Regulatory Efficiencies Dean Stoneley, Ford Frank Voss, Toyota

Borders and Infrastructure Reid Bigland, Fiat Chrysler Jerry Dias, Unifor

Innovation

Advanced Manufacturing and Productivity Improvements

Linda Hasenfratz, Linamar

Next Generation Technologies Scott Bell, General Motors

Talent Talent Attraction and Skills Development

Bob Magee, Woodbridge

Investment Investment Attraction Flavio Volpe, APMARob Wildeboer, Martinrea

CAPC Committee

5

1

2

Strengthening the

Investment Climate

3 Focusing on Talent

Harmonizing Environmental

Policies

Common Themes

USMCA/CUSMA

• Two Years in the Making

• Importance of Auto (Jobs, Investment, Innovation)

• US Objectives (Assembly Plants, Balanced, Level Playing Field)

• Canada Needs to Sign

• Auto Details Being Worked on

Reginal Value Content (RVC)

• 60% up to 75%

• Core Parts 75% by the End of Year Four

• Principal 70%

• Complimentary 65%

Labour Value Content (LVC)

• $16 US/Hour

• Define “Direct Production Worker”

• Define what is included

Uniform Regulation• How to Calculate

• RVC, LVC, Steel/Aluminum Content

• Timing

Industry Trends

• Electrification

• ADAS

• New Mobility

• Data

ADAS Penetration Rates

LARGEST GROWTH

L1-L3

Source: Internal Magna Q4 2019 Estimated

10%

21%

39%

21%

7% 2%

Level 0 Level 1 Level 2 Level 3 Level 4 Level 5

2030

Powertrain Electrification

ICE Micro hybrid Mild hybrid PHEV / HEV EV

17-19%28-29%

10-15%

26-29%11-17%

2030

ESTIMATED VEHICLES

WITH ELECTRFIED

POWERTRAIN IN 2030

70M

Source: Internal Magna

Sustainability

• Industry Perception

• Focus Areas -- Products & Manufacturing

• Greener Initiatives

– Water & Energy Conservation

– Emission Controls

– Waste Management

Business Council of Canada

• Reduce Regulations

• Significant Infrastructure Projects

• Simplify the Tax System

• Re-examine Foreign Policy

• Increase Immigration

• Develop National Resource & Climate Strategy

Vision for Canada

• Economic Strategy

• Education

• Health care

• Taxation

• Innovation