Investor Day 2012 Successfully facing new challenges
Transcript of Investor Day 2012 Successfully facing new challenges
London • November 12, 2012
Investor Day 2012
Successfully facing new challenges
Investor Day 2012 – London – November 12, 2012 2Prop
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November 2011 - November 2012
New European context with a very weak environment
Faurecia growing faster than expected in North America and Asia
Acceleration of Faurecia globalization
Validating our strategic priorities
New European context is impacting mid-term financial targets
Requiring additional action plan
New European context, same strategic priorities,additional action plan
Investor Day 2012 – London – November 12, 2012 3Prop
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IHS Automotive production forecast is now significantlylower than 12 months ago
New European context with very weak environment
Light vehicle production up to 3.5 tons – Source IHS Automotive
Light vehicle production in Europe (excl. Russia)
CAGR 2011-2016 :
+0.8%
CAGR 2011-2015 :
+2.8%
18.8
19.8
18.4
15.5
17.417.9
17.5
18.3
19.4
20.0
17.8
18.6
17.9
16.616.3
17.0
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
-12%
In million vehicles
IHS October 2011IHS October 2012
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Faurecia growing faster than expectedin North America and Asia
Product sales
Asia+14% like-for-like9M 2012 vs 9M 2011
North America+21% like-for-like9M 2012 vs 9M 2011
In € million
North America Accelerated rebound of automotive production Faurecia growing faster than expected thanks
to rapid expansion with VW, Ford, Nissan, Daimler and Commercial vehicles for Faurecia Emissions Control Technologies
Asia Slower growth in China but impacting
more the low end of the market than the core and luxury segments
In China, Faurecia continued to outperform automotive production by 5 pp.
Faurecia sales in China up 12% in 2011 and up 13% (like-for-like) after 9 months in 2012
Faurecia sales in Korea up 34% in 2011 and +8% (like-for-like) at end September 2012 thanks to continued development with Hyundai
2010
1,860
9M 2012
2,659
1,945
9M 2011
2,579
2011
+43%+33%
2011
790
9M 2012
9991,117
9M 2011
968
2010
+15%+26%
Investor Day 2012 – London – November 12, 2012 5Prop
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Acceleration of Faurecia's globalization
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20
59
2
9M 2011
57
27
510
1
9M 2012
Europe
North America
South America
AsiaOther
Europe After 9 months 2012, product sales in Europe are down 5% (like-for-like) and represented 57% of group total (versus 64% a year ago)
North AmericaAfter 9 months 2012, product sales are up 43% (21% like-for-like). The acquisition in June of the Ford Saline business (annual consolidated sales of approx $ 400m) is boosting the overall growthAt end of September 2012, product sales in North America represented 27% of group total or +7 points versus a year ago
AsiaAt the end of September 2012, product sales are up 26% (14% like-for-like) on the back of a strong organic growth and represented 10% of group total product sales
Product sales breakdown by region (in %)
19
59
9M 2010
66
1
Investor Day 2012 – London – November 12, 2012 6Prop
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3 6
1
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Keep our focus on 4 core businesses Operational performance as a strategic lever
Leverage globalization Technology leadership as a growth and profitability lever
Accelerate in Asia Be a cautious consolidator
Adequate growth and profit potential for all the 4 business groups
Leadership positions and worldwide coverage Technology leadership
Deliver worldwide to customers the same benchmark level of service in manufacturing and engineering
Keep optimizing the cost base to ensure competitiveness and profitability
Lead competition in global programs and global platforms management
Outperform market in BRIC countries Achieve scale in Russia and India Become a Top 5 supplier in North America
Environment and fuel efficiency solutions Breakthrough materials and processes Decoration, comfort, end-user interface and connectivity Targeted technology acquisitions
More than double sales in China Become fully local in all markets with state-of-the-art
R&D capabilities Build on worldwide expansion with targeted Asian OEMs Target € 3.4bn product sales in 2016 (over 25% CAGR 11-16)
Priority to organic growth Small to medium size acquisitions backed
by our customers
Validating our strategic priorities
Investor Day 2012 – London – November 12, 2012 7Prop
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Lower European market has 4 main impacts on our medium term milestones
With expected automotive production being cut by 12% for 2014, Faurecia Europe product sales have been significantly lowered
Delaying our above 5% Group operating margin until 2016 (versus 2014)
Significantly reduced production perspectives are requiring additional restructuring action
Impacting 2013-2014 free cash flow generation
November 2012 versus November 2011
Investor Day 2012 – London – November 12, 2012 8Prop
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Secure profitability in Europe in a weakenvironment with aggressive cost cutting
Rapidly increase profitability in North America
Keep a rapid growth pace and high profitability in Asia
Technology leadership momentumto grow our value content
2014 and 2016 profit, cash flow and debt targets
Action plan to converge on our mid-term financial targets
1
2
4
5
3
Investor Day 2012 – London – November 12, 2012 9Prop
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Secure profitability in Europe in a weakenvironment with aggressive cost cutting
Rapidly increase profitability in North America
Keep a rapid growth pace and high profitability in Asia
Technology leadership momentum to grow our value content
2014 and 2016 profit, cash flow and debt targets
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2
4
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Yann DelabrièreChairman & CEO
Yann DelabrièreChairman & CEO
Hervé GuyotEVP Strategy
Hervé GuyotEVP Strategy
Frank ImbertEVP CFO
Action plan to converge on our mid-term financial targets
Investor Day 2012 – London – November 12, 2012 10Prop
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Yann DelabrièreChairman & CEO
Secure profitability in Europe in a weakenvironment with aggressive cost cutting
Rapidly increase profitability in North America
Keep a rapid growth pace and high profitability in Asia
Technology leadership momentum to grow our value content
2014 and 2016 profit, cash flow and debt targets
Action plan to converge on our mid-term financial targets
Investor Day 2012 – London – November 12, 2012 11Prop
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Automotive production in Europe (excl. Russia)should stay weak
Additional 2-3% decline in light vehicle production in 2013
2011 level is now not expected to be reached again before 2015
2016 expected light vehicle production to be remain below 2006-2007 peak
1
Light vehicle production in Europe (excl. Russia)
CAGR 2011-2016 :
+0.8%
CAGR 2011-2015 :
+2.8%
18.8
19.8
18.4
15.5
17.417.9 17.5
18.3
19.4
20.0
17.8
18.6
17.9
16.616.3
17.0
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
-12%
In million vehicles
IHS October 2011IHS October 2012
Light vehicle production up to 3.5 tons – Source IHS Automotive
Investor Day 2012 – London – November 12, 2012 12Prop
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Secure profitability in Europe
Our client portfolio is a real asset: 50% German OEMs 40% Premium OEMs
Fixed cost base adjusted down by € 230m in 2009
Industrial footprint in Western Europe resized in 2008-2009
Europe is profitable, at group average in 2011 and 2012
1
Europe product sales by OEM
VWo/w Audi 19%
BMWPSA
Renault-Nissan
12%
Tata 2%GM 2%
OtherFiat-Chrysler 1%Geely-Volvo 3%
DaimlerPorsche 1%
H22012e
8%
20% 7%
33%
9%
2%
GermanOEMs50%
Ford
Investor Day 2012 – London – November 12, 2012 13Prop
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Faurecia sales in Europe (excl. Russia)expected flat between 2011 and 2016
Product sales in Europe are expected to:
Decline in 2012 (-4.9% like-for-likeat end of september 2012)and no rebound expected in 2013
Gradually recover to 2011 level from 2014 onwards
1
Faurecia Europe (excl. Russia) product sales
7.7
2011 2016
7.6
In € billion
Investor Day 2012 – London – November 12, 2012 14Prop
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Western Europe industrial footprint adjustment Group restructuring charges expected to reach € 100m in 2012
including 1,500 headcounts reduction in Western Europe Group restructuring charges expected to reach € 90m in 2013
Adjusting further the cost base in Western Europe1
Fixed costs base in Europe to be reducedby € 50m in 2013 and € 100m in 2014
Investor Day 2012 – London – November 12, 2012 15Prop
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Managing the cost base through additional extensionof the Eastern Europe footprint
7 new manufacturing sites added in Eastern Europe between 2012 and 2014
Poland LegnicaGorzow II
Czech Republic Mlada BoleslavPilsen
Romania Râmnicu VâlceaCraiova
LCC direct headcounts targeted to increase from 39% to 55% of total European (excl. Russia) direct headcounts
Direct headcounts Europe (excl. Russia)
2011 2016
LCC
HCC
39% 55%
61% 45%
1
Eastern Europe footprint extensionPoland
Romania
CzechRepublic
FASFECTFIS
Craiova
Legnica
Gorzow
Râmnicu Vâlcea
Mlada BoleslavPilsen
Investor Day 2012 – London – November 12, 2012 16Prop
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Faurecia's growth in Russia is based onglobal customers and programs
Automotive market Russian automotive production is expected to grow
from 1.9m units in 2011 to 2.4m units in 2016 Localization of components accelerated by tax
incentives. Decree 166 requires OEMs to achieve 60% local contents within 6 years
Overall Tier-1 auto components sector is expected to grow much faster than the OEM market
OEMs strategy Russian OEM industry now well structured
through consolidation Renault-Nissan partnership with AvtoVAZ consolidated
with the launch of the new entry platform and introduction of Renault, Nissan and AvtoVAZ vehicles
Ford in St Petersburg and Ford-Sollers JV areexpanding fast with 4 production facilities
VW partnership with GAZ in Nizhny Novgorod in addition to its Kaluga base
Russia light vehicle production
1
CAGR+5%
1.9
2.4
2011 2016
In million units
Up to 3.5 tons – Source IHS Automotive – October 2012
Investor Day 2012 – London – November 12, 2012 17Prop
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Faurecia's growth in Russia is based onglobal customers and programs
Rapid development with Renault/Nissan/AvtoVAZ
in Togliatti are fully deployed and are key suppliers to Renault/Nissan/AvtoVAZ.
is already supplying Avtoframos and expanding through partnershipwith Avto component
in St Petersburg is also localized for Nissan programs
1
2011 2016
Faurecia product sales
Luga
St Petersburg
TogliattiKaluga
Moscow
FASFECTFIS
400
46
CAGR+54%
In € million
. Expansion with both Ford in St Petersburg
and with Ford-Sollers JV Business development with VW and PSA in Kaluga
and with GM in St Petersburg 10 manufacturing sites already covering
the key automotive regions
Investor Day 2012 – London – November 12, 2012 18Prop
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European automotive production slowdown is expected to reduce Faurecia Europe operating margin by 1.5 point
Action plan to regain 1.0 point operatingmargin in Europe in a slowly recovering market
Western European footprint adjustment
Higher Eastern Europe content
Fixed costs reduction
Growth in Russia
Product sales in global Europe reaching € 8.0bn and to secure European profitability
Global Europe product sales
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In € billion
2016
8.0
2011
7.8CAGR+0.5%
Sales roadmap Profitability roadmap
Investor Day 2012 – London – November 12, 2012 19Prop
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Yann DelabrièreChairman & CEO
Secure profitability in Europe in a weakenvironment with aggressive cost cutting
Rapidly increase profitability in North America
Keep a rapid growth pace and high profitability in Asia
Technology leadership momentum to grow our value content
2014 and 2016 profit, cash flow and debt targets
Action plan to converge on our mid-term financial targets
Investor Day 2012 – London – November 12, 2012 20Prop
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Faurecia in North America is to become ranked # 6
North America product sales Very rapid growth in 2011 (+33%) and 2012e (+42%)
Ford Saline acquisition is an additional booster with $ 400m annual consolidated revenues
Has pushed Faurecia to become the 6th largest automotive component supplier in North America
North America now accounting for over 25% of Faurecia’s global sales
Faurecia customer base reinforced and broadened through: Expansion with Ford through organic growth and Saline
acquisition from € 370m in 2010 to € 850m in 2012e Expansion with Nissan from € 13m in 2010
to € 240m in 2012e Expansion with Daimler from zero to € 230m in 2012e Expansion with VW in Mexico and Chattanooga (TN)
( +25% in 2011 and +70% in 2012e) Commercial vehicles from zero to € 90m in 2012e
North America product sales by OEM
Ford
GM
Chrysler
BMW
DaimlerVW
Cummins 2% Other 4%
23%
21%
20%
11%
7%Nissan6%
6%
2
2012e
2009 2010 2011 2012e2008
3.7
2.61.9
0.91.5
In € billion
+42%
Investor Day 2012 – London – November 12, 2012 21Prop
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Market leader in passenger cars emissions control with a market share of 33%
Technology leadership confirmed Development of the commercial vehicles
business with Cummins
Faurecia Business Groups have reinforced their strategic position in North America
North America product sales breakdown
2
Positioned as market leader with a market share of 27% in cockpits after the acquisition of Ford Saline business
Leading position in premium vehicles
Has achieved a breakthrough from challenger to main player
Daimler business launched in 2011 and sole supplier of Mercedes-Benz M-Class, G-Class and R-Class
Nissan Smyrna (TN) supply, launch of new Altimaand new development planned for Nissan Mexico
34%
32%
31%
3%
2012e
Investor Day 2012 – London – November 12, 2012 22Prop
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Belvidere
FASFECTFIS
FAE
BradfordLansing
Sterling Heights
Fountain InnSpartanburg
TuscaloosaArlington
Cottondale
Chattanooga
Cleveland
Madison
Dexter
Louisville
ColumbusRiverside
Rapid expansion of the manufacturing footprint 15 new sites in 2011 and 2012
2
Hermosillo
Ramos ArizpeSan Luis Potosi
SilaoQueretaro
Puebla
Mexico
Sizeable footprint expansion in 2011 and 2012 with 15 sites added
Region is now fully covered Low cost base is significant
with 43% of the direct workforce in 2011 38 manufacturing sites in 2012
10 manufacturing sites (components)US + Canada 28 manufacturing sites (14 components / 14 JIT)
FASFECTFISFAE
Saline Fraser
FranklinToledo
Taylor
Troy
Investor Day 2012 – London – November 12, 2012 23Prop
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Development with Ford and GM on global programs and premium products (Cadillac) for Faurecia Automotive Seating
Development with Nissan and Hyundai with sales expected to reach € 380m in 2016
Commercial vehicles product salesto account for € 210m by 2016
Development with VW/Audi thanks to OEM expansion and global programs
Product sales expected to reach€ 4.3bn in 2016 or 11% CAGR 2011-2016
Faurecia expects to continue to expand its business in North America
North America product sales
2011 2016
2
CAGR+11%
2.64.3
In € billion
Investor Day 2012 – London – November 12, 2012 24Prop
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Only 5 new JIT sites between 2013 and 20162
After a phase of rapid expansion, only 5 new JIT sites to be added between 2013 and 2016, 3 JIT in the US and 2 JIT sites in Mexico
Industrial focus will shift from new footprint launch to industrial efficiency
44 sites in North America in 2016
Mexico + 2 JIT sites
Ramos Arizpe
Cuernavaca
FAS
US + Canada + 3 JIT sites
Detroit
Wentzville
Louisville
FAS
Investor Day 2012 – London – November 12, 2012 25Prop
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North America profitability to rapidly improve: Finalization of the Emcon integration Stabilization of the manufacturing footprint
in North America after 15 new manufacturing sites opened in 2011 - 2012
Fixed costs stabilization after a high number of new programs launches
Synergies expected from revenue growth Leverage further the low cost base
Faurecia is targeting a fast improvement of its North American profitability
North America direct labor
LCC
HCC
2011 2016
43% 54%
57% 46%
2
Investor Day 2012 – London – November 12, 2012 26Prop
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North America 2016 financial targets2
Profitability to rapidly increase to 5.0% operating margin Manufacturing footprint stabilization Fixed costs stabilization Leverage further the Mexican
cost base
Sales roadmap Profitability roadmap
2011 2016
CAGR+11%
2.64.3
In € billion
North America product sales
Investor Day 2012 – London – November 12, 2012 27Prop
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3 Hervé GuyotEVP Strategy
Secure profitability in Europe in a weakenvironment with aggressive cost cutting
Rapidly increase profitability in North America
Keep a rapid growth pace and high profitability in Asia
Technology leadership momentum to grow our value content
2014 and 2016 profit, cash flow and debt targets
Action plan to converge on our mid-term financial targets
Investor Day 2012 – London – November 12, 2012 28Prop
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China: CAGR 11-16: 9% Excellent mid-term prospects
(volume & value) Favorable mix trend with growth
in medium and high segments above average
World’s largest commercial vehicle market
Japan Temporary recovery after
Fukushima disaster in 2011 Globalization is pushing Japanese
OEMs to expand production abroad
Asean: CAGR 11-16: 11% Thailand is becoming a major hub
for automotive production in Asia Indonesian market expected to grow fast
India: CAGR 11-16: 10% Automotive market growth
is expected to remain strong Average value to increase
but will remain very low Very large commercial vehicle market
South Korea Hyundai-Kia are increasing global market
share though footprint globalization Auto production in Korea expected
to remain broadly stable
Asia remains a key driver for automotive market expansion
Light vehicle production in Asia
Other Asian Countries**ASEAN*South KoreaJapanIndiaChina
15.8
3.5
7.7
4.62.80.7
2011
35.1
24.5
5.7
8.1
4.34.7
1.0
2016
48.3
3
In million units
*ASEAN : Indonesia, Malaysia, Philippines, Thailand, Vietnam** Other Asian Countries : Australia, Pakistan, Taiwan Light vehicle production up to 3.5 tons – Source IHS Automotive – October 2012
CAGR+7%
Investor Day 2012 – London – November 12, 2012 29Prop
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Key drivers of the Chinese market are favorable for Faurecia
New emission regulations to be introduced
2009 2010 2011 2012 2013 2014 2015 2016
Euro 3 Euro 4 Euro 5
3
Source: IHS Automotive, October 2012
Light vehicle production in million units
Premium segment to continue to grow faster than market Overall mix to improve further International OEMs are expected to maintain their leadership and few Chinese OEMs
may emerge as key players Emissions standard are converging with European ones offering huge opportunities to Faurecia
Emissions Control Technologies business for both passenger cars and commercial vehicles
CAGR (11-16)
LCVAB
C
DE+
MPV/SUV
20162011
15.8
24.5
8%
9%
6%
6%
5%
18%11%
22%4%10%
35%
12%2%15%
18%3%9%
35%
11%2%
21%CAGR+9%
Investor Day 2012 – London – November 12, 2012 30Prop
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Faurecia has already a solid presence in China3
Total sales
2009 2010 2011 2012e
1.01.2
+25%
In € billion
Ford
PSA
VW
HyundaiOthers
Nissan
GM
2011
Total sales by OEM
0.6
1.5
Industrial footprint
Changchun
Shenyang
Lanzhou
ChengduChongqing Wuhan
Lanzhou
Huadu
YantaiQingdao
ShanghaiWuxi Jinan YanchengBeilun Cixi Nanjing
Southwest Central North
Northeast
East
SouthFASFECTFISFAE
Investor Day 2012 – London – November 12, 2012 31Prop
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A fully owned R&D assets
R&D Strategy
R&D headcounts
Fully owned R&D centers in Shanghai integrated in the global Faurecia network and regional footprints for programs deployment
Strong local teams with a very large range of skills, able to realize complete local developments
Industrial style as differentiation factor
Innovation capabilities localized in China400
1,200
2011 2016
3
New Tech Centers in Shanghai
opened in 2011 opening in 2013
Investor Day 2012 – London – November 12, 2012 32Prop
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Emissions control market for light vehicle expected to grow faster than automotive production thanks to the convergence with European norms (13% CAGR 11-16)
Market share 2011 2016Passenger cars 25% 27%
Market share in light vehicle to increase slightly from 25% to 27% Strong portfolio of western OEMs
(top 3 customers: VW, PSA, GM) Development with Chinese OEMs:
Geely, Chery, FAW, SAIC Commercial vehicles business to reach € 60m in 2016
Market share 2011 2016Mechanisms 15% 20%Frames 20% 20%
Market share 2011 2016Passengers cars 4% 10%
JV with ChangAn under final discussion for Ford and PSA new businesses
Selected development with chinese OEMs:Faurecia-Geely JV for Geely – Volvo programs
Faurecia growth strategy in China3
Faurecia to double its market share in complete seats Nissan, PSA and BMW VW as a new customer Premium vehicles
Faurecia leading position in mechanisms and frames Global platform deployment with VW, Nissan, PSA, GM Mechanisms localization and vertical integration Overall globalization
Market share 2011 2016Complete seats 5% 10%
Follow our key customers in their worldwide programs.Existing business with: Ford VW PSA
Investor Day 2012 – London – November 12, 2012 33Prop
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Faurecia in China in 20163
China product salesin € billion
0.9
2.6
20162011
CAGR+24%
20162011
30
55
To support growth 25 new manufacturing sites to be added by 2016 or a total of 55 manufacturing sites
To continue to grow 15 pointsfaster than automotive production
China manufacturing sites
Investor Day 2012 – London – November 12, 2012 34Prop
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Competitive developments in India and Thailand
To supply Ford, Renault-Nissan, Hyundai and VW Opportunities in commercial vehicles New development center in Pune
working for worldwide programs (600 engineers)
3
2011 2016
54
250
India product salesIn € million
2011 2016
18
140
Thailand product salesIn € million
IndiaTo accompany key customers with optimized and limited investment and leverage a very efficient and low cost D&D base
Expanding interior systems business (Nissan, Ford) Expanding in emissions control (Ford, GM)
ThailandTo follow OEMs as it is becoming a major production hub for Ford, GM and Nissan
CAGR+36%
CAGR+51%
Investor Day 2012 – London – November 12, 2012 35Prop
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Worldwide business expansion with Nissan and Hyundai
Nissan already represents 3.5% of Faurecia product sales Faurecia nominated Alliance Growth Partner Strategic partnership with NHK Spring in automotive seating
for Nissan leading to rapid development in North America, Brazil, Russia, China and Europe
Partnership with Howa Textile for Interior systems
3
2011 2016
345
1,000In € million
CAGR+24%
Product sales with
Hyundai-Kia: strong emissions control business and opportunities in other activities
Strategic development with Nissan and strong growth through the Alliance and agreements with Nissan's suppliers
Emissions control: € 200m product sales targeted in 2016, already 24% market share
Technology and business opportunities with other business group
2011 2016
171300
In € million
CAGR+12%
Product sales with
Investor Day 2012 – London – November 12, 2012 36Prop
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Sustained and profitable growth in Asia
China Continue strong strategic development in world’s largest auto market Japan & Korea Be a partner of Japanese & Korean OEMs in their globalization India Follow key customers with limited investment and expand the low cost D&D base Thailand To accompany strategic customers
Roadmap & objectives
Product sales to reach€ 3.4bn by 2016
Profitability to stay significantlyabove group average
Asia product sales
Faurecia in Asia
1.1
2011
3.4
2016
3
CAGR+25%
In € billion
Investor Day 2012 – London – November 12, 2012 37Prop
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Hervé GuyotEVP Strategy
Secure profitability in Europe in a weakenvironment with aggressive cost cutting
Rapidly increase profitability in North America
Keep a rapid growth pace and high profitability in Asia
Technology leadership momentum to grow our value content
2014 and 2016 profit, cash flow and debt targets
Action plan to converge on our mid-term financial targets
Investor Day 2012 – London – November 12, 2012 38Prop
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Faurecia technology strategy is based on 4 pillars
Faurecia product offer
4
Faurecia Innovation key drivers
CO2 and fuel consumption reduction
60 kg weight saving equivalent to 6 g/km CO2 reduction 40 kg additional savings with composite solutions Energy recovery solutions
Emissions regulation NOx reduction for passenger cars Commercial vehicles business development
Attractiveness for the end user Premium decoration Electronics integration to add new functions and value content
Platform solutions Generics solutions Product and process standardization
Investor Day 2012 – London – November 12, 2012 39Prop
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Faurecia lightweight solutions
Gain of induction brazing on an European B-Segment car
13.3 kg 8.8 kg (- 33%)
4
5.94.8
0.35(7%)
1.5(25%)
2012 2016Lightweight
Regular
€ 0.2bn € 0.9bn
Faurecia market share of lightweight market and product sales
Worldwide Market for Cold EndIn € billion
Thickness reduction from 1.2 to 0.8 mm
Gain of on an American C-Segment car
Chevrolet Cruze1.4L gasoline turbo
Ford B-Max
60%57%
2012 2016
Source: Faurecia
29 L
15.5 kg 9.0 kg (- 42%)
19 L (- 34%)
Reduction of interfaces overlap
Muffler size reduction
Over 10 kg saved with induction brazing & adaptive valves
CAGR46%
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Faurecia lightweight solutions
40% weight reduction (11 kg per car) with new generation of frames
- 40% weight reduction, based on major materials,
product concept and industrial processes
innovationBMW Mini VW Up!
High Strength Steel Laser welding Material hybridation
4
OEM 1OEM 1
Global & Modular
Previous Front Seat Structure - Metal
Global & Modular IMetal
2007 20162011
2016Global & Modular II
Metal/Hybrid
of Front Seat Next generation Structures M0
OEM 2OEM 2
OEM 3OEM 3
OEM 1OEM 1
OEM 2OEM 2
OEM 3OEM 3
Prod. Dev.
FaureciaElectronics
Inside
FaureciaElectronics
Inside
FaureciaElectronics
Inside
15.0 kg 11.5 kg 9.5 kg
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Cellular polypropylene instrument panel carrier
Injected natural fiber door panel
Faurecia lightweight solutions
Wood fiber door panel
Thin slush skin
"Lightweight concept”acoustic package
Ford Kuga
PEUGEOT 208
Mercedes-Benz SL
2013 Global C Segment Car
2013 Premium Sedan(Germany)
Synthetic premium skin
2013 Luxury SUV(USA)
2013 European C Segment Car
4
- 20%
- 20%
- 40%
- 20%
- 15%
- 60%
Up to 22 kg weight reduction in car interior with new technologies & materials
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Composite chassisUp to 5 000 vehicle / year
Mass market
> 50 000 vehicles / year
Structural Thermoplastic Front
End Carrier
Faurecia lightweight solutions
-20% weight reduction, based on major materials,
product concept and industrial processes
innovation
Composite hybrid body panels
Thermoplastic - RTM
SMC, RTM, RIM,…
Injection molding
Carbon fiberBody panels
Automotive Composite
4
Structural thermoset Composite chassis Composite body parts Thermoset body parts Thermoplastic body parts
Target: - 35 kg(C-Segment sedan)
- 15 kg
Complete composite technologies and preparingfuture light weight solutions
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Faurecia market share of the heat recovery market
and product sales
Acting as working temperature optimizer or direct power supply to the powertrain, heat recovery systems are key contributors to Hybrids overall efficiency.Faurecia is aiming at 20% market share in 2016 and targeting 25% by 2020.
State-of-the-art solutions to addressnew energy recovery market
25 %Traction
40 %Exhaust
Heat
35 %Friction
2012: Serial production on FORD C-Max Hybrid
Heat recovery marketHeat to Power (H2P)
Medium term
Heat to Heat (H2H)
Hybrid engines, Diesel engines
4
In € million
20%
€ 30m
2016
€ 75m
25%
2020
Hybrid engines, Diesel engines
40% of the energy createdby the internal combustion
engine is wasted in exhaust heat
Direct positive impact on homologation CO2 test levels (NEDC, WLTP,…).
Source: Faurecia
Energy recovery technologies reduce fuel consumption
150
2016
300
H2P
180
2020
H2H H2H
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Faurecia NOx treatment breakthrough
BlueBox: A close coupled architecture providing a complete SCR system within the packaging of a conventional Diesel Oxidation Catalyst
4
SCR world marketIn € million
Diesel oxidation catalyst (DOC)
Urea injector
Urea mixing device
SCR catalyst or SCRF (SCR coated DPF)
ConventionalLayoutClosed coupled -
BlueBox
Proximity to engine (close coupling)
Earlier catalyst activation, better NOx treatment Reduction of catalyst cost
Compact packaging Easier installation in vehicle Weight saving Reduced complexity
425
2011 2016
110ClosecoupledSCR100%
35%
65%
Conventional SCR
Faurecia market share
CAGR+31 %
BlueBox10 contracts pending in 2013
Faurecia expertise in system design and manufacturing are key assets to meet the technical challenges imposed by close coupled SCR. With BlueBox, Faurecia is aiming at 40% of the close coupled market by 2016.
2011 2016
Source: Faurecia
Faurecia BlueBox allows a faster & better treatment of NOx, weight saving and cost optimization
12 % ofConventionalSCR
40% of Closecoupled SCR
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Major position in theCommercial Vehicles Engines (CVE) market
DOC/DPF systemsfor Euro VI
Thermal regenerators
Selective Catalytic Reduction systems
Off Highway On Highway
Truck
Off road
Complete CVE product offering
After-Treatment engineering and manufacturing
World leader in medium-to-heavy duty on and off-road diesel engines
More than 1m engines produced in 2012
Strong positions in North & South America,India and China
System integrationMarketing and sales
CVE product salesIn € million
4
20162011
425
150
CAGR + 23 %
Source: Faurecia
Partnership Faurecia-Cummins
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Generating more value with interior decoration
Aluminum surfacesAcquisition of Angell-Demmelcompleted in 201160% market share on Premium market
Large wood surfacesProprietary technology for 3D shaping of large wood surfaces
FilmsExclusive partnership established with
Decoration Product Line at € 320m product sales
by 2016
2011 2016
50
320
4
Decoration product line salesIn € million
CAGR + 45 %
Faurecia masters all decoration technologies
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Opening of the new electronic lab in Brières (France)on October 3rd 2012
Appropriate time to market Modular architecture
with integration of the latest standards
Connectivity to central electronic architecture but not competing with core electronics
Developing electronics technologiesfor Automotive Seating
Modular & decentralized CPU architecture
Heatingcontrol Unit
Ventilation control Unit
Pneumatic control Unit
State of the art standardized actuators
Brushless motor
Self powered seat mechanism
Rare Earth - freeGear motors
4
Deployment through internal and external innovation
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Innovation in new end-user functions, increasing the value to the end customer
Electronic integration adding new functionalities associated with attractive style and perceived quality
Easy integration into existing products
Enhancing product function & value content
Enhanced Life On Board
SmartFitTM high end customized featuresCushion Massage Adjustable Firmness
New gen Climate SeatBack Adv. Massage New gen pneumatics
Soft Adjustments
4
Tailor Fit Back Fit GPS FitSmart
Fit
Growing demand for smart andhigh perceived quality functions
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Standard solutions for seat frame platforms
Faurecia generic seat frames design
Apollo Dragon
High to medium specifications Optimized weight Laser welding
Low to medium specifications Mono or bi-recliner Magnetic welding
(*) per year in 2016
OEMbenefits
Lower development cost Improved yield Competitive cost Shorter time to market
4
625 000B & CApollo
Apollo
Apollo
Apollo
Apollo - Dragon
Apollo - Dragon
Generic
D& E
Truck
B, C, D
C, D & Entry
B,C & Entry
Segments
1 900 000American
2 050 000American
4 450 000German
1 550 000French
2 700 000Asian / European
Car sets*OEM
German Premium
Standard jig & tool
Standard equipment
Standard workstation
Faurecia generic seat process
Standard layout
Standard process
Standard design
Standard process to reduce Capex and reach full use of industrial capacity
Standardized process Higher flexibility Full use of industrial capacity Lower Capex Leverage on material purchasing
Faureciabenefits
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Technology leadership to grow our value content
Short term CO2 and fuel consumption reduction with lightweight solutions
and energy recovery systems Emissions regulations with NOx reduction solutions for passenger cars (BlueBox)
and complete product offering for commercial vehicles Attractiveness for end user with premium decoration and electronics integration Platform solutions with generics solutions and product and process standardization
Medium term CO2 reduction to 95g in 2020 in Europe Structural composites Pollutants for Euro 7
4
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1
2
4
5
3
Frank ImbertEVP CFO
Secure profitability in Europe in a weakenvironment with aggressive cost cutting
Rapidly increase profitability in North America
Keep a rapid growth pace and high profitability in Asia
Technology leadership momentum to grow our value content
2014 and 2016 profit, cash flow and debt targets
Action plan to converge on our mid-term financial targets
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Rapid growth at +6/7% p.a.to reach € 22 billion total sales in 2016
Faurecia salesIn € billion
2011
12.4
2016
17.0CAGR +7%
5
Faurecia outside Europe product sales In € billion
CAGR 14%
Europe (incl. Russia) product sales
7.8 8.0
In € billion
2011 2016
2011 2016
2011
16.2
2016
22.0CAGR +6%
4.6
9.0
Product salesTotal sales
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50%37% 55%
Out of Europe sales to represent 55% of our product sales by 2016
5
Product sales by region
Europe to decline in relative value from 63% to 45% due sales stability in this region North America to grow to 25%, stabilizing after a strong growth period in recent years Asia to keep growing steadily doubling from 9% to 20%, through China, India and Thailand South America will grow from 6% to 8%
Europe (excl. Russia) North America Asia RoW
21%
9%
63%
7%
27%
15%
50%
8%
45%
25%
20%
10%
2011 2014 2016
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Faurecia targets over 5.0% operating marginby 2016
Around 4.0%
2014 2016
> 5.0%
Operating margin Profitability roadmap
5
As % of total sales
Europe European automotive production slowdown
is expected to reduce Faurecia Europe operating margin by 1.5 point Action plan to adapt costs and additional restructuring will allow
to regain 1.0 point profitability
North America Fixed costs will stabilize after a phase of very rapid expansion Low cost footprint will help to leverage profitability Profitability to rapidly increase to 5.0% operating margin
Asia Will keep a high level of profitability thanks to a steady growth
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Profit generated outside out of Europewill represent 2/3 by 2016
5
Out of Europe
Europe64%36% Europe
64%36%
Out of Europe
Operating profit by region
2011 2016
Profit generated out of Europe will grow from 36% to 64% of total profit
Investor Day 2012 – London – November 12, 2012 57Prop
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Cap Capex at present level withselective approach of new contracts
Business selectivity Focus on strategic regions:
Asia, North America Focus on strategic OEMs Footprint extension limited to Asia
Cap upfront investments Seek limited capex and development costs
and/or obtain pre-financing
Manage tendering portfolio Strict limit on overall 2013-2014
spending on Capex + Capitalized R&DCapex capped below € 550m
5
Selective approach Capex
0
100
200
300
400
500
600
2011 2012 2013 2014 2015 2016
€ 550m
In € million
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Positive free cash flow from 20145
Capex coverage by depreciation
Capex Depreciation
In € million
0
100
200
300
400
500
600
2011 2012 2013 2014 2015 2016
€ 550m
Cash flow roadmap
2013 cash flow will be impacted by restructuring spending
Balanced cash flow in 2014 targeted
From 2014, free cash flow to grow thanks to:
Operating income growth (+60% between 2011 and 2016)
Depreciation and amortization growth(+70% between 2011 and 2016)
Capex coverage to reach 87% by 2016
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Targeting Net Debt / EBITDA 0.5x in 20165
Net Debt / EBITDA
June 2012 2014 2016
1.4
1.3
0.5
In x
Net debt reduction
Positive free cash flow from 2014 onwards
Operating margin improvement
Higher depreciation and amortization
EBITDA improvement
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Liquidity secured by long term financing5
Initial maturity
Maturityextended
0
0.5
1.0
1.5
2.0
2013 2014 2015 2016 2017 2018 2019
3-yeartranche
Available long-term financial resources € 3.1bn long term financing secured
Syndicated banking credit facility 1,150 Bonds 740 Convertible bonds 460 Medium term banking facilities 250 Factoring programs 500Total 3,100
Average maturity of bonds and banking credit of 4.2 years
No major refinancing before 2016
In € billion In € million
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Total sales € 16 billion € 22 billion
Operating margin 4.0% above 5.0%
Net debt / EBITDA 1.1x 0.5x
Faurecia 2016 vision 5
2011Actual
2016Target
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Contact & Share data
Investor Relations
Eric-Alain Michelis2, rue Hennape92735 NanterreFrance
Tel: +33 1 72 36 75 70Fax: +33 1 72 36 70 30E-mail: [email protected] site: www.faurecia.com
Share DataBloomberg Ticker: EO:FPReuters Ticker: EPED.PADatastream: F:BERTISIN Code: FR0000121147
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Safe Habor Statement
This report contains statements that are not historical facts but rather forward-looking statements. The words "will," "may," "designed to," "outlook," "believes," "should," "anticipates," "plans," "expects," "intends," "estimates" and similar expressions identify these forward-looking statements. All such statements are based upon our current expectations and various assumptions, and apply only as of the date of this report.
Our expectations and beliefs are expressed in good faith and we believe there is a reasonable basis for them.
However, there can be no assurance that forward-looking statements will materialize or prove to be correct. Because such statements involve risks and uncertainties such as automotive vehicle production levels, mix and schedules, financial distress of key customers, energy prices, raw material prices, the strength of the European or other economies, currency exchange rates, cancellation of or changes to commercial contracts, liquidity, the ability to execute on restructuring actions according to anticipated timelines and costs, the outcome could differ materially from those set out in the statements.
Except for our ongoing obligation to disclose information under law, we undertake no obligation to update publicity any forward-looking statements whether as a result of new information or future events.
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