1. © 2013 J.D. Power & Associates, The McGraw-Hill Companies, Inc. All Rights Reserved. J.D. POWER & ASSOCIATES PROPRIETARY AND CONFIDENTIAL—FOR INTERNAL USE ONLY Using Connectivity to Find Happiness Mike VanNieuwkuyk Executive Director, Global Automotive J.D. Power & Associates Wards Interior Conference May 22, 2013

2. 2 © 2013 J.D. Power & Associates, The McGraw-Hill Companies, Inc. All Rights Reserved. J.D. POWER & ASSOCIATES PROPRIETARY AND CONFIDENTIAL—FOR INTERNAL USE ONLY Importance of New Vehicle Technology

3. 3 © 2013 J.D. Power & Associates, The McGraw-Hill Companies, Inc. All Rights Reserved. J.D. POWER & ASSOCIATES PROPRIETARY AND CONFIDENTIAL—FOR INTERNAL USE ONLY Most Important Factor in Choosing Your Make/Model Automotive Emerging Technology Purchase factors with a 3 percentage point or more increase from 2008 to 2012 Advanced Technology Playing Larger Role in Vehicle Selection Source: J.D. Power & Associates Initial Quality Study (IQS) (2008-2012)

4. 4 © 2013 J.D. Power & Associates, The McGraw-Hill Companies, Inc. All Rights Reserved. J.D. POWER & ASSOCIATES PROPRIETARY AND CONFIDENTIAL—FOR INTERNAL USE ONLY Market Trends

5. 5 © 2013 J.D. Power & Associates, The McGraw-Hill Companies, Inc. All Rights Reserved. J.D. POWER & ASSOCIATES PROPRIETARY AND CONFIDENTIAL—FOR INTERNAL USE ONLY Total Sales In Millions Retail Sales In Millions Sources: J.D. Power & Associates and LMC Automotive, February 2013 U.S. Light Vehicle Sales: Steady and Healthy

6. 6 © 2013 J.D. Power & Associates, The McGraw-Hill Companies, Inc. All Rights Reserved. J.D. POWER & ASSOCIATES PROPRIETARY AND CONFIDENTIAL—FOR INTERNAL USE ONLY Models New minus Drops(3)(20)(1)(11)91414 Redesign19242122364647 Facelift 41332643434038 Sources: J.D. Power & Associates and LMC Automotive, February 2013 U.S. Model Activity: More Choices, Improved Choices Increase in New and Refreshed Products

7. 7 © 2013 J.D. Power & Associates, The McGraw-Hill Companies, Inc. All Rights Reserved. J.D. POWER & ASSOCIATES PROPRIETARY AND CONFIDENTIAL—FOR INTERNAL USE ONLY Quality Equality Quality gap between best and worst brands Quality as a DifferentiatorQuality as a Given Source: J.D. Power & Associates 1987 through 2012 U.S. Initial Quality Study (IQS)

8. 8 © 2013 J.D. Power & Associates, The McGraw-Hill Companies, Inc. All Rights Reserved. J.D. POWER & ASSOCIATES PROPRIETARY AND CONFIDENTIAL—FOR INTERNAL USE ONLYWarrantyCasesMalfunctions not brought to warranty Soft “Inadequacies” needs addressed but not as preferred Missed Opportunities vehicle misalignment with market expectations vehicle misalignment with market expectations Redefinition of QualityWarrantyCasesMalfunctions not brought to warranty Soft “Inadequacies” needs addressed but not as preferred Missed Opportunities vehicle misalignment with market expectations vehicle misalignment with market expectations Traditional QualityConsumer Quality Design Quality Consumer Behavior

9. 9 © 2013 J.D. Power & Associates, The McGraw-Hill Companies, Inc. All Rights Reserved. J.D. POWER & ASSOCIATES PROPRIETARY AND CONFIDENTIAL—FOR INTERNAL USE ONLY Increased Complexity (Soft “Inadequacies”) …Usability has taken on greater importance Quality Improvement: 2007 vs. 2012 Source: J.D. Power & Associates 2007 through 2012 U.S. Initial Quality Study (IQS) unless noted otherwise

10. 10 © 2013 J.D. Power & Associates, The McGraw-Hill Companies, Inc. All Rights Reserved. J.D. POWER & ASSOCIATES PROPRIETARY AND CONFIDENTIAL—FOR INTERNAL USE ONLY Expanding needs -Increased flexibility (personalization, customization) -Increased functionality (value, usability) WeekdayWeekend Average Daily Time In Vehicle 2 hours 27 minutes* 2 hours 4 minutes* *Source: 2011 Arbitron Inc./Edison Research/Scarborough Research 16:23 per Week Time in Vehicle

11. 11 © 2013 J.D. Power & Associates, The McGraw-Hill Companies, Inc. All Rights Reserved. J.D. POWER & ASSOCIATES PROPRIETARY AND CONFIDENTIAL—FOR INTERNAL USE ONLY -Individualistic and self-directed -Adept at social networking but are not personally social -Function well in a virtual environment -Have a global perspective -Environmentally aware -Well educated -Technically savvy -Lifelong use of communication and media devices -Self identified experts at multi-tasking -Expect instant action and satisfaction Future Generation of Drivers Ability to do what they want, when they want, where they want…SAFELY

12. 12 © 2013 J.D. Power & Associates, The McGraw-Hill Companies, Inc. All Rights Reserved. J.D. POWER & ASSOCIATES PROPRIETARY AND CONFIDENTIAL—FOR INTERNAL USE ONLY Items Brought into Vehicle Everyday/Few Times a Week – Minimum 50% 95% of consumers regularly bring a mobile phone into the vehicle Source: J.D. Power & Associates 2009 Vehicle Interior Needs Study (VINS)

13. 13 © 2013 J.D. Power & Associates, The McGraw-Hill Companies, Inc. All Rights Reserved. J.D. POWER & ASSOCIATES PROPRIETARY AND CONFIDENTIAL—FOR INTERNAL USE ONLY Connectivity Interests

14. 14 © 2013 J.D. Power & Associates, The McGraw-Hill Companies, Inc. All Rights Reserved. J.D. POWER & ASSOCIATES PROPRIETARY AND CONFIDENTIAL—FOR INTERNAL USE ONLY Emerging Technology Interests Source: J.D. Power & Associates 2013 Emerging Technologies Study ^ Device/Application link interest is asked only of smartphone owners

15. 15 © 2013 J.D. Power & Associates, The McGraw-Hill Companies, Inc. All Rights Reserved. J.D. POWER & ASSOCIATES PROPRIETARY AND CONFIDENTIAL—FOR INTERNAL USE ONLY Emerging Technology Interests: Connectivity Source: J.D. Power & Associates 2013 Emerging Technologies Study ^ Device/Application link interest is asked only of smartphone owners

16. 16 © 2013 J.D. Power & Associates, The McGraw-Hill Companies, Inc. All Rights Reserved. J.D. POWER & ASSOCIATES PROPRIETARY AND CONFIDENTIAL—FOR INTERNAL USE ONLY Emerging Technology Interests: Device/Application Link^ Source: J.D. Power & Associates 2013 Emerging Technologies Study ^ Device/Application link interest is asked only of smartphone owners Types of Connectivity Owners Would Like to Integrate Traditional In-Vehicle Information and Services Social/Personal Connections News and Entertainment Resources Professional and Personal Organization Personal Information Resources

17. 17 © 2013 J.D. Power & Associates, The McGraw-Hill Companies, Inc. All Rights Reserved. J.D. POWER & ASSOCIATES PROPRIETARY AND CONFIDENTIAL—FOR INTERNAL USE ONLY Emerging Technology Interests: Usability Source: J.D. Power & Associates 2013 Emerging Technologies Study ^ Device/Application link interest is asked only of smartphone owners

18. 18 © 2013 J.D. Power & Associates, The McGraw-Hill Companies, Inc. All Rights Reserved. J.D. POWER & ASSOCIATES PROPRIETARY AND CONFIDENTIAL—FOR INTERNAL USE ONLY

19. 19 © 2013 J.D. Power & Associates, The McGraw-Hill Companies, Inc. All Rights Reserved. J.D. POWER & ASSOCIATES PROPRIETARY AND CONFIDENTIAL—FOR INTERNAL USE ONLY Add in the Complexity of Connected Services

20. 20 © 2013 J.D. Power & Associates, The McGraw-Hill Companies, Inc. All Rights Reserved. J.D. POWER & ASSOCIATES PROPRIETARY AND CONFIDENTIAL—FOR INTERNAL USE ONLY Emerging Technology Interests: Ultimate Enabler – Autonomous Driving Source: J.D. Power & Associates 2013 Emerging Technologies Study ^ Device/Application link interest is asked only of smartphone owners

21. 21 © 2013 J.D. Power & Associates, The McGraw-Hill Companies, Inc. All Rights Reserved. J.D. POWER & ASSOCIATES PROPRIETARY AND CONFIDENTIAL—FOR INTERNAL USE ONLY Emerging Technology Interests: Ultimate Enabler – Autonomous Driving Source: J.D. Power & Associates 2013 Emerging Technologies Study Last year, consumer sentiment on was filled with excitement regarding the possibilities a self- driving vehicle could offer As autonomous driving becomes more of a reality, sentiment is transitioning toward consumers still wanting to drive their own vehicle until the technology gains consumer confidence and trust Semi-autonomous driving features are paving the way for this confidence and trust2012 2013

22. 22 © 2013 J.D. Power & Associates, The McGraw-Hill Companies, Inc. All Rights Reserved. J.D. POWER & ASSOCIATES PROPRIETARY AND CONFIDENTIAL—FOR INTERNAL USE ONLY Thank You Mike VanNieuwkuyk Executive Director, Global Automotive J.D. Power & Associates mike.vannieuwkuyk@jdpa.com