1 ROLE OF PRIVATE EQUITY IN AUTO SUPPLY BASE RESTRUCTURING Thomas T. Stallkamp Industrial Partner Ripplewood Holdings, LLC Automotive News World Congress January 17, 2006

2 Factors Affecting Supplier Restructuring Limited traditional financing Limited traditional financing Frequent reliance on single customer Frequent reliance on single customer Lack of OEM assistance or loyalty Lack of OEM assistance or loyalty Liquidity issues created by uncertain schedules Liquidity issues created by uncertain schedules Arbitrary OEM pricing requests Arbitrary OEM pricing requests

3 “Restructured” Supplier Profile (You’ll know things are better when…) Pricing based on technology/cost advantage Pricing based on technology/cost advantage Balanced customer base Balanced customer base Operations in major geographic markets (NA, Europe, Far East) Operations in major geographic markets (NA, Europe, Far East) Streamlined overhead and wage structure Streamlined overhead and wage structure Cost reductions greater than price downs Cost reductions greater than price downs

4 Role of Private Equity Accelerate restructuring of supply base Accelerate restructuring of supply base Increased size and mass through add-on acquisitions or mergers Increased size and mass through add-on acquisitions or mergers Provide capital for refinancing Provide capital for refinancing Promote critical review of Business Plan Promote critical review of Business Plan Increased emphasis on profitability over revenue Increased emphasis on profitability over revenue Increased management involvement through ownership Increased management involvement through ownership

5 Opportunities in Auto Supply “Industry will always need parts” “Industry will always need parts” Take advantage of restructuring events Take advantage of restructuring events Combination of similar operations/suppliers Combination of similar operations/suppliers Acquisition of OEM non-core businesses Acquisition of OEM non-core businesses Coordinating with OEM outsourcing plans as preferred supplier Coordinating with OEM outsourcing plans as preferred supplier Leverage of global assets (accelerate moves to lower cost locations) Leverage of global assets (accelerate moves to lower cost locations)

6 Light Metal Strategy Light Metal Strategy Public – JapanPrivate – Belgium Locations – JapanEurope ThailandBrazil China – JVCanada Multiple customers Multiple customers Broad geographic base Broad geographic base Strong technology and developments Strong technology and developments