Integria Logistics Oy Ltd New business concept for manufacturing networks Timo Koivumäki Vehicle component supplier network development project closing seminar Tampere 7.5.2012

Integria Logistics Ltd Oy Background Vision and business idea Field of operation and network Offering Establishing support Business case structuring Market potential of Russian automotive industry Contacts

Background A spin off from Automotive Supplier development project Initiated by an automotive OEM in Russia Suited to serve multilayer manufacturing networks Combines elements of LSP, Trading house and IT company Built on long experience and competence of key persons Market analyzing and business plan development started 2008 Integria Logistics Ltd Oy founded in the end of 2011 Focus in serving Finnish and Scandinavian companies who are targeting becoming suppliers to industry in Russia Member of Odette / NAF since April 2012

Vision and business idea Opening a new market for Nordic component manufacturing industry and leaving a lasting footprint in Finnish automotive industry Mission Integria is a supply chain management specialist and a system vendor providing customers optimizing of sourcing and procurement as well as localized value added operations thus creating value and competitiveness Vision Integria provides a supply chain management model for developing and streamlining global capital, information and material flows Business idea

Integria field of operation Swedish Procurement Finnish Logistics Russian Sales Viipuri Swedish Procurement company Sourcing, purchasing Network management Quality assurance Finnish LSP SCM JIT operations Packing and kitting Forwarding services ERP Integration Russian trading agency - Sales & trading - Value-added Manufacturing JIT Localization Customs & delivery Operational excellence, Supply Chain transparency, Field tested processes

Integria offering Linking suppliers and buyers SCM Optimization Logistics Localization Trading from Russian DUNS Establishing support Production transferring JV setting up Consulting

Positioning Integria Logistics Customers OEM’S & Tier 1 SME- Supplier Sourcing & Sales Quality Logistics ERP transparency Supplier E Customers OEM’S & Tier 1 Localization SCM Optimization Supplier D Deliveries to the automotive factories from the Added Value site. Factories will buy in Russian currency A new Integrator (System Vendor) forms a network of suppliers, based on OEM component needs and demands SME- Supplier C SME- Supplier B

We provide Competitive sourcing Lead time shortening Localization Nordic countries China & India Lead time shortening Localization Transport management Kitting and sequencing Transparency / ERP integration

Network IT support Deliveries to the automotive factories from the Added Value site. Factories will buy in Russian currency A new Integrator (System Vendor) forms a network of suppliers, based on OEM component needs and demands

ERP Transparency, Cost management Integria service solution Cars Seats Interior panels Carpets, Insulations Batteries Wheels Metals parts Electrical components Bumpers ….. Heavy vehicles Seats Bunks Axles Radiators Gears Gearboxes Hydraulics Plastic items …. Procurement Consolidated sourcing Process management Alternative suppliers Contract management Financing Quality assurance Localization Efficient sales Trading agency Value added service JIT operations Sequencing Logistics Kitting Safety stock Forwarding Customs Process quality ERP Transparency, Cost management

Localization in Business Park Vyborg Business Park provides production support services Consulting Turnkey full scale projects Outsourced manufacturing Premises are provided by property partner Sublease arrangement via Business Park Vyborg is possible depending on agreement model

Integria’s Support; preparation for OEM delivery Integria has up-to-date understanding of OEM Quality and process requirements Complete audit - insight to the actual situation View of improvement needs PSA (Potential Supplier Assessment), PCPA (Control Plan Audit) Action plan preparation Audit result -> training and other needs of Potential Supplier Integria development and training Automotive special requirements Co-operation with ISO certification project Support and benchmark

Business case structuring Lead by Integria Standardised project concept Supplier candidates audited and action plan created Project financing secured Project kick off and follow up

Project team Organization and resources Project team A project manager and concerned staff CEO / Production manager / engineer Basics on QA English language Committed to automotive goals A matter of commitment Most changes needed relate to larger volumes and change in production scale and pattern Need for Process quality and Quality process understanding

Automotive Industry Certificates ISO/TS 16949 Automotive special standard ISO 14001 Environmental policy MMOG Material Management operations guide Supplier may be accepted without certification Transition period Defined date for audit

OEM basic requirements Potential supplier; Imperative documents for OEM audit Facility DUNS Purpose & Plant Location Production Capacity Production Process Chart Plant Equipment Plan Layout Plan (Plant & Warehouse) Investment Plan QSB compliance Flow Chart of Quality Control System Process Defect Rate EDI connection CEO Commitment letter confirming plan to setup a new business (in the new country)

OEM basic requirements Time to become a supplier Acceptable product, capacity (2 days from initial inquiry) Quotation, pricing (10 days) OEM audit (3+ months) PPAP approval, trial runs, tooling when necessary (3 – 6+ months) First delivery (6 – 12 months)

OEM Ready - Project overview OEM Ready – common objective Practical approach 2nd party certification Aiming at starting deliveries Project lead-time Minimum 6 weeks

Business potential in Russia Immediate need of 600 or more new suppliers in Russia Component market size 7 Billion Euros Approx 50 % within reach for Nordic suppliers Nordic and Russian industry sizes match Nordic supplier base is a competitive sourcing market for Russia in terms of supply chain operation and lead time optimization

Contacts Integria Logistics Oy Ltd Integria Logistics Oy Ltd Timo Koivumäki COO, Chairman Integria Logistics Oy Ltd Kimmeltie 3, 3rd Floor PO Box 41 02101 ESPOO Finland tel: +358 9 4289 00 88 mob: +358 40 524 44 11 timo@integria.fi Mikhail Smirnov Development Manager Integria Logistics Oy Ltd Kimmeltie 3, 3rd Floor PO Box 41 02101 ESPOO Finland tel: +358 9 4289 00 88 mob: +358 40 678 67 47 mikhail@integria.fi