1. Soikot Sengupta London, 4 th February 2004 The European Market for Mechatronics in Passenger Cars © 2003 Frost & Sullivan. All rights reserved. This document contains highly confidential information and is the sole property of Frost & Sullivan. No part of it may be circulated, quoted, copied or otherwise reproduced without the written approval of Frost & Sullivan.

2. Today’s presentation 01: Market Overview & Definitions 02: Market Drivers & Restraints 03: Key Trends in the Mechatronics Market 04: Market Size & Forecasts 05: Strategic Impact on the Key Market Participants 06: Report Highlights 07: Questions

3. Market Overview and Definition Revenues from Mechatronics estimated to € 5.7 billion in 2003 Mechatronics is the integration of mechanics, electronics and software technologies. Mechatronics consist of: Mechanics = Actuators Electronics = Sensors Software = ECU Mechatronics Mechanics Electronics Software What is Mechatronics?

4. Market Overview and Definition (Cont) Headlights Side Electric Mirrors Keyless Entry Automatic Wipers Exterior Climate Control Power Seats Interior Electronic Mirrors Interior Steering Systems Braking Systems Suspension Systems Chassis Mechatronics Interior Electronic Mirrors Climate Control Market Segmentation of Mechatronics Features

5. Market Drivers and Restraints Drivers Restraints Pressure on Car Body Controller Impact Components Cost Reduction Demand for Comfort Features Absence of 42V Supplier Initiative Lack of open standards Delay of By Wire Systems High Cost of Systems and Components Increased Risks of System Bugs Growth of Intelligent Safety Features

6. Key Trends Revenues for Mechatronics components expected to increase by 4% (CAGR) percent between 2003 and 2010. Car body controller becoming increasingly saturated Price of Mechatronics components reducing year on year Increasing cooperation among automotive suppliers Expectancy of Vehicle Manufacturers with regards to suppliers increasing Mechatronics architecture favoured by German manufacturers

7. Market Size and Forecast Total European Mechatronics Market in Passenger Cars: Revenues Forecast and Growth (Europe), 2001-2010

8. Market Size and Forecast (Cont) Market for Mechatronics in Passenger Cars: Market Attractiveness by Features (Europe), 2003-2010

9. Strategic Impact on Key Industry Participants - Vehicle Manufacturers Mechatronics can offer a product differentiation advantage Flexibility of Mechatronics systems will lead to better product management Increasing levels of Mechatronics will open the door for remote vehicle diagnostics The adoption of 42v will result from rationalisation of the industry Open standards, common interfaces and protocols will be required to be developed

10. Strategic Impact on Key Industry Participants - Tier 1 and Tier 2 TIER 1: Promote the benefits of Mechatronics over the traditional approach Working close to VMs and suppliers to develop standard systems Maintain internal control over the development of software TIER 2: Need to develop cross-functional knowledge and capabilities Required to provide smaller and more robust components Need to be proactive and influence the development of systems

11. Report Highlights Ten features analysed covering several areas of automotive systems development Penetration and revenues of all the systems by vehicle segments Revenue and units forecast up to 2010 of Mechatronics components by features Profiles of key market participants in all three segments Market share analysis of Tier 1 suppliers of Mechatronics systems Strategic recommendations for all key market participants

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