PartsHorizon2020: Volkswagen Group Polska

PartsHorizon2020: Volkswagen Group Polska
Hannover, 13th May 2014 28/04/2018 Volkswagen Group Polska

Poland in figures 9th largest country in Europe (6th in EU)
SF 9th largest country in Europe (6th in EU) Surface area: 312,7 thous. km2 Shoreline: 770 km Population: 38,2 million Currency: Polish Zloty (PLN) 1 Euro = 4,2 PLN Poland is member of: NATO /March 1999 OECD /November 1996 European Union /May 2004 28/04/2018 Volkswagen Group Polska

Poland - Macro economy Economy GDP growth and inflation (%)
Indicator Date Value Change y/y GDP growth 4Q2013 2,7% + 2,0pp Consumer inflation 0,7% - 1,0pp Average gross salary 3.856PLN + 3,8 % Unemployment rate 13,5% - 0,8pp PMI Poland 55,4 +6,8 p. Interest rate 2,50% - 1,5 pp Fuel prices Euro exchange rates (avg. monthly rates in PLN) Fuel Price ON (Diesel) 5,34 PLN / 1,27€ PB95 5,37 PLN / 1,28€ PB98 5,64 PLN / 1,34€ LPG 2,54 PLN / 0,60€ Source: GUS, NBP, IPSOS, e-petrol, money.pl, bankier.pl 28/04/2018 Volkswagen Group Polska

Main vehicle production plants in Poland
Passenger cars and light commercials Buses Trucks 28/04/2018 Volkswagen Group Polska

01.06.2012 Merger concept Kulczyk Pon Investment Polska Skoda Auto
28/04/2018 Volkswagen Group Polska

VGP: development steps
GO! 2020 Strategy NSC Step 3 3. GROUP IS MORE THAN JUST COMMON FUNCTIONS => 2nd step of integration NSC structure stabilization Adapting IT standards and infrastructure Creation of reliable KPI system and reporting Development of: HR, purchasing and organizational processes Defining committees and decision-making frameworks Promoting Volkswagen AG work culture 2013/ 2014 NSC Step 2 2. => 1st step of integration Foundation of VGP: Merger: NSC Step 1 2012 1. 28/04/2018 Volkswagen Group Polska

Volkswagen Group Polska today
529 employees Brands with VGP Official spare parts’ supplier for Poland and Belarus (Atlant-M; Autohaus AV) Logistic facilities for cars Own rail terminal for cars unloading Central high storage spare parts warehouse m2 and 1 additional rented warehouse m2 Dealers’ Service Trainings Center m2; 5 technical training rooms 28/04/2018 Volkswagen Group Polska

From developing to the best performing NSC
within the area of After Sales 28/04/2018 Volkswagen Group Polska

Car Park in Poland – current status
Starting point Actual Data Actions Different data sources by Brands Different calculation methodologies Lack of consistency No common acceptance by Brands Data differences Reference date : Topics coordinated by K-VO-SR: Workshop with Brands/Regions ( ) Cooperation with Brands, POLK and SAMAR*) I step: definition of reference Car Park figures ( ) – already accepted by all Brands II step: estimation till based on different scrappage rate methodology – analyse by brands Units VW PC VW CV Audi Seat Skoda Group *) Source – K-VO - SR *) SAMAR – car institute for car park in Poland Why do we need it? Business cases After Sales, STS, Planning Round, Parts Horizon, Network Planning 28/04/2018 Volkswagen Group Polska

Car Park – VGP segments development
-3,2% 2.256 2.240 2.202 2.183 Remark: Car park figures in thousands 28/04/2018 Volkswagen Group Polska

New and used car market development
Share NC vs. First Reg. 29,6% 29,5% 29,3% 28/04/2018 Volkswagen Group Polska

Registrations of imported used cars by model

Automobile Market in Poland – New cars
New passenger car registrations per 1000 inhabitants / 2012 28/04/2018 Volkswagen Group Polska

Car Park – market share 566 886 cars 930 808 cars 28/04/2018
Volkswagen Group Polska

Market share – without oil and tires, Segment I Authorized workshops + brands’ connected workshops

Market share – without oil and tires, Segment II Authorized workshops + brands’ connected workshops

Market share – without oil and tires, Segment III Authorized workshops + brands’ connected workshops

Spare parts sales to NORA® customers
8,7 m PLN 3,0 m PLN 2,2 m PLN 0,011 m PLN Period: January - March Total DNP NORA DNP VGP brands NORA share development in 2013/2014 28/04/2018 Volkswagen Group Polska

VGP - Mission, Vision, Goals
Be the best automotive group in Poland. Mission … by the best performing and satisfied dealer network. … by competent and motivated employees. We are the preferred supplier of automotive products and services in Poland generating loyal and satisfied customers … … by efficient and customer oriented processes. Goals Volume + market share Profitability Satisfaction Top Employer 28/04/2018 Volkswagen Group Polska

Group After Sales Strategy – Key challenges
New cooperations (insurance, fleet, leasing) Decreasing repair business potential Increasing competition (unauthorized services) KEY CHALLENGES IN THE AFTER SALES BUSINESS New technologies (Increasing car complexity) Law / Rule (Rule changes) Changing model and country mix Rising complexity costs Changing of customer structures Expanding product range Decreasing customer loyality 28/04/2018 Volkswagen Group Polska

Group After Sales - Mission, Vision, Goals
Main Motive B1B => Beat One Billion Vision Stronger through BRANDS to strengthen the BRANDS for the most effective CUSTOMERS and DEALERS tailored After Sales Business Mission We do it right = We do right thing in right quality to right time = After Sales Excellence 28/04/2018 Volkswagen Group Polska

Group After Sales Strategy – Strategic and operative targets
B1B Customer satisfaction Market exploitation Quality Profitability Transparency Offers Channel management People & Training Technical service Pricing Logistics & disposition Cost management IT 28/04/2018 Volkswagen Group Polska

Group After Sales Strategy – Action plan
Strategic sales-concepts to improve market exploitation Strategic areas to optimize process/cost structure Transparency Market studies – price position, market potential, customer satisfaction Implement regular reporting, BMO Logistics & disposition M0 New central depot, stock value optimization, parts availability, same day delivery concept M11 Implementation/intensification of product management (including economy parts) M1 IT Offers Implementation of repair financing ET 2000, Autopart system for all brands M2 M12 Optimization of tyre business M3 Cost management Efficiency in all processes, pragmatic approach, monitoring/ benchmarking of cost drivers Mobile service offering, warranty extension program M13 M4 Development of Accident damage management concept M5 Technical service Repeat repair project, product influencing, special tool rental concept, technical expertise Channel management M14 Development of fleet business M6 Optimisation / redefinition of NORA business M7 Development of E-business M8 Pricing Optimization of price management M9 People & training TCSS, retail coaching program, motivation concept for network, employee satisfaction, recruitment process Development of accessories business M15 M10 28/04/2018 Volkswagen Group Polska

TOP Priorities Group After Sales 2014
Parts Horizon 2020 People & Processes Turnover & Profit IT support Cost of Franchise Transparency Sales Tyres NORA Used cars approach Economy parts Cooperation with FS AG Product management ADM Logistics New central depot ET-2000 Export service for Porsche Obsolete parts process Same-Day-Delivery Cooperation with MAN Performance efficiency Roadside Assistance Blue print technical support IT-monitoring for special equipment e-mobility Special tools management BID number harmonization Service Blue print Trainings’ Academy Mystery client GTO development Further implementation of ”new approach” Enlargement of the cooperation with brands Trainings’ Academy 28/04/2018 Volkswagen Group Polska

PartsHorizon2020 Poland Till the End of 05.2014 04.2014
Final presentation to K-TSK Finalization of the Back Bone and Business Cases in terms of right Car Park figures *) Second Draft of the Mandatory Backbone with the Business Cases will be sent to the regions First Draft of Mandatory Backbone sent to the Regions Workshop - CarPark common multibrand approach *) Kick Off Meeting *) The Car Park issue for Poland will be coordinate by KVO-SR 28/04/2018 Volkswagen Group Polska

PartsHorizon2020: Mandatory backbone for K-TSK presentation
Hannover, 13th May 2014 28/04/2018 Volkswagen Group Polska

Assumptions for turnover calculation
Topic - Details - Baseline some of the activities planned within PH2020, have been already considered within PR62, therefore the baseline turnover is underneath the PR62 turnover Used assortment Genuine Parts, incl. Warranty Tyres Miscellaneous 2013 –VGP systems integration – implementation of the Kopfsparte allocation methodology 2014 – change in the allocation methodology – from Kopfsparte to Singlesparte 2014 – Seat - New Brand in portfolio Baseline Volkswagen PKW Due to the change of the common parts allocation methodology (Kopfsparte to Singlesparte) VW PKW had a budget adjustment The baseline of VW PKW is based on the new budget which is about 20. Mio PLN higher than PR62 Car Park Source POLK Multi brand approach coordinated by K-VO-SR Price step All turnovers calculated in nominal figures (Inflation rate included) 28/04/2018 Volkswagen Group Polska

Car Park development 2014-2018 Premise: Age of vehicles ≤15 years
Source: - POLK new estimation method (VWN, Audi, Seat, Skoda) - POLK historical estimation method (VW Pkw) 28/04/2018 Volkswagen Group Polska

Baseline:. Baseline turnover (in PLN)
Baseline: Baseline turnover (in PLN) Baseline turnover per car (in PLN) Premise: turnover only domestic market only genuine parts & tyres (incl. Warranty; excl. Oil and accessories) 28/04/2018 Volkswagen Group Polska

PR62 – Baseline (in PLN) Turnover (in PLN) Time 28/04/2018

Actions PartsHorizon2020: Pricing
Brand - Details - Pricing VW Implementation of Market Intelligent Pricing Price Image Campaign development Reports, analysis & planning, aftersales market study (STS, MIS Aftersales) development on brand level VWN cMIP implementation Price image campaign with Economy parts packages (segment II & III) Audi Brand specific price strategy: Price optimization according to brand value, customer value expectation and OEM/OES/IAM price studies; specific focus on premium models & brands Price studies on elasticity and profit optimization (e.g. discount groups / rush & stock discounts) Ongoing analysis of brand and grey market competition Due to the exclusive parts share and the programs for the brand Audi, a dedicated FTE is required SEAT SKODA Price study: STS Group Reporting and analysis of aftersales market and parts pricing studies Appointment of Aftersales Business Analyst to provide insight analysis, reporting to the brand and factory Development of market competitive Fleet Package Pricing - ensure consistency and transparency of pricing to fleet customers (fleet) Market price study as a solid base for price definition Implementation of new pricing concept (Market oriented price tool - Simon&Kucher) (excl. AOT) Create attractively priced offers for new vehicle customers to support customer loyalty based on certain assortment (own / fleet) Special pricing to retain used vehicle / Segment II and III customers (own) Exploitation of price potential of „monopoly parts“ 28/04/2018 Volkswagen Group Polska

Studies & Analysis Participation in Carlisle Price Study 2012 & 2013 Analysis of results as a baseline for activities in the market Selected high competitive parts from 70 HPGs with decreased pricing (in average -10%): brakes; exhaust, wipers; toothed belts; filters Dedicated marketing campaigns and sell-out communication (example: toothed belt sets) Participation in Carlisle Price Study 2014 Results presentation: September 2014 Plan of local study for NORA customers MotoData market study 28/04/2018 Volkswagen Group Polska

Systems cMIP implementation Workshop in Nov. 2013 Go-live of results in April 2014 Results: Brands VW PC, VW CV Average +3,78% within 400 HPGs Package pricing - project running in VGP Business specification of PPS module – done Production works stage I – done Solution validation – done Additional requirements specification – in progress Production works stage II – planed June 2014 Simulation Old New Delta [abs] Delta [%] Volume [pcs] -4,00% Dealer net revenue [PLN] 1,40% Importer margin [%] 34,20% 36,60% 2,40% 7,00% 28/04/2018 Volkswagen Group Polska

Actions PartsHorizon2020: Own Workshop
Brand - Details - Own Work-shop VW Loyalty increase: Extended Warranty S&M Packages development Segment II&III increase: Service Offensive Economy Parts development & implementation of PPS Development of Direct Express concept Market exploitation & turnover per throughputs increase Active Selling implementation (2014) & CRM approach for marketing campaigns + predictive marketing (automated reminder program for service, MOT, etc.) Increase sales potential per throughput with direct reception development (new tools & system solutions needed) Development and implementation of Service app for smart phones Unfall Spezialist – Concept implementation VWN Development of Direct Express workshops Service Packages to retain new and used vehicle customers Loyalty program for service customers Development of FF team responsible for VWN After Sales and support for dealers business of one add. Person (total 3 FF’es for 71 Service Partners) Roll out of predictive marketing - automated reminder program for service, MOT, etc. Service packaging Audi Customer loyalty increase via increasing sales of Extended Warranty and Audi Service and Maintenance Packages (either linked to new vehicles sales at the dealer and linked to workshop visit) Keeping AOT purchase exclusivity concept Professionalization of Audi Workshop appearance, processes and performance via mobile solutions for Direct Reception process (iPads concept) Establishing Body & Paint centers in strategic market areas focus especially on Audi aluminium repairs PPS - Service Segment II/III: “One price for the job”, Season campaigns, Service and Accessories offers in Audi Magazine; development and promotion of sell-out activities: e.g. exhaust test, periodic review , seasonal check (winter / summer), etc., CRM – system: Implementation in Service, Audi Insight, Audi App., use of predictive data to optimize market penetration, activities by sending service reminders or re-book at service visit 28/04/2018 Volkswagen Group Polska

Brand - Details - Own Work-shop SEAT Extended Warranty implementation on country standard level Service Packages implementation SEAT Insurance implementation SEAT Connect application Roll out of predictive marketing - automated reminder program for service, MOT, etc. Development and implementation of Service app for smart phones SKODA Price image campaigns with economy price packages, 4+ discounts program supported by importer Implementation of Direct Reception process Supporting IT tool for service process (Digital Check-in – Health Check) CRM approach for central and local marketing campaigns (Automated Sales chances) Skoda Care products launch with VW Bank (extended warranty, Insurance and re-launch of S&M Packages) CA Package launch Marketing of Service app for smartphones Group Ensure implementation and further development of new product range „Economy parts“ (depending on launch of new product groups from the factory) Development and implementation of Accident Management concept, incl. Unfall Spezialist concept to increase customer loyalty Development and further implementation of product for repair financing together with VW Bank Product groups analysis and intensive follow up by field forces Full implementation and further development and optimization of E-mobility concept/business Coordination of implementation of digital solutions for service process Implementation of full package pricing 28/04/2018 Volkswagen Group Polska

Product Management HPG analysis (Top / Bottom) on: DNP level, Partner individual turnover, HPG groups, After sales categories Next steps Analysis per Partner (HPG) Analysis per Field Force Benchmark Individual measures for Partner Best practice sharing 28/04/2018 Volkswagen Group Polska

Product Management Sell-in marketing Action calendar Agreed on Group and Brand level Including all business relevant activities One common „road map” for whole after sales Easy defining synergies between group & brand as well as between brands themselves Including „Product of the Year” strategy Including tyre strategy Including NORA offensive Next steps: Predictive marketing based on HPG analysis Further sell-in publications Workshop Fairs / Exhibitions 28/04/2018 Volkswagen Group Polska

Actions PartsHorizon2020: Own Workshop Economy Parts
Product information Image campaigns next planned in 2014 Economy Experience Days 2014 25 participants Online training Sell-in brochures Sell-in actions „Happy Service” 2014 28/04/2018 Volkswagen Group Polska

Segment II & III Do you know your car mechanic too good? Then it’s not good! The first brand image campaign in the history of VGP Main goals: build a strong image of the VGP brands After Sales increase the awareness of genuine parts & authorized service quality reach customers of older car segments clear message to visit authorized workshops instead of the independent ones baseline for future campaigns 28/04/2018 Volkswagen Group Polska

Used car business Next multi brand campaign „Check the car” build a strong image of the VGP brands After Sales increase the awareness of genuine parts & authorized service quality reach customers of older car segments build customer loyalty 28/04/2018 Volkswagen Group Polska

Cooperation with VW FSAG Scope: Car financing Car insurance Leasing Extended Warranty Service Packages Common activities with Group After Sales 2013 GAS Image Campaign FSAG Poland action „Guaranteed car” 2014 Used cars Tyres (focus) Hyperlinks to FSAG offer on GAS campaign web page 28/04/2018 Volkswagen Group Polska

Coordinated by Group After Sales Multi Brand Approach Mutual standards Equipment Trainings Certification Processes Structure CI Toolbox Develop only own body & paint workshops Standards tailored to Polish market situation Accident Damage Management Actions PartsHorizon2020: Own Workshop Approach to ADM Wszystkie marki VGP- wspólne standardy dla ADM Jeden brand ADM dla wszystkich marek VGP 28/04/2018 Volkswagen Group Polska

Activities in pilot phase
Actions PartsHorizon2020: Own Workshop ADM Current situation Pilot group 8 dealers with own body & paint workshop All brands representing Good market exploitation Operation in different regions Activities in pilot phase Current (1st half of 2014) Next (by the end of 2014) Developed standards consulting Technical audits realization Technical trainings realization Standards implementation Accident specialist certification Pilot phase summarizing VW Skoda Multi brand 88 dealers cooperate with own body and paint workshop Rest dealers order services to subcontractors 28/04/2018 Volkswagen Group Polska

ADM Fair repair Project Project developed by KTI - Kraftfahrzeugtechnisches Institut ( German independent organization) and VW PC To share information to participants how important is right repair technology after accident To build relationships with independent experts and insurances Developed for Skoda, as a 2nd wave 28/04/2018 Volkswagen Group Polska

ADM Fair repair Project - Comparison between two different repair technology Passat B6 repair technology Passat B4 repair technology First crash First crash Repair (actual technology) Repair (not actual technology) Second crash Second crash Comparison Comparison 28/04/2018 Volkswagen Group Polska

Good participation rate Opening for next meetings
Actions PartsHorizon2020: Own Workshop ADM Fair repair Project - Organized in two waves- VW & Skoda examples Service Network & Adjusters Companies ( , ) Insurance & fleet companies ( ) Good participation rate Positive feedback Open discussion Opening for next meetings Media & Associations ( ) Motor Show ( ) 28/04/2018 Volkswagen Group Polska

Rescue Sheets - communication activity Get new customers to the service Service image building as a service which takes care of customers safety Communication in: Communication supported by articles in press 28/04/2018 Volkswagen Group Polska

Actions PartsHorizon2020: Fleet
Brand - Details - Fleet VW Fleet loyalty program – AutoTeam Fleet development: Fleet Business/Service Center implementation, Measures development: unified labour rate, oil strategy, discount rules connected with volume targets Incorporate of small fleet customers to the program Mobility offer & services (i.e. door to door) development – main competitive advantage on fleet service market Increase number of fleet customer in program and service revenue by more active acquisition & maintaining relations VWN Auto Team Fleet Platform and further development of the platform Audi Service Maintenance Program implementation for Audi fleet customers (including IT solution) Develop and promote actively customized Fleet Service products Definition and implementation of loyalty measures for insurance and lease companies SEAT Service Fleet Program development SKODA Service Program for fleet - further development Simplify legal solution, new discount rules, oil price strategy based on VW Group branded oil, semi automated authorization process, New IT tool Fleet Connect with CRM support for fleet and fully automated authorization process Group Development of market competitive Fleet Package Pricing - ensure consistency and transparency of pricing to fleet customers Create and implement a framework that can be marketed to fleet customers by the Brands 28/04/2018 Volkswagen Group Polska

Questionnaire Content
Actions PartsHorizon2020: Fleet Oil situation in VGP network – Own Survey General information Questionnaire Content Survey was conducted in CW Target – multi brand dealers Concerned to service inspection and oil change for: VW Golf VII with petrol engine 1,4 TSI Skoda Rapid with petrol engine 1,2 TSI The research panel workshops (91,5% of VGP Network) Service availability Number of Telephone signals Waiting time to get a service appointment Duration of inspection time The cost of inspection Type of oil used to inspection Cost of oil per liter Original oil availability 28/04/2018 Volkswagen Group Polska

Example of the survey results
Actions PartsHorizon2020: Fleet Oil situation in VGP network – Own Survey Example of the survey results 28/04/2018 Volkswagen Group Polska

Actions PartsHorizon2020: Fleet Oil situation in VGP network – Own Survey Example of the survey results Brand Skoda VW Castrol 63% 73 zł <44,112> 61% 84 zł <40,113> Mobil 15% 80 zł <55,91> 76 zł <54,91> Shell 17% 74 zł <59,90> 5% 78 zł <52,93> Elf 1% 75 zł 75 0% - Total 4% 70 zł <62,79> 55 zł <40,70> Genuine 71 zł <60,85> Other recommended Oil ( as a second ) 40% Genuine oil recommended as a second 3% 16% The fact of having Genuine oil 19% 83% 28/04/2018 Volkswagen Group Polska

Actions PartsHorizon2020: Fleet Oil situation in VGP network – Own Survey Example of the survey results 28/04/2018 Volkswagen Group Polska

Actions PartsHorizon2020: Fleet Oil situation in VGP network – Own Survey Example of the survey results Location Cost review Price of oil per litre City street Kraków Bełtowski - Góra Libertowska 850 85 Bełtowski - Zakopiańska 800 Warszawa Szewczyk Auto - Radzymińska 980 98 Porsche Inter Auto - Połczyńska 118 72 Gajewska - Chełmżyńska 900 67 Chylińscy - Modlińska 1000 100 Auto Special – Grochowska 750 109 Rowiński - Drewny 60 Porsche Inter Auto Połczyńska 111 112 Auto Gala - Płowiecka 79 Benepol - Płochocim 700 71 Poznań Rzepecki Mroczkowski –Wiatraczna 65 Porsche Inter Auto – Krańcowa Berdychowski – Owsiana 670 75 Krotoski – Cichy – Głogowska 70 Krotoski – Cichy – Poznańska 80 28/04/2018 Volkswagen Group Polska

Actions PartsHorizon2020: Fleet
Oil situation in VGP network – Survey Summarizing Conclusions Recommendations There is no common Oil price strategy Different prices versus competition Castrol recommended in first place, market leader Insufficient awareness of the Original Oil More focus on Original Oil Build Original Oil brand image Common price strategy implementation 28/04/2018 Volkswagen Group Polska

Actions PartsHorizon2020: NORA
Brand - Details - NORA VW VWN Offer for parts transport between dealers and Nora customers Special offer for delivery car purchase for Nora customers Audi SEAT NORA business model implementation in SEAT service network SKODA Group Development and implementation of regular reporting system for retail network Re-definition of NORA concept to support further market exploitation (e.g. NORA Centers) Optimization of NORA bonus conditions Implementation of consistent auditing process of NORA business 28/04/2018 Volkswagen Group Polska

Bonus Status Slajd z Kaplera KPI`s WHY? HOW? Approx. 57 thd. independent workshops in Poland Cooperating with 16% of independent workshops Relative old car park - average age 14 years Near 90% are segment III cars Redefinition of NORA program (standards, guidelines) Product mgmt. for NORA Dedicated campaigns NSC voluntary support NORA Field Force NORA workshop with K-VO-SV NEVERTHELESS! Main goal is to exploit the market potentials within both streams: NORA & own workshop Seg. III VGP cooperates via Service Partners with approx. 9 thd. independent workshops in Poland Further Potential! 28/04/2018 Volkswagen Group Polska

Own Analysis Sales to NORA by district Baseline for deeper analysis on: region level, HPG level (NORA), Partner level ) DNP, 2013 year 28/04/2018 Volkswagen Group Polska

Actions PartsHorizon2020: Tyres
Brand - Details - Tyres VW VWN Audi SEAT Fixed tyres seasonal campaign Extended tyres offer SKODA Full implementation of group programs Group Development and implementation of regular reporting system for retail network Development of marketing activities Market and potential analysis of tyre business Joining the central tyre business project Tyre storage Tyre insurance Tyre Etka 28/04/2018 Volkswagen Group Polska

KPI`s SITUATION ACTIVITIES Main players in tyre business: - specialized tyre workshops - tyre wholesaler - internet B2C offer Quantitative purchase targets Tyre dedicated Bonus Following K-VO Global Tyre Strategy Multi brand approach – competitive offer Dedicated tyre actions within motivation program „Happy Service” Tyre ETKA Tyre insurance (FSAG) Cross selling opportunity Short term potential! Decrease reasons: Overstocking 2012 No winter, no snow Main goal is to exploit potentials and gain customers to own workshops for a cross-selling opportunities for parts and services +800% 28/04/2018 Volkswagen Group Polska

Focus areas Implementation of ETKA Tyre Planned go-live: mid 2014 translations adaptation for Polish market training for network Implementation of Tyre Insurance (coop. with FSAG) Planned go-live: mid 2014 introduction of the program marketing activities (brand & group) to build awareness Implementation of Tyre Connect (after launch of ET2000) Planned go-live: mid 2015 tyre ordering platform interfaces to DMS/DFS training 28/04/2018 Volkswagen Group Polska 60

Additional turnover of PartsHorizon2020 actions (in PLN) (1/2)

Additional turnover of PartsHorizon2020 actions (in PLN) (2/2)

Turnover incl. PartsHorizon2020: Total turnover (in PLN)
Additional turnover vs. Baseline (in PLN) 28/04/2018 Volkswagen Group Polska

PR 62 vs. Baseline vs. PartsHorizon2020
Turnover (in PLN) Time 28/04/2018 Volkswagen Group Polska

Additional turnover vs. Baseline (in PLN) 28/04/2018 Volkswagen Group Polska

Turnover per car Baseline vs. Parts Horizon2020
PLN Group Ø PLN VW Pkw PLN VWN PLN AUDI PLN SEAT PLN SKODA PH2020 Baseline 28/04/2018 Volkswagen Group Polska

Requirements NSC: Additional Headcounts (organizational correlation) (1/2)
x field force level x specialist level 28/04/2018 Volkswagen Group Polska

Requirements NSC: Additional Headcounts (organizational correlation) (2/2)
x field force level x specialist level 28/04/2018 Volkswagen Group Polska

Financial result: NSC level (in PLN) (1/2)

Financial result: NSC level (in PLN) (2/2)

Thank you for your attention!

Backup 28/04/2018 Volkswagen Group Polska

Merger concept 28/04/2018 Volkswagen Group Polska

VOLKSWAGEN GROUP POLSKA
Merger concept KPI SC KT KPI BS SAP KPI SC VIF KPI SC VOLKSWAGEN GROUP POLSKA 100% KPI SC will be renamed into Volkswagen Group Polska Sp. z o.o. (GmbH) – r. 28/04/2018 Volkswagen Group Polska

Merger concept 28/04/2018 Volkswagen Group Polska

Volkswagen Group Polska – FTE Development Status November 2013

Group After Sales – FTE Development Status February 2014

Spare parts sales to NORA® customers
8,7 m PLN 3,0 m PLN 2,2 m PLN 0,011 m PLN Period: January - March Total DNP NORA DNP NORA turnover [DNP] VGP brands NORA share development in 2013/2014 28/04/2018 Volkswagen Group Polska

New Regional Parts Distribution Centre in Poland and ET2000
Main issues Consolidation into one building ( m2 warehouse space) and equipment implementation ET corporate solution for spare parts distribution Both projects should have the same go-live date – May 2015 Expenditures Planning phase: 0,5 Mio. € ET 2000: 4,85 Mio. € Equipment & Infrastructure: 4,3 Mio. € Warehouse will be leased for 10 years (estimated cost per annum: 1,45 Mio. €) Location: Komorniki (Poznań area) I 28/04/2018 Volkswagen Group Polska

Final preparation phase
ET2000 implementation Optimization of multi brand logistics by: implementation of multi brand logistics international servicing areas for logistics regional/national trade and marketing Poland is the first country to implement EWM module. Total project budget: 4,85 Mio. EUR ET2000 SAP productive planned / in roll out 2013 2014 2015 09 10 11 12 01 02 03 04 05 06 07 08 Full Go Live IAM Testing done Planning phase Implementation phase Final preparation phase Purchasing Design Testing Training Inbound start Blueprint Business Case 28/04/2018 Volkswagen Group Polska

New Regional Parts Distribution Centre
Location: Poznań area Storage space: sq.m. Option to expand up to: sq.m. Height:11 m Building Class: A Green certificate (BREEAM) Accessible for handicapped people Investment of 95 Mio PLN Storing common and exclusive parts for all VGP brands Amount of stored parts: indexes 2013 2014 2015 01 02 03 04 05 06 07 08 09 10 11 12 Full Go Live Contract with developer Early access Planning phase Construction phase Final preparation phase Approval Planning Racking Feasibility Study Business Case Equipment Tendering & Negotiation Building Construction Migration Ramp up 28/04/2018 Volkswagen Group Polska

Automobile Market in Poland New Passenger Cars Registrations in 2013
Market Share Change vs PY in pp 12,6% 0,7% 9,0% 0,6% 8,1% 0,8% 6,7% 0,5% 6,3% -0,7% 5,9% 0,4% 5,8% 0,2% 5,1% 0,3% 4,5% 0,1% 3,8% 3,7% -1,2% -0,2% 3,2% -1,5% 3,1% 2,2% -0,3% 2,1% -0,1% 2,0% 1,9% 0,0% - VGP Brands - Main Volume Brands Competitors 28/04/2018 Volkswagen Group Polska

Car Park - segments 566 886 cars 930 808 cars 28/04/2018

Additional turnover vs. Baseline (in PLN) Additional turnover vs. PR 62/Budget (in PLN) 28/04/2018 Volkswagen Group Polska

Car Park – VW segments development
-12,9% 931 894 859 811 Remark: Car park figures in thousands 28/04/2018 Volkswagen Group Polska

Car Park – Audi segments development
+4,4% 328 334 336 343 Remark: Car park figures in thousands 28/04/2018 Volkswagen Group Polska

Car Park – VW LCV segments development

Car Park – Škoda segments development

Car Park – Seat segments development
-15,8% 260 261 247 219 Remark: Car park figures in thousands 28/04/2018 Volkswagen Group Polska

PartsHorizon2020 – Overview of Measures
Pricing Own Workshop Fleet NORA Tyres IAM/OEM Price studies Implementation of Market specific pricing (cMIP/MIP) Development of Price Image Campaigns Further implementation of Package prices System Development of age segment relevant pricing Implementation of Accident Damage Concept Strengthening of Economy parts Approach for Used cars Further implementation of Customer Binding Programs Development of CRM, active selling & predictive marketing Implementation of Product management Cooperation with FS AG Further development of Service Fleet Program Development of Fleet Package Pricing, including oil strategy Implementation of new IT platform for fleet business Implementation of Fleet Business/Service Centers Re-definition of the NORA Business Concept Development of new Bonus System Implementation of consistent Auditing Process Transparency and performance monitoring Targeted Sales & Communication campaigns Further development and expansion of PartsLink24 Transparency and performance monitoring Market and potential analysis Development of Marketing and Seasonal Campaigns Implementation of Tyre ETKA Catalogue Development of Tyre Insurance Transparency & Reporting IT System 28/04/2018 Volkswagen Group Polska

PartsHorizon2020: Volkswagen Group Polska

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