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AUTO & AUTO PARTS Korea Where Success Knows No Limits 2 Index

Continuous growth 3 Unit: KRW 100 mn Source: Korea Auto Industries Coop. Association (KAICA) CAGR 8.6% Annual Sales of the Auto Parts Industry of Korea

Major Export Markets Export Trends 4 Source: KIET; Korea Eximbank Global Economy Research Institute ( ); Naver Search Statistics Transmissions Other auto body parts Other parts and components CAGR 14 % Major Export Items

Comparison of auto part competitiveness: Korea, Japan, China 5 Unit : % Source: KIET, Korea Auto Parts Industry Promotion (KAP) PriceQuality Technology Unit : %

Cost comparison of major auto countries 6 Source: Mizuho Bank. Ltd. of Japan KoreaJapanGermanyMexicoUSA Sales Raw material costs Fuel costs Outsourcing costs 3.2 Labor costs Depreciation Costs Costs comparison of major auto countries

7 Global status of Korean auto & auto parts makers Source: Automotive News 6 th 35 th 43 rd 5 7

Status of Korean auto parts vendors 8 Note: Ranking based on 2013 sales Source: Korea Enterprise Data (KED)RankingVendorTurnoverEmployees Main products 1Hyundai Mobis17,5127,338Modules and systems 2Hyundai Wia6,2872,688 Gear boxes, engines, constant velocity joints, axles 3Mando5,0604,192Brake, steering and suspension devices 4Hyundai Powertech3,2731,800 Gearbox 5Hyundai Dymos1,6041,096Powertrain, seats Unit: KRW bn, people

Status of Korean auto parts vendors 9RankingVendorTurnoverEmployees Main products 6Hyundai Kefico1,5031,052Engine control unit, powertrain control unit 7 Korea Delphi Automotive Systems Corporation 1,2031,940Brake, steering and powertrain devices 8Heesung Catalysts Corp.1,107306Automotive catalyst 9Kyungshin1,1031,340 Wiring harnesses, junction boxes 10Sungwoo Hitech9371,246Bumper rails, door/door side inner Unit: KRW bn, people Note: Ranking based on 2013 sales Source: Korea Enterprise Data (KED)

Regional clusters for R&D 10 Gyeonggi Province Green car energy Source: Ministry of Trade, Industry & Energy South Chungcheong Province Automotive interior / electronic parts North Jeolla Province Green car commercialization Gwangju Clean diesel car Busan Global quality certification Ulsan EV components South Jeolla Province Automotive performance tuning service base North Gyeongsang Province Convergence automotive parts Daegu - Smart car commercialization - Smart green cars

R&D support for green vehicles Policies for future vehicles 11 Source: The Korea Institute for the Advancement of Technology (KIAT)CategoryEV Hydrogen Fuel Vehicle Plug-in Hybrid Vehicle Hybrid Vehicles Clean Diesel Vehicles R&D Project Development of EV finished-vehicle s (2010~) Development of systems and parts (2006~) Local production of parts (2008~) Local production of power train systems and parts Development of intake & exhaust system parts Government Support (Unit : KRW billion)

Annual Foreign Investment in Local Auto Parts Industry Status and trends of foreign investment 12 Source: Ministry of Trade, Industry & Energy Unit: Cases, USD 1, Automobiles No. of investments Amount invested 51,03810,379417,352373,3013,694889,391799,563 Auto parts No. of investments Amount invested 332,672287,84088,4812,079,611188,890254,056274,941

Investments of U.S. Companies 13 Company Equity share Parts/components supplied TRW Shinhan Valve Ind. Co., Ltd. (25%)Engine valves Visteon Halla Visteon Climate Control Corp. (69.9%)Climate control systems, etc. Visteon Interiors Korea (50.9%)Built-in modules JohnsonControls Johnson Controls Automotive Interior Korea (100%)Door trim Johnson Controls Automotive Korea (100%)Seats, etc. Delphi Packard Korea (50%)Wiring harnesses Korea Delphi Automotive Systems Corporation (50%)Steering control devices and brakes Lear Corp. Lear Korea (100%)Seats, etc. Federal-Mogul Corp. Dongsuh Industrial Co., Ltd. (50%)Engine parts FDI overview by region

Investments by German Companies 14 FDI Overview by region Company Equity share Parts/components supplied Continental Automotive Continental Automotive Systems Corp. (65%) Fuel injection devices, electronic control devices, etc. Continental Automotive Electronics (65%)Censors, instrument cluster Robert Bosch Robert Bosch Korea Ltd. (100%)Engine parts Robert Bosch Korea Buyong (100%)Auto motors, etc. ETAS Korea Co., Ltd. (100%)Auto embedded systems MAHLE GmbH MAHLE Donghyun Filter Systems Co., Ltd. (100%)Air filters, cylinder parts

Investments by Japanese Companies 15 FDI Overview by region Company Equity share Parts/components supplied Denso Denso Korea Automotive Corp. (71.0%)Motors, electric components Denso Korea Electronics Corp. (100%)Instrument cluster, HUD Denso International Korea Corp. (100%)Sale corporation Hitachi Automotive Systems Namyang Metals Co., Ltd. (90.8%)Engine parts, steering and control devices

Honeywell Korea’s Turbo Operations 3,305 ㎡ production facility Full capital investment investment by Honeywell Turbocharger brand “Garrett” “Garrett” Market share 60% ↑ USD 3 mn 16