© SKF Group CMD 2013
SKF Automotive
CMD 2013
© SKF Group CMD 2013
© SKF Group CMD 2013
SKF Automotive speakers
Tryggve Sthen
President
SKF Automotive
Bernd Stephan
Director,
Business unit Trucks
Edward Holweg
Director,
Product and Systems Development
© SKF Group CMD 2013
Agenda SKF Automotive
Market update
Way ahead
Special focus - Trucks
Special focus - SKF knowledge engineering
Key business messageQ&A
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Market update
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Sales in local currencies and demand outlook
Sequential trend
Sales in local currencies excl. structure change y-o-y YTD 2013
EuropeNorth
AmericaLatin
AmericaAsia
Middle East & Africa
Total Automotive +/- +/- + +++
Trucks ++ --- +++
Cars and light vehicles ++ +++ +++ +++
Vehicle service market +++ ++ +++ -- +
Two-wheelers and electrical +/- --- +++ ---
SKF demand
outlook for Q3 2013
© SKF Group CMD 2013
Business recovering
Sales development Operating margin
0,0
2,0
4,0
6,0
8,0
10,0
12,0
14,0
16,0
18,0
20,0
2007 2008 2009 2010 2011 2012 2013 H1
0,0%
1,0%
2,0%
3,0%
4,0%
5,0%
6,0%
7,0%
8,0%
9,0%
2007 2008 2009 2010 2011 2012 2013
H1
5%
SE
K b
illio
n
Per
cent
Excl one time costs
8,5%
Q2, 20135,8%
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Customer segments
Cars Trucks Two wheelers Vehicle aftermarket
Other
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Car ChassisTrucks PTE & TWVehicle Service Market
Sealing Solutions
Aurelio NervoBernd Stephan Franco Ferro Christer Cedervall John Bohenick
Five global business units with clear roles & responsibilities.
SKF Automotive organisation
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Light vehicle production
0
8000
16000
24000
32000
40000
W.Europe N.America Asia
2007
2008
2009
2010
2011
2012
Fcst2013
Source: IHS July 2013
-3.1 %
+4.8 %
+3.0 %Total growth 2013/2012: +2,3% Values in K units
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Two wheeler production
05 000
10 00015 00020 00025 00030 00035 00040 00045 00050 00055 00060 00065 000
W.Europe L.America Asia
2007
2008
2009
2010
2011
2012
2013fcst
Source: Frost & Sullivan and others, July 2013
-1.4% +4.2 %
+8.3%Total growth 2013/2012: +8% Values in K units
© SKF Group CMD 2013
0
200
400
600
800
1 000
1 200
1 400
1 600
1 800
2 000
W.Europe N.America Asia
2007
2008
2009
2010
2011
2012
FC2013
Trucks production (GVW>6t)
Source: LMC Report Q2 2013
-6,6%
-0,4%
+4,2%
Total growth 2013/2012: +3% Values in K units
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The way ahead
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SKF Automotive strategy
GrowthFast
growing markets
Engineering
partner
Winning customers
After-market
Strategic account manage-
mentCost and capital
efficiency
ProductivityOffers
for regional demand
Cost reductions
© SKF Group CMD 2013
Growth drivers - Winning customers
GrowthFast
growing markets
Engineering
partner
Winning customers
After-market
Strategic account manage-
mentCost and capital
efficiencyProductivi
tyOffers for
regional demand
Cost reductions
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Growing with winning OEM customers
Recent successful cases
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Supplier recognition
GM Supplier of the Year Award 2012
3 consecutive years!
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SAIC Zhan Jinping, Suspension System Manager
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SAIC
Excellent supplier important for brand building
SKF best in R&D and quick response time
Need SKF technology to meet goals
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GeelyChen Yong, Purchasing Manager
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Geely
Brand positioning
Localization in China
High performance and energy efficient products
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Growth drivers - Aftermarket
GrowthFast
growing markets
Engineering
partner
Winning customers
After-market
Strategic account manage-
mentCost and capital
efficiencyProductivi
tyOffers for
regional demand
Cost reductions
© SKF Group CMD 2013
Growing the vehicle aftermarket
Growing range
600 new kits in 2013 = 20.600 kits
Global customer need for local markets
Step up in-sourcing
Continued re-sourcing to have the right suppliers
Flexible production capacity OE to aftermarket
Products
Asia distributor network grown with 40 new in half year 2013
Consolidation of national distributors to Int. trading groups
Formed Global Product Management organization
Customers
Significantly increased flexibility and capacity in packaging centers
Extensive sales and marketing efforts to launch SKF branded CV-Joint kits
Performance
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Growth drivers – Engineering partner
GrowthFast
growing markets
Engineering
partner
Winning customers
After-market
Strategic account manage-
mentCost and
capitalefficien
cy
ProductivityOffers
for regional demand
Cost reductions
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Engineering partner
Local engineering globally
SKF Global Technical Centers – expansion in fast growing markets
Simulation and calculation expertise
Testing and evaluation expertise
Reducing lead times by more than 10 times
Reducing weight and friction with up to 50%
Solving customer issues
12 engineering centers
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SKF BeyondZero portfolio - Automotive
SKF Turbocharger Ball Bearing Unit
High pressure valve stem seal
SKF eDrive Ball Bearing
SKF Low Weight Hub Bearing Unit SKF
StopGo
SKF Rotor Positioning Bearing
E2 TRB for truck final drive
SKF Low Friction Engine Seal
SKF Bus Door Actuator
High performance seal for hub bearing unit
SKF Low Friction Hub Bearing Unit
SKF Sealed Energy Efficient deep groove ball bearing
SKF Rotor Positioning Sensor-Bearing Unit for traction motors
Energy efficient solutions to reduce CO2 emissions and fuel/energy consumption.
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SKF Automotive – Reducing cost
GrowthFast
growing markets
Engineering
partner
Winning customers
After-market
Strategic account manage-
mentCost and
capitalefficien
cy
ProductivityOffers
for regional demand
Cost reductions
© SKF Group CMD 2013
Cost reduction programmes
Sustainable cost reductions through a number of global programmes
Manufacturing footprintInvestment focus in best cost countries
Cost reduction from sourcing and design
Business Excellence ManufacturingManagement and administrationSix SigmaQuality
Inventory optimization
50 factories in 45 locations
45% in fast growing markets
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Business Excellence in Guadalajara, Mexico
Inventory reduction (days of inventory) - 33%
Down time reduction - 30%
Increased efficiency +19%
Scrap reduction - 44%
How was this achieved?
Deep dive to understand the gap vs. ideal lean conditions
Master schedule
Daily management process with visual inspection
All people involved and committed
Continuous improvements
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Manufacturing and engineering footprint – Asia
Factory inaugurated and in production: Jinan, China
New factory being built: ATC II Shanghai, China
SKF Global Technical Centers expanding in India and China
12 factories in Asia
Wuhu
Taegu
Jakarta
Mysore
Pune
HaridwarBusa
nJinan
Shanghai ATC+SSBC
Bangalore
Expansion in Asia
Shanghai ATC II
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SKF Automotive
Lets move out…..
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SKF Automotive
CMD 2013
© SKF Group CMD 2013
Key business message
© SKF Group CMD 2013
SKF Automotive – The way ahead
GrowthFast
growing markets
Engineering
partner
Winning customers
After-market
Strategic account manage-
mentCost and
capitalefficien
cy
ProductivityOffers
for regional demand
Cost reductions
© SKF Group CMD 2013
SKF Automotive – Driving profitable growth
Competitive advantages
• SKF brand
• SKF knowledge engineering
• Technology leadership
• Global presence; sales, engineering and manufacturing
• Value added products and solutions
Cost focus
• Reduce waste
• Adapt and adjust for low inventory cost
• Optimize product cost for optimized customer value
SKF BeyondZero portfolio
• Energy efficient solutions
• Credibility
• Life cycle management
• Calculations and measurements
• External audit/review
Growth drivers
• Fast growing markets
• Sustainability
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SKF Automotive – Key business message, Sept 2013
Well positioned product portfolio, with clear positive environmental impact
Good growth sequentially
Improvements of order intake
Earnings recovering in first half 2013
Overall heading in the right direction
© SKF Group CMD 2013
SKF Automotive
Open for questions…
Thank you