GKN at a glance

2

Agenda

9:00 – 9:15 Meet & Greet Bob Willig

9:15 – 10:15 GKN & Torque Presentation Bob/Jochen

10:15 – 10:45 Break All

10:45 – 11:00 PPE Mike Erdt

11:00 – 12:00 Plant Tour/Plant 1 Mike Erdt

12:00 – 1:00 Lunch All

1:00 – 2:00 Plant Tour/Plant 2 Mike Erdt

2:00 – 2:30 Wrap Up Bob Willig

3

Every day at GKN,

we drive the wheels of hundreds of millions of cars,

we help thousands of aircraft to fly,

we deliver the power to move earth and harvest

crop and we make essential components for

industries that touch lives across the globe.

4

GKN Driveline GKN Powder

Metallurgy

World leader in the

manufacture of sintered

components

Manufactures precision

automotive, industrial

and consumer products

Largest powder

producer in North

America

GKN Aerospace

Supplier to the global

aviation industry

Leader in the

manufacture of highly

complex composite

aero structures and

engine products

Developer of fuel

efficient solutions to

lower emissions

GKN Land Systems

Supplier to the global

agricultural,

construction, mining

and other industrial

markets

Innovation within

renewable energy and

mass transit solutions

Global aftermarket

distribution and service

World leading supplier

of automotive driveline

systems & solutions

Focused on solutions

that create weight,

space and fuel savings

Committed to

innovation

GKN at a glance

5

GKN at a glance

49,700 people

Global footprint – 40 countries

Market leading businesses

Above market growth

Operational excellence

GKN Driveline

GKN Powder

Metallurgy

GKN Aerospace

GKN Land Systems

Other

GKN 2013 Sales

£7.6bn $US 12.7bn €9.1bn

GKN Driveline driving tomorrow’s technology

7

GKN Driveline

Largest business of global engineer GKN

Market leading driveline technologies

• CVJ Systems

• AWD Systems

• Trans Axle Solutions

• eDrive Systems

Broad global footprint

Established long term global relationships

Focused engineering resource providing

driveline solutions

Expert customer specific account teams

8

GKN Driveline Executive Team

Regions

Chief Executive

Andrew (Andy) Reynolds Smith

Functions

Senior Vice President –

Finance and IT

Bill Curral

Senior Vice President –

Engineering

Rob Rickell

Senior Vice President –

Lean Enterprise and

Manufacturing Engineering

Marc Vuarchex

Senior Vice President –

Quality and

Risk Management

Trevor Pillay

Senior Vice President –

Commercial and

Customer Management

Stefan Magirius

Senior Vice President –

Purchasing and

Supply Chain

Philippe Roman

Senior Vice President –

Human Resources

Monique Carter

Senior Vice President –

Program Management

and Strategy

James (Jim) Voeffray

President – Americas

Robert (Bob) Willig

President – Europe

Helmuth Rohregger

President – Asia Pacific

Arnaud Lesschaeve

9

GKN Driveline – Sales 2013

Europe 37%

Asia Pacific

27%

Americas 36%

Trans Axle Solutions

7%

eDrive Systems

1% Other 1%

CVJ Systems

62%

AWD Systems

29%

by product segment by region of origin

£3,416m US$5,699m €4,106m

10

GKN Driveline – Sales 2013

VW 15%

GM Group 12%

Fiat Chrysler 11%

Ford Group 11%

Renault-Nissan

10% Toyota Group

6%

Tata Group 5%

BMW 4%

Mitsubishi Group 4%

Volvo Cars 4%

Other 18%

11

Brazil

India

U.K.

France

Spain

Italy

Slovenia

Turkey

Malaysia

Thailand

Colombia

Singapore

Taiwan

Japan

United

States China

South

Korea

Australia

Mexico

Sweden

Poland

Germany

GKN Driveline – An Excellent Global Footprint

Manufacturing plant

Joint Venture

Corporate office /

Engineering centre

GKN Driveline

end-2013

£3.42 billion

Sales

c.24,000

Employees

45 Manufacturing Plants

22 Countries

12

GKN Driveline – 4 Strong Product Segments

CVJ Systems AWD Systems Trans Axle Solutions eDrive Systems

CV Joints

Sideshafts

Propshafts

Transfer Units

AWD Couplings

Disconnects

Final Drive Units

Differentials

Limited Slip &

Locking

Differentials

eAxles

eTransmissions

eMotors

13

High performing, economic

solutions

Twinball (ST) joint with Face Spline

50% higher torque transfer

54 degree articulation – tightest

turning

reduced assembly time & backlash

Maximised performance

Ballspline system

maximise offroad angle & movement

Reduce NVH

GKN Driveline – CVJ Systems

Fuel saving technology

countertrack™ CVJ

smallest

lightest

most efficient

High performing, economic

solutions

Twinball (ST) joint with Face Spline

50% higher torque transfer

54 degree articulation – tightest

turning

reduced assembly time & backlash

efficient thinking The technology leader in CVJ sideshafts

Weight, space and fuel savings

Improved efficiency

Solutions provider

Most extensive range of CVJs

Widest global footprint

Manufacturing CVJs in 20 countries

14

GKN Driveline – AWD Systems

The global leader in efficient all-wheel

drive systems

Unique capability to develop and

manufacture full AWD Systems

World-class engineering over many

years

Optimized components through full

system understanding

dynamic thinking Reduces everything but

performance

DTF propshaft interface

reduces weight

reduces assembly time

reduces packaging space

reduces system costs

AWD Disconnect

Power Transfer / Rear Drive Unit

seamless engagement to AWD

mode

no compromise all wheel drive

improved efficiency

expert all wheel drive capability

Performance AWD

TWINSTER®

disconnect and LSD combination

efficiency and performance

active yaw control

optional torque vectoring

High performance coupling

EMCD®

electric or hydraulic actuation

low drag torque

Optimised connection methods

15

GKN Driveline – Trans Axle Solutions

Global supply

Open Differential

smaller packaging

weight saving

globally available

Improved dynamic performance

Electronic Torque Manager (ETM®)

maximum traction

maximum stability

Adaptable sophisticated

technology

Electronic Torque Vectoring

controlled fast cornering for premium

cars

Off-road expert

Electronic Locking Differential

fast locking rear axle for extreme off-

road conditions

unlimited thinking A leader in conventional and controlled

differentials for transmissions and axles

Manufacturing in all regions of

the world

Full product range

Established and experienced player

16

GKN Driveline – eDrive Systems

Electrified thinking A pioneer in advanced electric and

hybrid drivelines

Systems leadership capability

Standard product range

250,000 vehicles on the road

eTransmissions success in each

major automotive region

Broader range of motors

Hybrid with improved

performance

eAxle System

30% fuel saving

four driving modes

Economies of scale

eTransmission Family Approach

Compact

ultra quiet

choice of interfaces & gear ratio

Proven technology

Multi-mode eTransmission

total control of fuel economy

seamless switching between modes

Dynamic partnership

Integrated Motor & eTransmission

advanced electric motor technology

low weight

compact packaging

17

Driveline systems and solutions that deliver

CVJ Systems

AWD Systems

Trans Axle Solutions

eDrive Systems

GKN Driveline Americas Torque Business Unit

19

Torque Business Unit

Bowling Green, OH Newton, NC Auburn Hills, MI

Transaxle Solution Electronic Locking Differentials

Open Differential

Torque Management Devices /

Clutches

AWD Systems Final Drive Units

Power Take-off Units

Rear Drive Modules

AWD Disconnect

Systems

Technical Center Product Engineering

Program Purchasing

Top Line Progression

20

Our Team

21

Plant Director

NWT

Mike Erdt

Plant Director

BGR

Craig Zimmerly

Purchasing

Director

Todd Tinnell

Director of Program

Management

Markus Herrmann

Director Product

Technology

Edward Kwon

Business Analysis

Director

David Wilson

Program Director

GM AWD

Brad Murphy

Finance

Director

Kevin Ruff

Human Resources

Director

Kimberly Byerley

Commercial

Director

Owen Nagy

VP Operations AWD

& Transaxle Solutions

Jochen Wieland

Operations Functions

President .

Americas .

Bob Willig .

Our Team

22

Our Team

More than 900 great

people

23

23

GKN Driveline Newton

24

GKN Driveline Newton

248,000 Sq. Ft. / 23,038 m²

Central Administration

Spiral Bevel Gear, Housing and Cover Production

Assembly

Plant 1

257,000 Sq. Ft. / 23,876 m²

Logistic Services

Assembly

Axle Development Lab

Plant 2

Location: Newton, North Carolina

784 Employees as of October 2014

Total Sq. Ft. 505,000 / 46,914 m2

25

GKN plc – Excellence Award for Customer Service

26

26

GKN Driveline Torque

Products

27

Rear Final Drive Units (FDUs)

646

648

646-V

649

28

Front Final Drive Units (FDUs)

650

655

29

AWD PTUs (Power Take-off Units) and Rear FDUs

760

660

790

690 680

780 755

715

30

New Technology – Booster & Twinster Clutches

665 - RDM TTD Booster

665 - RDM Twinster eLSD

31

New Technology AWD Disconnect

Disconnect PTU

Disconnect RDM RDM ETM Module

32

New Technology AWD Disconnect

765 PTU Disconnect 665 RDM eLSD

33

New Technology Twinster Torque Vectoring

Twinster

Torque Vectoring

34

Our Strategy

35

Our Strategy

36

Lead in Chosen

Markets

37

Lead in Chosen Markets

Focus on AWD systems, Premium FDU’s, EDL, Clutches

Clutches provide

most of growth

– GM D2

Considerable growth

on FDU’s

– BMW Front FDU

– Mercedes Front

FDU (KBO)

38

Leverage Global

Footprint

39

Leverage Global Footprint

Localize Gear-Set manufacturing

28% of all gearsets

used are currently

imported from:

– Tochigi for

Chrysler MK

– Koeping / Nagoya

for GM Lambda

PTU

– BMW DGF

40

BMW

Chrysler

Ford

GM

Mercedes

Subaru

2.47 mio

units1.19 mio units

2014 2019

Leverage Global Footprint

Localize Gear-Set manufacturing

Localization and new

business wins help

to diversify

distribution to a

more robust

business case for

the high capex gear-

set manufacturing

area

41

Global Mega Platforms - ‘Go East to win the West’

Large and Mega Platform revenue will be over 80% of total revenue for Torque

Global Footprint and global capabilities will be a decisive factor for sourcing by the OEM’s, GKN needs to

strengthen it’s global organisation in regards to:

Commercial

Program Management

Manufacturing Systems

Engineering

Purchasing / Supply Chain

Revenue Growth on Large

and Mega Platforms % to Total Revenue

42

Technology Driving

Margins

43

Technology Driving Margins

Disconnect systems, Clutches, EDL, ECU incl. Software

Example Lambda RDM and PTU C1UX AWD System

GKN Content: – Assembly

– RDM Gear-

set

GKN Content: – Assembly

– RDM & PTU

Gear-set

– PTU

Disconnect

system

– Single /

Twin

hydraulic

Clutch

– GKN ECU &

Software

Approx. $850 Approx. $1,050

Big increase in complexity

and scope requiring new

skills (hydraulics, software,

electronics, ..)

Current State Future State

44

Technology Driving Margins

Disconnect systems, Clutches, EDL, ECU incl. Software

Example Ford C520 Global RDU Ford C2 ETM

GKN Content: – Assembly

– Machining

of Diff hsg

GKN Content: – Assembly

– GKN ECU &

Software

Approx. $35 Approx. $200

Current State Future State

Could open door to

complete RDU

45

Operational Excellence

46

Operational Excellence

Strong Focus on

People Development

Engagement

Business Process Improvement

Lean Fundamentals

to drive CI Culture

47

Operational Excellence

However beautiful the

strategy, you should

occasionally look at the

results.

Winston Churchill

48

Operational Excellence

Integrated System for

high level business and

departmental KPI’s,

linked to

– Individual CI plans

– Departmental PVD boards

– PDP goals

49

Sustain Growth Above

Market

50

Sustain Growth Above Market

Focus on Strategic Products

Strategic Products

only!

Internal clutches are sold as

part of a FDU

Twin systems are counted

as two units

units

51

Break

52

52

Plant Tour

Process Highlights

53

Gear Development Gear Calculation

Prototyping and

Validation

Noise Correlation

Production Support

Warranty / Reliability

Process Improvement S+ Tool Life

$0.670

$0.000 $0.203 $0.238 $0.238 $0.196 $0.224$0.000 $0.000 $0.000 $0.000 $0.000

$0.254

0.350

$0.380

$0.000

$0.100

$0.200

$0.300

$0.400

$0.500

$0.600

$0.700

$0.800

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec YTD

Co

st/P

cs

Actual Forecast

-$21,195 $23,741 $11,955 $7,575 $8,131 $7,387 $6,712

q p p p p p p

0.00%

1.00%

2.00%

3.00%

4.00%

5.00%

6.00%

7.00%

2009 YTD 2010 YTD 2011 YTD

Teststand FTT Fail

Teststand Scrap

0.00%

1.00%

2.00%

3.00%

4.00%

5.00%

6.00%

7.00%

1st Quarter 2nd Quarter 3rd Quarter

648/646V Teststand Scrap

PTU Teststand Scrap

Area’s influenced by the Axle

Development Department

54

Spiral Bevel Gear Manufacturing Ring and Pinion Soft Turning

100% Process Measurement w/ Machine Monitoring for Critical Dimensions

Spline & Thread Rolling

100% Camera Monitoring

Gear Tooth Generating

KIMOS feedback loop for predicative material distortion effects

Vacuum Gas Carburizing Heat Treat

Propane Atmosphere with Nitrogen Quench

Part Specific Heat Treat Recipe

Environmentally friendly – No waste quench oil

Pinion Journal Grinding

In-process Machine Feedback w/ 100% Post Process Gaging

Pitch Chuck Clamping

Ring Hard Turn & Drill

Pitch Chuck Clamping

Hard State – Turning Drilling, and Threading

100% Post process Bore Gaging

Lapping and Testing

100% Measurement and Recording of Run-out, Drive and Coast MTE 1st and 2nd Order.

55

Machining Centers Manufacturing

PTU & RDM Housing Machining

High Speed 5-Axis Single and Twin Spindle Automated Machining

Integrated 2nd Operation - Single Spindle Machining for drain holes and removal of clamping tabs,

Washing, and Leak Testing

Dimensional Gage Stations - 100% measure critical dimensions and mark housings w/ measurement

and traceability information used by Assembly.

PTU & RDM Cover Machining

High Speed 5-Axis Vertical Single Spindle Automated Machining

Automatic Fixture Clamping with air confirmation error proofing to assure part is clamped properly.

56

Laserwelding

High precision CO2 TruFlow Laser Welding process

Force and Distance controlled press process prior to welding – Input Shaft to

Ring Gear

In process monitoring system and data tracking through Gear Set Number

Mini Lab for frequent quality checks during production – batch control

Laser Cell prepared with Wire Feed to be able to implement Differential Welding

(Cast Iron)

57

Less complex Single Station concept to

improve uptime

Rework and material inside the loop for

optimal space utilization

Quick Change over

Minimized foot print

Operator friendly design

Manpower flexible

100% Data tracking

High amount of error proofing

70 sec cycle time, with easy upgrade to

50sec

Decoupled test stand motor (belt drive) to

minimize influence on NVH test

Independent EOL loop from Assembly

High Volume Assembly – New Generation

58

ISO/TS 16949:2009

EN/ISO 14001

OSHAS 18001:2007

CQI-9 Certified

Six-Sigma and Red X trained staff

GM-Quality System Basics

Fully equipped Metrology Lab

Fully equipped Metallurgical Lab

On site incoming inspection facility

On site supplier quality support group

Quality Certifications and Capabilities

59

Supply Base

3PL’s

GAP

Collaborative Web-Based supply chain management tools

Supply Chain Synchronization / Pull Replenishment

Real Time data sharing

Freight cost/unit down during inflationary fuel cost periods

Year-over-year Inventory Reductions

Supply Chain Management / Logistics Execution

60

SAFETY REQUIREMENTS FOR VISITORS

Requirements:

• All visitors must wear

GKN Safety Vest when

entering shop floor area

• All visitors must wear

safety shoes (steel or

composite toe) when

entering the shop floor

• All visitors must wear

safety glasses

61

61

Thank You