US-China Clean Truck & Bus Forum & Summit Briefing on China Business Opportunities Green Truck Summit Update March 7, 2013 Bill Van Amburg/Kevin Beaty/Susan Romeo CALSTART

Agenda » CALSTART Background

» Forum and Summit Overview

» China Overview

» China Truck & Bus Market Overview

» New Energy Vehicles

» Summit Activities & Takeaways

» Advanced Technology Insights

» Joining the Forum 2

CALSTART is a national, non-profit, clean transportation technology organization.

Mission: Support and expand clean transportation industry

Goals: • Create high-quality jobs; • Clean the air; • Reduce dependence on foreign oil; and • Reduce global warming emissions

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Title is here

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What CALSTART Does

Mission: Support and expand clean transportation industry

Role: Speed development, validation and use of clean transportation systems

Activities: TECH: Help partners structure, manage and validate technology projects POLICY: Develop policies supporting clean transportation development and use USE: Help fleets and others choose and use clean transportation SUPPORT: Provide members access to opportunities, connections, info, trends

• Partnership with the US Department of Commerce

• Goal: Help drive exports and business growth for US truck and bus technology companies with prime potential Chinese partners

www.chinacleantruck.org

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Forum’s Main Activities to Date

» Webinars and Workshops on key China business and market issues » Business Practices, IP – April 26

» Intellectual Property – May 31

» Briefing at HTUF – Sept 18

» Local Content Rules, SUMMIT opportunities – Oct 2

» China Business and Opportunities Guide targeting M/HD tech market

» Clean Truck and Bus SUMMIT in Beijing » Oct 30-Nov 1

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Top 20 Motor Vehicle Producing Countries 2011

Source: Production Statistics, Organisation Internationale des Constructeurs d’Automobile;

http://oica.net/category/production-statistics/ 8

Growing Impacts - Pollution Beijing, 1/14/13 From: Energy Digital

» Beijing pollution reaches record levels in January 2013

» PM 2.5 levels > 700 ppm (> 500 considered “off the index”)

» Government acknowledging issues for first time 9

China Market – Why “New Energy”?

» Roughly 50% of China’s transportation fuel goes to commercial trucks and buses – as opposed to less than a third in the US

» New Energy means using new energy technologies (electric, hybrid) and has sometimes been expanded to include using less fuel or using new fuels (natural gas)

» China plans to subsidize new energy vehicles $12B Yuan ($1.76B) by 2012

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Business Guide: Advanced Tech for M/HD Vehicles in China

» Produced for Forum » ONLY document focused

on M/HD truck and bus market

» Developed to assist US companies to understand shape of market, opportunities, barriers

» Executive Summary available to all

» Full report available free to all companies participating in Forum

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» Total sales of commercial vehicles in 2011 were approximately 6.93 million (mini, light, medium, and heavy-duty trucks and buses) » Big portion of the overall totals are mini and light trucks.

» Medium and heavy-duty commercial vehicles sales

in 2011 (weight classes 3-8 in the US) together total more than 1.4 million. More than two times the US production.

» Bus sales over 400,000 in 2011. The bus market is many times larger than US production, particularly of urban transit buses.

Commercial Vehicle Volumes in China

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CV Market by End Use

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China Commercial Truck Sales 2005-2010

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China Bus Market

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Quick Overview: Fuel Usage

» There is a disparity between how trucks and buses use fuel

» The majority of all trucks and buses in China are powered by diesel (97%).

» The city bus is an exception: 12% are powered by CNG, 5% by gasoline.

» Government NEV support has definitely favored public sector bus fleets versus any truck fleets.

» However – we are privately tracking a rapidly growing natural gas truck & bus market; at least 60,000 M/HD CNG & LNG vehicles last year.

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Top China MD Truck Makers

2011 Volumes in Thousands Source: iCET, chinatrucks.org

Top China HD Truck Makers

2011 Volumes in Thousands Source: iCET, chinatrucks.org

Type Design

Horsepower

(hp) – China

Design

Horsepower

(hp) - US

HDT 207-433 306-592

MDT 138-217 158-286

City Bus 145 250-400

Joint Venture Bus 364

Average Truck and Bus Power in China

Chinese versus non-Chinese

Commercial Vehicles

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Percentage of New Energy Buses in 2011

Source: iCET, China Association of Auto Manufacturers Annual Report 2012

Total sales of

buses

Approximate

sales of New

Energy Bus*

Approximate New

Energy Bus as % of

Total market (%)

Large 73,800 3,525 4.77

Medium 69,128 1,794 2.59

Small 322,500 189 0.05

Total 403,400 5,508 1.37

Large (12 meter) buses dominate NEV deployment

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China’s Aggressive NEV Deployment & Development Program

» Driven by latest 5 Year Plan

» Original “10 Cities, 1,000” Vehicles activity expanded to 25 cities

» Funds for EV/HEV deployment and development of core technologies

» Transit buses and taxis have been biggest activity areas

» However, despite goals city regions are missing targets (technical, manufacturing challenges)

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CALSTART Companies Have a Range of Key Technologies Valuable for China Export

Advanced Transmissions

Energy Storage and management

Electric Drive systems and components

Hybrid Drive systems and components

Power management and control

Advanced Combustion, Alt Fuel Systems and Control

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US-China Clean Truck & Bus Summit

» Summit is key component of Forum –supported important face-to-face meetings

» 120 attendees from nearly 50 different US and Chinese companies

» 13 government agencies included MIIT, MOST, MEP, DOC, DOS, EPA, DOE

» 3 transit districts

US Company Attendees: Achates Power; BAE Systems; Caterpillar; Cummins; Eaton; Emerson; Fauricia; Gentherm; Hydrogenics; Navistar; Nidec; Remy: Smith Electric; Sturman Industries; Wells Fargo

Sponsors:

Chinese Company Attendees: Aowei Technology; BYD Overseas Group; China Star Technology; CITIC Guoan MGL; CSR Zhuzhou Institute Co.; DLG Power Battery Company; Dongfeng; E.ON; Fawer Automotive Parts; Foton; Green Power Co.; Hengtong E-Bus; Huayu E-Drive; JAC; Jing-jin Electric; Quingling Motors; SAIC-Iveco Hongyan; Shanghai Dajun Technologies; Shanghai Dianba New Energy Technology; Shanghai E-Drive; Shanghai Fuel Cell Vehicle Powertrain Co.; Sinotruck Power; Weichai Power; Weichai Westport; XJ Group; Yutong

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Unique Value

» Commercial vehicle agenda

» Interactive

» Key leaders from US and Chinese government and industry

» Included users in discussion

» Focus on commercialization 24

"The Summit is a useful resource no matter if you are first exploring the Chinese market, already engaged there, or looking for new opportunities. With a balanced structure between presentation and networking, participants will come away with both new ideas and new conversations. It's a bargain for the investment of time and costs." - Tim Weaver, Senior Director Global Government Affairs , Smith Electric Vehicles

Networking Center » Separate room used between sessions to help companies connect

» Multiple leads developed, follow on meetings set

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"I am glad I participated in the CALSTART US-China Summit, it was a great event and opportunity to meet Chinese bus and truck OEMs in one place. For those who would like to explore the possibilities of doing business in China, it will be one of the events that one won't want to miss." - Rob Del Core, Business Development Director, Hydrogenics USA

China Transit Panel

» Heard real field experiences, needs from major China transit districts

» Not common in China

» Moderated by Mike Reilly, BAE Systems

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"An excellent conference, well organized with a wide range of attendance from both policy makers and business and high quality presentations contributing to free and open discussion between all participants. One of the best I've ever attended." - Michael Reilly, Chief Representative, China, BAE Systems

Tech Site Visits

» Day three included field trip to Foton electric and alt fuel bus factory, Beijng transit battery swap facility

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Key Takeaways

» China committed to making New Energy Vehicles (NEVs) work

» Example: Beijing transit has stopped buying diesel buses; buying 3,000 LNG buses by 2015 plus more electrics!

» Chinese companies very interested in connecting with US technology firms

» Government recently further loosened rules on NEV tech imports

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• October 2013

• Build off success of first event in Beijing with Summit in center of transportation tech development in China

• Targeted, exclusive meetings of US and Chinese tech leaders, early tech users and key government agencies

• Goals: Expand/create exports via targeted meetings and introductions for US tech companies with potential Chinese customers

2nd US-China Clean Truck & Bus SUMMIT Shanghai 2013!

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Battery Swap System

» 100 buses operating in Beijing since 2008; similar system also in Shanghai

» Automated system provided by Dianba Technology, funded by State Grid 30

Battery Swap System

» Battery pack swap out in 8-10 minutes per bus

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Battery Swap System

» Buses swap packs several times per day » 240 9kw charging units » When not needed for buses, batteries also provide grid

support 32

Fast Charge Buses

» 30 buses operating in Chongqing Transit » State Grid facility refueling Hengtong buses with Microvast

batteries » 10 minute fast charge gives ~50 kwh of storage 33

Fast Charge Buses

» Facility can recharge 6 buses at a time; 400kw – 750V

» Buses recharge 5 times/day

» Operating in revenue service

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Hengtong

» Opened new electric, hybrid bus manufacturing line

» Also largest producer of NG buses, NG hybrid buses

» Chongqing region has 7500 NG buses operating

» Producing 450 hybrid/PHEV buses (15% of production), 50 all electric in 2012 35

Questions?

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Joining the Forum

» Open to US M/HD tech, component, engine and vehicle companies

» Receive full copy of China Business Opportunity Guide for M/HD Market

» What’s the catch? Simply agree to confidentially track export successes » Not a commitment to attend China Summit, just take

part in Forum (US webinars, info)

» Contact CALSTART staff – Susan Romeo, Kevin Beaty

» www.chinacleantruck.org

Upcoming Forum Activities

» Webinars on key topics » Tech exports to China– practical tips

» Opportunities in natural gas

» Opportunity to tap US Foreign Commercial Service Experts in China – custom research, connections

» Updated market information

» Summit II in Shanghai – join the tech delegation

US-China Clean Truck and Bus Summit 2013: Shanghai

» Plan Now: Summit 2013 in Shanghai - October

» Great opportunity for connections with M/HD industry leaders in, users of fuel efficient technology

» Opportunity to sponsor, network, speak, build out custom meetings

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Conclusions – Next Steps

» China M/HD market much bigger than US

» Tremendous innovation because of NEV commitment – natural gas, hybrid, electric

» Real, large scale EV deployments underway – China is ahead of US

» Also facing some tech challenges US companies can address

» Growing openness to collaboration

» Opportune timing for joint activities, learning, leveraging joint relationships

» How can we help you in China? 40

CALSTART Clean Transportation Technologies

and Solutions 41