Global Auto Industry Conference

Global Auto Industry Conference Detroit, MI January 14-15, 2014 Jan Carlson – President & CEO © Autoliv, Inc. All Rights Reserved. / INTERNAL Safe...
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Global Auto Industry Conference Detroit, MI January 14-15, 2014

Jan Carlson – President & CEO

© Autoliv, Inc. All Rights Reserved. / INTERNAL

Safe Harbor Statement * This presentation contains statements that are not historical facts but rather forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include those that address activities, events or developments that Autoliv, Inc. or its management believes or anticipates may occur in the future. All forward-looking statements, including without limitation, management’s examination of historical operating trends and data, are based upon our current expectations, various assumptions and data available from third parties. Our expectations and assumptions are expressed in good faith and we believe there is a reasonable basis for them. However, there can be no assurance that such forward-looking statements will materialize or prove to be correct as forward-looking statements are inherently subject to known and unknown risks, uncertainties and other factors which may cause actual future results, performance or achievements to differ materially from the future results, performance or achievements expressed in or implied by such forward-looking statements. The outcome of these forward-looking statements could differ materially from those stated for a variety of reasons, including without limitation, changes in and the successful execution of our capacity alignment, restructuring and cost reduction initiatives; changes in general industry or regional market conditions; loss of business from increased competition; higher raw material, fuel and energy costs; changes in consumer and customer preferences for end products; customer losses; changes in regulatory conditions; customer bankruptcies or divestiture of customer brands; unfavorable fluctuations in currencies or interest rates among the various jurisdictions in which we operate; fluctuation in vehicle production schedules; component shortages; market acceptance of our new products; continued uncertainty in pricing negotiations with customers, our ability to be awarded new business; product liability, warranty and recall claims and other litigation and customer reactions thereto; higher expenses for our pension and other postretirement benefits; work stoppages or other labor issues; possible adverse results of pending or future litigation or infringement claims; negative impacts of antitrust investigations or other governmental investigations and associated litigation (including securities litigation) relating to the conduct of our business; tax assessments by governmental authorities; dependence on key personnel; legislative or regulatory changes limiting our business; political conditions; dependence on customers and suppliers; and other risks and uncertainties identified under the headings “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Reports and Quarterly Reports on Forms 10-K and 10-Q and any amendments thereto. The Company undertakes no obligation to update publicly or revise any forward-looking statements in light of new information or future events. For any forward-looking statements contained in this or any other document, we claim the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995, and we assume no obligation to update any such statement.

(*) Non-US GAAP reconciliations are disclosed in our 8-K/10-K/10-Q filings available at www.sec.gov or www.autoliv.com ALV January 14-15, 2014 Global Auto Industry Conference Investor Meetings – Detroit - 2

Autoliv in Brief Sales and technology leader RoA

LTM* Sales US ~ $8.5 billion Fortune 500 company

Japan

Sales to all major vehicle manufacturers > 80 facilities in 29 countries 10 technical centers in 9 countries & 21 crash test tracks ~ 55,000 associates of which ~ 5,000 in R,D&E

Europe

10%

China

8%

15%

32%

LTM

35% Americas

Well balanced geographic presence (*) Last Twelve Months thru Q3’13. ALV January 14-15, 2014 Global Auto Industry Conference Investor Meetings – Detroit - 3

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Autoliv in Brief Sales and technology leader Airbags

LTM* Sales US ~ $8.5 billion Fortune 500 company

Seatbelts 32%

Sales to all major vehicle manufacturers

LTM

> 80 facilities in 29 countries 10 technical centers in 9 countries & 21 crash test tracks ~ 55,000 associates of which ~ 5,000 in R,D&E

Active Safety 4%

Airbags includes steering wheels and passive safety electronics (*) Last Twelve Months thru Q3’13. ALV January 14-15, 2014 Global Auto Industry Conference Investor Meetings – Detroit - 4

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64%

Our Key Strategies

Focus on savings lives and safety around the automobile Lead thru innovation and technology Leverage global footprint and talented-skilled people

Zero defects and customer focus

“One Stop Shop” for automotive safety system solutions

ALV January 14-15, 2014 Global Auto Industry Conference Investor Meetings – Detroit - 5

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Long-Term Targets - Creating long-term shareholder value Organic sales growth at least in line with our market •

and faster than our market including acquisitions

Operating margin range 8-9% over the business cycles •

US GAAP excluding costs related to the antitrust investigations

EPS growth faster than organic sales growth •

excluding the effects of currency

Net Debt*/EBITDA around one times (Debt Limitation Policy) •

and within the range of .5 and 1.5 times

Underlying Debt Policy is to remain “strong investment grade” (*) Non US GAAP Net Debt adjusted to include Pension Liability ALV January 14-15, 2014 Global Auto Industry Conference Investor Meetings – Detroit - 6

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2013 Recap - Solid performance thru Q3’13 Growth * • strong organic sales growth • active safety investments are paying off with increasing adoption rates • expansion in growth markets especially China and vertical integration Adjusting capital structure • re-initiated buybacks and announced dividend increase during Q4’13 • long-term credit rating upgraded to A- from BBB+ by S&P Transition continues • aligning capacity footprint with the market for the long-term • addressing margin challenges to achieve sustainable margins for the long-term

Target Active Safety to reach the long-term margin target range of 8-9% within 2 to 3 years (*) YTD Q3’13. ALV January 14-15, 2014 Global Auto Industry Conference Investor Meetings – Detroit - 7

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Volvo Cars Award of Excellence 2013 - World’s first Pedestrian Protection Airbag

Another joint world’s first for Volvo & Autoliv First launch on Volvo V40 Shows Volvo never compromises on safety

Autoliv safety products contributed to Volvo’s excellent EuroNCAP rating

ALV January 14-15, 2014 Global Auto Industry Conference Investor Meetings – Detroit - 8

Mercedes E-class - Receives top rating for AEB* according to Euro NCAP

Autoliv Content Radar system Side Chest & Head Curtain Airbags Active Seatbelts & Cable Cutters

Autoliv contributed to the Euro NCAP overall 5 star rating (*) Autonomous Emergency Braking ALV January 14-15, 2014 Global Auto Industry Conference Investor Meetings – Detroit - 9

2014 Motor Trend CAR of the YEAR - Cadillac CTS Autoliv Content Dual stage Passenger Airbag (with safety vent) Side Chest & Head Airbags (front and rear) Electronic Control Unit & crash sensors (integrated rollover & IMU) Radar system (Side Blind Zone Alert & Rear Cross Traffic Alert - Driver awareness package)

5-Star Overall US NCAP vehicle safety rating

ALV January 14-15, 2014 Global Auto Industry Conference Investor Meetings – Detroit - 10

Road Traffic Fatalities - According to the World Health Organization

Total 2004 Leading Cause

Total 2030 %

Leading Cause

%

1 Ischaemic heart disease

12.2

1 Ischaemic heart disease

14.2

2 Cerebrovascular disease

9.7

2 Cerebrovascular disease

12.1

3 Lower respiratory infections

7.0

3 Chronic obstructive pulmonary disease

8.0

4 Chronic obstructive pulmonary disease

5.1

4 Lower respiratory infections

3.8

5 Diarrhoeal diseases

3.6

5 Road traffic injuries

3.6

6 HIV/AIDS

3.5

6 Trachea, bronchus, lung cancers

3.4

7 Tuberculosis

2.5

7 Diabetes mellitus

3.3

8 Trachea, bronchus, lung cancers

2.3

8 Hypertensive heart disease

2.1

2.2

9 Stomach cancer

1.9

2.0

10 HIV/AIDS

1.8

1.3 million 9 Road traffic injuries fatalities

10 Prematurity and low birth weight

2.4 million fatalities

Road traffic injuries are increasing as one of the world’s leading causes of death Source: 2008 World Health Organization report ALV January 14-15, 2014 Global Auto Industry Conference Investor Meetings – Detroit - 11

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Just How Important is Safety - “North America Consumers’ Attitude & Perception” study

Safety remains one of the most important factors in the consumer’s vehicle purchasing decision February 2013 Frost & Sullivan Report ALV January 14-15, 2014 Global Auto Industry Conference Investor Meetings – Detroit - 12

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Just How Important is Safety - “Europe Consumers’ Attitude & Perception” study Closely behind reliability, safety features are highly important in the car selection process. Share of Preference for Vehicle Selection Criteria: Europe, 2013 90%

Reliability

86%

Safety Ride and handling

83%

Fuel economy/efficiency

82% 73%

Price of vehicle 62%

Comfort and convenience 52%

Environmentally friendly

50%

Power train Design and style of the exteriors Design and style of the interior Infotainment/ entertainment features Customization or personalization

44% 41% 39% 37%

Based on TURF Analysis of Anchored MaxDiff Scores. % of Respondents rating feature as important (Anchored Score > 20) February 2013 Frost & Sullivan Report ALV January 14-15, 2014 Global Auto Industry Conference Investor Meetings – Detroit - 13

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Rating and Regulations - US NCAP migration to Active Safety and Adaptive IIHS Ratings: • •

New IIHS Small Overlap test – Integrated into Top Safety Pick “Plus” for 2013. FCW and/or AEB – “Availability” of FCW required for Top Safety Pick “Plus” for 2014.

NHTSA - USNCAP: • Back-over Safety – ESC recognition replaced by rearview video systems to prevent back-over • Active Safety Areas Under Consideration Crash Avoidance and Post-Crash Technology Areas Under Consideration Features: Blind Spot Detection, Advanced Lighting, Lane Departure Prevention, Crash Imminent Braking, Dynamic Brake Support, Automatic Pedestrian Detection and Braking (Frontal & Rear)



Passive Safety Areas Under Consideration Improved Rating of Rear Seat Safety Rating of Safety for Older Occupants Rating of Pedestrian Protection Improved Test Dummies and Injury Criteria New Test Protocols for Electric Vehicles Alcohol Sensing

NHTSA estimates the US “annual cost to society of traffic accidents” is several hundred billion $’s

ALV January 14-15, 2014 Global Auto Industry Conference Investor Meetings – Detroit - 14

“Prevention – Protection” - The enablers for Autonomous Driving

POINT OF NO RETURN (One third of a second)

Prevention Protection

ALV January 14-15, 2014 Global Auto Industry Conference Investor Meetings – Detroit - 15

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The Road Towards Saving More Lives

The main questions remaining are when and how?

ALV January 14-15, 2014 Global Auto Industry Conference Investor Meetings – Detroit - 16

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Industry Direction - Electronic Controls Integration Radar

Radar Brake ECU

Steering Slave

Brake Slave

Brake Slave

ESC IMU Restraint Control + IMU

Radar

Suspension Slave

Vision

Restraint/ Brake Controller

Radar

SafetyChassis Domain Controller

Radar

GPS Driveline Slave Radar

Autonomous driving could be a catalyst to accelerate the implementation

ALV January 14-15, 2014 Global Auto Industry Conference Investor Meetings – Detroit - 17

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Radar

China - Increasing market share, CPV & LVP

Light Vehicle Production 30

2012*

2015*

25

Million units

Chinese 13%

Chinese 15%

20

ALV 35%

15

Others 50%

10

ALV 37% Others 50%

5

0 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

* Combined market share for airbags and seatbelts

Current content per vehicle ~ $210 (*) LVP (Light Vehicle Production) according to IHS @ December 16, 2013 ALV January 14-15, 2014 Global Auto Industry Conference Investor Meetings – Detroit - 18

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Investments for Growth - Recent announcements Propellant Campus for Asia Global capacity + 25% For increasing demand Closer to demand & cost optimization $33 million, SOP 2014 Seat Belt Webbing Global capacity +20% For increasing demand Closer to demand & cost optimization $10 Million, SOP 2011 Airbag Plant Asian capacity +10% For increasing demand $3 million, SOP 2013

Seat Belt Plant

Steering Wheel Plant for Asia Phase 3 Adding 25% to existing Asia capacity For increasing demand $8 million, SOP 2014 Tech Center Expansion New crash test track Passive & active safety capabilities + 430 engineers $8 million, SOP 2013-2014 Textile Center

For booked business

New weaving plant,

Doubles local sales to $25 million

New airbag cushion plant

$3 million, SOP 2012

$50 million, SOP 2014

Overall capital expenditures expected to remain in the range of 4 to 5% of sales

ALV January 14-15, 2014 Global Auto Industry Conference Investor Meetings – Detroit - 19

Dividend Trend - Per share and cash payments* 0.6

60

Dividend per share

40

0.2

20

$ per share

$ US Millions

0.4

Dividend Payments 0

0 1997 98

99

2000

01

02

03

04

05

06

07

08

09

2010

11

12

Shareholder annualized dividend $2.08 per share (*) Estimated dividend payment for Q1 2014 based on share count at the end of the 4th quarter 2013 ALV January 14-15, 2014 Global Auto Industry Conference Investor Meetings – Detroit - 20

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13

14

Share Repurchase Program* - Re-initiated in October 2013 35.9 million shares average cost $45.09 remaining authorization ~ 1.6 million shares

148 173 380 221

1,621

378

30

43

144

103 2000 Cost / share

$22.68

2001 0

2002 $19.57

2003 $20.97

2004 $41.97

2005 $44.86

2006

2007

2008

$55.69

$57.35

$46.77

2013 $90.39

Limited “open window” each quarter (*) MUS$ except where specified ALV January 14-15, 2014 Global Auto Industry Conference Investor Meetings – Detroit - 21

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TOTAL $45.09

Autoliv in Summary

Solid performance in 2013 thru Q3’13 Executing on our key strategies towards long-term targets 2014 will be a transition year to address our margin challenges Positioning our company to capitalize on the long-term industry trends

ALV January 14-15, 2014 Global Auto Industry Conference Investor Meetings – Detroit - 22

150 000 125 000 100 000 75 000 50 000 25 000 0 2012 We envision 150,000 lives saved by our products annually

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Autoliv - Safety Systems

Autoliv

Active Safety

Every year, Autoliv’s products save over 25,000 lives Passive

The Worldwide Leader in Automotive Safety Systems

Safety

The Global Leader in Automotive Safety