CMC — Investor Presentation 2017

Nov 23, 2017

CMC Operating Results and Future Plan

November 23, 2017

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Safe Harbor Notice
This presentation contains forward-looking statements concerning the financial condition, results of operations and businesses of China Motor Corporation (“CMC”). All statements other than statements of historical fact are, or may be deemed to be, forward-looking statements.

Forward-looking statements are subject to significant risks and uncertainties which may vary from time to time and actual results may differ materially from those contained in the forward-looking statements, whether as result of new information, future events, or otherwise. CMC, its subsidiaries and representatives do not undertake any obligation to the damages resulted from the use, with or without negligence, of this presentation or other information related with it, except as required by law.

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Agenda

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Market Overview in Taiwan and Mainland China

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Auto Market in Taiwan

The National Development Council announces that Purchase Management Index of this September is 58.7, the nineteenth consecutive month appearing expansion. The economic growth rate of the third quarter this year appeared 3.11%, better than the first two quarters, indicating the gradually recovering economy. There are 439,000 vehicles to be sold as expected in total in 2017, incl. 9,000 heavy trucks and buses.
As for 2018, although the economy recovers, there are still many uncertainties existing in the auto market. It is estimated around 424,000 vehicles to be sold in Taiwan, incl. 9,000 heavy trucks and buses.
in ten thousand vehicles

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Auto Market in Mainland China

There are 20.23 million vehicles sold in the three quarters of this year, growing 4.5% compared to 2016. There are expectedly 29.40 million vehicles to be sold in China this year, benefiting from increased infrastructure investment, credit expansion, growing trade and so on.
In 2018, the economy in China expectedly appears stably growing because of the favorable effects caused by several trade and investment policies implemented by the China government and the recovering economy of other nearby countries. It is estimated that there will be 30 million vehicles to be sold in 2018, rising up 2.0% compared to 2017.

In ten thousand vehicles
3,000

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CMC Operating Results

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Domestic and Overseas Sales in The Three Quarters of 2017

Items	Accumulative Amount up to Sept. 2017	Accumulative Amount up to Sept. 2016	Growth Rate(%)
Domestic Volume of Vehicles	40,293	38,430	4.8%
Market Share	11.7%	11.3%	3.5%
Overseas Volume
CBU	447	615	-27.3%
CKD(sets)	12,270	9,480	29.4%
Domestic Volume of Electric Scooters	4,900	3,861	26.9%
Noted：Domestic volume of vehicles includes sales of Fuso-branded trucks and buses.

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Operating Results in The Three Quarters of 2017
(disclosed in Consolidated Financial Statements)

Except for EPS in NTD, others in thousand of NTD
| Items | Q1~Q3 2017 | | Q1~Q3 2016 | | Growth Rate(%) |
| --- | --- | --- | --- | --- | --- |
| Revenue | 30,940,579 | 100.0% | 31,449,664 | 100.0% | -1.6% |
| Operating Profit | 2,163,191 | 7.0% | 2,340,794 | 7.4% | -7.6% |
| Non-operating gain or loss | 1,755,002 | 5.7% | 1,165,785 | 3.7% | 50.5% |
| Profit before tax | 3,918,193 | 12.7% | 3,506,579 | 11.1% | 11.7% |
| Profit after tax | 3,570,610 | 11.5% | 3,140,853 | 10.0% | 13.7% |
| Earnings per share(EPS) | 2.40 | - | 2.09 | - | 14.8% |

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CMC Prospect 2017 & 2018

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Automotive Business in Taiwan

CMC launched not only all-new Grand Lancer this April, equipped with new generation of 4J engine, CVT8 system and MDSS, which contribute to low fuel consumption and better driving experiences, but also the modified model of Colt Plus this June. In addition, CMC will import a crossover SUV “Eclipse Cross” in December. Also, cheered by “The policy of the replacement of old vehicles with new ones”, CMC expects to sell around 51,000 in 2017, incl. Fuso-branded vehicles.
In 2018, in addition to Eclipse Cross, CMC will continue to introduce current models to be slightly modified or featured by superior product competitiveness and even the modified model of Outlander in the forth quarter to increase sales. CMC plans to sell 50,000 vehicles in 2018, nearly equivalent to sales of 2017.
Grand Lancer
Outlander Modified Model
Colt Plus Modified Model
Colt Plus/Grand Lancer/Zinger
Multi-purpose Model and Adjustment

Eclipse Cross
Pajero 2018 model

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Automotive Business in Mainland China

In 2017, with strengthening sales of DX7 and DX3 and introducing several models equipped with/or featured by superior product competitiveness, SEM expects to sell 158,000 vehicles, growing more than 30% compared to last year. In 2018, in addition to launch of DX7 modified model and DX3 2018 model to stimulate strong buying of DX7 and DX3, SEM also plans to launch A-Class Sedan “A5” and DX3 electrical vehicle. So SEM makes an attempt to sell 170, 000 vehicles in 2018, hitting a new record high.

A0-Class SUV DX3
2018 Model Year/EV
A-Class Sedan A5
(V5 Modified Model)
A-Class SUV DX7 Modified Model

DX7 and DX3 new model year, and several modified models equipped with/or featured by superior product competitiveness
FBAC estimates to sell around 22,000 vehicles in 2017, benefiting from strengthening sales of VS20 and offering several exterior color choices and promotions to customers. In 2018, FBAC will continue several promotional campaigns to achieve the sales goal of 29,000 vehicles, rising up more than 30% compared to sales of 2017.

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Automotive Business in Overseas Markets

As for vehicle export, owing to the execution of tightened safety regulations in GCC effective from Jan. 2017 which causes Veryca, Zinger and Lancer Fortis not able to timely meet all requirements, the export is estimated to be 500~600 vehicles in 2017. In 2018, due to existing unfavorable factors and new model year products to be launched into the Middle East by the competitors, CMC conservatively estimates to export 400~500 vehicles.

CBU Exports
Veryca
Lancer Fortis
Zinger

As for CKD export, CMC may export 12,000 sets in total in 2017, mainly affected by Freeca unable to meet European Union (Stage IV) emission standards for vehicles to be executed in Philippines and SEM’s reconciling inventory. In 2018, the export will decline to 600 sets, unfavorably affected by respectively discontinued production of Freeca in Philippines and Lancer in SEM.

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Green Energy Business

In 2017, CMC takes advantage of cross-industry cooperation, promotions to enterprises, public authorities and schools, such as green school project, sets up different specialty stores, such as flagship stores, to deeply communicate with customers and launches “e-moving Shine” in early November to enhance their impression on e-scooter brand of Greentrans and e-moving. CMC expects to sell 9,000 e-scooters in 2017, incl. e-scooters free of license plate, greater than 2016 by more than 50%.
In 2018, in addition to continuing some promotional campaigns and activities executed in 2017, CMC also plans to provide enterprises with beneficial buying or rental options, to enhance the development of domestic specialty stores and free charging stations in schools and to introduce special editions of current e-scooters, such as “e-moving Shine” with new colors, to increase sales volume to 12,000 e-scooters.
Electric Scooter free
of License Plate
Electric Scooter
Featured by
Economic Convenience
Electric Scooter
Featured by High Performance
& Long Endurance
Electric Scooter Featured by Big Body, Able in Both Public and Private Uses

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Thanks for your listening!

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