CMC — Investor Presentation 2018

May 30, 2018

CMC Operating Results ?and Future Plan

May 30, 2018

Notes:

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.

Any part of this presentation can not be, on any purpose, directly or indirectly replicated, spread, transmitted or published.

Agenda

Notes:

Market Overview in Taiwan and Mainland China

Notes:

Auto Market in Taiwan

The GDP growth rate reached 3.04% in first quarter of 2018, which was higher than the expected 2.42% announced by Directorate-General of Budget, Accounting and Statistics. The monitoring indicator of Taiwan’s economy flashed green light for two consecutive months, indicating the gradually recovering economy.
Although the economy is recovering, there are still uncertainties remained in the continuous growth of Taiwan’s auto market due to the recent trading conflict between Mainland China and U.S.A. The total sales volume of 2018 is estimated to be 440,000 units, among which vehicles below 3.5 tons are 430,000 units and vehicles above 3.5 tons are 10,000 units.
Unit: in ten thousand

Notes:

Auto Market in Mainland China

The National Bureau of Statistics in Mainland China announced the GDP growth rate of the first quarter in 2018 was 6.8%, higher than the official annual target of 6.5%, but lower than 6.9% during the same period of last year. This benefited from several fiscal and monetary policies implemented by the Chinese government and the better global economy. The economy in Mainland China is expected to grow slowly in 2018.
The estimated total sales volume of auto market in Mainland China is 29.42 million units which is increased by 1.9% compared with 2017.

Unit: in ten thousand
2,942.0

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CMC’s Operating Results

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Domestic and Overseas Sales in 2017

Item	2017	2016	Growth rate(%)
Domestic Volume of Vehicles	49,222	47,094	4.5%
Market Share	11.1%	10.8%	2.8%
Overseas Volume
CBU	594	1,280	-53.6%
CKD(sets)	12,270	13,530	-9.3%
Domestic Volume of Electric Scooters	9,260	5,941	55.9%
Note：Domestic volume of vehicles includes sales of Fuso-branded trucks and buses.

Notes:

Operating Results in 2017
(disclosed in unconsolidated financial statements)

EPS in NTD, others in thousand NTD
| Item | 2017 | | 2016 | | Growth rate(%) |
| --- | --- | --- | --- | --- | --- |
| Revenue | 30,234,697 | 100.0% | 30,577,106 | 100.0% | -1.1% |
| Operating profit | 2,064,434 | 6.8% | 2,263,593 | 7.4% | -8.8% |
| Non-operating gain or loss | 2,275,209 | 7.5% | 1,264,507 | 4.1% | 79.9% |
| Profit before tax | 4,339,643 | 14.4% | 3,528,100 | 11.5% | 23.0% |
| Profit after tax | 4,105,643 | 13.6% | 3,189,100 | 10.4% | 28.7% |
| Earnings per share (EPS) | 3.01 | - | 2.34 | - | 28.6% |

Operating Results in 2017
(disclosed in consolidated financial statements)

EPS in NTD, others in thousand NTD
| Item | 2017 | | 2016 | | Growth rate(%) |
| --- | --- | --- | --- | --- | --- |
| Revenue | 38,908,093 | 100.0% | 40,584,424 | 100.0% | -4.1% |
| Operating profit | 2,434,560 | 6.3% | 2,591,893 | 6.4% | -6.1% |
| Non-operating gain or loss | 2,441,447 | 6.3% | 1,493,659 | 3.7% | 63.5% |
| Profit before tax | 4,876,007 | 12.5% | 4,085,552 | 10.1% | 19.3% |
| Profit after tax | 4,540,190 | 11.7% | 3,597,372 | 8.9% | 26.2% |
| Earnings per share (EPS) | 3.01 | - | 2.34 | - | 28.6% |

Notes:

Domestic and Overseas Sales in
the First Quarter of 2018

Item	Q1 2018	Q1 2017	Growth rate(%)
Domestic Volume of Vehicles	14,943	13,946	7.2%
Market Share	12.0%	11.6%	3.5%
Overseas Volume
CBU	105	165	-36.4%
CKD(sets)	480	5,070	-90.5%
Domestic Volume of Electric Scooters	2,403	1,250	92.2%
Note：Domestic volume of vehicles includes sales of Fuso-branded trucks and buses.

Operating Results in
the First Quarter of 2018
(disclosed in Consolidated Financial Statements)

EPS in NTD, others in thousand NTD
| Item | Q1 2018 | | Q1 2017 | | Growth rate(%) |
| --- | --- | --- | --- | --- | --- |
| Revenue | 10,411,933 | 100.0% | 10,856,885 | 100.0% | -4.1% |
| Operating profit | 803,029 | 7.7% | 829,297 | 7.6% | -3.2% |
| Non-operating gain or loss | 802,373 | 7.7% | 438,094 | 4.0% | 83.2% |
| Profit before tax | 1,605,402 | 15.4% | 1,267,391 | 11.7% | 26.7% |
| Profit after tax | 1,387,278 | 13.3% | 1,142,760 | 10.5% | 21.4% |
| Earnings per share (EPS) | 0.97 | - | 0.76 | - | 27.6% |

CMC’s Prospect in 2018

Notes:

Automotive Business in Taiwan

In order to better face the fierce competition in Taiwan, CMC continues launching special editions for existing vehicle models and improving our sales and after-sales systems this year. We also plan to launch modified models of Outlander and Veryca in fourth quarter. The total CMC’s sales are estimated to be 50,000 units in 2018 equivalent to the sales of 2017, including Fuso-branded vehicles, while the policy of replacement of old vehicles with new ones is still in effect.
Colt Plus/Grand Lancer/Zinger
special editions &
system improvement
Veryca
modified model
Outlander
modified
model
Colt Plus
modified model
Grand Lancer
Domestic

Imported

Eclipse Cross
Pajero 2018 model

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Automotive Business in Mainland China

In 2017, with strengthened sales of DX7 and DX3 and introducing several models with superior product competitiveness and special editions, SEM’s sales were able to reach 155,000 vehicles, which were 30% higher than 2016. In 2018, in addition to the existing DX7 and DX3 models, SEM has also launched DX7 modified model in April and plans to launch DX3 new model year in third quarter. For the new energy vehicle, SEM has launched DX3 electrical vehicle in March and plans to launch A-Class Sedan “A5” in fourth quarter. SEM’s sales are estimated to be 165,000 vehicles in 2018, which will be a new record high.

DX7 and DX3 new model year, DX3 special sport-edition and several modified models with superior product competitiveness and special editions.

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

Benefiting from strong sales of VS20 with several exterior color choices and promotion plans to customers, FBAC’s total sales in 2017 were 22,000 units. In 2018, FBAC continues several promotional campaigns to achieve the sales goal of 30,000 vehicles, which is over 30% more than the sales of 2017.

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Automotive Business in Overseas Markets

As for vehicle export, due to the tightened safety regulations in GCC executed in 2017, it caused Veryca, Zinger and Lancer Fortis not able to timely meet all requirements. The export volume was only 594 units in 2017. In 2018, CMC’s export is conservatively estimated to be 400~500 units because of existing unfavorable factors and new model year products to be launched by the competitors in the Middle East.

CBU Exports
Veryca
Lancer Fortis
Zinger

As for CKD export, CMC exported 12,000 sets in 2017. The result was mainly affected by Freeca’s not being able to meet European Union (Stage IV) emission standards executed in Philippines and SEM’s reconciled inventory. In 2018, the export is estimated to decline to 600 sets due to discontinued production of Freeca in Philippines and Lancer in SEM.

Notes:

Green Energy Business

In 2017, CMC’s sales were 9,260 units, including e-scooters. This increase was because of improved brand preference on Greentrans/e-moving through implementing cross-industry alliance, promotions to enterprises, public authorities and schools (such as green school project), setting up different specialty stores, such as flagship stores, to deeply communicate with customers and launching “e-moving Shine” in early November.
In 2018, in addition to the 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. CMC’s e-scooter sales are estimated to be 12,000 units in 2018, which are 30% more than the sales of 2017.
Electric scooter featured by big body for both public and private uses
Electric scooter
featured by high performance
& long endurance
Electric scooter
featured as general
heavy-duty
commercial uses
Electric scooter free
of license plate
Electric scooter
featured by
economic convenience

emoving POST

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Thank you for your listening

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