Kongsberg Automotive

Investor Presentation • Dec 9, 2021

KONGSBERG AUTOMOTIVE CAPITAL MARKETS DAY DECEMBER 9, 2021

CAPITAL MARKETS DAY CEO PRESENTATION / PART I

DECEMBER 9, 2021

KONGSBERG AUTOMOTIVE // 2

FORWARD-LOOKING STATEMENTS AND NON-IFRS MEASURES

FORWARD-LOOKING STATEMENTS

This presentation contains certain "forward-looking statements". These statements are based on management's current expectations and are subject to risks, uncertainty and changes in circumstances, which may cause actual results, performance, financial condition or achievements to differ materially from anticipated results, performance, financial condition or achievements. All statements contained herein that are not clearly historical in nature are forward-looking and the words "anticipate," "believe," "expect," "estimate," "plan," and similar expressions are generally intended to identify forward-looking statements. We have no intention and are under no obligation to update or alter (and expressly disclaim any such intention or obligation to do so) our forward-looking statements whether as a result of new information, future events or otherwise, except to the extent required by law. The forward-looking statements in this presentation include statements addressing our future financial condition and operating results. Examples of factors that could cause actual results to differ materially from those described in the forward-looking statements include, among others, business, economic, competitive and regulatory risks, such as conditions affecting demand for products, particularly in the automotive industries; competition and pricing pressure; fluctuations in foreign currency exchange rates and commodity prices; natural disasters and political, economic and military instability in countries in which we operate; developments in the credit markets; future goodwill impairment; compliance with current and future environmental and other laws and regulations; and the possible effects on us of changes in tax laws, tax treaties and other legislation. More detailed information about these and other factors is set forth in the 2020 Kongsberg Automotive Annual Report and the Kongsberg Automotive Quarterly Reports.

NON-IFRS MEASURES

Where we have used non-IFRS financial measures, reconciliations to the most comparable IFRS measure are provided, along with a disclosure on the usefulness of the non-IFRS measure, in this presentation.

TOPICS FOR TODAY

• > INTRODUCING OUR NEW VISION
• > KONGSBERG AUTOMOTIVE CURRENT STATUS
• > SHIFT GEAR - CORE IMPACT AREAS
• > FINANCIAL TARGETS
• > ROADMAP
• > KEY TAKEAWAYS

TOP MANAGEMENT TEAM

JOERG BUCHHEIM

PRESIDENT & CEO // Zurich (Switzerland)

// previously CEO INALFA Roof systems Group (2016-2021), CEO HELLA China and Member of the Group Management Board (2012-2016)

FRANK HEFFTER CHIEF FINANCIAL OFFICER // Zurich (Switzerland)

// previously Head Group Controlling OC Oerlikon CFO of an affiliate entity of Siemens PT&D

DR. CHRISTIAN AMSEL

CHIEF TECHNOLOGY OFFICER // Zurich (Switzerland)

// previously CFO INALFA Roof Systems Executive Board of Electronic at HELLA

INTRODUCING OUR NEW TAGLINE, VISION AND MISSION

T A G L I N E

V I S I O N

WE DRIVE THE GLOBAL TRANSITION TO SUSTAINABLE MOBILITY

M I S S I O N

O N O U R P A T H T O B E C O M I N G A T R U E G L O B A L L E A D E R , W E P U T E N G I N E E R I N G , S U S T A I N A B I L I T Y, A N D I N N O V A T I O N I N T O P R A C T I C E .

We seek to constantly improve our products, leverage our experience in cutting-edge engineering, and widen our scope to find new solutions and technologies that make mobility safer and cleaner.

Our ambition is to be second to none in all we do. This is how we unlock growth potential and create substantial value for our customers, our employees, and shareholders.

We take responsibility as a strong global team. We are committed to making a difference by developing our skillset and delivering excellent products.

KONGSBERG AUTOMOTIVE // 7

KONGSBERG AUTOMOTIVE CURRENT STATUS

GLOBAL FOOTPRINT

• HEADQUARTERS
• PLANT
• SITE OFFICE
• TECHNICAL CENTER
• WAREHOUSE

POWERTRAIN & CHASSIS 35% REVENUE

CLUTCH AND GEARSHIFT SYSTEMS, ACTUATORS AND VEHICLE DYNAMICS APPLICATIONS

APPROXIMATELY ONE OUT OF FIVE VEHICLES CONTAINS OUR PRODUCTS

INTERIOR 27% REVENUE

INTERIOR COMFORT SYSTEMS AND LIGHT DUTY CABLES

Interior divestment ongoing (all figures pre-divestment)

HEADQUARTERED IN ZURICH, SWITZERLAND AND LISTED ON THE OSLO STOCK EXCHANGE

SPECIALTY PRODUCTS 38% REVENUE

COUPLINGS, FLUID TRANSFER SYSTEMS, AND OFF-HIGHWAY APPLICATIONS

FULL IN-HOUSE PROTOTYPE, TEST AND VALIDATION CAPABILITY

AT A GLANCE KA BUSINESS UNITS AND PRODUCTS

P O W E R T R A I N & C H A S S I S S P E C I A L T Y P R O D U C T S I N T E R I O R

DRIVER CONTROL AND DRIVELINE PRODUCTS

€420M R E V E N U E S

FLUID TRANSFER SYSTEMS, AIR COUPLINGS SYSTEMS, AND OPERATOR CONTROL SYSTEMS

€400M

SEAT COMFORT SYSTEMS AND MECHANICAL AND ELECTRO-MECHANICAL LIGHT-DUTY MOTION CONTROLS

INTERIOR DIVESTMENT ONGOING

• 2022 start of product portfolio transformation

• Strategic move, coping with vertical integration trend.

40%

10%

THE DIVESTMENT STRENGTHENS OUR EXPOSURE TO COMMERCIAL VEHICLE AND OFF-ROAD SEGMENTS

R E V E N U E I N E U R b n / R E V E N U E S H A R E B Y C U S T O M E R S E G M E N T I N %

After our divestment we generate ~75% of our revenue in the CV and Off-road business

NEW KA - BUSINESS UNITS AND PRODUCTS SEGMENT VIEW

Passenger Car products are mostly delivered by DRIVELINE (DRL) -

ON-HIGHWAY (ONH) and FLUIDS (FTS) mostly focus on Commercial Vehicles, while OFF-HIGHWAY (OFH) and COUPLINGS (COU) largely focus on SPP

PERSISTENT MARKET TRENDS SHOW POWERTRAIN SHIFT AND HIGHER PROFITABILITY IN CV AND OFF-ROAD SEGMENTS

NUMBER OF VEHICLES SOLD, IN MLN; x % PROFITABILITY x %

• Shift in powertrain solutions towards EV

• Strong competition and high number of suppliers

• EV investment increases strongly at supplier's shoulders along entire supply chain with uncertain ROI

• Highly volatile and crisis impacted

• Industry consolidation due to competition where long term partnerships and fairness counts

• Growing Segment with increasing technology content less volatile

• Higher emission standards drives higher quality products (TOC)

• Fueled by infrastructure projects across the globe

• Strong Growth forecast as Construction/ Industry/Agro Economy/Outdoor-Powersports Actively level expected to grow Post Corona

• Autonomy of the construction & mining value chain

SHORT-TERM SUPPLY CHAIN DIFFICULTIES PUT THE AUTOMOTIVE INDUSTRY UNDER PRESSURE

C O S T I N F L A T I O N

>130% y-o-y price increase for steel

>130% y-o-y price increase for copper Significant y-o-y price increases for freight, labor salaries, electricity, oil, and others

Automotive sales plummeted during COVID and only recovered: 80% in Europe, 70% in China, and 50% in the US

Since first quarter of 2021 semiconductor shortage has halted assembly lines

MARKET HEADWINDS COUNTERED WITH STRINGENT COUNTER MEASURES

MARKET HEADWINDS INCLUDE:

• Raw material shortage and price increases

• Higher freight costs

• Dynamic demands from customers

COUNTER MEASURES INCLUDE:

• Customer negotiations

• Operational excellence

• Supplier negotiations

KA FINANCIALS SHOW RESILIENCE IN DYNAMIC ENVIRONMENT

€~800 M RE V E N U E	€~50M A D J . E B I T
On continuing business	On continuing business
1.1	€ ≥1 M
B O O K-T O-B I L L R A T I O	F R E E C A S H F L O W
On continuing business	On continuing business	achieved

WE EXPECT TO RECEIVE €175M NET PROCEEDS BY END OF Q1 2022

SHIFT GEAR CORE IMPACT AREAS

Shift gear - core impact areas

KA FOCUSES ON THREE IMPACT AREAS TO SHAPE ITS FUTURE

KA-wide performance improvement program launched in May with central program management office ensuring BU and central targets are being reached

Shift gear - core impact areas

MASTERPLAN: 6 SPECIFIC WORK PACKAGES ON THE WAY TO A NEW KA TO ACHIEVE MAXIMUM IMPACT

GEAR I	GEAR II	GEAR III
PERFORMANCE 1 IMPROVEMENT PROGRAM	SECURE & INNOVATE 3 (P&C)	ENVIRONMENT, SOCIAL, 5 AND GOVERNANCE
ORGANIZATION 2 AND OPERATING MODEL	ACCELERATE 4 & INNOVATE (SPECIALTY PRODUCTS)	DIGITIZATION & 6 AUTOMATION OF CORE PROCESSES

We aim for superior results with an EBIT margin > 10%, a winning portfolio focused 75% on commercial vehicles and off-road customers, as well as a diverse management to drive our sustainable future

THE PERFORMANCE PUSH 1

5 core workstreams: Commercial Excellence, Direct and Indirect Purchasing, Operations, and Cash Management

Strong performance infrastructure including a rigorous drumbeat, KA-wide cloudbased measure tracking tool, clear targets, and regular performance reviews

Mobilization of all organizational units, ensuring KA's full potential is reached and capabilities are utilized as best as possible

Focus on short-term improvements (e.g., via implementation of spend control tower) as well as structural measures (e.g., renegotiation of supplier contracts)

THE MEASURES WE HAVE IMPLEMENTED IN 2021 WILL HAVE SIGNIFICANT CARRY-OVER EFFECTS TO 2022 AND BEYOND

Group measure impact for 2021 per calendar week, in EUR m

KA-wide performance improvement

EUR 56m in measures already implemented

Most measures with positive carry-over effects for 2022 onwards

AFTER OUR DIVESTMENT WE HAVE IMPROVED PROFITABILITY, AND ARE WORKING ON RESHAPING AND RIGHTSIZING OUR ORGANIZATION 2

SALES 2021: EUR 0.8bn ADJ. EBIT 2021: EUR ~ 50m (6%) CAPEX / SALES: 4% SALES SPLIT, in %:

O U R N E W K E Y F I G U R E S D I V E S T M E N T I M P L I C A T I O N

STATUS

EBIT and cash flow improved by divestment of low-margin and cash-intensive business

Rightsizing to match new KA structure

Adapted operating model, with strong regional footprints, and cross-BU centers of competence

WE WILL FOCUS ON HIGHLY PROFITABLE SPECIALTY PRODUCTS IN NICHE MARKET SEGMENTS WITH A REGIONAL PRESENCE (GLOBAL) 2

M A I N T A I N & S T R E N G T H E N S T R O N G M A R K E T P O S I T I O N

INDUSTRIES MUNICIPAL RAILWAY 2- & 3- WHEELERS HEALTHCARE CONST-RUCTION & FORESTRY EQUIPMENT MEDIUM / LOW VOLUME PASSENGER CARS AFTERMARKET TIER 1/2 AG, CE, MH ETC. AGRICULTURAL MACHINERY MATERIAL HANDLING CHARGING INFRA-STRUCTURE E S T A B L I S H K A A S C O R E P L A Y E R A N D E N T E R W H I T E S P O T S

L O N G-T E R M A D D I T I O N A L P O T E N T I A L M A R K E T S

KA is in the process to set up regional sales companies target customers in our adapted operating model based on regional market knowledge and the full KA product portfolio

WE AIM IN 2030 FOR A HIGHLY PROFITABLE BUSINESS WITH 2.0–2.5X THE REVENUE OF TODAY 3 4

Revenue and EBIT trajectory, vs. 2021 post-divestment

M I D-T E R M P L A N 2 0 2 4	L O N G-T E R M A M B I T I O N 2 0 2 6
TOPLINE ASIA	TOPLINE
+90% 1.3 -1.5x AMER	1.5 – 1.7x
+50%
ADJ. EBIT EMEA	ADJ. EBIT
+40% 9% - 10%	11%-12%

OUR GROWTH AND PROFITABILITY TRAJECTORY IS ACCOMPANIED BY A TOP-POSITION IN COVERED MARKETS, AND A SUSTAINABLE FREE CASH FLOW

TAKE AWAY

Second to None Wherever we are operating, we want to be positioned among the TOP 3 within the Industry in Market share and Technology. This unlocks strong growth potential

Specialty product business to be developed and adapted

"We consolidate our strengths across the BUs to accelerate growth"

Strong growth in Asia Pacific - China Korea and India – untapped

COMPETITIVE & PERFORMANCE CHECK – SECOND TO NONE UNLOCKS STRONG GROWTH POTENTIAL 3 4

COMPETITIVE & PERFORMANCE CHECK – SECOND TO NONE UNLOCKS STRONG GROWTH POTENTIAL 3 ⁴

COMPETITIVE & PERFORMANCE CHECK – SECOND TO NONE UNLOCKS STRONG GROWTH POTENTIAL 3 ⁴

potential move to ONH

WE EXPECT STRONG GROWTH IN OUR MOST PROFITABLE SEGMENTS, THANKS TO OUR STRUCTURED INNOVATION PROCESS

STRATEGIC SHIFT TO GROW IN PROFITABLE SEGMENTS EXAMPLES FOR PORTFOLIO PRODUCT STRATEGIES 3 4

SPECIALTY PRODUCTS

Deep dives on the following pages

innovate business model along mega trends

by market trends and addressed through an adapted operating model with regional presence (global)

P&C SECURE: DRIVELINE BUSINESS AS LPV SEGMENT WITH FURTHER FOCUS ON COST IMPROVEMENT AND ABOVE-AVERAGE GROWTH POTENTIAL IN CHINA

TARGET MARKET SHARE, INCL. RESULTING VOLUMES

I N N O V A T I O N P R O J E C T S E V A L U A T E D A N D D E V E L O P E D A L O N G L E V E L S O F M A T U R I T Y O F R & D P I P E L I N E ( D E V E L O P M E N T H O R I Z O N S )

F O C U S C V S E G M E N T S

… AS SHOWN BY THESE OPPORTUNITIES WE HAVE IDENTIFIED BY LEVERAGING OUR EXISTING PORTFOLIO 3B 4B

Top-opportunities are thoroughly developed along the R&D funnel and clustered into innovation centres. This leverages KA-wide core competences and knowledge from existing portfolio applications

FTS/COU: BATTERY THERMAL MANAGEMENT SYSTEMS (BTMS)

MARKET CAGR

BTMS market linked correlated to electrified vehicles sales.

ESG IS INCREASINGLY A LICENSE-TO-PLAY FOR OUR INVESTORS, CUSTOMERS, AND TALENTS

OEMS INCREASE REQUIREMENTS

INVESTORS DEMAND SUSTAINABLE RETURNS

TALENTS PREFER "GREEN" COMPANIES

Multiple

increase in OEM supply chain decarbonization commitments in last 24 months

Trillions

of assets are managed by ESG investors, and growing at 15+% p.a.

Majority

of millennials say ESG purpose and performance are a litmus test for employers

Some of our customers are pushing for 100% clean energy in production by 2025

Green initiatives allow cheaper financing through green bonds; potential green-bond issue under investigation; sustainability-linked bonds can reward us for achieving targets.

Especially at European sites employees are increasingly reluctant to work for companies which do not align with their values

Significant share of corporate profits at risk with environmental requirements

Source: CDP Climate Change Report 2019

THE SHIFT GEAR PROGRAM HELPS US ACHIEVE OUR SUSTAINABILITY TARGETS WHILE IMPROVING OUR BUSINESS

OUR ESG-TARGETS

Carbon neutral products by 2039

100% carbon free energy used in production by 2030

Responsible sourcing

PROGRESS OF OUR INITIATIVES

• Work with suppliers towards carbon neutrality

• 40% renewable energy in 2020, 7 plants already at 100%

• Only suppliers with NQC rating >= 70% threshold approved by sourcing board

NEXT STEPS

Install carbon emissions management system, across own operations and scope 3

Expand LCA activities to broader product portfolio

Further develop ESG strategy to be at the leading edge of sustainability /mega trends

DIGITALIZATION & AUTOMATION OF CORE PROCESSES IMPROVES EFFICIENCY, QUALITY AND TIME TO MARKET 5

Digital engineering and product lifecycle management can reduce time to market by 40 % and increase on-time-delivery by 20 %

Smart manufacturing can increase productivity by 20 % while reducing cost of non-quality by 30 %

Combining these elements gives high-quality data on a fully traceable value chain

KA will invest up to EUR 1m in 2022 to further develop our ESG Roadmap

COFFEE BREAK

TRANSFORMATION OF THE AUTOMOTIVE SECTOR: TRENDS AND OPPORTUNITIES DR. CHRISTIAN AMSEL, CTO

DEC 9, 2021

CASE THEMES STILL THE DRIVER FOR THE AUTOMOTIVE TRANSFORMATION

"CASE themes continue to drive the Automotive Transformation – ELECTRIC currently has greatest impact"

*) Smart Mobility describes a transportation ecosystem where stakeholders use data and connectivity to move people and goods sustainably and efficiently.

Shared mobility remains as a sub-segment and an important value pool in this ecosystem focusing on people transport with passenger vehicles.

TRANSFORMATION OF THE AUTOMOTIVE SECTOR IS HAPPENING EVERYWHERE, BUT AT DIFFERENT SPEEDS. ELECTRIC HAS GREATEST IMPACT

Total vehicle parc and technology penetration of new car sales - expected new car sales in 2030 in million: China 31, USA: 17, Europe: 17

Smart Mobility	2021 100% 100% 100%	2025 100% 100% 100%	2030 100% 100% 100%	2035 100% 100% 100%	grow in the long term.
Connected (eCall, % new LV sales)	2021 44% 100% 100%	2025 88% 100% 100%	2030 100% 100% 100%	2035 100% 100% 100%	Europe by 2025, US by 2023, China by 2029 air update functionality)
Electric (BEV, % new LV sales)	2021 6% 2% 9%	2025 19% 6% 27%	2030 33% 19% 50%	2035 55% 44% 78%	2025 – ahead of China (19%), US (6%). growth hurdle
Automated (L3/L4/L5, % new LV sales)	2021 0% 3% 0%	2025 1% 6% 4%	2030 11% 12% 20%	2035 34% 16% 29%

• Smart mobility modes beyond vehicle ownership are expected to
• With rising number of car-subscription offerings, share-active (e.g. rental subscription) is expected to grow strongest in Europe (10% of total km by 2025), while shared-passive (e.g. ride hailing) is expected to grow significantly more in China (10%) vs. USA or Europe 1-3%).
• Vehicle connectivity is advancing, with 50% of total parc connected in Europe by 2025, US by 2023, China by 2029
• While OEMs are reaching a critical size with their connected service customer base, they will struggle with reliable service at scale (over-the-
• E-mobility is at an inflection point in Europe, driven by strong government drive (incentives and regulation), with 27% BEV shares of new car sales in 2025 – ahead of China (19%), US (6%).
• Slow charging infrastructure build-up will soon become the biggest
• Automated driving will enter the market in passenger transport with a range of specific use cases that are difficult to scale.
• L4 share of new cars at 14-15% by 2035 in Europe & China.
• Industrial and logistics applications likely to grow faster.

3 MAJOR DRIVING FORCES ARE INFLUENCING THE TRANSFORMATION SPEED DRIVEN BY ELECTRIC. MAIN CHALLENGES:

By the end of the decade BEVs will be the most effective powertrain solution for almost all Light Vehicle (LV) segments

CONSUMERS

• Range anxiety and charging options are the biggest obstacles to buy an electric car

• Further aspects are:

• Availability of Electric vehicles at the dealer

• Costs

• Performance

• Image

• …

TECHNOLOGY

• Battery Electric

• Efficiency improvement and cost reductions

• High voltage system and architecture for development, production and service

• High voltage battery: system design and cell innovation

• Fuel Cell

• "Green" hydrogen and charging infrastructure

• Stack and tank optimization

ACCELERATION

REGULATION

• EC adopted a package under European Green Deal (07/21) aiming for climate neutral in 2030

• EC promoting alternative fuels infrastructure … and Strategic Roll Out Plan

• China New Energy Vehicle Industrial Development Plan (2021-35) (10/20)

• US lagging behind but recently measures to accelerate charging infrastructure

LEGISLATION IS GOING TO ACCELERATE THE TRANSFORMATION, EXAMPLE OF EUROPEAN COMMISSION: SIGNIFICANT INCREASE OF CO2 FLEET TARGETS

• > Top-Down simulations show that further strengthening of the CO2 reduction targets is needed until 2030 to achieve the wholistic climate neutral target in 2050:
  • » LV -37,5% ➔ -55% (70g/km)
  • » LCV -31,0% ➔ -50%
  • » HDT: -30,0% in discussion
  • » 2035: -100% what is more or less "STOP of ICE Technology" for new vehicles!
• > What is the approach to achieve the targets?
  • » Efficiency improvements (48V architecture, CNG and LPG, hybridization, recuperation, …)
  • » Emission free drive trains
    • › PHEV as accelerator
    • › Push for synthetic ("E-Fuels") and Bio-Fuels as interim solution but no long-term approach
    • › FCEV for specific LV, LCV and HDT applications

BEV = Battery Electric Vehicle PHEV = Plug-in Hybrid Electric Vehicle FCEV = Fuel Cell Electric Vehicle

LCV = Light Commercial Vehicle < 6t HDT = Heavy Duty Truck ZLEV – Zero and Low emitting vehicles

AS PART OF OUR PORTFOLIO MODERNIZATION, WE HAVE MADE A STRUCTURED ASSESSMENT OF THE DIFFERENT SEGMENTS

• General market size and margin potential as representation for financial attractiveness

• Fit to KA's current customers and technical capabilities as indicator for chances to reach aspired TOP 3 position

• Technical change until 2030

• Innovation involves uncertainty – we are managing our risk using a structured methodology, ensuring a cost-efficient development process

• We have identified areas where there will be a

  • » high degree of technical change,
  • » high margin potential and a
  • » good fit to our existing technology, production and customer base

• Major disruptions act as door opener for suppliers to access new clients and segments

AS PART OF OUR PORTFOLIO MODERNIZATION, WE SELECTED THE MOST PROMISING PRODUCTS FOR KA

• The chosen structured methodology led to a longlist with more than 120 ideas for KA

• A stringent prioritization of the longlist clustered into:

  • "Bold Moves",

  • "Logical Extensions" and

  • "Low Hanging Fruits"

• led to 3 growth trajectories in the areas of

  • Thermal Management Systems,

  • Electric Power Steering and

  • Actuators for Truck E-axle Reducers

• All growths initiatives will be performed as Innovation Cells in order to minimize Time-to-Market

Source: Roland Berger / Kongsberg Automotive

KA WILL LEVERAGE STRENGTHS IN MORE PROFITABLE SPECIALTY PRODUCT SEGMENT (SPP) BASED ON 3 GROWTH PILLARS:

Systematic approach to…

1 Broaden customer base in current

application fields

The future of our product portfolio lies in profitable niche segments closely related to our current markets with clear second to none strategy

WE STREAMLINED OUR INNOVATION AND R&D PROCESSES TO SHORTEN TIME-TO-MARKET SIGNIFICANTLY

• > The newly defined innovation process provides clear structure for
  • » Agile and Focused innovations to shorten Time-to-Market and
  • » for selected M&A activities
• > Structured Gate Releases to ensure needed maturity levels
• > Our approach is to grow mainly organically but selectively also via M&A in case of product/ technological gaps

Couplings EV products

"NO 1 CHOICE FOR ELECTRICAL VEHICLE MANUFACTURERS"

H I G H E R S Y S T E M R E Q U I R E M E N T S O P E N N E W D O O R S

• > Pneumatic brake systems continues to shift from ICE to EV. No negative effect on air couplings
• > No air leakage saves energy increasing driving distance
• > Optimal airflow leads to shorter time for braking, suspension and auxiliary systems
• > «Click-click» assembly and disassembly improve installation cost and reduce vehicle down time
• > Light weight materials contributes for light weight vehicle and increased payload

C O M P E T I T I V E P O S I T I O N I N G

• > Leverage relationship with already existing OEMs to enter new, electrical based platforms
• > Provide "best in class performance" to capture new customers entering electrical vehicle market
• > Meet future zero emission and safety critical performance requirements which results in higher quality standards and product differentiation
• > High focus on developing new products and enter new markets

INCREASED GLOBAL MARKET SHARE

POLE POSITION IN ELECTRICAL VEHICLE SEGMENT

F E A T U R E S & B E N E F I T S

FTS EV products

GROWING BUSINESS BENEFITING FROM EV TRANSITION

R E L E V A N C E

RELEVANCE	ICEV TODAY	ICEV FUTURE	PHEV	BEV	FCEV
AIR SUSPENSION LINES					
(FLEXIBLE) HYDRAULIC BRAKE LINES					
FUEL LINES (BIOFUELS, HYDROGEN)					
EMISSION CONTROL LINES			
(FLEXIBLE) TURBO LINES			
COOLANT LINES					

P R O D U C T T R E N D S

> Weight savings

» replacement of steel and rubber by high performance plastic fluid transfer lines

> Tighter packaging

• » increasing need for flexible high-performance plastic fluid transfer lines
• » for ICEV increased temperature resistance fluid transfer lines

> Increased durability

» high performance plastic fluid transfer lines

> Increased safety

• » increase crash and flammability resistance by high performance plastic fluid transfer lines

• Increased cleanliness

  • » supports fuel savings and enables hydrogen fuel cell technology

M A R K E T D Y N A M I C S

SAFETY REGULATIONS

CO² EMISSION LEGISLATIONS FOR ICE VEHICLES

MILES-PER-GALLON LEGISLATION DRIVING NEW ENGINE TECHNOLOGY

C O M P E T I T I V E P O S I T I O N I N G

PRODUCT LINES

1 st Rfi's received on Fuel Cell truck System Cooling

B-Sample order for next generation EV truck at European OEM

ELECTRIC VEHICLE MARKET

M A R K E T D Y N A M I C S

P R O D U C T S & O P P O R T U N I T I E S

• > Electric Power Steering
  • » STD EPS for Powersport Vehicles
  • » Lightweight EPS for applications sensitive to size, weight, and power consumption.
• > Electronic Pedals and Hand controls:
  • » Brake by wire
  • » Throttle by wire
  • » Shift by wire
  • » Driver input/button modules
• > Battery Management Systems:
  • » Supporting key customer developing battery management subsystems and components
• > Other compatible devices
  • » Such as power efficient solid-state relays, programmable modules, and sensors

P R O D U C T H I G H L I G H T S

E L E C T R I C P E D A L S A N D H A N D C O N T R O L S

B A T T E R Y M A N A G E M E N T S Y S T E M S

• > X by wire products: Throttle, Shift, and Brake
• > Multiple signal and communication protocols supported, including CAN, analog, and PWM
• > Designed specifically for Off Highway Vehicles
• > Manufacturing services for subcomponents, such as PCBA assembly
• > Battery Chargers, monitoring & diagnostics, inverters

AUTONOMOUS VEHICLE MARKET

M A R K E T D Y N A M I C S

P R O D U C T S & O P P O R T U N I T I E S

• > Electric Power Steering
  • » Demonstrated on agricultural vehicle
  • » Provides precise fine movement and sufficient torque to drive existing hydraulic steering systems
• > GPS + Steering actuator
  • » Demonstrated on a watercraft to provide a functional autopilot
• > Other compatible devices
  • » Such as power efficient solid-state relays programmable modules, and sensors

P R O D U C T H I G H L I G H T S

• > Contactless torque sensor with a rigid shaft
• > Optional integrated torque sensor
• > Multi-mode capability
• > Designed specifically for Off Highway Applications
• > Small light weight package
• > Can be sold as a standalone actuator w/o electronics

P&C EV products

DRIVELINE SEGMENT WITH HIGH MARKET DYNAMIC AND NEW EMERGING CUSTOMERS

M A R K E T D Y N A M I C S

C O M P E T I T I V E P O S I T I O N I N G

• > Leverage deep skilled R&D team at Mullsjo, Sweden innovation center
• > Build upon 15% shift-by-wire market share in China with innovative products for shift-by-wire shifters and actuators
• > Continue winning new BEV-related applications
• > Sustainably improve customer relationship with existing OEMs
• > Double-down on patents in application process

STRONG POSITION IN ACTUATION SYSTEMS

P R O D U C T H I G H L I G H T S

S H I F T-B Y-W I R E E L E C T R I C A C T U A T O R S

TOGGLE SHIFTER ROTARY SHIFTER

• > Small packaging & compact design
• > Low noise level vs. competition
• > Designed for BEV
  • and ICE vehicles
• and quick response > Low noise level
  • > Designed for BEV and ICE vehicles

> New locking

mechanism w/ low current consumption

DECOUPLING UNIT

DOG CLUTCH ACTUATOR

• > Complete gearshift actuator for BEV T/M
• > Incl. spring assistance
• and shift fork
• > High performance
• > Compact design
• > Actuator to decouple eAWD to save energy when in 2WD mode
• > Incl. spring assistance

P&C DRIVELINE PRODUCTS & TECHNOLOGY FOR PHEVs & EVs

	SBW GEAR &	TRANSMISSION		CONNECT /	DECOUPLING ACTUATOR FOR ELECTRIC DRIVE
VEHICLE TYPE	FORWARD/REVERSE SHIFTER	ACTUATOR	PARK LOCK ACTUATOR	DISCONNECT E-DRIVE AXLE
PHEV Plug-in Hybrid Electric Vehicle	YES Lever, Stalk, Rotary, Toggle SBW Shifter	YES (PRND) KA ARC Some transmissions	YES KA ARC Some transmissions	YES KA DCA Electrified 2nd axle
EV Electric Vehicle	YES Lever, Stalk, Rotary, Toggle SBW Shifter	YES (2/3 speed EV) KA DCA Some transmissions	YES KA ARC Some transmissions	YES KA DCA 4WD EVs

P&C EV products

ON-HIGHWAY HIGH PERFORMING TRANSMISSION BUSINESS

M A R K E T D Y N A M I C S

ADOPTION OF AIR SUSPENSION YIELDS OPPORTUNITIES

FUEL ECONOMY AND ENERGY SAVINGS DRIVING AMT* DEMAND

* Automated manual transmission

C O M P E T I T I V E P O S I T I O N I N G

• > Leverage deep skilled R&D team at Kongsberg Automotive, Norway innovation center
• > Further enhance system supplier capabilities
• > Leverage significant transmission knowledge
• > Push high performance actuators
• > Double-down on systems applicable for MD and HD commercial vehicles

P R O D U C T H I G H L I G H T S

G E A R A C T U A T I O N S Y S T E M S C L U T C H A C T U A T I O N S Y S T E M S

• > Pneumatic actuation can also be used for BEV trucks in addition to ICE based powertrains like AMT
• > Full electric actuator solutions based on existing technology in development
• > High performance and precise actuation
• > First high performance full electric clutch actuator for HD transmissions launched
• > Qualified for extreme requirements related to robustness and durability to secure uptime for the vehicles
• > Spin off and knowledge can be utilized for other actuators as gear actuation etc.
• > Can be used for hybrid trucks

P&C EV products

P&C ON-HIGHWAY PRODUCTS & TECHNOLOGY FOR HEVS & EVS

WE ARE LEVERAGING OUR STRENGTHS AND IMPROVING OUR FOCUS TO ENSURE WE CAN GROW PROFITABLY INTO THE FUTURE OF THE AUTOMOTIVE INDUSTRY

> We are transforming our product portfolio to better match the future of our industry

> Our key markets will continue to be commercial vehicles and off-highway, with selected exposure to passenger cars

> The future of our product portfolio lies in profitable niche segments closely related to our current markets

> There are segments outside the automotive sector which may also be a good fit

CAPITAL MARKETS DAY CEO PRESENTATION / PART II

DECEMBER 9, 2021

KONGSBERG AUTOMOTIVE // 58

TOPICS

• > INTRODUCING OUR NEW VISION
• > KONGSBERG AUTOMOTIVE CURRENT STATUS
• > SHIFT GEAR - CORE IMPACT AREAS
• > FINANCIAL TARGETS
• > ROADMAP
• > KEY TAKEAWAYS

FINANCIAL TARGETS

MAIN FINANCIAL PILLARS TO SUPPORT THE NEW KA

PROFITABLE Growth

Our long-term goal is to be "second to none" in the sectors where we operate

> This is supported by recent divestments of lowermargin, capex-intensive business

INNOVATIVE Growth

• We will reach this goal through targeted growth in high-margin sectors

• Finance supports the innovation process by setting and monitoring important metrics

MANAGED Growth

• Without careful management of liquidity and leverage, our growth and profitability targets will be jeopardized

• Avoiding negative liquidity events is key to preserving and growing shareholder value

THE DIVESTMENTS WE HAVE MADE WILL IMPROVE MOST OF OUR KEY METRICS

SELECTED LINE ITEMS		PRE-DIVESTMENT	POST-DIVESTMENT	CHANGE
P&L	Sales	1,150	822	(29%)
	CM (%)	34 %	35 %	+3%
	GM (%)	20 %	22 %	+8%
	R&D / Sales	5.1%	4.8%	(5%)
	Adj. EBIT	~39	~50	+26%
BS / CF	Free cash flow	~(25)	≥1
	Capex / Sales	3.8%	3.3%	(13%)
	Sales/Assets	1.2	1.1	(9%)
ROCE		6.4%	11.6%	+81%
SALES TO FTE		0.11	0.15	+33%

(Negative numbers in brackets)

Attractive increase on major KPIs despite 2021

> All CORONA limitations

With significant turmoil in the sub-component supply chain

> Still with the full STRANDED COST included

Financial targets

IN THE LONG TERM WE ARE AIMING TO BE "SECOND TO NONE" ALSO IN FINANCIAL METRICS

COMPETITOR KPIS VS. OUR TARGETS

SELECTED KPIS
Revenue, EURm	6,380	5,809	1,480
Gross Margin	24%	9%	19%
Adj. EBIT, EURm	510	175	28
R&D / Sales	10%	2%	5%
FCF, EURm	148	178	104
ROCE	12%	3%	2%
FTE, k	37	38	10
Sales per FTE, EURm	0.17	0.15	0.15

MID-TERM 2024	IN 2026
1,250	1,600
25%	30%
>120	>175
4%	4.5%
55-75	95-120
11%-12%	13%-15%
8	9
0.15	0.18

ROADMAP

Roadmap

THE OVERALL KA TRANSFORMATION PLAN UNTIL END OF 2022

NET PROCEEDS WILL DELEVERAGE THE COMPANY, REWARD SHAREHOLDERS AND INVEST IN OUR FUTURE GROWTH

DELEVERAGE	RETURN	INVEST
DE-LEVERAGING:	CASH RETURN TO SHAREHOLDERS:	LIQUIDITY TO INVEST:
Bond Call 75M EUR	10% of the Market Cap in	CAPEX to fuel organic growth
Cost 2.5% of call	share buybacks	Accelerate productivity improvement measures
Potential reduction in gearing (NIBD/EBITDA ratio) from 2.8 to 1.75	We will continue to look for opportunities to buy back shares when the stock is undervalued.	Investments into environmental footprint
		M&A
Generate flexibility	Continuous Option	Stay flexible w/ room for maneuver

KEY TAKEAWAYS

EXECUTIVE SUMMARY: IN 2021 WE HAVE WEATHERED THE STORM AND PREPARED FOR THE FUTURE…

• Despite CORONA Year 2 Kongsberg Automotive limited the damages and delivered in 2021 on their revised Guidance by Performance Improvement

• Beside this, Kongsberg Automotive has started to execute the Product Transformation process by successfully Divesting Interior in Q1/22

• By this, Kongsberg Automotive consequently is going to increase their Liquidity in 2022 and can start to Deleverage their debt, Buying back shares while keeping sufficient Liquidity for further Growth and Innovations

• F O U N D A TI

N

• This has laid successfully the runway in 2021 towards the NEW KONGSBERG AUTOMOTIVE "Mobility solutions for the future" determining the companies focus clearly on ONH and OFH within our Product Portfolio SPP & P&C

• This strategy aims to make Kongsberg Automotive more independent from low-margins passenger car business and to a large degree – from critical semiconductor dominated products

• The clear Focus on more niche business group, will reduce volatility and provide strong cash generation capabilities

WITH A SUSTAINABLE CASH FLOW, WHICH SUPPORTS GROWTH AND AN ATTRACTIVE SHAREHOLDER RETURN

… IN 2022 AND BEYOND WE WILL COMPLETE OUR DIVESTMENTS AND CONTINUE TO EXECUTE OUR PLANS

• In 2022 we will successfully close the divestments and make Kongsberg Automotive further fit for the future.

• This includes post-divestment restructuring, streamlining the organization with a motivating S2N DNA, strengthening our processes (best-in-class and meaningful digitalization), and going for ROI-oriented innovation and highly efficient business development

F O R W A R D

• 2022-2025 we will foster growth in these niche segments by unlocking untapped growth opportunities within "Regions - New Segments - Customer bases - Product extensions" supported by innovation and a clear focus on electrification, all in a structured and controlled way

• Beside this, we will invest into necessary sustainability, corporate governance and carbon reduction to support global environmental targets

• We are looking forward to generating shareholder value every day and telling our shareholders about it!

11-12% EBIT

WITH A SUSTAINABLE CASH FLOW WHICH SUPPORTS GROWTH AND AN ATTRACTIVE SHAREHOLDER RETURN

WE DRIVE THE GLOBAL TRANSITION TO SUSTAINABLE MOBILITY