YL — Investor Presentation 2018

Nov 21, 2018

TW：2201

YULON MOTOR CO., LTD.?Investor Conference

2018/11/21

Notes:

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Agenda

Agenda	Time	Speaker
Opening	-	Chen Hsiang Yao -President
Financial Results & Future Prospects	15 min	Lo Wen Yi –General Management
Q&A	25 min	Chen Hsiang Yao -President Lo Wen Yi –General Management

Financial Results & Future Prospects

2018/1~10 Sales Volume in Taiwan

exchange rate factor

The sales volume in Jan.~Oct. 2018 decreased by 1.8% year on year, including 8.8% decrease of domestic cars and 7.8% increase of imported cars, accounting for domestic cars and imported cars of 54%:46%. The imported cars growth reasons: (1)the exchange rate factor and competitive imported car prices , (2)product portfolio updated faster and more diverse.

Notes:

Auto Sales in Taiwan Through the Years

42.5 (F)

The sales volume in Jan~Oct. 2018 of Taiwan is 348K units, and 1.8% decrease rate year on year.
“Chung-Hua Institution for Economic Research“ and “Taiwan institute of Economic Research” predicted economic growth rate of Taiwan are 2.61% and 2.57% in 2018 respectively. The “Directorate General of Budget” forecast the economic growth rate of Taiwan is 2.69% in 2018 showing the economic grow steadily in 2018.
Due to the effect of the commodity tax subsidy policy slowing down, the implementation of the pension reform, and the uncertain situation of the China-US trade conflicts, it is estimated that the overall automobile market will reach 425,000 units in 2018, decreased about 10,000 units compared to 2017,approximately declined 2.2%.

Notes:

Auto Sales in China Through the Years

2,900 (F)

The sales volume in Jan.~Oct. 2018 of China is 22.87 million units, and 0.4% decline rate year on year.
“Global Insight” and “International Monetary Fund” predicted economic growth rate of China are 6.7% and 6.6% in ? 2018 respectively. The "People's Bank of China" forecast the economic growth rate of China is 6.5% in 2018 ? showing the economic grow steadily in 2018.
Due to the economic growth of China steadily , there are uncertainty factors such as China-US trade conflicts. China overall auto market forecast is expected to reach 29 million units in 2018, increased by 0.12 million compared to 2017, the growth rate is about 0.4%.

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Consolidated Comprehensive Income Statements

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Consolidated Balance Sheets

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Luxgen Sales Volume in China and Taiwan

1. Luxgen
A.The main sales models in Jan.~Oct.2018 were U6 and U5. Luxgen is improving customer satisfactions and implementing quality improvement activities continuously. The sales volume in Jan.~Oct.2018 of Luxgen is 8,798 units, and the revise model is expected to be launched in the fourth quarter.
B.Due to launched new models and minor change products in 2019,the sales volume is expected to reach 15,000 unit.
2. Dongfeng Yulon Motor (DFYL)
A.The sales volume in Jan.~Oct.2018 of Dongfeng Yulon Motor is 8,282 units. The main sales models were U6 and U5. To increase sales, DFYL will expand sales channels (including physical channels, e-commerce sales and travel platforms) as well as service outlets and increase after-sales satisfactions. The first BEV SUV U5 has been verified by the Ministry of Industry and Information Technology and is expected to be rolled off in China at the end of 2018.
B.Due to launched new models,minor change,and EV product in 2019,the sales volume is expected to reach 15,000 unit.
3. Plan 510
A. Accounding to plan 510,Luxgen brand will be launched new models every year and upgrade present products,new conception car with AI conception cabin, AR and ADAS(Advanced driver assistance system)technology will provide driving safety, pleasure for customers.

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Real Estate Development - Xindian

Progress of real estate development in Xindian:
1. Commercial district
Commercial district will be presold in Q1 2020
Commercial district has started construction in Q2 2017, estimated getting usage permit in Q2 2023 and running in Q1 2024.
2. Residential district
Residential district will be getting building permit in Dec. 2018.

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Q & A