Johan van Zyl President & CEO Motor Many challenges facing our industry

TOYOTA MOTOR EUROPE 4 challenges

1. Building a sustainable business in Europe

2. Coping with 10 million sales globally

3. Embracing new technologies

4. Reducing our environmental impact

TOYOTA MOTOR EUROPE Challenge 1 EUROPE GROWTH

TOYOTA MOTOR EUROPE Different Challenges in East and West

TOYOTA MOTOR EUROPE European mid-term focus

Sustainable business with small cars

Product 5% & Brand Profitably share Power

TOYOTA MOTOR EUROPE Toyota: Sustainable Growth in Europe

900k Sales in 2016

4.7% share ‘10 ’11 ’12 ’13 ‘14 ‘15 ’16

TOYOTA MOTOR EUROPE Mid-term objectives

#1 #1 1 Million Sales Customer Value Chain Recommendation Revenue

TOYOTA MOTOR EUROPE Better cars for Europe

Invest in More local Local European R&D production design responsibility

TOYOTA C-HR “ An innovative and sophisticated car that returns to change the parameters of the SUV”

“ Is a revolution running at Toyota?”

TOYOTA MOTOR EUROPE Local production increasing

2008 2009 2010 2011 2012 2013 2014 2015 2016 *concept Toyota C-HR +20% RAV4 • To start production in late in next • To start production in Russia 2016 in Turkey for Europe and 2 years in August 2016 export (Russia, Belarus, Kazakhstan)

TOYOTA MOTOR EUROPE Clear hybrid strategy 50%

31%

13%

2012 2016 2020

TOYOTA MOTOR EUROPE Europe Hybrid leader outside Japan

10% 31% North America Europe

TOYOTA MOTOR EUROPE Challenge 2 GLOBAL GROWTH

TOYOTA MOTOR EUROPE 10M* Challenges the Way We Work

10.2 M 10.1 M 10.1 M

2014 2015 2016 Plan

* 10M units including Toyota, & Hino

TOYOTA MOTOR EUROPE Source: TMC Two initiatives

TNGA NEW ORGANISATION

Ever Better Cars “Smaller Toyota” Agility and Speed

TOYOTA MOTOR EUROPE TNGA: Making Ever Better Cars TNGA

Create products with Enhance product emotional appeal marketability

Re- At the same time invest

Commonize parts & powertrain by group- Reduce cost based development

TOYOTATOYOTA MOTOR MOTOR EUROPE EUROPE TNGA: Making Ever Better Cars TNGA

Styling parts Optimised for each market

Commonised

% of vehicle cost Functional parts scope

TOYOTA MOTOR EUROPE TNGA: Making Ever Better Cars TNGA

TOYOTA MOTOR EUROPE TNGA: Making Ever Better Cars TNGA

80% of global production by 2020

2015 2020

TOYOTA MOTOR EUROPE From a function-based organisation... Small Toyota

TMC

Toyota Toyota Unit . R&D #1 #2 Centre Jpn, Emerging . Production markets US, EU Engineering . Production

Product Business units Functions for all vehicles centric

TOYOTA MOTOR EUROPE … To a product-based organisation Small Toyota

Head Office Functions

Toyota Toyota Internal companies #1 #2 (each with a CEO) Jpn, Emerging markets US, EU

Business units Product centric companies

TOYOTA MOTOR EUROPE Smaller Toyota companies Small Toyota

TMC Frontier Research Center HEAD OFFICE Corporate Strategy

Toyota Toyota Toyota Innovative Mid-size Commercial Toyota Lexus Compact Powertrain #1 #2 R&D vehicles vehicles Connected Car

Business units Product centric companies

TOYOTA MOTOR EUROPE Challenge 3 EMERGING TECHNOLOGIES

TOYOTA MOTOR EUROPE Automotive key trends driving our future

Hybrid electric vehicles Battery electric mobility Fuel Cell vehicles 1917 2015

Woods Dual Power Mirai

TOYOTA MOTOR EUROPE Automotive key trends driving our future

Combustion era goes up in smoke May 11 2016

TOYOTA MOTOR EUROPE Automotive key trends driving our future

Connectivity Customer data & digitisation

TOYOTA MOTOR EUROPE Automotive key trends driving our future

Automated and self driving cars

TOYOTA MOTOR EUROPE “Automakers, not Silicon Valley, lead in driverless car patents.”

Reuters Jan 5 2016

TOYOTATOYOTA MOTOR MOTOR EUROPE EUROPE The Next Frontier

TOYOTATOYOTA MOTOR MOTOR EUROPE EUROPE Moving fast, globally

TOYOTA MOTOR EUROPE CARMAKERS: A NEW DIRECTION OF TRAVEL: The industry contemplates a future of driverless and shared vehicles Jan 2016

TOYOTATOYOTA MOTOR MOTOR EUROPE EUROPE Data drives mobility change Automated driving

TOYOTATOYOTA MOTOR MOTOR EUROPE EUROPE Challenge 4 OUR ENVIRONMENTAL IMPACT

TOYOTA MOTOR EUROPE Prius concept @ 1995 Tokyo Motorshow

TOYOTA MOTOR EUROPE Hybrid technology evolution

Fuel efficiency l/100 km 5.1 4.3 3.9 3.0

HV system cost

First-generation Prius Second-generation Prius Third-generation Prius New Prius

Hybrid Vehicles technology significantly evolved in fuel efficiency with reduced cost

TOYOTA MOTOR EUROPE Hybrid global sales

9 million Cumulative 9 (million) 9 months! 8 8 7 million 6 5 5 M 4 3 M 3 2 1 M 1 0 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015

More than 9 million HVs in world wide cumulative sales to date

TOYOTA MOTOR EUROPE Hybrid: Impact on CO2

Cumulative (million vehicles)

1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 0

Cumulative 20 Million Tons 67 million 40 tons 60

67 million tonnes of cumulative CO2 reduction compared to same class gasoline vehicles

TOYOTA MOTOR EUROPE Hybrid: Mid term target

Million 15 2020 TARGET Cumulative 15 million HVs

9

1 0 1997 2000 2005 2010 2015 2020 2050

HV target cumulative 15 millions in 2020, to lead next generation vehicles

TOYOTA MOTOR EUROPE Developing Hydrogen FCV for 20 years

FCV-R Fuel FCEV Fuel FCHV-4 Fuel FCHV Hydrogen stored in Toyota-made tanks, Mirai precursor H Stored in adsorbing alloy 2 high-pressure tanks 1st FCV homologated

1996 1999 2001 2002 2005 2009 2011 2015

FCHV-3 Fuel FCHV-5 Fuel FCHV-adv Fuel Mirai Hydrogen Hydrogen generated on-board New stack, Revolutionary Titanium stack, (adsorbing alloy) by reforming on gasoline stainless steel cells 3.1 kW/L world record

TOYOTA MOTOR EUROPE H2 helps addressing some key problems

CLIMATE AIR ENERGY CHANGE QUALITY SECURITY

TOYOTA MOTOR EUROPE Sales: Mirai sales plan in 2020 and after

GLOBAL: More than 30,000/year around 2020 and after

TOYOTA MOTOR EUROPE About 5,680 FCV related Toyota patents

NUMBER OF PATENTS ITEM FREE USE PERIOD TO BE FREE

FC stack Approx. 1,970

High-pressure hydrogen tanks Approx. 290 Until the end of 2020

FC system control Approx. 3,350

Hydrogen station Approx. 70 No expiration Announcement at CES on January 6 by TMS SVP Bob Carter

Toyota share all patents for free to accelerate the spread of FCV

TOYOTA MOTOR EUROPE Fuel cell research: Partnership with BMW

DEVELOPING NEXT GENERATION FCV SYSTEM TOGETHER

TOYOTA MOTOR EUROPE Looking forward

TOYOTA MOTOR EUROPE Annual greenhouse gas emissions Baseline scenario 1,000 Tg CO2 140 (+3.7~4.8℃) Eq./year 120 (RPC8.5) 100 80 60 40 Below 2℃ scenario 20 (RPC2.6) 0 20 2000 2020 2040 2060 2080 2100

Full-scale initiatives to reduce CO2 emissions Zero or less

Regarding GHG emissions, there is no time to lose

Source: From the IPCC Working Group III 5th Assessment Report (2014)

TOYOTA MOTOR EUROPE

New Vehicle

Zero CO2 Emissions Challenge

Challenge of Challenge of Minimizing and Establishing a Optimizing Recycling-based Water Usage Society and Systems

Life Cycle Plant Zero CO 2 Zero CO Emissions Challenge 2 Emissions Challenge

Challenge of Establishing a Future Society in Harmony with Nature

TOYOTA MOTOR EUROPE “We must complete the Toyota Environmental Challenge 2050 at all costs for our vehicles to always be beloved by our customers.”

Akio Toyoda

TOYOTA MOTOR EUROPE TOYOTA MOTOR EUROPE Long term trends by engine types

Sales volume

HV Conventional PHVPHV

FCV EVEV

2010 2020 2050 Accelerate next generation vehicle

development toward 90% CO2 reduction

TOYOTA MOTOR EUROPE TOYOTA MOTOR EUROPE Life cycle Zero CO2 Disposal/recycling Maintenance

Driving

Fuel production Parts/vehicle production Material production Gasoline HV MIRAI Zero vehicles New generation In the future Vehicles

Next generation vehicle emits zero CO2 during driving however, material, parts/vehicle production still do

TOYOTA MOTOR EUROPE TOYOTA MOTOR EUROPE Focus on 2 pillars

Reduced by low CO -emitting production CO emissions under “Business As Usual” 2 2 technologies and daily Kaizen activities

Plant CO2 emissions ➡ Aiming for zero in the long run Reduced by using renewable energy and hydrogen

2001 2030 2050

TOYOTA MOTOR EUROPE TOYOTA MOTOR EUROPE Importance of cooperation by all stakeholders

Customers

Energy Carbon free Governments suppliers Mobility & Society

Industry

Zero CO2 Challenge in cooperation with stakeholders

TOYOTA MOTOR EUROPE Thank you

TOYOTA MOTOR EUROPE