March 17, 2015 NTN Corporation Contents

I. Long-term Vision: “Our Vision”

II. New Medium-term Management Plan 1. Basic Policy 2. Company-wide Targets 3. Main Themes 4. Plans by Business Sector 5. Plans by Region 6. Main Management Indices

• This presentation and comments made in this conference or during the following Q&A session include forward-looking statements about Management expectations for future performance and future business strategies. • These statements represent the best judgment of the management of the company based on the information currently available. However, there can be no assurance that future results meet any expectation, estimate or projection conveyed by these statements or comments. Actual results may differ materially from management projections depending on various factors such as changes in product demand, exchange rates and interest rates and contingent liabilities.

3/17/2015 2 I. Long-term Vision: “Our Vision”

(1) A company where its corporate philosophy is understood by all employees around the world and where all employees think and act for themselves – A company where all employees take action based on the corporate philosophy by complying with the law and regulations, and contribute to society – A company that grows daily, and where each and every employee can think and act for themselves

(2) A company with original new products and services, appreciated for its high quality and functions, and has a global presence – A company with world top-class technology, and makes use of them to conduct business around the world – A monozukuri company seeking high quality and technology – A company that keep challenging to the most advanced leading-edge research and technology

(3) A company where everyone involved with NTN be able to be proud of the "NTN" brand

3/17/2015 3 Long-term Objectives

Operating margin to 10 to 15%

Net sales to double current figures

Company's 100th anniversary

March 2018

For the Global Rapid Advance Revival GCA Next. Advance 21 2014 FY2025 21 2010 2013

3/17/2015 4 II. New Medium-term Management Plan " "

“ " -NTN Transformation for Next 100- (1) Company’s 100th anniversary in FY2017 (2) “Our Vision” to continue growing for the next 100 years Three years for transformation and a building foundation to achieve these  Period: April 2015 to March 2018

Our Vision (1) A company where its corporate philosophy is understood by all employees around the world and where all employees think and act for themselves (2) A company with original new products and services, appreciated for its high quality and functions, and has a global presence (3) A company where everyone involved with NTN is able to be proud of the "NTN" brand

Company's New Medium -term 100th "Revival 2014" Management Plan anniversary FY2013 to FY2014 "Reform Business "NTN100" Structure to Generate FY2015 to FY2017 “Base period for Our Vision" Profit"

3/17/2015 5 1. Basic Policies of " "

Implement main policies based on 3 Basic Policies to become a co-creative partner company for customers

ASEAN, etc. Concentrate resources Americas (personnel, materials and cash) on strategic areas

Business Product Reform business structure

unit axis from “volume” to “value” to generate profit

Strengthen management and financial foundations

3/17/2015 6 2. Company-wide Targets of " "

Company's 100th anniversary

Medium-term For the Next. Management GCA 21 GA 2013 復活Revival2014 2014 NTN100 Plan 2010

3/17/2015 7 Review of "Revival 2014"

・ Issues remain with "Reform Business Structure to Generate profit" ・ Also clarify the issues toward the next 100 years

Review of "Revival 2014" Future Major Issues • The aftermarket business system • Expand the highly profitable was strengthened and the target aftermarket business even amount achieved, however the further volume was insufficient • Operating margins for the • Automotive products, in particular automotive business exceeded improvements to profits for CVJ plans, however the effects of exchange rates was significant • Continued growth requires not only • Urgent need to develop new existing products and businesses, business areas following on from but urgently requires the creation of bearings and CVJs new business

3/17/2015 8 3. Main Themes of " "

Major Themes

(1) Develop Businesses in New Areas business byStrategies Growth (2) Expand Aftermarket Business

(3) Structural Reform of the Driveshaft business Profitability (4) “Monozukuri” with Next-generation Technology

(5) Strengthen the Management Foundation Foundation (6) Strengthen the Financial Foundation

Strategy by function

3/17/2015 9 Growth Major Theme (1) Develop Businesses in New Areas

"Develop business in new areas fusing NTN's technology and knowhow"

Current Status and Issues Target

• Hub bearings for automobiles: • Search for ideas for new World’s No. 1 share businesses instead of being limited to existing areas • CVJ for automobiles: World’s No. 2 share • Utilize accumulated technology and • Strength in large and precision knowhow, as well as strengthen bearings for aircraft, rolling stock external links to fuse technology and wind turbines, and composite with ideas material products • Target new markets expected to grow in the future with unique • Existing products and businesses, technology as well as new products and businesses are required

3/17/2015 10 Growth Major Theme (1) Develop Businesses in New Areas

Four new business areas Develop business in new areas fusing NTN's technology and knowhow Energy Business EV Business “Using Natural Energy” “Electrifying Automobiles,

Universities Revolutionizing Safety”

Other Research companies institutions

Government agencies Service, Robot-related Business Solution Business “Working and Living with “Utilizing Big Data” People” Government-industry-academia collaboration Tier 1 supplier collaboration

3/17/2015 11 Energy Business: "Using Natural Energy"

Main strategies Sales targets

100 million yen Roll-out of business utilizing innovative technology Developing markets for the natural energy field 500 Covers wind and hydroelectric power generation, and storage device businesses

Utilized technology 0 億円 • High-efficiency blade technology 2015 2020 2025 • Rolling technology • Replace existing energy sources • Magnetic materials technology Market potential • Increased uptake of micro-grid • Increased uptake of zero energy houses

Vertical Axis Changes in power generation capacity with natural energy Wind Turbine Unsubsidized:

Power generation capacity Powergeneration Other

Bioenergy (terawatt-hours) Wind onshore Solar PV

Subsidized: Other Bioenergy Wind onshore Solar PV Horizontal Axis Wind Turbine Micro Hydro Turbine Source:IEA 2014 IEA July (2014)

3/17/2015 12 EV Business: "Electrifying Automobiles, Revolutionizing Safety"

Main strategies Sales targets

100 million yen Develop and propose system products for 300 "driving," "turning" and "stopping" functions

Utilized technology

・ Unique machinery elemental technology that contributes to 0 億円 more compact and lightweight advantages 2015 2020 2025 (In-wheel Motor, Electric Braking System, Steer-by-wire) Market potential ・ Control technology that includes motors and inverters

・ Better CO2 emission controls ・ Increased uptake of automated driving Increasing numbers of next-generation automobiles

Steer-by-wire (million Quantity vehicles) System

Fuel cell vehicles Electric vehicles

Plug-in hybrid vehicles Hybrid vehicles Internal combustion engine vehicles In-wheel motor Electric commuter "Q’mo" system Electromechanical brake system Source:IEA 2014 IEA July (2014)

3/17/2015 13 Robot-related Business: "Working and Living with People"

100 million yen Main strategies Sales targets 200

Adapt seeds unique technology to suit new needs, and develop business Roll out products developed within the group globally Pro-active collaboration with external companies, 0 億円 2015 2020 including /sales 2025 • Working and living with people with Utilized technology Market potential “monozukuri" and the "service field" • For growth areas such as edical, • Precision positioning technology such as the welfare and nursing

linear module ( Trillion yen) Future markets for robotics technologies • Compact actuator technology • Unique, high-precision and high-speed parallel Lifestyle services Parallel link Secure and safe public link mechanism field Monozukuri, RT products Lifestyle services field Various linear modules

Secure and safe public field

Monozukuri, RT product field

2005 2010 2015 2020 2025 2030

Source: Japan Society for the Promotion機械振興協会２００７ of Machine Industry (2007) Electric actuators Ball screw actuators 3/17/2015 14 Service, Solution Business: "Utilizing Big Data"

Main strategies Market potential

Shift from providing products, • Better infrastructure maintenance to providing services and solutions • Shift from regular maintenance to constant monitoring Utilized technology • Utilize Big Data

• Bearing condition monitoring technology CMS Change in size of the maintenance management • Bearing diagnostics technology Handheld diagnostic market device • Structural degradation sensing technology Energy supply, industrial infrastructure Lifestyle, urban About 1.4 infrastructure times Wireless measurement unit Power infrastructure

Public structures

Condition monitoring system Infrastructure and structures

Wind power 2010 2015 2020 2030 generator Nacelle section Monitoring service Source:富士経済 Fuji-Keizai ２０１４ (2014)

3/17/2015 15 Growth Major Theme (2) Expand Aftermarket Business

"World's No. 1 customer satisfaction level with product lineup and engineering services"

Current Status and Issues Target • Establish Aftermarket Business • Excellent product lineup and shorter Headquarters and strengthen lead-time from ordering to delivery system (October 2013) • Expand engineering services • Engineering services at customer's • Approach growth markets and actual field of operations specific industries

• Automotive aftermarket product (100 million yen) (auto parts) business in Europe 2,000 Aftermarket sales plan +35% 1500 1,500 1115 • Insufficient presence in emerging 1,000 markets Automotive • Strong and weak businesses exist 500 Industrial machinery depending on industry 0 2014 2015 2016 2017

3/17/2015 16 Growth Major Theme (2) Expand Aftermarket Business

Important measures-1 1. Enhance product lineup and shorten lead-time  Roll out Japan's No. 1 product lineup globally Warehouse dedicated to  Establish central warehouse aftermarket in Europe dedicated to the aftermarket  Shorten the lead-time from ordering to shipment  Develop global system capable of deliveries within 24 hours Technical service unit 2. Strengthen MRO activities  Expand the technical service units that are running in Japan, Europe, Americas and China, to emerging countries  Develop the aftermarket academy  Upgrading and expanding bearing technical training, bearing diagnosis, aftermarket database Aftermarket academy

3/17/2015 17 Growth Major Theme (2) Expand Aftermarket Business

Important measures-2

3. Strengthen approaches to target markets (100 million yen) +65% 500 Americas North American market 415 • Growth in MRO target industries 400 • Expand part kits for trucks and 300 252

passenger vehicles 200 Automotive • Strengthen relationship with major distributors 100 Industrial Machinery

Chinese market 0 2014 2015 2016 2017 • Concentrate on MRO target industry Forecast見通し (100 million • Expand distributor network yen) 200 China +85% Russia market 150 • Full-scale operation of new sales company, net sales 2-fold 100 81

Industrial Central and South American market Machinery

• Strengthen organizational system and engineering services 0 2014 2015 2016 2017 Forecast見通し

3/17/2015 18 Profitability Major Theme (3) Structural Reform of the Driveshaft Business

"NTN driveshafts achieving World's No.1 customer satisfaction level"

Current Status and Issues Target • Expand sales to aim for greater share • Expand profits of the driveshaft business • Increase number of car makers supplied • World's No. 1 customer satisfaction level for quality, cost, delivery and technical • Global system for production in customer aspects regions Automotive business operating margin Driveshaft net sales Number of customers 2000 20 1500 100 million Driveshaft business 15 yen operating margin 1000 10 6,000 Sales target 5,300 +15% 500 4,590 5 0 4,000 100 2000 2005 2010 2014 0 million yen 2005 2014 Others

2,000 +15% • Operating margins have dropped due to Drive falling sales prices and soaring costs shaft 0 2014 2015 2016 2017

3/17/2015 19 Profitability Major Theme (3) Structural Reform of the Driveshaft Business

Important measures-1 1. Expand profits of the drive shaft business Improve operating margin by 3 points over 3 years

Review design, materials and methods Strengthen sales price control • Increase use of locally-procured materials • Limit price reductions Seek production efficiency • Seek materials with near net shape • Implement measures to protect • Coordinate production loads • Change design of shafts and other sales price of low-profit items between plants components • Reduce man-hours by streamlining Exchange rates processes Sales price • Reduce equipment costs with new Decrease in levels technologies variable costs Increase fixed costs

Scale merits + approximately Expand sales and improve mix 7 billion yen • Net sales: approximately FY2017 29 billion yen increase FY2014 • Expand high value-added products (forecast) for premium-grade vehicles

3/17/2015 20 Profitability Major Theme (3) Structural Reform of the Drive shaft Business

Important measures-2 2. Strengthen global quality control and supply system Globally consistent standard quality assurance with

“Made by NTN” NTN-AT (Germany) Xiangyang NTN (China) NTN (China) Works (Japan) Iwata Works (Japan)

NTN Sibio Faster reliable operation of new (Romania) plants (China, ) NDI () NTN (China) NTE ()

Seohan-NTN Increase production capacity Taiway () (Americas) in the U.S. NTN Fukuroi Corp (Japan)

NNMI () NMT () Development system in 5 regions NTN de Mexico NDB (Brazil) around the world designed Unidrive () to meet local needs 3. Development and series lineup of next-generation driveshaft modules

hub bearing + drive shaft Utilize EBW (Electron Beam Welding) and PCS (Press Connect Spline)

3/17/2015 21 Profitability Major Theme (4) “Monozukuri” with Next-generation Technology

"Innovation with "Monozukuri" methods toward next 100 years" Current Status and Issues Target • Introduce innovative manufacturing • Change in working environment technologies − Decreasing birthrate and aging − Cost-competitive capabilities, population in Japan reduce equipment unit costs − Shorten lead-time, eliminate stock − Soaring personnel expenses in in process emerging countries − Adopt energy and resource efficient processes • Globally consistent standard quality • Global standardization of − Increase in overseas production "Monozukuri"

plants − Globally consistent standard quality • "Monozukuri" comes from assurance − Speedy and flexible production “Hitozukuri" system − "Hitozukuri" chiefly in Japan • Strengthen global “Hitozukuri” − Expand business at the ideal time − Respond to sudden increases in demand

3/17/2015 22 Profitability Major Theme (4) “Monozukuri” with Next-generation Technology

Important measures-1 1. Develop and introduce innovative manufacturing technologies • Development and roll out of “Grow Up line” • New driveshaft machining method Innovative • Including streamlining with manufacturing grinding-free machining and combined line machining, using precision joint technology, and using near net shapes • New mass-production technologies for (hub bearings) (Image) • Establish flexible lines with equipment modulization and by utilizing robots • Construct in-line production and consistent production lines for tapered bearings and needle roller bearings

3/17/2015 23 Profitability Major Theme (4) “Monozukuri” with Next-generation Technology

Important measures-2 2. Promote global standardization of “Monozukuri" Deploy new production Global  Development of “Monozukuri" standards methods standardization  Roll out to the "mother plant" and Mother plant provide training Deploy laterally  Deploy laterally to overseas plants

 Globally consistent standard quality Overseas Overseas Overseas Overseas plant plant plant plant assurance with “Made by NTN” 3. Continual “Hitozukuri” to increase worksite capabilities  Expand system for training of technicians from outside Japan at the "mother plant“  "Global QC Circle Convention" and "NTN Technical Skills Competition"  Open "Monozukuri school"  Improve technicians for special processes

3/17/2015 24 Foundation Major Theme (5) Strengthen the Management Foundation

"Establish management foundation as a truly global company"

Current Status and Issues Target • Progress of • Ensure all NTN Group employees are – Ratio of overseas sales: approximately aware of the "Corporate philosophy" 70% as a globally common code of – Ratio of overseas production: conduct approximately 50% – Development system in 4 regions around • Ensure compliance and strengthen the world efforts for governance and diversity – Ratio of overseas employees: as a global company approximately 65% • Contribute to local communities and • Instill the "corporate philosophy" environment conservation to become • Strengthen compliance globally a company admired throughout the region • Train global personnel • Encourage the roles of women • Establish “on local site with local (in Japan) materials by local personnel” system

3/17/2015 25 Foundation Major Theme (5) Strengthen the Management Foundation

Important measures-1 1. Strengthen control of NTN Group companies Japan CSR Headquarters

Relevant Subsidiaries departments ・ Europe, North America Instill the corporate philosophy globally Office of General Office of General Manager Manager -Europe & -Americas Region Africa Region Internal Control Section Internal Control Section

Subsidiaries Exchange information Subsidiaries ・ Global training and follow-ups Personnel interaction

China by the CSR Headquarters India Office of General Office of General Manager Manager -India & West ASEAN -China Region Region Internal Control Section Internal Control Section Office of General Manager ・ -ASEAN & Oceania Strengthen the internal control system overseas Region Subsidiaries Subsidiaries Internal Control Section

Subsidiaries ・ Ensure that information is disclosed appropriately and at the ideal time, and with transparency NTN's 2. Strengthen risk management corporate Corporate philosophy system ・ Create disaster mitigation plan for the global philosophy

supply chain Basic policy

Employee code of Business code of conduct conduct

3/17/2015 26 Foundation Major Theme (5) Strengthen the Management Foundation

Important measures-2 3. Conserve the global environment and

promote social contribution activities Wind power • Promote “using natural energy” at plants and business generation • Reduce environmental impact throughout the supply chain • Strengthen links with local communities for business plants Regional planting activities 4. Train global personnel Sunlight power generation Number of female managers • Mutual interaction between personnel from in Japan Japan  overseas, overseas  overseas Double • Improve training of young personnel and management personnel • Double the number of female managers (in Japan)

• Promote employment of diverse personnel 2014 2015 2016 2017 forecast見通し

3/17/2015 27 Foundation Major Theme (6) Strengthen the Financial Foundation

"Strengthen profit control and improve asset efficiency"

Current Issues and Target Values

ROE: 14% or more Equity to capital ratio: 30% or more Net income to net sales for current term, and turnover ratio are worsening

Drop in equity to capital ratio Net D/E ratio : Net D/E ratio increases 1.0 or less

3/17/2015 28 Foundation Major Theme (6) Strengthen the Financial Foundation

Important measures-1 1. Financial actions to improve asset efficiency (1) Reduce interest-bearing debt (-60 billion yen/3 years) Utilize free cash flow, and cash and deposits Expand scope of funding within regions ・ Improve inventory turnover ratio (4.0  4.5) Clarification of proper stock standards and multi-directional follow-up system ・ Sell assets Careful examination of held stock and other assets (2) Reduce obligations for retirement benefits Build up pension assets

3/17/2015 29 Foundation Major Theme (6) Strengthen the Financial Foundation

Important measures-2 2. Financial actions to improve net income to net sales (1) Actions to improve operating margin for each business (6.2%  8.8%) • Aftermarket business...expand highly profitable businesses • Industrial machinery business....improve plant operating ratio by expanding sales • Automotive business...focus on improving profits of driveshafts (2) Shift to investment decisions with greater focus on CF than previously • Better balanced investment decisions by field • Review decision standards, risk information, follow-up methods and other aspects 3. Returns for shareholders • Ongoing long-term and reliable returns of profits to shareholders • Based on 30% dividend payout ratio

3/17/2015 30 Plans by Business Sector (Aftermarket Business)

Expand global net sales 35% (10% pa) over 3 years

100 million yen Japan: Secure a solid 50% share in Japan

with bulk equipment repair contracts (MRO) and pro-active efforts to secure new customers

+31% Americas: Cooperate with major distributors to expand share Highlight advantages through marketing and +31% engineering Greater lineup of alternative products for automobiles Expand auto parts for trucks

+65% Europe: Expand MRO for //paper, etc Expand share in emerging markets +15% Extend spread of suspension auto parts

Asia: Conduct training and maintenance demonstrations Strengthen sales promotions and advertising Increase distributor network and expand sales to major distributors Paper manufacturing equipment Spherical roller Steelworks facilities Auto parts for trucks bearings 3/17/2015 31 Plans by Business Sector (Industrial Machinery Business)

Expand global net sales 17%, improve operating margin to 7.5% over 3 years

100 million Japan: Increase demand for gearboxes and reducers for yen robots

Increase domestic production of machine tools Increase demand for exports of agricultural machinery

+10% Americas: Recover demand for machinery Increase new orders for agricultural machinery +35% Include orders of CVJs for industrial machinery

+26% Europe: Increase new orders for aircraft Recover demand for agricultural machinery +3% Increase new orders for rolling stock

Asia: Increase new orders for Chinese rolling stock Include orders for hydraulic pumps for construction machinery Increase demand for wind turbines

Bearings for Bearings for jet engines wind turbines 3/17/2015 32 Plans by Business Sector (Automotive Business)

Expand global net sales 15%, improve operating margin to 6% over 3 years

100 million Japan: Reduce domestic market (-12%) yen Reduce sales by developing local procurement for customers +59%

Americas: Increase production quantity (+7%) +3% Expand market to increase sales Expand sales by launching the Mexico plant

+21%

Europe: Recovery mainly in western Europe

Increase sales of 3rd generation hub bearings -9%

Asia: China leads the way as the largest market Stable supply system in and Xiangyang Recovery/growth in ASEAN and Indian markets Mechanical unit Press connect hub joint Ball screw Hub bearings with sensor linear module 3/17/2015 33 Plan by Region (Net Sales and Operating Margin)

Japan: Expand aftermarket business Americas: Continued growth with firm market environment

100 million yen 100 million yen

Europe: Increase for industrial machinery Asia: Automotive and aftermarket business lead the way

100 million yen 100 million yen

3/17/2015 34 Main Management Indices of " "

(100 million yen)

Forecast NTN100 Year on year (2)-(1) FY2014 (1) FY2017 (2) Net sales 6,730 8,000 +1,270

Operating income 420 700 +280

Operating margin 6.2% 8.8% +2.6 points

Net Income 200 420 +220

Inventories 1,680 1,800 or less +120 or less

Inventory turnover ratio 4.0 4.5 +0.5 (times)

Equity to capital ratio 26.0% 30.0% or more +4 points or more

0.24 or more Net D/E ratio 1.24 1.0 or less improvement

ROE 9.7% 14% or more +4.3 points or more

Exchange rate $:¥101.5 €:¥134.5 $:¥110 €:¥130 -

3/17/2015 35

NTN Transformation for Next 100

3/17/2015 36