Aluminum Content in European Cars

ALUMINUM CONTENT IN EUROPEAN PASSENGER CARS

Prepared for

- Public Summary - 10.10.2019

Assessment Scope 3 European Car Production 5 European Electric Vehicle Production 7 Aluminum Content in Cars 9 Aluminum Content by Vehicle Segment 11 Aluminum Content by Vehicle Brand 13 Aluminum Content by Vehicle Model 14 Aluminum Content by Component Group 15 Aluminum Content by Forming Process 19 Aluminum Content Evolution 2016-2028 20 Comparison of Aluminum Content by Powertrain Type 21

© 2019 DuckerFrontier. All rights reserved | www.duckerfrontier.com 2 ASSESSMENT SCOPE This assessment of the Aluminum Content in European Passenger Cars encompasses all aluminum applications in a car, includes electric vehicles, and is based on the analysis of a car sample covering nearly 95% of total EU28 production

Scope Deliverables

Application scope: Passenger cars CURRENT ALUMINUM CONTENT IN CARS1 (2019) • Aluminium content by vehicle Geographic scope: EU 28 (production location in EU 28 - CKD not  Component net weight (for components in focus) included)  Forming process / Product form (sheet vs. extruded vs. cast vs. forged) Vehicle sample: accounts for 94.3% of total EU 28 production  Estimated additional aluminum content by vehicle • Vehicle models have been jointly selected with EA (subcategories “Other”) • 11 pure BEV models included in the sample:  [For engine blocks, cylinder heads and steering knuckles only] Share of primary vs. secondary ⁻ BMW 3 Series EV aluminum ⁻ Mercedes Benz EQC ⁻ Mercedes Benz EQE Sedan • Average aluminium content per vehicle (after extrapolation to ⁻ Ford C EV whole EU28 production) ⁻ Peugeot 208 EV  Average component net weight (for components in ⁻ Renault Zoe ZE focus) by vehicle segment ⁻ Jaguar I-Pace  Average net weight of consolidated components in ⁻ Audi e-tron GT focus segmented by product form ⁻ Audi e-tron  Average additional aluminium content per component ⁻ Porsche Taycan group ⁻ Volkswagen ID.3 (previously called Neo) ALUMINUM CONTENT FORECASTS (2025, 20282) • Total Product scope: aluminum components • By component group • 11 components groups • By forming process • 38 components in focus (see following page) • By component [1] Total market exploration for conventional/hybrid-versions only; only selected EV sample analyzed [2] 2028 forecasts are modelled based on 2025 aluminum content data and projected 2028 vehicle production using same CAGR as from 2019 to 2025

© 2019 DuckerFrontier. All rights reserved | www.duckerfrontier.com 3 ASSESSMENT SCOPE Aluminum applications are classified into 12 component groups. Within a component group, the focus has been set on select main AL components; remaining applications have been considered in the each sub-category “Other”

Component Group Component Approach Component Group Component Approach Blocks Research Transmission Case Research Heads Research Differential Case Research Head Covers Research Transmission Transfer Case Research Engine Pistons Research Driveshaft Research Powertrain Mounts Research Other Transmission Modelling Oil Pans Research Complete Body Structures Research Other Engine Modelling Shock Towers Research Steering Research Rails Research Suspension Arms Research Radiator Supports Research Steering Knuckles (Front) Research Body Structure Structural Parts Research Chassis & Suspension Wheel Carriers (Rear) Research IP Structures Research Front & Rear Subframes Research Floor Group Research Other Chassis & Suspension Modelling Body Side Panels Research Wheels Research Other Body Structure Modelling Brakes Research Hoods Research External Trim Research Fenders Research Roof Rails Research Liftgates, Decklids & Tailgates Research Closures Trim & Interior Interior Trims Modelling Front & Rear Doors Research Sun roofs Modelling Roofs Research Pans & Tracks Modelling Other Closures Modelling Heat Exchangers Modelling Crash Management Bumpers & Crash Boxes Research Heat Transfer Heat Shields Modelling Battery Boxes Research Electrification Other Heat Transfer Modelling Electric Motor Housing Research

© 2019 DuckerFrontier. All rights reserved | www.duckerfrontier.com 4 EUROPEAN CAR PRODUCTION Car production forecasts expect steady growth, with a CAGR of 1.54% from 2019 to 2025. The Volkswagen brand leads the European market, accounting alone for approx. 2 million cars produced in the EU28

10-year European Car Production 2016-2025 (EU 28) (Million Units) CAGR: 1.54% 18.3 18.0 17.8 17.7 17.4 17.2 17.0 16.9 16.8 16.7

2016 2017 2018 2019 2020 2021 2022 2023 2024 2025

2,000 Car Production by Brand 2016-2025 (EU 28) (Thousand units) 1,500 2019 2025

1,000

500

Source: LMCA Database Q1 2019 + Ducker Frontier estimates

© 2019 DuckerFrontier. All rights reserved | www.duckerfrontier.com 5 EUROPEAN CAR PRODUCTION C-Compact vehicles (e.g. VW Golf, Ford Focus, etc.) make up the majority of the car production (43%). Segment split is expected to remain similar till 2025, though with stronger growth from B-segment and a decrease of A-segment

2019 Car Production by Segment Highest Production Programs by Segment (2019, Thousand Units)

10% 6% Range Rover Sport Audi Q7 A - BASIC 15% Audi A6 26% B - SUB-COMPACT BMW 5-Series Mercedes-Benz E-Class 16.7M C - COMPACT Volvo XC60 D - MIDSIZE VW Passat E - LARGE Mercedes-Benz GLC Audi A4 43% BMW 3-Series

Peugeot 3008 VW Tiguan 2019 vs. 2025 Car Production by Segment Nissan Qashqai (Million units) Ford Focus VW Golf 1.86 1.68 2.74 Opel Corsa 2.47 Citroen C3 Dacia Duster VW Polo 7.57 Ford Fiesta 7.12 Smart Fortwo VW Up! C3 Aircross 5.09 4.33 Fiat New Panda Fiat 500 1.09 1.03 0 100 200 300 400 500 2019 2025

Source: LMCA Database Q1 2019 + Ducker Frontier estimates

© 2019 DuckerFrontier. All rights reserved | www.duckerfrontier.com 6 E U R O P E A N ELECTRIC VEHICLE PRODUCTION Electric vehicle production (BEV and PHEV combined) is expected to rapidly ramp-up, with a CAGR of over 30% between 2019 and 2025

10-year EV Production (EU 28) – PHEV & BEV Units

CAGR: 33.1% 3,324,607

14% 2,875,726

15% 2,407,040 21%

15% 1,969,863 21%

16% 21% 1,528,240 42% 16% 22% 1,085,810 40% 22% 19% 41% 597,420 23% 43% 383,927 46% 27% 20% 278,357 44% 19% 193,543 26% 24% 19% 26% 19% 33% 14% 38% 10% 11% 42% 35% 13% 5% 4% 4% 5% 4% 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025

A - Basic B - Sub-Compact C - Compact D - Midsize E - Large

Source: LMCA Database Q1 2019 + Ducker Frontier estimates

© 2019 DuckerFrontier. All rights reserved | www.duckerfrontier.com 7 EUROPEAN ELECTRIC VEHICLE PRODUCTION BEVs are forecasted to grow faster than PHEVs. C-segment will continue to be predominant. Smaller PHEVs will be introduced (B-segment) and C-segment to gain shares

10-year BEV Production 2016-2025 (EU 28) 10-year PHEV Production 2016-2025 (EU 28)

CAGR: 42.6% CAGR: 21.4%

2,277,199 2,277,199 1,047,408 1,047,408

11%

1,946,984 1,946,984 928,742 928,742 20%

12% 18% 810,106

1,596,934 1,596,934 21% 747,806 747,806

18% 679,646 21% 12% 27%

21%

594,553 594,553 1,222,057 1,222,057 19% 23% 28% 13% 39% 25% 25% 37% 25% 848,594 848,594 21% 24%

11% 36% 326,902 24% 20%

491,257 491,257 49%

39% 201,437 40% 46% 175,724 175,724 49% 11% 27% 50% 270,518 270,518 42% 26% 51%

21% 109,310

182,490 182,490 27% 41% 48% 29% 49%

102,633 102,633 38% 84,233 84,233 17% 20% 34% 37% 17% 36% 30% 56% 55% 20% 39% 30% 59% 30% 29% 10% 9% 7% 6% 7% 6% 28% 23% 22% 4% 4% 4% 4% 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025

A - Basic B - Sub-Compact C - Compact D - Midsize E - Large

Source: LMCA Database Q1 2019 + Ducker Frontier estimates

© 2019 DuckerFrontier. All rights reserved | www.duckerfrontier.com 8 ALUMINUM CONTENT IN CARS (2019) Average Aluminum Content per Vehicle currently amounts to nearly 179kg and Total Aluminum Content for the whole car market (including electric vehicles) is estimated at 2,989 KT – most of which being aluminum castings

Aluminum Content in Cars (2019) Net weight

Average Al Content Total Al Content Per Vehicle

179.2 kg 2,989 KT

Cast 116.0 kg 1,936 KT

Sheet 34.0 kg 567 KT

Extrusions* 19.0 kg 317 KT

Forged 10.2 kg 169 KT

* Extrusions exclude forging stock

© 2019 DuckerFrontier. All rights reserved | www.duckerfrontier.com 9 ALUMINUM CONTENT IN CARS (2025) Average AL Content per Vehicle is expected to increase by approx. 20kg to 198.8kg by 2025, bringing the Total AL Content in European cars to 3,635 KT. AL casting is expected to remain the predominant forming process

Aluminum Content in Cars (2025) Net weight

Average Al Content Total Al Content Per Vehicle

198.8 kg 3,635 KT

Cast 118.1 kg 2,161 KT

Sheet 43.2 kg 789 KT

Extrusions* 26.7 kg 489 KT

Forged 10.7 kg 196 KT

* Extrusions exclude forging stock

© 2019 DuckerFrontier. All rights reserved | www.duckerfrontier.com 10 ALUMINUM CONTENT BY VEHICLE SEGMENT While E-segment vehicles have the highest Average AL Content per Vehicle (442kg), C-segment vehicles capture the largest share (36%) of Total AL demand due to the overall volume of C-segment vehicle production

Total AL Content by Vehicle Segment (2019, Net Weight in KT) Average AL Content by Vehicle Segment (2019, Net Weight in kg)

442 E - LARGE; 742 A 3% B 14% E 25% D - MIDSIZE; 656 266

152 C - COMPACT; 1,085 98 77 D 22% C 36% B - SUB-COMPACT; 423 Total: 2,989 KT A - BASIC; 84 A - BASIC B - SUB- C - COMPACT D - MIDSIZE E - LARGE COMPACT

Vehicle Programs with the Highest Average AL Content (Net Weight 2019) per Segment

A - Basic B - Sub-Compact C - Compact D - Midsize E - Large

Opel Adam Audi Q2 BMW i3 Jaguar I-Pace Audi e-tron

2019 Production: ~27K units 2019 Production: ~82K units 2019 Production: ~40K units 2019 Production: ~21K units 2019 Production: ~29K units Total AL Content 2019: 2.6 KT Total AL Content 2019: 12.5 KT Total AL Content 2019: 14.5 KT Total AL Content 2019: 15.0 KT Total AL Content 2019: 22.8 KT Avg. AL Content 2019: 110kg Avg. AL Content 2019: 164kg Avg. AL Content 2019: 367kg Avg. AL Content 2019: 704kg Avg. AL Content 2019: 804kg

© 2019 DuckerFrontier. All rights reserved | www.duckerfrontier.com 11 A L U M I N U M CONTENT BY VEHICLE SEGMENT The Average AL Content per Vehicle is forecasted to increase by 19.6kg between 2019 to 2025 - only 2.9kg in A- segment vehicles, but up to 38kg in D-segment vehicles. Growth will come from sheet and extrusions

Average Aluminum Content per Vehicle between 2019-2025 by Segment Net Weight in kg +22.2

464.2 442.1

+38.0

303.9 265.9 +19.6 +18.3 198.8 179.2 170.8 152.4 +13.1 +2.9 110.9 97.7 76.8 79.8

Avg. AL A B C D E Avg. AL A B C D E Content Content 2019 2025

Average additional AL content per vehicle (kg) in 2025 +xx.x as compared with 2019

© 2019 DuckerFrontier. All rights reserved | www.duckerfrontier.com 12 A L U M I N U M C O N T E N T BY VEHICLE BRAND However, on a per vehicle level, Jaguar Land Rover models have the highest aluminum content. All premium brands are above market average, reversely all volume brands are below average

Average AL Content per Vehicle by Brand 2019, Net Weight in KG

Above Market Average Below Market Average 532

479

416 378

294 276 273 273 267

188 179 164 148 144 129 129 129 128 125 123 123 121 115 115 110 109 102 96 91 87 72

© 2019 DuckerFrontier. All rights reserved | www.duckerfrontier.com 13 A L U M I N U M C O N T E N T BY VEHICLE MODEL 8 out of the 20 most aluminum-intensive vehicle models belong to the JLR group. The model with the highest AL content however is the Audi e-tron with 804kg AL content (nearly 4.5 times the market average)

Top 20 Vehicle Models with the Highest Average AL Content per Vehicle 2019, Net Weight in kg

804 794 746 704 679 649 641 633 614 613 600 586 562 549 543 533 532 530 516 511

179

© 2019 DuckerFrontier. All rights reserved | www.duckerfrontier.com 14 A L U M I N U M CONTENT BY COMPONENT GROUP Engine and Wheels together represent almost half of Total Aluminum Content in cars (~45%)

Total Aluminum Content by Component Group 2019, Net Weight in KT

Electrification* 44 Other small parts 8 Engine Trims & Interior 25 702 Brakes 52 Steering 61

Crash Management 74

Wheels Body Structure 642 235 Total: 2,989 KT

Body Closures 200

Transmission Heat Transfer 323 310 Chassis 314

*Electrification components includes Battery Box, Battery Cooling and Electric Motor Housing

© 2019 DuckerFrontier. All rights reserved | www.duckerfrontier.com 15 A L U M I N U M CONTENT BY COMPONENT GROUP Engine components and Wheels are by far the largest aluminum contributors. Average AL Content per Vehicle related to Battery Box and Electric Motor Housing will grow fast with the expected accelerated production of EVs

2019 Average Aluminum Content per Vehicle by Component Group Incl. all powertrain types, Net Weight in kg

TOTAL 179.2

Engine 42

Wheels 38

Transmission 19

Chassis 19

Heat Transfer + Battery Cooling 19

Body Closures 12

Body Structure 14

Crash Management 4

Steering 4

Brakes 3

Trims & Interior 2

Battery Box 1

Electric Motor Housing 1

Other small parts 2

© 2019 DuckerFrontier. All rights reserved | www.duckerfrontier.com 16 A L U M I N U M CONTENT BY COMPONENT GROUP Electrification components will be the main growth area by 2025, together with Body Closures. Alone Battery Boxes account for nearly 2/3 of the Average AL Content increase to come

Avg. Aluminum Content Evolution 2016-2025 by Component Group Net Weight in kg

+19.6 kg +28.7 kg 198.8 179.2 3.3 3.1 3.7 3.6 4.5 4.4 Other small parts 150.5* 14.1 15.0 Trims & Interior 4.3 2.9 12.0 16.5 Brakes 3.8 8.1 Steering 18.6 17.6 10.4 Crash Management Body Structure 16.9 18.8 19.8 Body Closures 15.6 19.4 18.8 Heat Transfer 17.8 Chassis Transmission 38.5 39.3 27.0 Wheels Engine

41.6 42.1 39.7

2016 2019 2025

* 2016 numbers do not include Electrification components (i.e. Battery Boxes, Battery Cooling and Electric Motor Housings), and are based on a limited sample of 60 vehicles that has been extrapolated to the whole market. 2016 numbers do also not include the second set of OE wheels that is purchased at the same time as the vehicle

© 2019 DuckerFrontier. All rights reserved | www.duckerfrontier.com 17 ALUMINUM CONTENT BY COMPONENT GROUP By 2025, Battery Box and Body Closures appear to be the component groups that will most benefit from the Average Aluminum Content growth. On the contrary, aluminum demand for traditional powertrain components will decrease

Expected AL Gains & Losses within Average AL Content per Vehicle For the time period 2019 to 2025 (Net Weight in kg)

Battery 179.2 kg +19.6 kg 198.8 kg Box 12.38 2019 2025

Body Closures 4.52 Electric AL Gains AL Motor Housing Heat 2.69 Transfer Body + Other Chassis Structure Wheels Crash Battery small 0.98 0.97 0.79 Brakes Management Steering Cooling parts 0.17 0.09 0.02 0.01 0.00

Trims & Transmission Interior -0.58 AL Losses AL -0.04 Engine -2.43

© 2019 DuckerFrontier. All rights reserved | www.duckerfrontier.com 18 A L U M I N U M CONTENT BY FORMING PROCESS Cast aluminum represents the large majority of the Total Aluminum Content (in 2016, 2019 as well as in 2025). Extrusions and Sheet will win shares by 2025, mainly driven by demand for Electrification components and Closures

Forming Process Split of Total AL Content (Net Weight in KT)

2019 Evolution 2016, 2019, 2025

11% 13%

11%

11% 19% 19% Total: 18% 22% 2,989 KT 5% 66% 6% 65% 59% 6% 65%

Innermost ring: 2016 (2,620 KT) Middle Ring: 2019 (2,989 KT) Cast Forged Sheet Extrusion Outer Ring: 2025 (3,635 KT)

© 2019 DuckerFrontier. All rights reserved | www.duckerfrontier.com 19 A L U M I N U M CONTENT EVOLUTION (2016 - 2028) The evolution of Total AL Content is expected to continue on a positive trajectory, with further dynamic growth. The 2028 demand is currently forecasted at approximately 4,160 KT (net weight)

Total Aluminum Content Evolution 2016-2028 (Net Weight in KT) by Vehicle Segment

CAGR: 4.62% 4,163

CAGR: 3.31% 3,635

CAGR: 4.61% 2,989 E - Large 2,612 D - Midsize C - Compact B - Sub-Compact A - Basic

2016 2019 2025 2028

© 2019 DuckerFrontier. All rights reserved | www.duckerfrontier.com 20 COMPARISON OF ALUMINUM CONTENT BY POWERTRAIN TYPE BEVs have significantly higher AL Content than their ICE variant, primarily due to the aluminum used for the Battery Box. Overall, the higher the car segment, the larger the difference in AL Content between BEV and ICE variants

Avg. AL Content per Vehicle for ICE vs. BEV variant 2019, Net Weight kg

D-Midsize Vehicle from Premium Brand B-Sub-Compact Vehicle from Volume Brand with ICV and BEV Variants with ICV and BEV Variants

+201.8

458.8

308.0

-51.0

+63.7 126.2 90.2

-27.7

ICV Powertrain AL AL Gains BEV ICV Powertrain AL AL Gains BEV Losses Losses

© 2019 DuckerFrontier. All rights reserved | www.duckerfrontier.com 21 COMPARISON OF ALUMINUM CONTENT BY POWERTRAIN TYPE Large batteries for BEV & PHEV, as well as doubled powertrain components for PHEV, are strong drivers for high Average Aluminum Content. Electric vehicle growth will foster a further increase of the Average Aluminum Content per Vehicle

Average Aluminum Content per Vehicle Comparison by Powertrain Variant (2019, Net Weight in kg)

+39.7kg 360.5

+141.6kg 320.8

+7.1kg 179.2 172.1

ICV Overall BEV PHEV

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