AutoShow Profile

COMPANY PROFILE

Magna International Inc.

REFERENCE CODE: AD9D42CC-B80C-44F5-A748-B0310AADC7FDPUBLICATION DATE: 13 Dec 2013www.marketline.comCOPYRIGHT MARKETLINE. THIS CONTENT IS A LICENSED PRODUCT AND IS NOT TO BE PHOTOCOPIED OR DISTRIBUTED.

TABLE OF CONTENTS

Company Overview..............................................................................................3

Key Facts...............................................................................................................3

Business Description...........................................................................................4

History...................................................................................................................6

Key Employees...................................................................................................10

Key Employee Biographies................................................................................11

Major Products and Services............................................................................16

Revenue Analysis...............................................................................................18

SWOT Analysis...................................................................................................20

Top Competitors.................................................................................................26

Company View.....................................................................................................27

Locations and Subsidiaries...............................................................................30

Magna International Inc. Page 2© MarketLine

Magna International Inc.TABLE OF CONTENTS

COMPANY OVERVIEW

Magna International Inc. (Magna or "the company") designs, develops and manufactures automotivesystems, assemblies, modules and components primarily to original equipment manufacturers(OEMs) of cars and light trucks. The company operates in the Americas, Europe, Asia, and Africa.It is headquartered in Aurora, Canada and employed about 119,000 people as on December 31,2012.

The company recorded revenues of $30,837 million during the financial year ended December 2012(FY2012), an increase of 7.3% over FY2011.The operating profit* of the company was $1,507 millionin FY2012, an increase of 20.9% over FY2011.Its net profit was $1,433 million in FY2012, an increaseof 40.8% over FY2011.

*Interest (income) expense, equity income, and other expense are not included for the calculationof operating profit.

KEY FACTS

Magna International Inc.Head Office337 Magna DriveAuroraOntario L4G 7K1CAN

1 905 726 2462Phone

1 905 726 7164Fax

http://www.magna.comWeb Address

30,837.0Revenue / turnover(USD Mn)

DecemberFinancial Year End

119,000Employees

MGANew York Ticker

MGToronto Ticker


Magna International Inc.Company Overview

BUSINESS DESCRIPTION

Magna is a diversified automotive supplier engaged in the design, engineering, testing andmanufacture of automotive systems, assemblies, modules and components primarily for sale tooriginal equipment manufacturers (OEMs) of cars and light trucks. The company also providescomplete vehicle engineering and assembly services. Magna operates 315 manufacturing operationsand 87 product development, engineering and sales centers in 29 countries across North America,Europe and rest of world (primarily Asia, South America and Africa).

The company operates in three geographic reporting divisions, including North America, Europeand rest of World. Each division functions as an autonomous business unit operating withinpredetermined guidelines.

Although the company operates through three geographic divisions, its operations can be dividedinto seven segments: exterior and interior systems, body systems and chassis systems, powertrainsystems, complete vehicle assembly, tooling, engineering and other, vision and electronic systems,and closure systems.

The exterior and interior systems segment design, engineer and manufacture various interior exteriorcomponents and systems for the global automotive and commercial truck product markets. Thesegment’s exterior systems portfolio includes front and rear fascia systems, class A compositepanels, modular systems, exterior trim structural components, under hood and underbody components,and sheet molding compound material. Interior systems offered by the company include sidewallsystems, trim systems, cargo management systems, cockpit systems, and overhead systems.

The body systems and chassis systems segment provides metal body systems, components,assemblies and modules, including body systems, chassis systems, and related engineering services.Body systems offered by the segment include complete body-in-white, floor pans, underbodyassemblies, door, hood and deck assemblies, and roof panels. The chassis systems offered by thesegment include cross member assemblies, radiator supports, shock towers, engine cradles, frontand rear sub-frame assemblies, and front and rear suspension modules. The engineering servicesportfolio includes program management, program engineering, computer-aided engineering, designverification, prototype build, and testing and validation.The segment also provides renewable energystructures such as solar energy racking systems.

The powertrain systems segment design, engineer and manufacture powertrain systems andcomponents, including driveline systems, fluid pressure systems, and metal-forming solutions. Thesegment also offers engineering and system integration services, including engine & drivetrainengineering, commercial & special vehicle engineering, engine testing services, and epowertrainand vehicle integration.

Magna’s complete vehicle assembly segment provides components, systems and vehicle engineeringand contract vehicle assembly services. The company is one of the largest brand-independent


Magna International Inc.Business Description

assembler of complete vehicles for OEMS. The segment offers engineering services, includingdesign & vehicle concepts, complete vehicle development & integration, systems & modulesdevelopment, safety engineering & testing, prototype and low-volume production, and test bedservices.The segment also provides contract manufacturing, including vehicle contract manufacturing,door modules, industrial services, and fibre composite technology applications. It also provides fuelsystems, including fuel tanks, tank filler pipers & filler braces, tank caps, diesel misfueling protection,fuel supply modules / valves and other oil & cooling-water systems components. In addition, thesegment also provides battery systems, including battery pack development & production, cell,module & battery pack testing, and materials analysis.

The tooling, engineering and other segment designs, engineers and manufactures tooling for ownuse, as well as for sale to the customers. Additionally, the segment provides engineering supportservices, independent of particular production programs.

The vision and electronic systems segment is engaged in the design engineering and manufacturingof vision systems, and electronic components and sub-systems. Vision systems offered by thesegment includes interior mirrors, exterior mirrors, actuators, and electronic vision systems. Electronicsystems offered by the segment includes driver assistance and safety systems, engine electronicsand sensors, body systems and human-machine interfaces (HMI), intelligent power systems, andindustrial products.The segment also offers hybrid & electric vehicle components/systems, includingtraction motors, inverters, and control units.

The closure systems segment engineers and manufactures closure systems and modules, includingdoor modules, power closure systems, engineered glass window systems, sealing systems, latchingsystems, driver controls, and handle assemblies. The segment also provides electronic features,including electronic control unit design, obstacle detection and anti-pinch, and non-contact sensing.In addition it offers lighting systems, including front lighting, rear lighting, and center high mount stoplamps.


Magna International Inc.Business Description

HISTORY

The history of Magna can be traced to the 1950s when Mr. Stronach opened a one-man tool anddie shop called Multimatic. In 1969, Multimatic merged with Magna Electronics, an aerospace,defense and industrial components manufacturer. Between 1970 and 1972, the company expandedits automotive operations and began manufacturing more stamped and electro-mechanicalcomponents. During 1973, the company's name was changed to Magna International. Magnaimplemented a major product diversification strategy in 1976, where the company's divisions wereorganized into product groups.

Between 1990 and 1991, the company sold off its non-strategic operating divisions as part of itsrestructuring strategy. During 1996-98, Magna expanded its presence in Europe through theacquisition of several Europe based automotive systems suppliers. In 1998, the company acquiredSteyr-Daimler-Puch, an automotive technology and engineering company. Magna floated its plasticexterior modules and systems group, Decoma International, as a separate public company in 1998.

Subsequently, Magna Entertainment and Intier Automotive were established as separate companiesin 2000 and 2001, respectively. The company acquired Donnelly in 2002. In 2003, Magna spun offits real estate business, MI Developments, to Magna shareholders. In the same year, the companyand its subsidiary, Tesma International, jointly announced signing of a definitive arrangementagreement to privatize Tesma International.

In 2005, Magna and its subsidiary, Decoma International, jointly signed a definitive arrangementagreement to privatize Decoma, in the wake of the company's poor performance in Europe. In thesame year, the company completed the privatization of its former public subsidiaries, Tesma, Decomaand Intier.

In 2006, Cosma International, an operating group of Magna, opened two new facilities, one each inFrance and the US. In the same year, the company opened a representative office in Bangkok,Thailand. Later in 2006, Cosma International formed a joint venture with Shin Young Metal, aKorean-based supplier of major stampings, welded assemblies and tools to the automotive industry.

Magna acquired Porsche's North American engineering services unit, based in Troy, Michigan in2006. During the same year, the company signed a five-year collaborative agreement with IBM tosupport Magna's entry into the vehicle electronic systems. Also in 2006, Magna Powertrain, anoperating unit of Magna, and Amtek Auto signed a joint-venture agreement to establish amanufacturing facility in India. Later in 2006, Cosma International acquired Vyroba AutomotivnychBlotnikov of Tychy, Poland.

In 2007, Intier Automotive Seating, an operating unit of Magna, in conjunction with Chrysler Group,co-engineered and manufactured new seating features, for Chrysler Group's 2008 Dodge GrandCaravan and Chrysler Town & Country. In the same year, Magna introduced olli, a clek booster seatfor the North American market at the annual Juvenile Products Manufacturers Association (JPMA).


Magna International Inc.History

Later in 2007, the company acquired certain manufacturing assets and equipment, including a leasedfacility located in Toluca, Mexico. During the same year, Magna Powertrain formed a 50/50 jointventure with RICO Auto Industries to establish a new manufacturing facility in Gurgaon, Haryana(India) for the manufacture of oil and water pumps with aluminum housings for automotive engineapplications.

In the following year, Magna Steyr, an operating unit of Magna, expanded its presence in India byopening a new engineering and research & development office in Pune. Also in 2008, the companyacquired the Zhangjiagang Suxing Electronics facility located in Zhangjiagang, China. In the sameyear, the company acquired Allied Transportation Technology, a producer of ultrasonic sensingsystems used for parking assistance and back-up object detection.

Magna acquired Technoplast, a supplier of plastic exterior and interior components, located in NizhnyNovgorod, Russia, in 2008. During the same year, Cosma International established a new facility inPune, India. Later in 2008, Cosma International opened a new facility in Shanghai, China. In thesame year, Magna Electronics, an operating unit of Magna, acquired Blower Systems, a developerand supplier of electric and energy-management systems for hybrid electric vehicles, plug-in hybridvehicles and battery electric vehicles.

In 2009, Cosma International entered into an agreement with Ogihara America to acquire Ogihara'sstamping and sub-assembly plant in Birmingham, Alabama. In the same year, Magna entered intoa partnership with Ford Motor to introduce a zero-emission lithium-ion battery electric vehicle (BEV).In the same year, World Industries Ace (WIA), a Korea-based powertrain company affiliated withHyundai Kia Motors Group, and Magna Powertrain formed a 50/50 joint venture to establish a newmanufacturing facility located in Chungcheongnamdo, South Korea.

Decoma International acquired Cadence Innovation (Cadence Europe), a supplier of automotiveinterior and exterior plastic components and systems, in 2009. In the same year, Magna Steyr, anoperating unit of Magna, signed an agreement with Daimler to extend the Mercedes-Benz G-Classproduction at Magna Steyr in Graz, Austria until 2015. Also in 2009, Magna Electronics and BRUSAElektronik, a developer and supplier of power electronics and electric motors, announced collaborationon electric and hybrid vehicle applications.

In 2009, Magna Electronics and Semikron, a power semiconductor components and systems providerformed a 50/50 joint venture to produce power electronics for future electric and hybrid vehicleapplications. Later in 2009, Magna Seating, an operating unit of Magna, and Krishna Group of Indiaformed a 50/50 joint venture to produce complete seating systems and seat mechanisms forautomakers operating within the Pune region of India. In 2009, Magna Steyr was given a contractto develop and manufacture the aluminum body for the new Mercedes-Benz SLS AMG in Graz.

Magna Exteriors and Interiors, an operating unit of Magna, launched EpicBlendSMC, a sheet moldingcompound material (SMC), in 2010. During the same year, Magna Steyr acquired Karmann Japan,a subsidiary of Wilhelm Karmann and a convertible system supplier. Also in 2010, Magna Seatingand Hollingsworth Logistics, a provider of industrial supply chain management, formed a joint venture



to supply Volkswagen Group of America with complete seat systems for the mid-size sedan to bebuilt at Volkswagen's new Chattanooga, Tennessee, assembly facility.

In 2010, Magna E-Car Systems, a joint venture between Magna and the Stronach Trust, opened anelectric-vehicle system development center and battery/materials testing facility in Auburn Hills,Michigan. During the same year, the company opened three facilities in St. Petersburg, Russia.

Magna opened a new technoplast production plant in Kaluga, Russia, in 2010. In the same year,Magna Seating acquired Resil Minas, a Brazil based automotive seating supplier. Further in 2010,the company acquired Erhard & Sohne, a Germany based manufacturer of fuel tanks.

Magna Seating acquired Pabsa, an automotive seat supplier, in 2011. Subsequently, the companyestablished a new facility in San Luis Potosi, Mexico, which would produce stamped and weldedassemblies for automakers. In addition, Cosma International acquired the Durbheim facility ofAcument. Further in the year, Cosma International formed a joint venture in China with GuangzhouAutomobile Group Component to manufacture major body and chassis components and structuralassemblies.

Later in the year, the roof systems group of Magna Steyr commenced the production of textile foldingroof for the 2012 Fiat 500 Cabrio. Subsequently, Magna Exteriors and Interiors formed a three-partyjoint venture, called MCC Wuhu Exteriors, with Changshu Automotive Trim and Chery Tech topurchase an existing injection molding and painting facility located in Wuhu city in the Anhui province,China.

Further in the year, Cosma International acquired Grenville Castings, a structural casting supplierof aluminum components for the automotive, heavy truck and recreational markets. Subsequently,Magna Powertrain opened a new greenfield manufacturing facility in the Tianjin Airport EconomicArea in China. In addition, Cosma International acquired BDW technologies group's four operations,including two in Germany, one each in Poland and Hungary.

Also during the year, Magna Electronics, in conjunction with its partner for image processing, Mobileye,developed a driver assistance system that uses a single, forward-looking video camera to providesafety and convenience features such as forward collision and lane departure warnings. Subsequently,Cosma International acquired ThyssenKrupp Automotive Systems Industrial do Brasil, a producerof chassis structural components and modules for several Brazilian automotive customers.

Further in the year, Cosma International opened a manufacturing facility in Phoenix, Arizona toproduce metal structures and roll-formed components and systems for the photovoltaic (PV),concentrated photovoltaic (CPV), and concentrated solar power (CSP) solar markets.

Magna Exteriors and Interiors, an operating unit of Magna, and Zoltek Companies formed acollaborative partnership to develop low cost carbon fiber sheet molding compounds, in March 2012.

In the following month, Magna E-Car Systems and Hyundai Heavy Industries agreed to form a jointventure, MAHY E-CELL, as a platform to co-develop a battery cell and battery pack business. Also



in April 2012, Magna E-Car Systems opened a plant in Grand Blanc Township, Michigan, tomanufacture components for hybrid and electric vehicles.

In May 2012, Infiniti, the luxury vehicle brand of the Nissan Motor, signed a memorandum ofunderstanding with Magna Steyr for the assembly of a future luxury entry level Infiniti compactvehicle.

In October 2012, Magna launched the active grille shutter (AGS), a louver system that blocks variousfront-end airflow openings, reducing drag while maintaining optimal engine temperatures.

Also in October 2012, Magna Exteriors and Interiors (MEI), an operating unit of Magna, announcedthe opening of its new operation in Craiova, Romania.

Russian carmaker Avtotor Holding and Magna announced a cooperation agreement to establish anautomotive manufacturing cluster in the Kaliningrad region, in November 2012. During the month,Magna’s Powertrain operating unit completed the previously announced acquisition of ixeticVerwaltungs, a manufacturer of automotive vacuum, engine and transmission pumps.

In February 2013, Magna Steyr unveiled its roof systems capabilities at Geneva Motor Show 2013.

In the following month, Magna Exteriors and Interiors (MEI) operating unit in partnership with strategicdevelopment partner Zoltek, developed a low-cost carbon fiber sheet molding compound (SMC)using Zoltek's Panex 35 commercial carbon fiber combined with Magna's EpicBlendSMC formulationsand production capability. During the month, Magna Electronics operating unit inaugurated a newautomotive camera production line at its Zhangjiagang plant in China.

Subsequently in April 2013, Magna Exteriors and Interiors (MEI) operating unit opened a newmanufacturing facility in Meerane, Germany.

During June 2013, the company’s Magna Steyr operating unit opened a new engineering centerlocated in the Tiexi District of Shenyang, China.

In August 2013, Magna Powertrain, an operating unit of Magna, opened a new facility in the TianjinAirport Economic Area. In the following month, Magna Steyr, an operating unit of the company,launched modernized and expanded Mercedes-Benz G-Class production plant at its Graz location.Also in September 2013, the company opened a two new auto supply facilities: a Magna Interiorsplant in Arteaga and a Cosma International plant in Ramos Arizpe, Mexico.

In October 2013, Magna announced the expansion of its business in Eastern Europe with theinauguration of a new greenfield manufacturing plant in Kocaeli, Turkey. In the same month, thecompany launched Magna Seating d.o.o., a new seat component manufacturing facility in Odzaci,Serbia, which will supply OEM customers including Smart, Renault and Ford.



KEY EMPLOYEES

CompensationBoardJob TitleName

16855770 USDExecutive BoardChief Executive OfficerDonald J. Walker

458350 USDNon Executive BoardChairmanWilliam L.Young

148950 USDNon Executive BoardDirectorPeter G. Bowie

169030 USDNon Executive BoardDirectorV. Peter Harder

278160 USDNon Executive BoardDirectorKurt J. Lauk

171160 USDNon Executive BoardDirectorScott Bonham

247740 USDNon Executive BoardDirectorJ. Trevor Eyton

323550 USDNon Executive BoardDirectorLawrence D. Worrall

323550 USDNon Executive BoardDirectorLady Barbara Judge

6809110 USDSenior ManagementExecutive Vice President and ChiefFinancial Officer

Vincent J. Galifi

4880780 USDSenior ManagementExecutive Vice President and ChiefLegal Officer

Jeffrey O. Palmer

Senior ManagementPresident, Magna EuropeGuenther Apfalter

Senior ManagementExecutive Vice President, CorporateEngineering & R&D

Swamy Kotagiri

Senior ManagementExecutive Vice President, GlobalHuman Resources

Marc Neeb

2724880 USDSenior ManagementChief Marketing Officer andPresident, Magna Asia

James J. Tobin

7088470 USDSenior ManagementChief Operating Officer, Exteriors,Interiors, Seating, Mirrors andClosures; and President, Cosma

Tom J. Skudutis

Senior ManagementVice President, TaxationAtul Mehta

Senior ManagementVice President and CorporateSecretary

Bassem A. Shakeel

Senior ManagementControllerRobert Cecutti

Senior ManagementVice President, Investor RelationsLouis Tonelli

Senior ManagementVice President, FinancePatrick McCann

Senior ManagementVice President, Ethics and LegalCompliance

Joanne Horibe


Magna International Inc.Key Employees

KEY EMPLOYEE BIOGRAPHIES

Donald J. Walker

Board: Executive BoardJob Title: Chief Executive OfficerSince: 2010Age: 56

Mr. Walker has been the Chief Executive Officer at Magna since 2010. He previously served as theCo-Chief Executive Officer at the company from 2005 to 2010 and the President and Chief ExecutiveOfficer from 1994 to 2001. Mr. Walker was formerly the President, Chief Executive Officer andChairman at Intier Automotive. Prior to joining Magna in 1987, he spent seven years at GeneralMotors in various engineering and manufacturing positions. Mr. Walker is a Founding Member atthe Yves Landry Foundation, and is currently the Chairman since 2011. He was previously theChairman at the Automotive Parts Manufacturers Association (APMA).

William L.Young

Board: Non Executive BoardJob Title: ChairmanSince: 2011Age: 58

Mr.Young has been the Chairman at Magna since 2011. He is the co-Founder and Partner at MonitorClipper Partners, a private equity firm. Mr.Young also serves as the Founding Partner at WestbourneManagement Group since 1988. He served as a Partner in the European practice at Bain & Companyfrom 1981 to 1988. Mr.Young is the Chair Emeritus of the Board of Trustees at Queen’s Universityand has significant private company board and board leadership experience over the last 20 years.

Peter G. Bowie

Board: Non Executive BoardJob Title: DirectorSince: 2012Age: 66

Mr. Bowie has been a Director at Magna since 2012. He most recently served as the Chief ExecutiveOfficer at Deloitte China from 2003 to 2008. Before that, Mr. Bowie was the Senior Partner and aDirector at Deloitte China until his retirement from the firm in 2010. He was previously the Chairmanat Deloitte Canada from 1998 to 2000. Mr. Bowie was previously a Member of the board at the Asian


Magna International Inc.Key Employee Biographies

Corporate Governance Association and has served on a variety of boards in the private andnon-governmental organization sectors.

V. Peter Harder


Mr. Harder has been a Director at Magna since 2012. He is the Senior Policy Advisor at FraserMilner Casgrain (FMC) since 2007. Prior to joining FMC, Mr. Harder was a Deputy Minister in theGovernment of Canada, having first been appointed as Deputy Minister in 1991. He served in anumber of federal departments, including Treasury Board, Solicitor General, Citizenship andImmigration, Industry and Foreign Affairs and International Trade until 2007. Mr. Harder currentlyserves as the President at the Canada China Business Council since 2008 and is a Member at theInternational Institute of Strategic Studies.

Kurt J. Lauk


Dr. Lauk has been a Director at Magna since 2011. He is the co-Founder and President at GlobeCP, a private investment firm. Previously, Dr. Lauk was a Member of the Management Board andthe Head of World Wide Commercial Vehicles Division at Daimler Chrysler from 1996 to 1999. Healso served as the Deputy Chief Executive Officer and Chief Financial Officer at Audi from 1989 to1992. Dr. Lauk also served as the Chief Financial Officer and Controller at Veba (now known asE.On) from 1992 to 1996. Before that, he was the Chief Executive Officer at Zinser Textil Machineryfrom 1984 to 1989. Dr. Lauk served as a Partner and the Vice President of the German practice atBoston Consulting Group from 1978 to 1984. He served as a Member of European Parliament from2004 to 2009, including as a Member of the Economic and Monetary Affairs Committee and DeputyMember of the Foreign and Security Affairs Committee. Dr. Lauk currently serves as a Trustee atthe International Institute for Strategic Studies in London and is an Honorary Professor at the EuropeanBusiness School in Reichartshausen, Germany.

Scott Bonham




Mr. Bonham has been a Director at Magna since 2012. He is the co-Founder at GGV Capital, anexpansion stage venture capital firm. Prior to co-founding GGV in 2000, Mr. Bonham served as theVice-President at the Capital Group of Companies, where he managed technology investmentsacross several mutual funds from 1996 to 2000. He also previously served in various marketingroles at Silicon Graphics from 1992 to 1996. Before that, Mr. Bonham served as the Manufacturingand Information Systems Strategy Consultant at Booz, Allen & Hamilton from 1989 to 1992. He alsoserved as the Systems Engineer and Maintenance Foreman at General Motors of Canada. Mr.Bonham also served as a Director at Hurray!.

J.Trevor Eyton


Mr. Eyton has been a Director at Magna since 2010. He was a Member of the Senate of Canadafrom 1990 until his retirement in 2009. Mr. Eyton previously served as the President and ChiefExecutive Officer at Brascan (now known as Brookfield Asset Management) from 1979 to 1991. Healso served as its Chairman and Senior Chairman until 1997. Prior to this, Mr. Eyton was a Partnerat the law firm Tory Tory DesLauriers & Binnington. He previously served on numerous public andprivate company Boards, including General Motors Canada.

Lawrence D. Worrall


Mr. Worrall has been a Director at Magna since 2005. He previously served as the Vice-President,Purchasing, Strategic Planning and Operations, as well as a Director at General Motors of Canadafrom 1995 to 2000.

Lady Barbara Judge


Lady Judge has been a Director at Magna since 2007. She previously served as the Chairman atthe UK Atomic Energy Authority from 2004 to 2010. Prior to which, Lady Judge was a Board Memberat the UK Atomic Energy Authority since 2002. Previously, she was a Director of the Energy Group



at the UK’s Department of Trade and Industry from 2002 to 2004. In addition, Lady Judge formerlyserved as a Commissioner at the US Securities Exchange Commission, the Deputy Chairman atthe UK Financial Reporting Council and the Co-Chairman at the UK/US Task Force on CorporateGovernance.

Vincent J. Galifi

Board: Senior ManagementJob Title: Executive Vice President and Chief Financial Officer

Mr. Galifi currently serves as the Executive Vice-President and Chief Financial Officer at Magna.

Jeffrey O. Palmer

Board: Senior ManagementJob Title: Executive Vice President and Chief Legal Officer

Mr. Palmer currently serves as the Executive Vice-President and Chief Legal Officer at Magna.

Guenther Apfalter

Board: Senior ManagementJob Title: President, Magna Europe

Mr. Apfalter currently serves as the President, Magna Europe at Magna.

Swamy Kotagiri

Board: Senior ManagementJob Title: Executive Vice President, Corporate Engineering & R&D

Mr. Kotagiri currently serves as the Executive Vice-President, Corporate Engineering & R&D atMagna.

Marc Neeb

Board: Senior ManagementJob Title: Executive Vice President, Global Human Resources

Mr. Neeb currently serves as the Executive Vice-President, Global Human Resources at Magna.

James J.Tobin



Board: Senior ManagementJob Title: Chief Marketing Officer and President, Magna Asia

Mr. Tobin currently serves as the Chief Marketing Officer and President, Magna Asia at Magna.

Tom J. Skudutis

Board: Senior ManagementJob Title: Chief Operating Officer, Exteriors, Interiors, Seating, Mirrors and Closures; and President,Cosma

Mr. Skudutis currently serves as the Chief Operating Officer, Exteriors, Interiors, Seating, Mirrorsand Closures at Magna. He also serves as the President at Cosma.



MAJOR PRODUCTS AND SERVICES

Magna designs, develops and manufactures automotive systems, assemblies, modules and components, and engineer and assemble complete vehicles, primarily to original equipment manufacturers (OEMs) of cars and light trucks. The company's key products and services include the following:

Products:

Exterior and interior systems:

Front and rear end fascia systemsExterior trimModular systemsClass A composite panelsStructural componentsUnder hood and underbody componentsSheet molding compound materialComplete seating systemsMechanism solutionsSeat structures solutionsFoam and trim productsDesign and development servicesSidewall and trim systemsCockpit systemsCargo management systemsOverhead systems

Body systems and chassis systems:

Body systemsChassis systemsRenewable energy systemsFull engineering

Powertrain systems:

Driveline systemsFluid pressure and controlsMetal-forming solutionsEngineering services and system integration (ESSI)

Complete vehicle assembly:


Magna International Inc.Major Products and Services

Engineering servicesContract manufacturingFuel and battery systemsRoof systems

Tooling, engineering and other:

Engineering services and tooling contractsEngineering support services

Vision and electronic systems:

Interior mirrors (prismatic and electronics)Exterior mirrorsActuatorsElectronic vision systemsDoor handle and overhead console technologiesDriver assistance systemsIntelligent power systemsBody electronics and HMIEngine electronics and liquid sensorsIndustrial products

Closure systems:

Door modulesWindow systemsPower closure systemsLatching systemsHandle assembliesDriver controlsObstacle detectionEuropean testing centerClosures testing laboratories (CTL)Engineered glassSealing systems


Magna International Inc.Major Products and Services

REVENUE ANALYSIS

Overview

The company recorded revenues of $30,837 million during the financial year ended December 2012(FY2012), an increase of 7.3% over FY2011. In FY2012, the US, the company's largest geographicmarket, accounted for 22.9% of the total revenues.

Magna generates revenues through seven automotive products and services: exterior and interiorsystems (37.9% of total revenues in FY2012), body systems and chassis systems (23.1%), powertrainsystems (12.4%), complete vehicle assembly (8.3%), tooling, engineering and other (7.5%), visionand electronic systems (6.9%), and closure systems (3.9%).

Revenues by division

In FY2012, the exterior and interior systems division recorded revenues of $11,673 million, anincrease of 5.9% over FY2011.

The body systems and chassis systems division recorded revenues of $7,123 million in FY2012, anincrease of 17.6% over FY2011.

The powertrain systems division recorded revenues of $3,825 million in FY2012, an increase of4.3% over FY2011.

The complete vehicle assembly division recorded revenues of $2,561 million in FY2012, a decreaseof 4.8% compared to FY2011.

The tooling, engineering and other division recorded revenues of $2,317 million in FY2012, anincrease of 12.2% over FY2011.

The vision and electronic systems division recorded revenues of $2,132 million in FY2012, anincrease of 3.2% over FY2011.

The closure systems division recorded revenues of $1,206 million in FY2012, an increase of 1.9%over FY2011.

Revenues by geography

The US, Magna's largest geographical market, accounted for 22.9% of the total revenues in FY2012.Revenues from the US reached $7,053 million in FY2012, an increase of 8.3% over FY2011.


Magna International Inc.Revenue Analysis

Canada accounted for 19.2% of the total revenues in FY2012. Revenues from Canada reached$5,907 million in FY2012, an increase of 6.4% over FY2011.

Mexico accounted for 10.6% of the total revenues in FY2012. Revenues from Mexico reached $3,281million in FY2012, an increase of 21.6% over FY2011.

Great Britain* accounted for 3.1% of the total revenues in FY2012. Revenues from Great Britainreached $952 million in FY2012, an increase of 4.7% over FY2011.

Western Europe accounted for 32.2% of the total revenues in FY2012. Revenues from WesternEurope reached $9,927 million in FY2012, a decrease of 0.4% compared to FY2011.

Eastern Europe accounted for 5.5% of the total revenues in FY2012. Revenues from Eastern Europereached $1,684 million in FY2012, an increase of 8.2% over FY2011.

Rest of World accounted for 6.5% of the total revenues in FY2012. Revenues from rest of Worldreached $2,010 million in FY2012, an increase of 33.5% over FY2011.

Corporate and others accounted for 0.1% of the total revenues in FY2012. Revenues from corporateand others reached $23 million in FY2012, a decrease of 53.1% compared to FY2011.

*Note: As mentioned in the annual report.


Magna International Inc.Revenue Analysis

SWOT ANALYSIS

Magna designs, develops and manufactures automotive systems, assemblies, modules andcomponents, and engineer and assemble complete vehicles, primarily to original equipmentmanufacturers (OEMs) of cars and light trucks. The company has a broad product portfolio andbalanced revenue streams, which enables Magna to provide end-to-end solutions and tap high valuecustomers. This also helps the company to balance its revenues in case of slowdown of a particulardivision. However, operating in a competitive environment exerts continued pressure on the operationsof the company, which may result in a further downward price pressure that could adversely impactMagna's financial condition and results of operations.

WeaknessesStrengths

Overdependence on few customersBroad product portfolio and balancedrevenue streams Unfunded employee pension benefitsStrong geographic footholdRobust financial performance

ThreatsOpportunities

Intense competition and pricing pressurePositive outlook for the global new carmarket Foreign currency fluctuationsPoised to benefit from the growing demandfor hybrid electric vehicles

Compliance with environmental laws andregulations

Strong outlook of the global automotivemanufacturing industry

Strengths

Broad product portfolio and balanced revenue streams

Magna has a broad product portfolio and balanced revenue streams. The company offers one ofthe broadest product portfolios among tier one automotive suppliers.The company’s operations canbe divided in seven segments: exterior and interior systems, body systems and chassis systems,powertrain systems, complete vehicle assembly, tooling, engineering and other, vision and electronicsystems, and closure systems. The exterior and interior systems segment design, engineer andmanufacture various interior exterior components and systems for the global automotive andcommercial truck product markets.The body systems and chassis systems segment provides metalbody systems, components, assemblies and modules.


Magna International Inc.SWOT Analysis

In addition, the powertrain systems segment design, engineer and manufacture powertrain systemsand components. Magna’s complete vehicle assembly segment provides engineering services,including design & vehicle concepts, complete vehicle development and integration. The tooling,engineering and other segment designs, engineers and manufactures tooling for own use, as wellas for sale to the customers. Further, the vision and electronic systems segment is engaged in thedesign engineering and manufacturing of vision systems, and electronic components and sub-systems.The closure systems segment offers closure systems and modules, including door modules, powerclosure systems and engineered glass window systems.

A broad product portfolio allows Magna to offer nearly all components of a new vehicle model, whichresults in a high dollar content per vehicle. Moreover, the company has balanced revenue streamsand is not dependent on any one segment for a majority of its revenues. The company’s largestsegment exterior and interior systems accounted for 37.9% of total revenues in FY2012. This wasfollowed by body systems and chassis systems (23.1%), powertrain systems (12.4%), completevehicle assembly (8.3%), tooling, engineering and other (7.5%), vision and electronic systems (6.9%),and closure systems (3.9%). Thus, broad product portfolio and balanced revenue streams enablesMagna to provide end-to-end solutions and tap high value customers. This also helps the companyto balance its revenues in case of slowdown of a particular division.

Strong geographic foothold

The company has a diversified geographic presence. Its products are primarily sold to OEM's ofcars and light trucks across the globe primarily in North America, Europe and rest of world (primarilyAsia, South America and Africa). As of December 2012, Magna had 315 manufacturing operationsand 87 product development, engineering and sales centers in 29 countries.The company generatedsignificant revenues across all the geographic regions. In FY2012, the US, Magna's largestgeographical market, accounted for 22.9% of the total revenues. This was followed by Canada(19.2% of the company's revenue); Mexico (10.6%); Great Britain (3.1%); Western Europe (32.2%);Eastern Europe (5.5%); and rest of world (6.5%) of the overall revenues during the year.

Hence, strong geographic foothold and fairly spread revenue base ensures that the company doesnot rely on any one market for a majority of its revenues, which in turn enables it to reduce its businessrisk in the highly volatile industry.

Robust financial performance

The company has witnessed strong financial performance in FY2012. The company’s revenuesgrew by 7.3% to $30,837 million in FY2012. Also the operating and net profits of the company grewby 20.9% and 40.8%, respectively to $1,507 million and $1,433 million, respectively. Moreover, thecompany witnessed strong growth across all its business segments. In FY2012, the company’srevenues from exterior and interior systems segment grew by 5.9%, while revenues from bodysystems and chassis systems segment grew by 17.6%. Further revenues from powertrain systems,tooling, engineering and other, vision and electronic systems, and closure systems segments grewby 4.3%, 12.2%, 3.2%, 1.9%, respectively. Thus, strong financial performance across segmentenhances its shareholder's value and allows the company to fuel its expansion plans.



Weaknesses

Overdependence on few customers

Magna is highly dependent on few customers including, General Motors, BMW, Fiat / Chrysler, FordMotor, Volkswagen, and Daimler for a majority of its revenues. These customers contributed 82.7%of total revenues generated in FY2012. High dependence upon a few customers reduces thebargaining power of the company. Large customers besides using their bargaining power to imposeunfavorable terms, could try to influence the strategies of the company. For instance, in 2009,Volkswagen threatened to cancel all of its contracts if Magna bought General Motors' German-basedOpel unit. Therefore, overdependence on few customers could have a material adverse influenceon Magna's operations thus impacting its profitability and financial condition.

Unfunded employee pension benefits

Magna has significant unfunded obligations with respect to employee future benefit plans. Thecompany sponsors a number of defined benefit pension plans and similar arrangements for itsemployees. In FY2012, the company's employee benefit obligations stood at $858 million as comparedto the planned assets of $289 million, resulting into an unfunded status of $569 million. Unfundedpension obligations will force the company to make regular cash contributions to bridge the gapbetween pension assets and liabilities, which in turn could distress its liquidity position.

Opportunities

Positive outlook for the global new car market

The global new cars market has experienced moderate growth during 2008-2012. However, forecastssuggest this will accelerate to strong double digit growth during the 2012-2016 periods. Accordingto MarketLine (a unit of Informa plc), the global new cars market generated total revenues of $1,426.6billion in 2012, representing a growth of 9.2% compared to 2011.

The performance of the segment is forecast to accelerate, with an anticipated compound annualgrowth rate (CAGR) of 10.8% for the four-year period 2012-16, which is expected to drive the industryto a value of $2,153.2 billion by the end of 2016. Magna designs, develops and manufacturesautomotive systems, assemblies, modules and components primarily to original equipmentmanufacturers (OEMs) of cars and light trucks.Thus, the strong outlook for the global new car marketcoupled with the company’s new product launches provides a growth opportunity for the company.

Poised to benefit from the growing demand for hybrid electric vehicles

Over the last few years the demand for eco-friendly cars and electric vehicles has been rapidlyincreasing as environment has become a major concern for many governments and many people



around the world. According to International Energy Agency (IEA), worldwide demand for electricand plug-in hybrid vehicles (EVs and PHEVs) is estimated to reach approximately seven millionunits annually by 2020 and 100 million units by 2050. Rising energy costs and increased emissionsregulations are likely to increase the demand for hybrid-electric vehicles (HEVs), as hybrid enginesare more fuel efficient and less polluting than conventional gasoline and diesel engines. Costdisparities between HEVs and conventional light vehicles are expected to decline as productionvolumes increase.The primary markets for HEVs will be within the US, Western Europe, and Japan,although the rapidly growing Chinese market is also expected to experience relatively strong demandfor these fuel efficient and environmentally friendly vehicles.

Magna remains focused on significantly strengthening and deepening its expertise in electric vehicledevelopment and electric vehicle systems. During the recent past, the company continued to makemajor strides in pursuing its strategic objective of becoming one of the industry's leading hybrid andelectric vehicle systems suppliers. Magna E-Car Systems, a partnership between Magna and theStronach Group, is a global supplier of components and systems for hybrid and electric vehicles.The entity provides a wide array of products, including lithium-ion cells and battery packs, electricdrive motors and generators, inverters, converters, onboard chargers, and powertrain control modules.Also in April 2012, Magna E-Car Systems opened a plant in Grand Blanc Township, Michigan, tomanufacture components for hybrid and electric vehicles.

Thus, a growing end market auger well for the company as it is well positioned to take advantageof the rapidly growing demand for hybrid vehicles and enhance its market position.

Strong outlook of the global automotive manufacturing industry

The global automotive manufacturing industry fell into sharp decline in 2009 before recovering withstrong growth from 2010 to 2011. The industry is expected to maintain positive but fluctuating levelsof growth from 2012 through to the end of the forecasting period in 2016. According to MarketLine(a unit of Informa plc), the global automotive manufacturing industry had total revenue of $1,563.9billion in 2012, representing a CAGR of 3.8% between 2007 and 2012.

Furthermore, the performance of the industry is forecast to accelerate, with an anticipated CAGRof 6.7% for the four-year period 2012-2016, which is expected to drive the industry to a value of$2,025.4 billion by the end of 2016. The company’s complete vehicle assembly segment providescomponents, systems and vehicle engineering and contract vehicle assembly services.The companyis one of the largest brand-independent assembler of complete vehicles for OEMS. The segmentoffers engineering services, including design & vehicle concepts, complete vehicle development &integration, systems & modules development, safety engineering & testing, prototype and low-volumeproduction, and test bed services. Thus, the strong outlook of the global automotive manufacturingindustry represents an opportunity for the company to capitalize on this industry and expand itsrevenues and profits.

Threats



Intense competition and pricing pressure

Magna faces intense competition across its market segments. The company competes on the basisof pricing, product and service quality, development and introduction time, customer service andfinancing terms. Magna faces strong competitors, some of which are larger and may have greaterresources in a given business area and some from emerging markets, which may have a better coststructure. Some of its competitors include Aisin Seiki, BorgWarner, Dana Holding, GKN, Gentex,Genuine Parts, Johnson Controls, Lear and Robert Bosch.

In addition, Magna faces pricing pressure due to intense competition across its market segmentsand also due to the current global recession and industry downturn.The company is under pressureto absorb costs related to product design, engineering and tooling, as well as other items which werepreviously paid by OEMs, in order to face the current economic situation. These pressures areexpected to continue, even after the industry begins to recover. Therefore, operating in such acompetitive environment exerts continued pressure on the operations of the company, which mayresult in a further downward price pressure that could adversely impact Magna's financial conditionand results of operations.

Foreign currency fluctuations

Magna conducts operations globally, which involves transactions denominated in a variety ofcurrencies. A significant portion of the company's revenues and expenses is denominated incurrencies other than the Canadian Dollar. Moreover, Magna generates over 80.8% of its revenuesfrom markets other than Canada. Therefore, the company is subject to foreign currency risks andforeign exchange exposure.The primary exposures are to the US Dollar, the Euro, and British Pound.Hence, the effect of changes in demand and refinancing conditions, and fluctuations in exchangerates can have a significant impact on the company's profit on imported and exported goods.

Compliance with environmental laws and regulations

The company is subject to a range of environmental laws and regulations relating to air emissions,wastewater discharge, waste management and storage of hazardous substances. The company isalso subject to environmental laws requiring investigation and clean-up of environmental contaminationand are in various stages of investigation and clean-up at its manufacturing facilities wherecontamination has been alleged. Estimating environmental clean-up liabilities is complex and heavilydependent on the nature and extent of historical information and physical data relating to thecontaminated sites, the complexity of the contamination, the uncertainty of which remedy to applyand the outcome of discussions with regulatory authorities relating to the contamination.

In addition, these environmental laws and regulations are complex, change frequently and havetended to become more stringent and expensive over time. Therefore, the company may not havebeen, and in the future may not be, in complete compliance with all such laws and regulations andmay incur material costs or liabilities as a result of such laws and regulations significantly in excessof amounts it has reserved. Further, a failure to comply with these regulations could result in fines



or other penalties, which could adversely affect the company's business, financial condition andresults of operations.



TOP COMPETITORS

The following companies are the major competitors of Magna International Inc.

Dana CorporationJohnson Controls, Inc.Lear CorporationRobert Bosch CorporationGKN PLCBorgWarner Inc.Aisin SeikiGentex CorporationGenuine Parts Company


Magna International Inc.Top Competitors

COMPANY VIEW

A joint statement by Donald J.Walker, the Chief Executive Officer, and Vincent J. Galifi, the ExecutiveVice President and Chief Financial Officer, at Magna International is given below. The statementhas been taken from the company's 2012 annual report.

2012 was another record year for Magna – we achieved best ever sales and net income - our secondconsecutive year of records in each of these measures. Magna's share price, in part reflecting ourstrong operating performance, rose 50% in 2012, far outperforming the 7% increase of the DowJones Industrial Average as well as the average increase of our closest peers.

During 2012, we continued to put our strong balance sheet to use, investing $1.9 billion in ourbusiness, including fixed assets, investments and acquisitions.The following are some 2012 highlights:

Our fixed asset spending of $1.3 billion was at an all time high, as we continued to invest both inour traditional markets and to further expand our footprint in growing regions such as Asia, EasternEurope and South America. In fact, over the past two years approximately 30% of our capital spendinghas gone into regions outside of our traditional markets of North America and Western Europe.

We strengthened our position in automotive pumps through two acquisitions. We acquired ixeticVerwaltungs GmbH, a manufacturer of automotive vacuum, engine and transmission pumps withtwo manufacturing facilities in Germany and one in each of Bulgaria and China. In addition, weacquired the remaining 50% interest in STT Technologies ("STT") from our joint venture partner.STT is a leading supplier of transmission and engine related oil pumps serving the North Americanmarket.The global trend towards improved fuel efficiency is a key factor that we believe will contributeto continued growth in the automotive pump market.

We acquired BDW technologies group ( BDW ), a structural casting supplier of aluminium components,which has operations in Germany, Poland and Hungary. BDW provides us with high-pressure castingcapabilities that can provide meaningful weight savings to our customers and complements the manyother metal forming processes that we currently employ to provide structural components to ourcustomers.

We acquired the controlling 27% interest in Magna E Car Systems partnership, and integrated itsoperations into our existing operating units.

We also utilized our balance sheet to return cash to shareholders. In 2012, aggregate dividendspaid to shareholders amounted to$252 million. For the fourth quarter of 2012, our Board increasedour quarterly dividend by an additional 16% to a record $0.32 per share. Over the past two yearsour quarterly dividend has grown by a cumulative 78%, reflecting the confidence that our Board hasin Magna's future. We also returned capital to shareholders in 2012 through our share buybackprogram and our Board authorized a further Normal Course Issuer Bid, expiring in November 2013,to purchase up to an additional 12 million Common Shares.


Magna International Inc.Company View

Notwithstanding the significant uses of our balance sheet over the past year, our financial positionremains strong as a result of our excellent cash flow generation, with $1.1 billion in net cash as atDecember 31, 2012. This provides us with liquidity and flexibility to further invest in our business.

The following are other noteworthy operating highlights from 2012:

Our Europe segment, which incurred a loss for 2011, experienced a significant turnaround in 2012and recorded adjusted EBIT in each quarter of 2012. We continue to have significant work in orderfor Europe to reach acceptable profit levels, but we are confident that we are on the right path.

World Class Manufacturing, one of our top priorities coming into 2012, has been embraced by ouroperating units globally. Based on progress reports throughout 2012, we are confident that ouractions in this area will make us an even more efficient manufacturer overall in the years to come

Magna, our operating units and manufacturing divisions once again won a number of customerawards. For instance, GM recognized 11 of Magna's manufacturing divisions with the Supplier QualityExcellence awards for demonstrating the highest levels of quality performance from July 2011 throughJune 2012. As well, our Cosma Camacari facility in Brazil was one of 24 global supplier locationsto receive the Silver World Excellence Award from Ford. In addition, our Cosma operating unit forthe first time was awarded Volvols Quality Award of Excellence.

Our Magna Mirrors operating unit was selected as a 2012 Automotive News PACE Award winnerfor its Infinity rearview mirror. The PACE awards honour superior innovation, technologicaladvancement and business performance among automotive suppliers. We were also a finalist forour One-Touch Stow n' Go seat mechanism.

We have a number of ongoing technological innovations, both product and process, underdevelopment that address our customers needs for improved fuel efficiency and mass reduction.As an example, we commenced production of our Active Grille Shutter (AGS),a louver system thatblocks various front-end airflow openings, reducing drag - a key factor for improving vehicle gasmileage.

Beyond these financial and operational achievements, we continued to build upon prior initiativesto evolve our corporate governance practices. In 2012, our Board adopted shareholder-friendlyenhancements including: "say on pay", full majority voting, elimination of director stock options,disclosure of detailed voting results, board renewal, director education and board evaluation.

Going Forward

The global automotive market remains a growth industry. Despite expected short-term softening inWestern Europe, we believe the global automotive industry will continue to experience strong growthin the coming years, driven largely by markets in Asia, Eastern Europe and South America. As aresult, we continue to invest our financial resources in the industry, including these markets, withour fixed asset spending for 2013 expected to exceed our 2012 level.



Our customers are increasingly moving to larger, global platforms and need suppliers with capabilitiesin manufacturing, engineering and program management, along with the financial and humanresources, to support their activities around the world. We believe our growing global footprint, vasttechnologies, capabilities, resources, and our deep understanding of our customers' needs, positionus well to be a valuable partner to the world's OEMs. This in turn should lead to Magna creatingvalue for our shareholders.

Our current areas of focus include:

An acceleration in our efforts in innovation of new or enhanced products, processes and materials;

Continuing to implement our Leadership Development System to allow us to identify and developthe talent we need to support our future global growth;

Refining our product strategy to ensure we can be a leader in the products we offer to our globalcustomers;

Full implementation of our World Class Manufacturing initiative including successfully launching themany facilities and programs that are starting up all around the world; and

Continuing to restructure our European operations to improve profitability and competitiveness forthe long term as well as addressing some of the issues that are affecting certain of our operationsin South America.

In closing, we wish to thank our shareholders and customers for their ongoing support during anotherstrong year for Magna. We also wish to thank all our employees around the world for their continuedefforts in making Magna a great company. Lastly, we wish to thank Frank Stronach, Magna's founderand long-time chairman, who retired from our Board of Directors this past year after having madeenormous contributions since Magna's inception more than 50 years ago.



LOCATIONS AND SUBSIDIARIESHead Office

Magna International Inc.337 Magna DriveAuroraOntario L4G 7K1CANP:1 905 726 2462F:1 905 726 7164http://www.magna.com

Other Locations and Subsidiaries

Magna International JapanCosma International of America, Inc.Yaesu Center Building 5F600 Wilshire Drive1-6-6 YaesuTroyChuo-kuMichigan 48084Tokyo 103-0028USAJPN

Magna International Inc., ThailandMagna International JapanCentral City Tower1-16-6 Sakae30th FloorNaka-Ku, Nagoya1093/160 Moo 12 Bangna TradAichi 460-008BangnaJPNBangkok 10260THA

Magna International RussiaMagna International EuropeLane Kapranov 3 Bld. 1Magna-Strasse 1123242 MoscowA-2522 OberwaltersdorfRUSAUT

Magna International Inc. KoreaMagna International China6F Hanju Building8F, Tower A125 Nonhyeon 1-dongEton PlaceGangnam-gu69 Dongfang RoadSeoul 135-822PudongKORShanghai 201-120

CHN


Magna International Inc.Locations and Subsidiaries

Magna PowertrainMagna International India1870 Technology Drive101 Kane PlazaTroyMind SpaceMichigan 48083Malad WestUSAMumbai 400 064

MaharastraIND


Magna International Inc.Locations and Subsidiaries

AutoShow Profile

Documents

Transcript of AutoShow Profile