Central & Eastern Europe Developments

1. Central & Eastern Europe Developments Automotive News Global Conference - Detroit Jan ’08 Chris Lacey – General Motors

2. Today : • Central & Eastern European Markets • What are they • How are they developing • GM’s go-to-market strategy • Conclusions …..and finally ………

3. GM’s “Central & Eastern Europe” • 29countries • East of Germany, North, West & East of both India & China! • 12 time zones / 25 million sq. kilometers • 475 million population [8% of the world, 54% of Europe] • 84 million vehicles in car parc today [Average age = 12+ years] • 30 languages, 4 religions • GDP range (nominal 2006) GDP Total (million USD) Per Capita (USD) Russia 986 940 Slovenia 22 079 Moldova 3 266 Uzbekistan 753 • Complex legislative environment • Less than 20 years ago private vehicle retailing illegal –now one of the fastest growing vehicle markets in the world !

4. To put the Region in perspective

5. Diverse demand and usage

6. How are they developing ? Automotive Industry Market – C&E Region 25,10% of Europe 8,70% Global Annual Growth 20% 13,30% of Europe 4,60% of Global

7. GM’S “Go-to-market approach” • Our 5 P’s • The right Partnerswithin GM to provide productsfor the range of price points required • The right Partners in market place for manufacturing • The right Partnersfor component supply • The right Partners in the market for vehicle distribution and repair • The right Partner philosophy with our customers

8. The right Partners within GM for Product : • European Opel & SAAB • North American Cadillac / Hummer / Chevrolet SUVs • Asian [GM DAT] Chevrolet cars and SUVs • Russian [GM AvtoVaz] Chevrolet Niva Real evidence of GM’s Globalisation and “One Company” approach.

9. The right Partners within GM for Product:

10. The right Partnersfor manufacturing • GM and GM DAT (formerly Daewoo) have a long history of manufacturing in the C&E Region from early 90’s • GM in late 90’s actually stopped vehicle manufacturing in 3 GM plants in the region – Hungary, Poland (Warsaw), and Turkey • Daewoo had 4 regional plants (licensed assemblers) all still operating (in Ukraine, Poland (FSO), Uzbekistan, & Romania) • 180,000 GM DAT vehicle kits assembled in these plants are not recorded in GM Sales in the region • Recent developments include the new GM plant in St Petersburg and manufacturing licenses being granted to Zastava in Serbia, Azia Avto in Kazakhstan, and FSO in Poland • Currently GM vehicles are manufactured or assembled at 9 locations in the region

11. GM Manufacturing Footprint in C&E Region

12. The right Partners for component supply • GM’s Global Purchasing and Supply Chain group aims to increase component sourcing close to where we build • They extend supply channels, identify local suppliers and develop to GM standards for local and global manufacturing • Purchases in C&E region increased by 81% from 2003 to 2007, now 21.4% of total GME purchases • 440 TIER 1 Suppliers in C&E region • Resident Global Purchasing staff in C&E region increased by 305% • C&E region purchasing transactions 100% integrated in GPSC processes

13. Innovative customers need to be served well !

14. The right Partners for Distribution & Repair • GM network growth [contracts]‘95 = 202 ‘01= 402 ‘07 = 765 • In depth blueprinting • Best applicant selection:Management focus / site location / funding / customer service attitude • Full multi-brand approach appropriate to location & opportunity • Facilities to full European standards from day 1 • Communication / motivation / training & guidance

15. The right Partners for Distribution & Repair

22. The right Partner philosophy with our customers. • Changing the “old image” of the pre ’90’sindustry & treatingcustomers with respect • Transparent retail pricing [no premiums] • Warranty & “Policy” • Realistic labor / repair rates • Satisfaction survey • CRM activities • Retail finance and leasing options • Vehicle exchange or “buy back” policy • Excellent parts warehousing and fast delivery • Open communication /dialogue / CAC’s • G2 used car programme

23. Could we have done better? Dealer in house systems Full portfolio - only in 60% of market covered- Full CV range - Low cost product < $8,000 Wholesale & Retail finance in all markets Faster manufacturing capacity increases More training & more training Learnings & Observations No phones to mobiles Cash to credit cards Brand is King High % Internet use Mobile / clothes / travel / car / apartment / house Millionaires Show [Russia] Distribution partners’ positive can do attitude and investment policy Entrepreneurs everywhere Self Assessment / Learnings & Observations

24. Operational Difficulties and Legislation We try hard not be lost in the complex maze…

25. 2001 through 2007 – A Success Story GM Volume & Share Development – Central & Eastern Europe *Excludes 180K GM Daewoo Kits sold in the region in 2007

26. ……………..and finally • Market Volumes : - Russia = 2,708,659 - Ukraine = 584,823 - Turkey = 625,843 - Poland = 372,054 - China = 8,190,436 • Brazil = 2,220,481 • India = 1,812,375

27. ….and finally ….Emerging Markets ??

28. ……………..and finally Request:Can all of the Global Automotive Industry stop calling these markets & Brazil, China and many others:“Emerging” Fact:They have “Emerged” and are our markets of“Growth & Opportunity”We forget / ignore/ mistreat them at our peril.

29. Central & Eastern Europe Playing To Win