Volvo Construction Equipment
Volvo Construction Equipment Corporate Presentation 2010
Welcome to the Volvo Group Volvo Group is one of the world's leading suppliers of transport solutions for commercial use. We also provide complete packages for financing and service.
Volvo Construction Equipment Corporate presentation 2 March 2010
The Volvo Group Mission By creating value for our customers we create value for our shareholders. We use our expertise to create transport-related hard and soft products of superior quality, safety and environmental care for demanding customers in selected segments. We work with energy, passion and respect for the individual.
Volvo Construction Equipment Corporate presentation 3 March 2010
The Volvo Group Vision To be valued as the world's leading supplier of commercial transport solutions.
Volvo Construction Equipment Corporate presentation 4 March 2010
Corporate Values These values have a long tradition and permeate our organization, our products and our way of working. • Quality • Safety • Environmental Care
Volvo Construction Equipment Corporate presentation 5 March 2010
Corporate Culture The Volvo Way is a guide for our behavior as leaders and team members. It shows what we stand for and want to achieve. We shall work towards profitable growth with energy, passion and respect for the individual.
Volvo Construction Equipment Corporate presentation 6 March 2010
Organization
Volvo Trucks
Renault Trucks
Mack Trucks
Volvo 3P Volvo Powertrain Volvo Parts Volvo Logistics
Volvo Technology Volvo Information Technology
Volvo Group Real Estate – Volvo Business Services
Volvo Construction Equipment Corporate presentation 7 March 2010
Volvo Group
Nissan Diesel
Volvo Buses
Volvo Construction Equipment
Volvo Penta
Volvo Aero
Volvo Financial Services
Global Operation
Volvo Construction Equipment The rest of the Volvo Group
Volvo Construction Equipment Corporate presentation 8 March 2010
Employees 2009
Europe North America
58%
14% Asia
South America
20%
5%
Rest of World
3%
Number of employees: 90,208 Volvo Construction Equipment Corporate presentation 9 March 2010
Volvo Group 2009 Sales
Operating income
Total: SEK 218.4 bln (US$ 30.6 bln)
4% Volvo Aero 4% 5% Volvo Penta Financial Services
Total: SEK -17 bln (US$ -2.4 bln)
1000 0 -1000 -2000
8% Buses
-3000 -4000 -5000
-8000
Volvo CE
Buses
Volvo Penta
63% Trucks
-63%
-24%
-2%
-1%
Volvo Construction Equipment Corporate presentation 10 March 2010
-11000 -12000
Volvo Aero
Trucks
-9000 -10000
0.3%
Other
-7000
16% Volvo CE
Financial Services
-6000
-4%
-6%
Volvo Construction Equipment
Volvo Construction Equipment Corporate presentation 11 March 2010
Organizational Chart CEO Olof Persson
Strategy Carl Lockwood
Legal Edvard Carleson
Operations Pat Olney
Human Resources Richard Eyres
Corporate Communications Klas Magnusson
Processes & Systems Scott Park
Core Value Management Mats Deleryd
Technology Anders Larsson
Volvo Construction Equipment Corporate presentation 12 March 2010
Sales and Marketing Scott Hall
Finance Robert Dicker
Lingong Zhizhong Wang
Hallsberg, Sweden ± 490 empl.
Industrial System
Arvika, Sweden ± 990 empl.
Braås Braås, and Sweden Eskilstuna, ± 800Sweden empl. Eskilstuna, Sweden ± 1.370 empl.
Goderich, Canada ± 30 empl. Jinan, China Linyi, China ± 2.275 empl.
Shippensburg, US ± 570 empl.
Changwon, Korea ± 1.560 empl.
Tultitlán,Mexico ± 75 empl.
Pederneiras, Brazil ± 650 empl. Wroclaw, Poland ± 210 empl.
Hameln, Germany ± 480 empl.
R&D
Plant
Volvo Construction Equipment Corporate presentation 13 March 2010
Belley, France ± 330 empl.
Konz-Könen, Germany ± 680 empl.
Shanghai, China ± 470 empl. Incl. Linyi Hub
Bangalore, India ± 160 empl.
Data: Headcount figures August 2010
Volvo Construction Equipment Industry Segments and Customer Types Industry Segments
Industrial Material Handling 4%
Agriculture & Landscaping 7% Forestry Industry 3%
Recycling Industry 3%
Customer Types
Mining 11%
Energy related Industry (Oil & Gas) 0%
Demolition 0% Building 4%
Site Dependent 24%
Road Construction 18%
Utilities 3%
Volvo Construction Equipment Corporate presentation 14 March 2010
Rental 13%
Quarries & Aggregates 8%
Public Authorities 3%
Heavy infrastructure 39%
Contractors 60%
Sales & Marketing Worldwide distribution in approximately 150 countries
REGION ASIA ± 560 empl., incl. Volvo-owned dealerships (HQ in Singapore)
REGION EUROPE ± 1.510 empl., incl. Volvo-owned dealerships (HQ in Duxford, UK)
REGION INTERNATIONAL ± 540 empl., incl. Volvo-owned dealerships (HQ in Eskilstuna, Sweden)
REGION NORTH AMERICA ± 440 empl., incl. Volvo-owned dealerships (HQ in Asheville, US)
CUSTOMER SUPPORT BUSINESS AREA ± 550 empl. (HQ in Eskilstuna, Sweden)
RENTAL BUSINESS AREA ± 75 empl. (HQ in Asheville, US)
Volvo Construction Equipment Corporate presentation 15 March 2010
The Growth of Volvo CE Machine Volumes 70,000
Ingersoll-Rand (2007)
60,000
Lingong (2006) Skat Trak (2003)
50,000
Backhoe Loaders (2002) 40,000
Samsung (1998) 30,000
Champion (1997)
20,000
Pel-Job (1996)
10,000
Åkerman (1991) Zettelmeyer (1990)
Volvo Construction Equipment Corporate presentation 16 March 2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
1997
1996
1995
1994
1993
1992
1991
1990
1989
0
Volvo (historical base)
Customer Offer
The Evolution of Volvo CE
Machines Services Attachments Parts
2007
1991
Total Solution Provider
2003 1997 2002 1990
1966
1991
1996
2006
MultiSpecialist
1954
Specialist Time
Volvo Construction Equipment Corporate presentation 17 March 2010
Volvo CE Product Range MC60B
MC70B
MC80B
L90F
MC90B
L110F
BL60
BL61
ECR28
MC110B
ECR38
EC140C
L20F
L25F
L120F
BL61 PLUS
BL70
EC180C
A25E 4X4
L35B PRO
L150F
BL71
ECR48C ECR58 PLUS ECR88 PLUS
EC160C
L30B PRO
ECR145CL
EC210C
L180F
BL71 PLUS
EC15C
ECR235CL
ECR305CL
EC240C
A25E
L40B
EC290C
A30E
L45F
L50F
L180F HIGH LIFT
EC17C
EC18C
EW60C
EC330C
EC27C
EW160C
L350F
EC35C
EW180C
EC360C
A35E/A35E FS
L70F
L220F
EC20C
EW140C
L60F
EC55C
EW210C
EW230C
EC460C
A40E/A40E FS
EC60C
EC700C
HAULER CHASSIS TRANSPORT SOLUTION PLATFORM
G930
G940
G946
PAVERS
ASPHALT COMPACTORS
ABG BLAW-KNOX ABG BLAW-KNOX WHEEL PAVER WHEEL PAVER TRACK PAVERS TRACK PAVERS ABG4361 ABG5770 ABG5870 ABG6870
PF161 PF2181 PF3172 PF6160 PF6170
G960
ABG2820 ABG5820 ABG6820 ABG7620 ABG7820B ABG8620 ABG8820B ABG9820
PF4410 PF6110
COMBINATION SMALL COMPACTORS TANDEM ASPHALT CR24 COMPACTORS CR30
Volvo Construction Equipment Corporate presentation 18 March 2010
DD14S DD16 DD22 DD24 DD29 DD31HF DD38HF
RIGID FRAME ASPHALT COMPACTORS DD85 DD95
LARGE TANDEM ASPHALT COMPACTORS
G970
G976
SOIL COMPACTORS
SINGLE DRUM PNEUMATIC SMALL SOIL ASPHALT COMPACTORS TIRE COMPACTOR COMPACTORS SD25D DD126HF SD77DA DD70 SD25F PT125R DD70HF DD132HF SD45D PT220RH DD136HF DD80 SD45F PT240R DD138HF DD90 SD70D DD90HF DD138HFA SD70F DD112HF DD146HF SD77DX DD118HF DD158HFA SD77F DD118HFA
MID-SIZE SOIL LARGE SOIL COMPACTORS COMPACTORS SD100D SD100F SD100C SD100DC SD100FC SD105DX SD105F SD110G SD116DX SD116F
SD122D SD122DX SD122F SD150DC SD160DX SD160F SD190DX SD200DX SD200F SD251DX
G990
MILLING EQUIPMENT MW500
MT2000A
Lingong Product Range* 916
918
933L
LG952
LG952H
LG958L
LG660
LGS816
LG665
LG685
LGS818
938L
LG953
LG953L
LG968
LG959
Volvo Construction Equipment Corporate presentation 19 March 2010
936L
LG6140
LGR81821
ZL40F
LG956L
LG969
LG6210
LGS820
LG6220
LGS822
LG979
LG6240
LG6290
LGB680
*These products are sold under the brand name SDLG.
Volvo Construction Equipment vs Industry Products (2009 Portfolio) Construction equipment industry
Volvo Construction Equipment
Total: US$ 66 bln
Total: US$ 4.7 bln (including BA/BU allocations) *
*
**
Others 18%
9%
13%
10% 2%
10% 11%
** 7% 9%
31% *** 24%
43% 13%
***
* Utilities; ** Road Machinery Equipment; *** Local Chinese Wheel Loaders/Lingong
Volvo Construction Equipment Corporate presentation 20 March 2010
Volvo Construction Equipment vs Industry Geography (2009 Portfolio) Construction equipment industry
Volvo Construction Equipment
Total: US$ 66 bln
Total: US$ 4.7 bln (including BA/BU allocations)
18% Europe
24% North America
15.4% North America 36.4% Europe
7%
5% Latin America
31%
15.2% Asia excl. China
China 12% 10% Rest of World
Volvo Construction Equipment Corporate presentation 21 March 2010
Latin America
Asia excl. China 21% China
5% Rest of World
Total Construction Equipment Industry US$ 66 bln • Due to a strong decrease in global demand, the industry value is estimated to decrease by 39% in 2009. • Helped by demand in China, Japanese manufacturers increased their global market shares. • After the sale of its Mining business, Terex has moved from N.5 to N.10 position. • There has been further reshuffling in the Top 10 ranking, primarily driven by competitors' market and products mix. • Outside of the global Top 11, the market is composed of: – – –
Smaller companies often single product, regionally focused Several international specialist companies Emerging market competitors showing steady progress over time as well as increasingly global reach
Volvo Construction Equipment Corporate presentation 22 March 2010
Market shares 2009 Others 18%
Caterpillar 28%
Hyundai 1% Terex 1% JCB 3% CNH 3% Liebherr 4% Deere 4% Doosan 4%
Komatsu 20%
Volvo 7% Hitachi 8%
Volvo Construction Equipment Key Data 2009 Total 2009 sales 38,783 units Sales, SEK bln
35.7*
Operating Income, SEK bln
2002
2002
2003
2004
2005
2006
2007
2008
* US$ 4.7 bln (including BA/BU allocations) Volvo Construction Equipment Corporate presentation 23 March 2010
2003
2004
2005
2006
2007
2008
2009
- 4*
2009
* US$ - 0.5 bln (including BA/BU allocations)
R&D Expenses and Capital Expenditures
Turnover 2009 7.1% 209 287
135
140 145 92
246 346 264
112 85
70
143
43
35
46
58
2000
2001
2002
2003
2004
Capital Expenditures
104 2005
158 89 2006
2007
2008
2009
Research & Development Expenses
Restated for IFRS (= International Financial Reporting Standards) In MUSD excluding BA/BU allocations Volvo Construction Equipment Corporate presentation 24 March 2010
R&D expenses and capital expenditures 2009
15.080 employees in August 2010
Sweden
28%
Rest of Europe North America
23%
8%
Korea
12%
China Rest of Asia Brazil
5%
Rest of World
Volvo Construction Equipment Corporate presentation 25 March 2010
1%
21% 2%
Volvo Construction Equipment Corporate presentation 26 March 2010
Welcome to the Volvo Group Volvo Group is one of the world's leading suppliers of transport solutions for commercial use. We also provide complete packages for financing and service.
Volvo Construction Equipment Corporate presentation 2 March 2010
The Volvo Group Mission By creating value for our customers we create value for our shareholders. We use our expertise to create transport-related hard and soft products of superior quality, safety and environmental care for demanding customers in selected segments. We work with energy, passion and respect for the individual.
Volvo Construction Equipment Corporate presentation 3 March 2010
The Volvo Group Vision To be valued as the world's leading supplier of commercial transport solutions.
Volvo Construction Equipment Corporate presentation 4 March 2010
Corporate Values These values have a long tradition and permeate our organization, our products and our way of working. • Quality • Safety • Environmental Care
Volvo Construction Equipment Corporate presentation 5 March 2010
Corporate Culture The Volvo Way is a guide for our behavior as leaders and team members. It shows what we stand for and want to achieve. We shall work towards profitable growth with energy, passion and respect for the individual.
Volvo Construction Equipment Corporate presentation 6 March 2010
Organization
Volvo Trucks
Renault Trucks
Mack Trucks
Volvo 3P Volvo Powertrain Volvo Parts Volvo Logistics
Volvo Technology Volvo Information Technology
Volvo Group Real Estate – Volvo Business Services
Volvo Construction Equipment Corporate presentation 7 March 2010
Volvo Group
Nissan Diesel
Volvo Buses
Volvo Construction Equipment
Volvo Penta
Volvo Aero
Volvo Financial Services
Global Operation
Volvo Construction Equipment The rest of the Volvo Group
Volvo Construction Equipment Corporate presentation 8 March 2010
Employees 2009
Europe North America
58%
14% Asia
South America
20%
5%
Rest of World
3%
Number of employees: 90,208 Volvo Construction Equipment Corporate presentation 9 March 2010
Volvo Group 2009 Sales
Operating income
Total: SEK 218.4 bln (US$ 30.6 bln)
4% Volvo Aero 4% 5% Volvo Penta Financial Services
Total: SEK -17 bln (US$ -2.4 bln)
1000 0 -1000 -2000
8% Buses
-3000 -4000 -5000
-8000
Volvo CE
Buses
Volvo Penta
63% Trucks
-63%
-24%
-2%
-1%
Volvo Construction Equipment Corporate presentation 10 March 2010
-11000 -12000
Volvo Aero
Trucks
-9000 -10000
0.3%
Other
-7000
16% Volvo CE
Financial Services
-6000
-4%
-6%
Volvo Construction Equipment
Volvo Construction Equipment Corporate presentation 11 March 2010
Organizational Chart CEO Olof Persson
Strategy Carl Lockwood
Legal Edvard Carleson
Operations Pat Olney
Human Resources Richard Eyres
Corporate Communications Klas Magnusson
Processes & Systems Scott Park
Core Value Management Mats Deleryd
Technology Anders Larsson
Volvo Construction Equipment Corporate presentation 12 March 2010
Sales and Marketing Scott Hall
Finance Robert Dicker
Lingong Zhizhong Wang
Hallsberg, Sweden ± 490 empl.
Industrial System
Arvika, Sweden ± 990 empl.
Braås Braås, and Sweden Eskilstuna, ± 800Sweden empl. Eskilstuna, Sweden ± 1.370 empl.
Goderich, Canada ± 30 empl. Jinan, China Linyi, China ± 2.275 empl.
Shippensburg, US ± 570 empl.
Changwon, Korea ± 1.560 empl.
Tultitlán,Mexico ± 75 empl.
Pederneiras, Brazil ± 650 empl. Wroclaw, Poland ± 210 empl.
Hameln, Germany ± 480 empl.
R&D
Plant
Volvo Construction Equipment Corporate presentation 13 March 2010
Belley, France ± 330 empl.
Konz-Könen, Germany ± 680 empl.
Shanghai, China ± 470 empl. Incl. Linyi Hub
Bangalore, India ± 160 empl.
Data: Headcount figures August 2010
Volvo Construction Equipment Industry Segments and Customer Types Industry Segments
Industrial Material Handling 4%
Agriculture & Landscaping 7% Forestry Industry 3%
Recycling Industry 3%
Customer Types
Mining 11%
Energy related Industry (Oil & Gas) 0%
Demolition 0% Building 4%
Site Dependent 24%
Road Construction 18%
Utilities 3%
Volvo Construction Equipment Corporate presentation 14 March 2010
Rental 13%
Quarries & Aggregates 8%
Public Authorities 3%
Heavy infrastructure 39%
Contractors 60%
Sales & Marketing Worldwide distribution in approximately 150 countries
REGION ASIA ± 560 empl., incl. Volvo-owned dealerships (HQ in Singapore)
REGION EUROPE ± 1.510 empl., incl. Volvo-owned dealerships (HQ in Duxford, UK)
REGION INTERNATIONAL ± 540 empl., incl. Volvo-owned dealerships (HQ in Eskilstuna, Sweden)
REGION NORTH AMERICA ± 440 empl., incl. Volvo-owned dealerships (HQ in Asheville, US)
CUSTOMER SUPPORT BUSINESS AREA ± 550 empl. (HQ in Eskilstuna, Sweden)
RENTAL BUSINESS AREA ± 75 empl. (HQ in Asheville, US)
Volvo Construction Equipment Corporate presentation 15 March 2010
The Growth of Volvo CE Machine Volumes 70,000
Ingersoll-Rand (2007)
60,000
Lingong (2006) Skat Trak (2003)
50,000
Backhoe Loaders (2002) 40,000
Samsung (1998) 30,000
Champion (1997)
20,000
Pel-Job (1996)
10,000
Åkerman (1991) Zettelmeyer (1990)
Volvo Construction Equipment Corporate presentation 16 March 2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
1997
1996
1995
1994
1993
1992
1991
1990
1989
0
Volvo (historical base)
Customer Offer
The Evolution of Volvo CE
Machines Services Attachments Parts
2007
1991
Total Solution Provider
2003 1997 2002 1990
1966
1991
1996
2006
MultiSpecialist
1954
Specialist Time
Volvo Construction Equipment Corporate presentation 17 March 2010
Volvo CE Product Range MC60B
MC70B
MC80B
L90F
MC90B
L110F
BL60
BL61
ECR28
MC110B
ECR38
EC140C
L20F
L25F
L120F
BL61 PLUS
BL70
EC180C
A25E 4X4
L35B PRO
L150F
BL71
ECR48C ECR58 PLUS ECR88 PLUS
EC160C
L30B PRO
ECR145CL
EC210C
L180F
BL71 PLUS
EC15C
ECR235CL
ECR305CL
EC240C
A25E
L40B
EC290C
A30E
L45F
L50F
L180F HIGH LIFT
EC17C
EC18C
EW60C
EC330C
EC27C
EW160C
L350F
EC35C
EW180C
EC360C
A35E/A35E FS
L70F
L220F
EC20C
EW140C
L60F
EC55C
EW210C
EW230C
EC460C
A40E/A40E FS
EC60C
EC700C
HAULER CHASSIS TRANSPORT SOLUTION PLATFORM
G930
G940
G946
PAVERS
ASPHALT COMPACTORS
ABG BLAW-KNOX ABG BLAW-KNOX WHEEL PAVER WHEEL PAVER TRACK PAVERS TRACK PAVERS ABG4361 ABG5770 ABG5870 ABG6870
PF161 PF2181 PF3172 PF6160 PF6170
G960
ABG2820 ABG5820 ABG6820 ABG7620 ABG7820B ABG8620 ABG8820B ABG9820
PF4410 PF6110
COMBINATION SMALL COMPACTORS TANDEM ASPHALT CR24 COMPACTORS CR30
Volvo Construction Equipment Corporate presentation 18 March 2010
DD14S DD16 DD22 DD24 DD29 DD31HF DD38HF
RIGID FRAME ASPHALT COMPACTORS DD85 DD95
LARGE TANDEM ASPHALT COMPACTORS
G970
G976
SOIL COMPACTORS
SINGLE DRUM PNEUMATIC SMALL SOIL ASPHALT COMPACTORS TIRE COMPACTOR COMPACTORS SD25D DD126HF SD77DA DD70 SD25F PT125R DD70HF DD132HF SD45D PT220RH DD136HF DD80 SD45F PT240R DD138HF DD90 SD70D DD90HF DD138HFA SD70F DD112HF DD146HF SD77DX DD118HF DD158HFA SD77F DD118HFA
MID-SIZE SOIL LARGE SOIL COMPACTORS COMPACTORS SD100D SD100F SD100C SD100DC SD100FC SD105DX SD105F SD110G SD116DX SD116F
SD122D SD122DX SD122F SD150DC SD160DX SD160F SD190DX SD200DX SD200F SD251DX
G990
MILLING EQUIPMENT MW500
MT2000A
Lingong Product Range* 916
918
933L
LG952
LG952H
LG958L
LG660
LGS816
LG665
LG685
LGS818
938L
LG953
LG953L
LG968
LG959
Volvo Construction Equipment Corporate presentation 19 March 2010
936L
LG6140
LGR81821
ZL40F
LG956L
LG969
LG6210
LGS820
LG6220
LGS822
LG979
LG6240
LG6290
LGB680
*These products are sold under the brand name SDLG.
Volvo Construction Equipment vs Industry Products (2009 Portfolio) Construction equipment industry
Volvo Construction Equipment
Total: US$ 66 bln
Total: US$ 4.7 bln (including BA/BU allocations) *
*
**
Others 18%
9%
13%
10% 2%
10% 11%
** 7% 9%
31% *** 24%
43% 13%
***
* Utilities; ** Road Machinery Equipment; *** Local Chinese Wheel Loaders/Lingong
Volvo Construction Equipment Corporate presentation 20 March 2010
Volvo Construction Equipment vs Industry Geography (2009 Portfolio) Construction equipment industry
Volvo Construction Equipment
Total: US$ 66 bln
Total: US$ 4.7 bln (including BA/BU allocations)
18% Europe
24% North America
15.4% North America 36.4% Europe
7%
5% Latin America
31%
15.2% Asia excl. China
China 12% 10% Rest of World
Volvo Construction Equipment Corporate presentation 21 March 2010
Latin America
Asia excl. China 21% China
5% Rest of World
Total Construction Equipment Industry US$ 66 bln • Due to a strong decrease in global demand, the industry value is estimated to decrease by 39% in 2009. • Helped by demand in China, Japanese manufacturers increased their global market shares. • After the sale of its Mining business, Terex has moved from N.5 to N.10 position. • There has been further reshuffling in the Top 10 ranking, primarily driven by competitors' market and products mix. • Outside of the global Top 11, the market is composed of: – – –
Smaller companies often single product, regionally focused Several international specialist companies Emerging market competitors showing steady progress over time as well as increasingly global reach
Volvo Construction Equipment Corporate presentation 22 March 2010
Market shares 2009 Others 18%
Caterpillar 28%
Hyundai 1% Terex 1% JCB 3% CNH 3% Liebherr 4% Deere 4% Doosan 4%
Komatsu 20%
Volvo 7% Hitachi 8%
Volvo Construction Equipment Key Data 2009 Total 2009 sales 38,783 units Sales, SEK bln
35.7*
Operating Income, SEK bln
2002
2002
2003
2004
2005
2006
2007
2008
* US$ 4.7 bln (including BA/BU allocations) Volvo Construction Equipment Corporate presentation 23 March 2010
2003
2004
2005
2006
2007
2008
2009
- 4*
2009
* US$ - 0.5 bln (including BA/BU allocations)
R&D Expenses and Capital Expenditures
Turnover 2009 7.1% 209 287
135
140 145 92
246 346 264
112 85
70
143
43
35
46
58
2000
2001
2002
2003
2004
Capital Expenditures
104 2005
158 89 2006
2007
2008
2009
Research & Development Expenses
Restated for IFRS (= International Financial Reporting Standards) In MUSD excluding BA/BU allocations Volvo Construction Equipment Corporate presentation 24 March 2010
R&D expenses and capital expenditures 2009
15.080 employees in August 2010
Sweden
28%
Rest of Europe North America
23%
8%
Korea
12%
China Rest of Asia Brazil
5%
Rest of World
Volvo Construction Equipment Corporate presentation 25 March 2010
1%
21% 2%
Volvo Construction Equipment Corporate presentation 26 March 2010
