Masters Programmes
Assignment Cover Sheet
Submitted by:

Date Sent:

17-06-2015

Module Title:

Economics Of the Business Environment

Module Code:

IB8270

Date/Year of Module:

Jan 2015

Submission Deadline:

17-06-2015

Word Count:

2860

Number of Pages:

22

Question:
Q1: Choose a firm or an organisation. It must not be BA, Nippon Steel or Cemex It could be a business/organization you work for or any other in which you are interested. Set out the performance of the firm in relation to its main competitors from 2006 until 2014. Conduct an economic analysis of the firm, and its markets and its wider macro context. Does your analysis fully explain your data? If not, why not? What does your analysis reveal about the effectiveness of business strategy in your chosen firm or organization especially in 2009? How well equipped is the business to withstand any further future global economic shocks in 2015?

“This is to certify that the work I am submitting is my own. All external references and sources are clearly acknowledged and identified within the contents. I am aware of the University of Warwick regulation concerning plagiarism and collusion.
No substantial part(s) of the work submitted here has also been submitted by me in other assessments for accredited courses of study, and I acknowledge that if this has been done an appropriate reduction in the mark I might otherwise have received will be made.”

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CONTENTS
1. INTRODUCTION TO THE FIRM……………………………………….1
2. VULNERABILITY…………………………………………………………3
3. MARKET EXPOSURE…………………………………………………...4
3.1
3.2
3.3
3.4
3.5
3.6

GDP variation and Income Elasticity…………………………...4
Market Factors……………………………………………………6
Customer Dependence………………………………………….7
Competition………………………………………………………..8
Non-Economic Factors…………………………………………..9
Price Elasticity…………………………………………………….9

4. MACROECONOMIC EXPOSURE……………………………………..9
4.1
4.2
4.3

Material cost Fluctuation…………………………………………9
Ex-change Rate…………………………………………………..10
Government Policies……………………………………………..11

5. PROTECTION……………………………………………………………12
5.1
5.2
5.3
5.4

Brand development and Patent Protection……………………12
Economies of scale and vertical growth……………………….13
Technology………………………………………………………..13
Lock-in Strategy…………………………………………………..13

6. CONCLUSION AND OUTLOOK………………………………………..14
7. REFERENCE & BIBLIOGRAPHY………………………………………15-16
8. APPENDIX………………………………………………………………..17-22
9. ABBREVIATIONS…………………………………………………………22

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1. Introduction to the firm
Autoliv is a Swedish-American company which started operations in 1953 and is one of the major global automotive Safety components, Airbag, seatbelts and Safety Sensors, supplier. Over the years
Autoliv has expanded globally with presence in 28 countries and 60,000 employees worldwide.
Autoliv’s sales are generated mainly in four regions with major contribution from Europe and America
(graph1.1)

Graph 1.1 Sales per region. Source: Autoliv Report

Autoliv in order to strengthen its worldwide footprint adopted acquisition strategy as seen from graph1.2 below, with recent acquisition of Tyco Radar (2008) for $42Mn and Delphi’s Occupant restraint system in Asia, North America and Europe (2009/2010) for $36Mn (AR, 2009). This demonstrates global growth strategy and good financial health of the company.

Graph 1.2 Autoliv Acquisition Track record. Source: Autoliv Report

Autoliv product line up is organized into active and passive safety systems which are split into three product groups as represented below:

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Graph 1.3 Autoliv Commodity Share. Source: IHS Automotive Regional Report – 2014 edition This economic analysis will focus on Autoliv performance in relation to its competitors and Marcoeconomic factors over last eight years in European market, contributing 33% to company’s revenue
Safety component suppliers producing/supplying in European market are summarized in table1 below
(PRNewswire, 2015); however market is mainly dominated by Autoliv(33%), Takata(20%) and
TRW(23%) as can be seen by graph1.4 by Farren(2008).
Autoliv
KSS
Continental

TRW
Delphi
Toyoda Gosaei

Takata
Bosch
Nihon-Plast

Table 1 Safety Component Supplier EU. Source: PRNewswire (2015)

Graph 1.4 Safety Supplier Market Share (2007) Source: Istockanalyst

Out of the three dominant market players Autoliv has highest market share, operating margins(8.6%) and Return on Capital Employed RoCE(22) these measures indicate Autoliv’s better performance compared to its competitors (Graph1.5).

Operation Margins
10.00%
5.00%
0.00%

Autoliv Takata

TRW
Graph 1.5 Auto Safety Component Performance Measure.

Source: Annual Statements 2013 (Autoliv, Takata, TRW group)

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2. Vulnerability
As reflected in the picture below Autoliv has high level of automation and equipment investment, required to produce safety critical components, this represents 30% of overall cost as fixed cost (AR
2013 p.51). Additionally to ensure strong engineering capabilities employees are highly skilled and are costly to replace (Chris Harris, 2015), representing ‘Quasi-fixed cost’. Due to high fixed cost structure company’s operating margins are highly dependent on the capacity utilisation of its Plants
(AR 2013 p.51), which denotes Type 1 vulnerability.

Picture 2.1 Autoliv Hungary Plant Source: http://tiresandparts.net/News

When Automotive market collapsed in 2008/09 (great recession), its profit and ROCE took a significant hit and subsequently recovered post-recession (Fig 2.2). This information suggests that
Autoliv short run Average total cost (SRATC) curve is ‘half way’ between flute and saucer type, as volume falls average total cost increases due negative effect on fixed cost which reduces profit margins. Fig. 2.2 Autoliv: Operating margins and RoCE Source: Annual Reports (06-14)

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Additionally Autoliv is exposed to its input market as nearly 28% of costs of net sales are comprised of raw material (AR2013); therefore company is vulnerable to variation in input costs representing Type
2 vulnerability (Knight,2015).

Fig 2.3 Autoliv Cost Structure. Source: Annual Statements 2013
(Autoliv)

Autoliv management adopt various strategies to reduce type1 vulnerability, firstly to have high level of temporary staff instead of permanent which reduces ‘quasi-fixity’, its temporary staff ratios increased from 9%(2008) to 20%(2009) (AR 2009 p.37). Secondly, consolidation of business to reduce fixed cost, in 2009 globally company closed four sites including two in Europe (press release, 2009) and consolidated operation in Tunisia to have better plant utilisation (fixed assets). Thirdly, introducing variability in pay as Directors and senior management incentives are linked to company performance.
(Chris Harris, 2015).
Finally, Autoliv increased component sourcing from leading competitive countries (LCC) where automated production lines (fixed cost) can be replaced by labour-intensive line giving flexibility to manage in case of volume fluctuations (AR 2013 p.51).
To limit the effects coming from Type 2 vulnerability Autoliv, firstly increase vertical integration by acquiring steel component supplier Norma (AR 2012 p.35), secondly new cost efficient design replacing steel with Plastics and finally entering into long term contract with material supplier to minimise the variation in RM prices (AR 2013).
Therefore, it’s evident that Autoliv experience both Type 1 and Type 2 vulnerability and outlines strategy to minimize the RISK.

3. MARKET EXPOSURE
3.1 GDP Variation and Income Elasticity
Autoliv supply parts to automotive market which is highly impacted by economic shocks, any change in the economic factors will affect consumer disposable income thereby affecting buying

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power/confidence. In 2008/09 economic crisis, resulting from losses in US banking system, spread across Europe leading to loss of output and fall in real GDP fig.3.1 (IHS Automotive report, 2014). As a result demand for durable goods like car, which have high income elasticity, is reduced and affected the market in which Autoliv operates fig3.2 (ACEA,2014).

Fig. 3.1 GDP EU Source: IHS Automotive Supplier Business – Regional
Report 2014

Fig. 3.2 European Car Sales Data Source: ACEA,2014

As reflected in fig.3.3/3.4 Autoliv’s reduced sales and lower operating margin during 2008-2009 financial crises coincides with its market downturn.

Fig. 3.3 Autoliv’s Sales Data. Source: Annual Statements 2013

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Fig. 3.4 Autoliv’s Operating Margins Summary
Source: Autoliv’s Business Plan 2013 (http://www.sec.gov)

This suggests that Autoliv is impacted by GDP variation and income elasticity due to the market in which it operates.

3.2 MARKET FACTORS

Autoliv market is impacted by three main factors vehicle production, safety component per vehicle
(CPV) and the global sourcing by customers (AR 2013). During 2008/09 automotive recession, Key strategy followed was restructuring and launched a program (“The Action Program”) in July 2008 and reduced its work force by 10,000 by end 2009 mainly in High cost countries which helped to reduce
Break-even point by $0.9 billion (AR2009). This headcount reduction was in line with the trend in Euro zone economy as shown in fig3.5 below (GDP reduction and unemployment increase).

Fig. 3.5 EU Change in number of unemployed person
Source: IHS Automotive Supplier Business – Regional Report 2014

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Following the market trend where OEM were sourcing from LCC and setting plants in emerging markets like India and China, Autoliv made investment in these markets (AR 2013) which helped to reduce its component cost in Europe by LCC sourcing and offset negative volume impact in Europe with the revitalised CPV demand from these emerging regions/markers (outsource2india).

Fig. 3.6 Safety Market Life Cycle
Source: www.outsource2india.com

3.3 Customer Dependence
In order to avoid the risk coming from single customer Autoliv has quite a customer mix. Autoliv’s major customers are GM, Ford, Renault-Nissan, Hyundai and Volkswagen as shown below in fig3.7,
85% of total revenue is covered by 10 OEM’s with not a single one responsible for over 15% of companies sales in comparison to Takata whose 52% of sales are covered by 4 OEM’s (Takata AR
2009 p.8), thus by having a balanced customer base Autoliv manage volume fluctuation coming from
OEM.

Fig. 3.7 Autoliv Customer Share
Source Autoliv General Presentation 2014

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3.4 Competition
Automotive Safety component market is mainly dominated by Autoliv, TRW and Takata with each company supplying less differentiated products however entry barriers created though high investment and technological advancement, factors necessary for safe, competitive and quality products, suggests Autoliv operates in Oligopolistic market (Mankiw and Taylor, 2014 p.329). Based on the market share (2007) for safety suppliers its ‘Herfindahl index’ is between 2,000 and 10,000 which indicate ‘high’ market concentration (economicsonline, no date).
Even though safety products are less differentiated however due to high entry barriers Autoliv manages to escape ‘strategic hell’ and can have active pricing strategy. By comparing ROCE with the rate of return on low risk financial assets US treasury bonds confirms this and it signifies that Autoliv makes ‘super-normal profits’.
Year

Autoliv (%)

TRW (%)

Takata (%)

14
9
2
28
28
21
22

N/A
N/A
N/A
N/A
19.62
15.55
16.36

17.25
1.44
6.51
12.09
6.06
6.22
9.56

(US Treasuries Avg. rate)

2006/7
2007/8
2008/9
2009/10
2010/11
2011/12
2012/13

(4.8)
(4.6)
(3.6)
(3.2)
(3.2)
(2.7)
(1.8)

Table 3.8 ROCE Comparison with US Ten Year Treasuries Average Rate
Source: Autoliv/TRW/Takata Annual Statement 06/13

Autoliv makes significant investment in R&D which gives advantage on non-price features like product quality fig 3.9 (key for industry) and new cost competitive design over its rivals. However in June 2012
Autoliv was under investigation for price-fixing (anti-trust) for which company had to pay $14.2Mn in
US and investigation in EU still ongoing (AR 2012 p.43); this demonstrates company approach to intense rivalry in an Oligopoly and create barriers for new entrants by collusion(Halcom, 2012).

Fig. 3.9 Quality Improvement. Source: Autoliv Annual Statement 2013

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3.5 Non-Economic Factors
There are non-economic factors which impact Autoliv performance and strategy; recently one of its main competitors Takata faced massive airbag recall campaign. Following this campaign, Autoliv’s share price increased by 3.7% and company planned to increase its capacity to support demand
(autonews, 2015). Thereby adopting ‘pre-commitment’ strategy (spare capacity to restrict new competition) Autoliv discourages new entrants. (Knight,2015).

3.6 Price Elasticity
Price elasticity demand (PED) helps companies to understand their product demand in relation to its price variation and helps to establish commodity price to maximize profits. As per the price elasticity theory if product has substitutes and less differentiated then it depicts high price elasticity as customer could change the source if there is price increase (Mankiw and Taylor, 2014 p.73). As safety components are less differentiated and alternatives (outsource2india, n.d.) are available from competitors, it suggests that Autoliv products have elastic demand. However, considering the safety critical nature of product any price variation will not impact the demand in short run though in long run volumes will be impacted as OEM’s will source to competitors.
In addition to its own price movement sensitivity, Autoliv’s component demand is impacted by the demand of final product for which it is an input, price variation for Cars, which represents cross price elasticity of demand (complement product) (Knight,2015). If its main customer increases their product
(car) prices, final consumer could shift to other OEM’s resulting in decrease in demand of Autoliv’s input components.

4. MACROECONOMIC EXPOSURE
Autoliv operates in market which is highly exposed to various macroeconomic factors however the key factors Material cost fluctuation, Ex-change rates, Government policies.

4.1. Material Cost Fluctuation
As per Autoliv’s annual report 2014 p51 nearly 54.3% of sales represent direct materials, out of which
50% is comprised of raw materials (RM) (28% of sales) and remaining is value added from component suppliers. Therefore, Autoliv have significant exposure to RM prices variation and main
RM as portion of net sales – 17% is based on steel, 15% on oil prices, 9% on electronic circuits, and
3% on Zinc & Aluminium.
During the period from 2006-2014 main RM’s steel (steelbenchmarker) and Oil (eia) had significant variation which affected Autoliv’s profit margins. As shown in figure 4.1 and 4.2 during 2009 global recession when the steel and Oil prices reduced Autoliv generated a cost savings of approximately
$60Mn in its supply chain conversely it was hit in 2010 by $20Mn and 2011 by $100M$ (AR 2012 p47). 9

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Fig. 4.1 Steel Price Change. Source: Steelbenchmarker

Fig. 4.2 Oil Price Change
Source: www.eia.gov

In order to overcome these RM challenges Autoliv firstly increased components sourcing in LCC (14% to 43% by 2009) which helps to reduce value added portion due to lower labour rates, secondly focusing on better economies of Scale, consolidated its supplier base from 35% in 2004 to 77% in
2009 to optimize the value addition and have better logistics efficiencies to lower component price
(AR 2009, p.20). Thirdly, reduce internal cost by 5% YOY labour productivity improvement as represented by figure4.3.

Fig. 4.3 Labour Productivity Improvement. Source: Autoliv Annual Statement 2009

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Finally investing in R&D to develop new cost-efficient components for example new generation of airbags are 30% lighter (less material less exposure) (AR 2009 p.20) (appendix 1).
These actions together with shift of production to LCC has partly compensated for the RM RISK.

4.2 Exchange Rate
Autoliv is directly impacted by variation in the exchange rate resulting from Transactional exposure which is due to buying in one currency and selling in other country and also from Translational exposure. Transaction exposure is because of continuous variation between main currencies US
Dollar, Euro and Swedish Krona (AR) and impacted companies margins.

Fig. 4.4 Transactional Currency Exposure. Source: Autoliv Annual Statements

Another currency Risk comes from the translational exposure which is arising due to conversion of non US subsidiaries income statement and balance sheet into US $ consolidated sheets. However as company finance its subsidiaries in local currencies so the effect coming from translation exposure is minimum (AR 2014). (Appendix 2)

Fig. 4.5 Translational Currency Exposure. Source: Autoliv Annual
Statement

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In order to protect company from transaction exposure Autoliv tends to hedge these currencies to reduce the impact in short term.

4.3 Government Policies

Autoliv operates in a market which is important for the safety of the road users (appendix 3); therefore it is highly regulated by European commission transport policies. Time to time government introduces policies to enhance road safety requirements for both passenger and pedestrian as road traffic injuries account for 17% of fatal injuries in EU (EuroSafe, 2013). These new regulations have positive impact on the Autoliv CPV measure. As per the road safety policy 2011-2020, many safety measure are identified which includes seat belt pre-tensioners and active safety system (Enterprise and
Industry Directorate-General, 2014). These new regulation and growth in active system helped to increase Autoliv’s sales revenue as show in figure4.6 below.

Fig. 4.6 Autoliv Sales by Product. Source: Autoliv Annual Statement
2014

5. Protection
In this less differentiated market Autoliv adopts strategy to protect itself by having competitive advantage over current rivals and imposing ‘sunk cost’ for new entrant’s, thus achieving super-normal profits. 5.1 Brand Development and Patent Protection
Today safety is one of the strongest selling points for all OEM’s and Autoliv with its high R&D investments for new safety technologies is creating a strong brand. During 2013 company invested
$434Mn or 5.6% of sales in R&D thus creating entry barriers (sunk cost) for new entrants and maintaining technological edge over current competitors who invest less in R&D; TRW invested
$155M and Takata $39M during similar periods (TRW, Takata AR2011).

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Fig. 5.1 R&D Expenditure. Source: Autoliv Annual Statement 2013

Due to evolving new safety trends Autoliv is growth partners for many OEM’s like Renault Nissan who nominate Autoliv as Alliance Growth Partner (AGP) for current and future business (appendix 4).
In order to further strengthen its brand Autoliv strategy is to have technological leadership through registering patents across various safety technologies and currently holds more than 6,600 patents
(AR 2014). This gives strong technology brand and price positioning compared to its competitors who will have to pay royalties if they want to introduce similar safety features and thus reduce competition.

2013

2009

Fig. 5.2 Safety Patent. Source: Autoliv Annual Statement 2009/2013

5.2 Economies of Scale and Vertical Growth
Autoliv over the period of last six-years 2006-2013 managed to reduce the cost of component from
30% to 27% of sales (AR 2013 p.30). This was mainly achieved by consolidating the volumes to fewer suppliers to have better economies of scale and standardisation of components which help to future reduce supplier cost.

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In order to accelerate growth and better economies, Autoliv made several acquisition over last five year worth $255Mn (AR 2013 p.35) which helped company to increase vertical growth by acquiring its supplier like Norma (steel component supplier). With this approach company is able to maintain price competitiveness and thus creating entry barriers.

5.3 Technology
Recognising future market trend and to offer OEM diversified product range (“one stop shop solution”) with economies of scale in terms of production and logistics, Autoliv diversified into active safety products along with existing passive safety as represented (appendix 5). Company achieved this by acquisition of existing players in the market like Tyco radar and investing significant proportion of R&D in active safety as referred in Annual report 2014 p.40. With innovation as one of its core approach
Autoliv work closely with customers to delivery new technologies ,in 2013 Autoliv together with Volvo developed world’s first Pedestrian Protection Airbag (appendix 6) which contribute to OEM strong
ENCAP (safety rating), thus creating entry barriers.

5.4 Lock in Strategy
During the product development phase Autoliv works with OEM to make sure vehicle safety system, testing and ENCAP rating is exclusively based on Autoliv’s design, therefore if OEM intends to switch to another supplier they will incur high revalidation cost thus adopting lock-in strategy. During 2013 when Nissan announced Infiniti project in UK based on Daimler carryover A-platform, Nissan had to source with Autoliv (lock-in) as existing Daimler supplier (private business source).

6. Conclusion and Outlook
Based on the analysis it is evident that Autoliv in Europe is vulnerable (type 1 & type 2) to various
Marco-economic shocks. As it operates cyclical to Automotive market which is highly volatile and affected by external factors. Over last eight years company overall financial & key performance indicators followed overall trends in Euro zone economy however it to survive and keep competitive advantage it took necessary actions like:


Global consolidation of business to have better economies



invested in new technologies to standardize and reduce component weight



involve in cost reduction through supplier consolidation and labour productivity improvements



Expanding in new territories to diversify

In 2015 Autoliv is expected to grow, as automotive Total industry volume is expected to grow more than 2%. Over the last few years Autoliv has taken necessary action to strength its position as key player in Safety market though new technologies and quality focus.

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7. References
1 ACEA European Automotive Manufacturing Association (2014) Passenger Car registration:-1.7% in
2013; +13.3% in December [Online]. Available from http://www.acea.be/pressreleases/article/passenger-car-registrations-1.7-in-2013-13.3-in-december [Accessed: 27th April 2015]
2 Autoliv’s (2013) Autoliv’s Business Plan. [Online]. Available from: http://www.sec.gov/Archives/edgar/data/1034670/000119312513217855/d538177dex992.htm [Accessed: 17th May 2015]
3 Autoliv (2009) Autoliv to close four more plants. [online]. Available from: http://www.autoliv.com/NewsRoom/Pages/PressReleases.aspx?releaseid=464626 [Accessed: 18th
May 2015]
4 (2015) Autoliv is ready to increase capacity after Takata expands recall. Autonews [online], 20th May
2015. Available from: http://europe.autonews.com/article/20150520/ANE/150529996/autoliv-isready-to-boost-capacity-after-takata-expands-recall [Accessed: 21st May 2015]
5 Autoliv Annual Report (2006-2013) [Online]. Available from: http://www.autoliv.com/Investors/Pages/Reports%20And%20Presentations/AnnualReports.aspx [Accessed: 24th April 2015]
6 economicsonline (no date) Oligopoly. Moodle - Defining and Measuring oligopoly, [Online].
Available from: http://www.economicsonline.co.uk/Business_economics/Oligopoly.html [Accessed:
17th May 2015]
7 European Commission Enterprise And Industry Directorate-General Brussels (2014) Sustainable
Mobility and Automotive Industry [Online]. Available from: http://ec.europa.eu/enterprise/newsroom/cf/itemdetail.cfm?item_id=7803 [Accessed: 21st May
2015]
8 EuroSafe (2013) Injuries in the European Union, Report on injury statistics 2008-2010 [online],
Available from: http://ec.europa.eu/health/data_collection/docs/idb_report_2013_en.pdf [Accessed:
23rd May 2015]
9 Farren, A. (2008) Can TRW Automotive Escape the Michigan Auto Maker Mess? Graph. Istockanalyst
[Online]. Available from: http://www.istockanalyst.com/article/viewarticle/articleid/2581964
[Accessed: 13/06/2015].
10 Halcom, C. (2012) Autoliv to plead guilty, pay $14.5 million fine in growing investigation of supplier price-fixing [Online]. Available from: http://www.crainsdetroit.com/article/20120606/FREE/120609940/autoliv-to-plead-guilty-pay-14-5million-fine-in-growing [Accessed: 30th April 2015]
11 Harris, C. (2015) Autoliv Information. Email to Deepak Pathak and 18th May 2015.
12 IHS (2014) The European Automotive Supplier Report. [Online]. Available from: http://www.supplierbusiness.com/shop/products/14/automotive-reports [Accessed: 29th April 2015]

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13 Knight, B. (2015) Economics of the Business Environment Lessons Online. 17th February 2015
14 Murillo, M. (2015) Autoliv to Expand Seat Belt Plant in Hungary. [online]. Available from: http://tiresandparts.net/News/9489/Autoliv-to-Expand-Seat-Belt-Plant-Expansion-in-Hungary[Accessed on 17th May 2015]
15 Outsource2India (n.d.) Industry Report on Airbag Industry. [Online]. Available from: http://www.outsource2india.com/kpo/pdf/airbag-industry-report.pdf [Accessed 29th April 2015]
16 PR Newswire (2015) Global Automotive Safety Systems Market 2015-2019 with Autoliv, Takata,
Toyoda Gosei & TRW Auto Dominating. PR NewsWire [Online], 09th March 2015. Available from: http://www.prnewswire.co.uk/news-releases/global-automotive-safety-systems-market-2015-2019with-autoliv-takata-toyoda-gosei--trw-auto-dominating-295629561.html [Accessed: 15th May 2015]
17 Steelbenchmarker (n.d.) Price History [online]. Available from: http://steelbenchmarker.com/files/history.pdf [Accessed: 1st May 2015]
18 Shane, S. (2013) Using Economics to Set Your Prices. [Online]. Available from: http://smallbiztrends.com/2013/10/price-elasticity-economics-set-prices.html [Accessed: 18th May
2015]
19 U.S. Energy Information Administration (2015) Europe Brent Spot Price FOB [Online]. Available from: http://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=RBRTE&f=D [Accessed: 1st May
2015]
20 Zamora, R. (2011) Autoliv Inc. Investing in Safety [Online], Available from: http://www.gurufocus.com/news/144146/autoliv-inc-investing-in-safety-value-idea-contest [Accessed: 18th May 2015]
Bibliography
http://www.gurufocus.com/news/144146/autoliv-inc-investing-in-safety-value-idea-contest http://www.autoliv.com/Investors/Presentations/2014-01-14%20Detroit%20Auto%20Show.pdf http://www.eurofound.europa.eu/sites/default/files/ef_files/emcc/publications/2004/ef0427en.pdf http://economictimes.indiatimes.com/industry/auto/news/auto-components/swedish-car-safetypioneer-autoliv-bucks-margin-trend/articleshow/36053107.cms 16

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Appendix 1

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Appendix 2
Currency Exposure – Transaction and Translational Effect

Appreciation in EUR over USD had positive impact during 2013 VS. 2012

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Appendix 3

Appendix 4
Autoliv as AGP (Alliance Growth Partner) for Renault & Nissan Alliance

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Appendix 5
Annual report 2014 p. 19

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Appendix 6

Appendix

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Annual Report – Autoliv ROCE

Abbreviations
AR ---------------------------------------------------------------- Annual Reports
AGP----------------------------------------------------------------Alliance Growth Partner (Renault & Nisan)
CPV----------------------------------------------------------------Component Per Vehcile
ENCAP------------------------------------------------------------European New Car Assessment Programme
LCC----------------------------------------------------------------Leading Competitive Countries
RM-----------------------------------------------------------------Raw Material
YOY----------------------------------------------------------------Year-on-Year

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