Renault-Nissan Alliance Perspective

Thierry MOULONGUET Renaults CFO & EVP

Renault-Nissan Alliance structure: Optimizing the global allocation of resources

44.4%

RENAULT

NISSAN
15%

50%

50%

Renault-Nissan BV
100%

Joint companies eg: RNPO - RNIS 19 Cross Company Teams (CCTs) 4 Functional Task Teams (FTTs)
P/2

The 7 management guidelines for the revival of Nissan

1. Focus on profit and organize the decision process around a set of simple financial yardsticks. 2. Link compensation and promotion to performance. 3. Concentrate on the core business. 4. Seek new opportunities for growth. 5. Transform a collection of regional fiefdoms into a global group. 6. Associate public commitments empowerment transparency and accountability. 7. Build a budget combining project global function and regional approaches to stretch the performance through transversality.
P/3

The performance drivers of the Alliance

1. 2. 3. 4. 5. 6. 7. Common platforms Common purchasing Common manufacturing Exchange of best practices Common IS/IT infrastructures Complementarities in the international development of Renault and Nissan Sharing of resources for new R&D development
P/4

Renault-Nissan Alliance : win-win

Advantages drawn by Renault
1. Acceleration of international deployment 2. Economies of scale (purchasing, common engines & platforms, co-development) 3. Sharing of best practices (quality, industrial & engineering) 4. Optimization of capacity utilization 5. Contribution to net result & dividend flow 6. Cooperation on leading technologies

Advantages drawn by Nissan

1. 2. 3. 4. 5. 6. Initial financial input from Renault New performance orientated culture Cost and vehicle project management Re-invention of a product policy Turn-around in Europe Development of captive finance business
P/5

Worldwide production facilities : Complementarities within the Alliance

Russia United Kingdom France United States Mexico Spain Morocco India Colombia Brazil Thailand Malaysia Indonesia Chile Uruguay South Africa Argentina
P/6

Slovenia Romania Turkey Iran

China Korea Japan

Taiwan

Renault Renault

Nissan Nissan

Dacia Dacia

Renault Samsung Motor Renault Samsung Motor

Nissan operating margin

12% 10% 8% 6% 4% 2% 0% 1999 1.4%

10.8%

11.1% 10%

7.9%

4.75%

2004
P/7

Nissan - ROIC

25%

21.3%
20% 15% 10% 7.5%

19.8%

20 %

12.7%

5%
0%

1.3%

1999

2004
P/8

A positive impact of Nissan's results in Renault's accounts

In millions of euros
Nissan contribution to Renault's results Dividends received from Nissan

400

2,000
1,500 1,000 500 0 2000 2001 2002 2003

350 300 250 200 150 100 50 0

2004
P/9

2000-2004: 894 million euros of dividends received

Market Capitalization

(EURm)

Market Cap March 29,1999 96 736 81 541 59 848 52 518 39 961 22 159 16 277 13 522 10 439

Rank
(EURm)

Market Cap March 29, 2005

Rank

EVOLUTION 2005/1999
1,07 0,47 0,90 3,89 1,44 2,38 0,27 1,48 0,66 0,24 1,81 1,68 2,91 1,22 0,39 1,43 0,72 0,82

Toyota DaimlerChrysler Ford GM Honda VW BMW Fiat Volvo AB

Nissan Renault
Peugeot Suzuki Mazda Fuji Heavy Porsche Mitsubishi Hyundai Motor

9 049 8 393
6 615 6 065 4 459 3 521 3 990 3 043 678

1 2 3 4 5 6 7 8 9 10 11 12 13 14 16 15 17 18

Toyota DaimlerChrysler Honda

Nissan
BMW

Renault
Ford Volvo AB Volkswagen GM Peugeot Hyundai Motor Porsche Suzuki Fiat Mitsubishi Mazda Fuji Heavy

103 677 38 144 36 086 35 240 23 461 19 960 15 960 15 476 14 552 12 507 11 949 11 083 9 860 7 378 5 260 4 348 3 198 2 902

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18

P / 10

The objectives of the Alliance vision - destination

To rank among the top three automotive groups in the world:

For the quality and value of its products and services, in each region and market segment,
In key technologies, In terms of operating profit thanks to its strategy of profitable growth.

P / 11