Financial Overview

(in millions Euros)

	FY2010	FY2009	Rate of change (%)	Factors
Overall
Sales	5,402	4,528	19.3	-
Operating income	73	(40)	-	-
Sales by division
Lighting	1,586	1,228	29.2	1)
Engine Control	967	850	13.8	2)
Suspension System	583	525	11.0	3)
Shock Absorbers	394	281	40.2	4)
Electronic Systems	623	501	24.4	5)
Exhaust Systems	614	543	13.1	6)
Plastic Components and Modules	287	469	6.4	7)

Factors
1)
Lighting
-Revenues totaled 1,586 million euro in 2010, an increase of approximately 30% over the prior year. The principal increase in volumes was linked to a recovery in the medium-to-large segments of the European automotive market and primarily impacted activities in Germany and the Czech Republic. Performance was also strong in the Asian markets and the NAFTA region.

2)
Engine Control
-Revenues for 2010 totaled 967 million euro, representing an increase of 14% over 2009, with growth concentrated in Brazil, China, India and the United States.

3)
Suspension Systems
-Revenues totaled 583 million euro for the year, representing an 11% increase over the prior year. The largest rise was in Italy and was driven primarily by the increase in light commercial vehicle manufactured by the joint venture, Sevel. In Poland, sales for A and B-segment vehicles were down, but production of the Fiat 500 remained stable against 2009 levels. Performance in Brazil continued to be positive, driven by the strong product demand from FIASA.

4)
Shock Absorbers
-Revenues for the business line were 394 million euro for 2010. The 40% increase over the previous year was mainly driven by performance in Brazil and the United States.

5)
Electronic Systems
-Total revenues were 623 million euro in 2010, an increase of 24% over the previous year, mainly driven by growth in the Brazilian and Chinese markets, as well as new product launches in Slovakia. There was an increase in revenues from instrument panels (+16%), primarily attributable to higher volumes for external customers. Revenues from telematics rose significantly (+31%), due to the increase in volumes to Fiat and SAIC and launch of production of the e-call for PSA. Sales of products for vehicle interiors were also up.

6)
Exhaust Systems
-Revenues totaled 614 million euro for 2010, a 13% increase over the previous year. Sales were up for light commercial vehicles in Spain and Brazil, whereas volumes declined in Italy on the back of the contraction in passenger car demand.

7)
Plastic Components and Modules
-Revenues for the Plastic Components and Modules business line were 499 million euro, up 6% over the previous year.

Contracts

Lighting
-Numerous production launches during the year included headlights and tail lights for the Alfa Romeo Giulietta, in addition to new platforms for Audi and Mercedes with headlights utilizing exclusively LED technology. Major new orders included: headlights and tail lights for Peugeot, Mercedes and Volkswagen-Audi models and for the new Fiat Panda, and headlights for BMW, Renault, Citroën and Chrysler.

Engine Control
-Major orders received during the year included intake manifolds and throttle bodies for Chrysler in the United States, and the GDI pump and throttle body for PSA in Europe.

Suspension Systems
-New orders included the complete suspension for the new Fiat Panda and the front suspension for the new Lancia Ypsilon

Electronic Systems
-Major new orders acquired during the year included the instrument panel and interior control unit for the Chrysler C-evo platform, a digital instrument panel for a Renault electric vehicle, a radio-navigation platform for PSA and a new infotelematic system for BMW.

Exhaust Systems
-Major new orders included exhaust systems for the Euro 5 engines that equip a Mercedes light commercial vehicle and the first project for Chrysler.

Acquisition

-Magneti Marelli Suspensions USA, LLC announced that it has acquired the International Steel Solutions, LLC plant in Pulaski, Tennessee. The Company intends on using this facility to continue manufacturing shock absorbers and related suspension parts. The Company will be hiring a significant number of the current employees at the Pulaski facility, and has committed to increase those numbers in the next two years as it grows the business and expands the product line. (From a press release on January 18, 2010)

R&D Expenditures

(in millions Euros)

	FY2010	FY2009	FY2008
Overall	292	245	268

Product Developments

Lighting
-Innovation was centered around two key areas: reduced energy consumption, with the FINE-X (Future Integrated New Efficient Xenon) and economic low-intensity light projects; and design flexibility, with the adoption of LED technology also for headlights.

Engine Control
-Innovation focused on development of new generation control units, electric hybrid engines and a new range of direct injection fuel pumps. Development of the engine control unit for the Fiat 500 for the US market was completed, in addition to throttle bodies for GDI systems for Volkswagen and for BMW motorcycles. New products launched during the year included throttle bodies for Peugeot and Citroën in Slovakia and Freechoice hydraulic components in China.

Shock Absorbers
-The main innovation projects included: an inertial valve (a new valve for shock absorbers) and a full displacement piston valve suited for use in challenging terrain.

Electronic Systems
-With regard to innovation, instrument panels were developed for the North American version of the 500, the new Panda and the new small family car from Volkswagen. Development of the first high-volume digital instrument panel for PSA was also completed. For vehicle interiors, components were developed for Fiat customers (the new Lancia Ypsilon, Ducato and Iveco Daily), as well as the interior control unit for the new Palio in Brazil. In the telematics area, development focused on a navigator for BMW and the hands-free module (HFM) for Chrysler.

Exhaust Systems
-Innovation focused on reductions in CO2 emissions and emissions from diesel engines and development of a racing sound.

Plastic Components and Modules
-Product innovation included development and production of a new polyethylene fuel tank, which will reduce hydrocarbon emissions and limit evaporative emissions in the event of increased use of biofuels. First application of this technology will be on the new Lancia Ypsilon and the new Panda.

Capital Expenditure

(in millions Euros)

	FY2010	FY2009	FY2008
Overall	383	356	474

Investments Outside Italy

-The Company inaugurated a new plant in Russia for the production of automobile headlamps, rear lamps, and fog lights. This facilities are located near the city of Ryazan, 200 km south-east of Moscow, and cover a total surface of 5600 square meters. When fully operational, the plant will be able to produce approximately 2 million pieces a year with a workforce of 200 people. Production will be aimed at both local manufacturers (Autovaz, Gaz, Sollers) and international carmakers (Renault, Volkswagen, Ford etc.) operating in Russia. Back in 1995, the company opened another automotive lighting manufacturing plant in Ryazan. (From a press release on November 12, 2010)

-SAIC Magneti Marelli Powertrain Co. Ltd. (SMMP) of China inaugurated a production plant in Shanghai. The new plant will manufacture hydraulic components, which will be integrated into the electronic control unit of the Magneti Marelli system, are intended for Freechoice(TM) Automated Manual Transmission (AMT). The parts for approximately 300 thousand AMTs will be produced a year. The location will be equipped with its own research & development center. SMMP is a joint venture between Magneti Marelli and Shanghai Automotive Transmission Co., Ltd., a subsidiary of SAIC. (From a press release on June 9, 2010)