Financial overview

(in million euros)

	FY2010	FY2009	Rate of Change(%)	Factors
Overall
Sales	47,259	38,174	23.8	-
Profit after tax	2,489	(1,214)	-	-
Automotive Technology
Sales	28,097	21,716	29.4	+Positive market developments such as China and India.

Factors
1)　Sales of Automotive Technology business
-Sales in the Automotive Technology business sector increased by 29% to 28.1 billion euros (24 percent after adjusting for currency effects.). Despite the sale of its foundation brakes business in North America*, the sector has already nearly returned to the pre-crisis level of 2007. During the first six months, the business sector achieved growth of some 40 percent year on year, while growth slowed during the second half of the year.
*Sold its North American foundation brake business to Akebono.

-The Company were able to expand its market share and further extend its position in the particularly strong Asian market. For the first time, the share of Automotive Technology sales generated in Asia Pacific reached 28 percent (previous year: 24 percent).
-In terms of its product line, the Company benefited from rising demand for products that help improve energy efficiency, safety and comfort. This applies in particular to gasoline direct injection, start-stop systems, and electric power steering. The demand for active safety systems also increased. The diesel systems division, which had been particularly badly affected by the crisis in 2009, recovered significantly. An upturn in the number of diesel powered vehicles among new car registrations in western Europe had a positive impact. The green shoots of recovery in the commercial vehicles market also provided additional momentum for the division. The situation facing the Chassis systems brakes division remained difficult.

Moves to Electromobility

HEV/EV systems
-The Company recognizes that electromobility has a promising future for individual transportation over the long term. Therefore, it invest some 400 million euros annually in the business field working on powertrain electrification and developing systems solutions for hybrid and EV.
In 2010, the Company started series production of a parallel full hybrid in two premium models, VW Touareg and Porsche Cayenne S. Starting in 2011, the Company will also start series production of power electronics and electric motors for PSA's diesel hybrids with electric four wheel drive.

Batteries
-The Company made a joint venture with Samsung SDI in 2008. This joint venture, SB LiMotive Ltd. was awarded the contract to supply lithium-ion battery packs for the Fiat 500EV which will be launched in the U.S. market in 2012 and for BMW's all electric "Megacity Vehicle". In November 2010, the joint venture started series production in Ulsan, Korea.

<About SB LiMotive Ltd.>
-A 50:50 joint venture, two companies plan to jointly invest approx. 500 million USD in the venture by 2013.
-Planning to boost annual cell production capacity to a level which is enough for 20,000 EVs by 2012.
-Facilities
1.  Stuttgart, Germany; Development of battery packs and systems
2.  Ulsan, Korea; Manufacturing of Lithium-ion battery cells/Annual production capacity: 20,000 EVs by 2012, 180,000 EVs by 2015.
3.  Orion, Michigan, USA; Development of battery packs and systems (Previous Cobasys) 
4.  Springboro, Ohio, USA: Manufacturing of battery packs and systems.(Previous Cobasys)

Pilot project
-Its subsidiary Innovations Software Technology GmbH was appointed by Electric Vehicle (EV) Taskforce, the inter-agency of Singapore, to design, develop, deploy, operate and maintain Singapore's EV charging infrastructure. Bosch will deploy 25 normal charging solutions (full charge within 8 hours) and 1 quick charging station (full charge within 45 minutes). The charging stations will cater to the first batch of the Mitsubishi i-MiEVs, which are scheduled to arrive in March 2010. Singapore will be the first location outside of Germany for Bosch to test out this infrastructure solution. (From a press release on October 8, 2010)

Existing technologies

-The Company thinks Internal combustion engines will remain the dominant drive system in passenger cars for at least another 20 years, and commercial vehicles for much longer.

-The Company plans to expand sales of the gasoline direct injection system to double the current global market share of around 25 percent in terms of sales value to 50 percent in 2012. The Company will absorb needs of automakers especially in Europe where engine downsizing is being adopted widely.

-Bosch Mahle Turbo Systems received the first orders for exhaust gas turbochargers. The turbo technology will be applied in a gasoline downsizing engine and a common-rail diesel engine. Bosch Mahle Turbo Systems holds the development location in Stuttgart (Germany) as well as the production locations in Blaichach/Immenstadt (Germany) and St. Michael (Austria). Currently, turbocharger systems for engines in passenger cars and light commercial vehicles are being developed. The company plans to start production for the approximately one million turbochargers per year at the end of 2011. (From a press release on March 29 2010)

Emerging market

-The Company has developed a new airbag control unit "AB light". This control unit is designed for low-price vehicles, which are rapidly increasing in emerging markets such as China, India, and Brazil. Series production has already started in Suzhou, Jiangsu Province, China, for Dongfeng Motor Corporation models. The unit's standardized design and the use of internally developed application-specific integrated circuits (ASICs) enabled Bosch to reduce the number of components and the overall size. (From a press release on June 22, 2010)

-The Company will start series production of the New Baseline Generators in Changsha, Hunan Province, China, in mid-2010 for Geely, First Automotive Works (FAW), and Volkswagen. The generators are designed for low-price small vehicles. Production has been underway in Brazil and India since 2008 and 2009 respectively. The Company also plans to produce the New Baseline Generators in South Africa and Europe. (From a press release on August 4, 2010)

R&D Expenditure

(in million euros)

	FY2010	FY2009	FY2008
Overall	3,810	3,603	3,889
Automotive Technology	3,004	2,862	3,250

-The Company plans to gradually decrease its proportion of total sales, currently the 10% level, to around 7% by 2012. It will work on streamlining R&D operations to reduce the cost, which is expected to strengthen its financial and business position. (From an article in the Nikkan Jidosha Shimbun on January. 29, 2010)

R&D Structure

-Around the world, the Company has more than 34,000 research and development associates. (as at the end of 2010)

R&D Facilities

	Location	Activities
Regional centers	U.S., Russia, Singapore, China, Japan	-Monitor local trends and analyze market opportunities.

-The Company completed the vehicle proving ground enlargement at the Bosch Technical Center Memanbetsu (TCM) in Hokkaido, Japan. With an investment of 3.1 billion yen, the proving ground was extended to 63 hectares – thereby doubling its size. Since its opening in 1992 the total investment in the TCM amounts to 8.3 billion yen. The enlarged test course is now equipped with a dynamic driving area which is counting a diameter of 300m, an 800 m long 4-lane straight track, and a new emergency escape area. Bosch will additionally invest one billion yen in order to build up a handling course and an oval circuit until 2013. The company has also completed the expansion of the Yokohama development center in June 2010 with an investment of 4.3 billion yen. (From a press release on November 16, 2010)

Product Development

 Energy Efficiency
Ultra high pressure diesel fuel injection system
The Company will develop an ultra high-pressure diesel fuel injection system for heavy-duty vehicles, targeting injection pressures higher than 2,500 bar. The company is already working on its plan to launch a new system with injection pressure as high as 2,500 bar (an increase of approximately 15 percent from its existing products) at the end of 2011. As a move towards cleaner exhaust gases and improved fuel economy (for fewer emissions) is expected to accelerate in the medium term, the Company has decided it is vital to develop a further advanced system to support vehicle manufacturers' efforts to comply with strict environmental regulations. Bosch has already manufactured and tested a prototype of a new system that achieves 3,000 bar in injection pressure. After studying the result of the experiment, it aims to turn the technology into a practical business solution as early as possible. (From an article in the Nikkan Jidosha Shimbun on March. 31, 2010)

Denoxtronic 2.2
The Company developed "Denoxtronic 2.2", a new exhaust-gas aftertreatment system for commercial vehicles with diesel engines. Denoxtronic 2.2 works together with a SCR (Selective Catalytic Reduction) converter to lower nitrogen-oxide emissions by up to 95 percent. The system will thus help commercial vehicle manufacturers meet the emissions targets in the standards EPA 2007, EPA2010, Tier 4 and Euro 6. (From a press release on August 16, 2010)

Active Safety
Predictive emergency braking system
The Company announced that its predictive emergency braking system (PEBS) will go into series production. With recognition of the frontal environment of driving vehicles using radar and video sensor, the system provides support for drivers in critical situations in which there is the threat of a rear-end collision. The PEBS will be featured for the first time in the new Audi A8.  (From a press release on April 27, 2010)

Comfort
New head unit
The Company developed a new 8-inch touch-screen head unit with the Dual View display feature, which will be first introduced onto the market in the new Jaguar XJ. Dual View can show two different programs on a single monitor. (From a press release on May 5, 2010)

Capital Expenditure

(in million euros)

	FY2010	FY2009	FY2008
Overall	2,379	1,892	3,276
Automotive Technology	1,556	1,165	2,195

Investments in Germany

-The Company announced that its eight-inch wafer fabrication facility at the Reutlingen location in Germany will go into operation in March 2010. At 600 million euros, this is the biggest single investment in the Group. The wafer fab will manufacture semiconductors and micromechanical chips mainly for the automotive industry. (From a press release on March 16, 2010)

Investments outside Germany

<Turkey>
-The Company announced its plan to make an additional investment of almost 500 million euros in its Turkish operations by the end of 2013. Since Bosch opened its first manufacturing site in Turkey in 1973, the company has invested 1.4 billion euros in the country. The new investment will be used to expand production and development, in particular for diesel- and gasoline-injection technology. In 2010, Bosch Group sales in the Turkish market are expected to increase to 750 million euros from around 630 million euros in 2009. If all exports are included, the sales of the Bosch companies in Turkey will come to 1.6 billion euros in 2010. The workforce in Turkey is expected to reach some 10,000 in 2013, compared to the company's current headcount of some 8,700. (From a press release on September 24, 2010)

<U.S.>
-Robert Bosch LLC announced the company's plan to expand its facility in Dorchester Country, South Carolina, U.S.. The company will invest approximately 125 million USD in the facility in Dorchester Country and expect to create approximately 300 new jobs over the next five years. The Company will add equipment to support production of its passenger car diesel and gasoline fuel injectors, and next generation anti-lock brake and electronic stability control systems for the North American automotive market. (From a press release on December 3, 2010)