Recent Years

Contracts

Mazda
-In April 2010, the Company was awarded a contract to supply compressors and engine cooling modules to Mazda.

Volkswagen
-The Company has won a program business from Volkswagen to supply air conditioners. Its products will be mounted on a new compact model to be assembled in Central Europe. Halla will develop and produce these air conditioners at Halla Climate Control Slovakia s.r.o (HCCS) in Slovakia. HCCS is a wholly owned subsidiary of Halla Climate Control since December 2008. (From a press release on August 13, 2009)

Ford
-Halla Climate Control Slovakia s.r.o (HCCS) of slovakia won a program business from Ford to supply radiators and condensers. Shipment of the product started in April 2009. During 2009, the company is supplying products for 450,000 vehicles to its customers including Ford, Volvo, Fiat, and Jaguar. Supply volume for heat exchangers is expected to reach 1.78 million units by 2012. (From a press release on May 14, 2009)

Hyundai
-The Company announced that it and Hyundai Motor have signed an agreement for it to supply air conditioning systems to Hyundai for installation on the successor model to the Grandeur TG (development code: HG), which will be launched in August 2010. Halla Climate is forecasting that the volume of systems it will supply will reach 170,000 a year. (From a press release on June 13, 2008)

Chrysler
-The Company has started shipping its RSKK compressors to Chrysler for use in the Jeep Liberty and Dodge Durang. The total amount of compressors to be delivered annually is expected to reach 180,000. (From a press release on May 23, 2008)

-The Company won a supply award to provide compressors for use in the Phoenix V6 engines, which will become the mainstream Chrysler engines designed for the next generation. Over a period of six years starting from 2009, it will manufacture 2.5 million compressors for car models such as the Dodge Durango, Charger, Jeep Grand Cherokee, and Chrysler 300. (From a press release on November 5, 2007)

Subsidiaries and affiliates

<China>
-In December 2009, the Company established Halla Climate Control (Jinan) Co., Ltd.(HCC Jinan) in Shandong, China. The new company is invested 91.0 percent by the Company, and the remaining 9.0 percent by Jinan Luhu Automotive Parts Co., Ltd.

-The Company established Halla Climate Control (Shanghai) Technology in Shanghai, China. The new company will function as a hub to conduct sales, R&D, and procurement activities. (From a press release on July 14, 2008)

-Halla Climate Control (Dalian) Co., Ltd. (HCC Dalian) has celebrated the completion of its new compressor plant in Dalian, China. HCC Dalian was established jointly by the Company (60 percent) and Visteon (40 percent). The joint venture company is the Company's second Chinese manufacturing facility, following Visteon Climate Control Beijing Corp. created in November 2002. The 82,640 square-meter-facility employs some 300 workers, and manufactures products for passenger models and SUVs made by Beijing Hyundai Motor Company (BHMC) as well as passenger cars built by Changan Ford. (From a press release by the company on May 23, 2006)

<Slovakia>
-The Company established Halla Climate Control Slovakia s.r.o. in Slovakia to manufacture and sell automotive climate control systems. (From a press release on July 23, 2007)

Production
-Ulsan Plant has produced its 3 millionth front-end module system on December 30, 2008. Production of the module systems began in 2002. (From a press release on January 14, 2009)

Awards
-In June 2010, Halla Climate Systems Alabama Corp. (HCSA) of the U.S.A. was awarded a Five-Star Rating for Quality from the Hyundai Kia Automotive Group. (From a press release on July 26, 2010)

-The Company's Overseas Division earned the Best Supplier Award for 2009 from the Hyundai Kia Automotive Group. (From a press release on March 1, 2010)

-Halla Climate Control Dalian Co., Ltd., which is Halla Climate Control Corporation's Chinese subsidiary, received the Excellent Supplier Award for 2009 from Anhui Jianghuai Yangtian Automobile Co.,Ltd. (JAC). (From a press release on March 1, 2010)

R&D Structure

-The Company conducts R&D activities at an R&D center established in 1989.

-The Company develops technologies and products for Visteon group companies in Asia and Pacific through technical cooperation and joint development with Visteon, its parent company.

-The company has opened a testing laboratory in Shanghai, China. The laboratory develops air conditioning systems. Visteon and HCC have seven manufacturing facilities in China. (From a press release on March 2, 2009)

R&D Expenditure

(in millions of won)

	FY ended Dec. 31, 2010
Amount	64,784
% of sales	3.6%

R&D Activities

-Korea's Ministry of Knowledge Economy announced that it will invest over the next year or two approximately 155 billion won in several growth areas. In the area of LED technology, Hyundai Mobis will collaborate with Samsung LED and other companies to develop LED headlamps. Development of green cars will be led by Daesung Electric Co., Ltd.; Hyundai Mobis; Korea Electric Terminal Co., Ltd.; and Daewon Kangup Co., Ltd., which will work on the development and commercialization of major components. Application studies on renewable energy will be carried out by Halla Climate Control Corp.; Inzi Controls Co., Ltd.; Sejong Industrial Co., Ltd.; and the Namyang Research Center of Hyundai Motor. Hyundai Motor, Hyundai Autonet, Samsung Electric will develop semiconductors for next-generation vehicles. These projects are planned to be completed by the middle of 2010. (From a press release on July 8, 2009)

-The Ministry of Knowledge Economy of Korea announced that it has implemented eight strategic tasks in the area of renewable energy. One strategy is to commercialize polymer electrolyte fuel cells for transportation vehicles. The project will be lead by Hyundai Motor, with several other companies including Daewon Kangup Co., Ltd., Halla Climate Control Corp., and Sejong Industrial Co., Ltd. joining to develop this technology. Over the next three years, the ministry will invest 14.9 billion won and the private sector will invest 13.6 billion won in the project. (From a press release on December 9, 2008)

-The Company received the 2007 Automotive News PACE Award for its wave type cooling fan, becoming the first Asian HVAC manufacturer to win the award given by the U.S. company. 

Recent Achievements in R&D

Product	Achievements
Auxiliary heating systems	-Improved performance of heating systems -Enhanced user comfort -Prolonged engine lives by rapidly warming cooling water to the temperature at which the engine operates properly -The technology is used as a practical business solution especially in diesel engine vehicles. -The company has been acquiring and currently is applying for a number of patents in and outside Korea
Variable displacement swash plate compressors for A/C	-Enhanced temperature control performance -Improved user comfort (reduced the frequency of engagement/disengagement of the clutch) -Reduced the loss of engine power -Prolonged engine lives -Mass production system introduced since 2004 -The company has been acquiring and currently is applying for a number of patents in and outside Korea
Front-end modules	-Increased sales by supplying modules rather than parts -Reduced development costs of automakers -Innovated new car assembly lines -Mass production system introduced since 2002
Compact evaporators	-Developed smaller and lighter evaporators -Expanded space in the vehicle -Acquired technology to develop more compact air conditioner systems -Achieved cost savings by reducing raw materials -Introduced in mass production since 2003 -The company has been acquiring and currently is applying for a number of patents in and outside Korea
Thin condensers	-Developed smaller and lighter condensers -Expanded space in the vehicle -Acquired technology to develop more compact air conditioner systems -Reduced coolant consumption -Mass production introduced since 2003 -The company currently is applying for a number of patents in and outside Korea
Wave type cooling fans	-Low noise -Mass production introduced since 2003 -Has been acquiring and currently applying for a number of patents in and outside Korea -Received the U.S. Automotive News PACE Award in 2007
Large capacity compressors	-Established lineup of HS compressor by developing a 2,000cc class compressor to cope with small to large vehicles -Introduced for luxury models of automakers in Korea and overseas since 2005 -The company has been acquiring and currently is applying for a number of patents in and outside Korea
Clutchless pulleys	-Improved gas mileage by reducing weight -Improved riding comfort by reducing clutch noise -Mass production introduced since 2008 -The company is currently applying for a number of patents for these pulleys in and outside Korea
Intercoolers	-Developed environmentally friendly products compliant with Euro III and IV -Mass production introduced since 2004 -The technology is increasingly used in vehicles sold in Korea and Europe -The company is currently applying for a number of patents for these systems in and outside Korea
A/C System for hybrid vehicles	-Developed technologies to reduce engine power; developed highly efficient systems and parts -Mass production introduced since 2005 -The company has acquired and currently is applying for a number of patents in and outside Korea
Technologies to reduce odor of automotive A/C	-Developed coating fluid that minimizes the attachment of odor on the surface of an evaporator and has excellent corrosion resistance -Mass production introduced since 2006 -The company has been acquiring and currently is applying for a number of patents in and outside Korea
Injection molded plastic technology using Mucell crafting technique	-Improved gas mileage and reduced weight by developing lighter and stronger plastic by applying hollow injection molding technology -Mass production introduced since 2006 -The company is currently applying for a number of patents for this technology in and outside Korea
Automatic windshield defoggers	-An automatic fog detection and prevention system for windshields -Enhanced driving safety and comfort -Has been in mass-production since 2008 -The company is currently applying for a number of patents for these defoggers in and outside Korea
Refrigerant leak evaluation systems	-In January 2008, the Company's refrigerant leak evaluation systems for car air conditioning systems were certified by the EU authorities
RS compressors	-The company optimized this compressor's product packaging by eliminating the use of intake valves -Improved air conditioning efficiency and fuel economy -Has been in mass-production since 2008 -The company is currently applying for a number of patents for these compressors in and outside Korea
Cluster Ionizer	-The Cluster Ionizer with deodorizing and antibacterial effects reduces evaporator odor to enhance air quality in the cabin -Has been in mass-production since 2009 -The company has been acquiring and currently is applying for a number of patents in and outside Korea
Laminated oil coolers	-Developed high-performance transmission cooling systems, which expanded and enhanced the Company's product line -Has been in mass-production since 2009 The company has been acquiring and currently is applying for a number of patents in and outside Korea
Clutchless variable compressors	-Improved vehicle fuel efficiency -Has been in mass-production since 2009 -The company is currently applying for a number of patents in and outside Korea
Clutches with aluminum field coils	-Replaced copper coils with aluminum coils to develop lighter and more fuel efficient products -Has been in mass-production since 2009 -The company is currently applying for a number of patents in and outside Korea
Double-pipe heat exchangers	-Improved the efficiency and performance of air conditioner systems -Has been in mass-production since 2010 -The company has been acquiring and currently is applying for a number of patents in and outside Korea
Electric compressors	-Added electric compressors to its product lineup to respond to the growing hybrid and electric vehicle market -Has been in mass-production since 2010 -The company has been acquiring and currently is applying for a number of patents in and outside Korea
Oil warmers and coolers for automatic transmissions	-Improved efficiency of transmissions and gas mileage -Has been in mass-production since 2011 -The company has been acquiring and currently is applying for a number of patents in and outside Korea
High voltage PWM PTC heaters	-For electric vehicles -Has been in mass-production since 2011 -The company has been acquiring and currently is applying for a number of patents in and outside Korea
Air-conditioning load reduction system using CO2 sensors	-Air circulation control systems using CO2 sensors -Improved fuel efficiency; and enhanced cooling, heating, dehumidification and ventilation performances -The company has been acquiring and currently is applying for a number of patents in and outside Korea
Compact HVAC	-Plans to start mass production -The company has been acquiring and currently is applying for a number of patents in and outside Korea
Air delivery system for fuel cell vehicle	-Plans to start mass production -The company has been acquiring and currently is applying for a number of patents in and outside Korea
Front end module with pedestrian protection	-Plans to start mass production -The company has been acquiring and currently is applying for a number of patents in and outside Korea
Design of high voltage fan and inverter for fuel cell vehicle	-Plans to start mass production -The company has been acquiring and currently is applying for a number of patents in and outside Korea
Heat pump system for EV	-Plans to start mass production -The company has been acquiring and currently is applying for a number of patents in and outside Korea