Financial Overview

(in million dollars)

	FY2011	FY2010	Rate of change (%)	Factors
Overall
Sales	16,041	13,817	16.1	1)
EBITDA	2,119	1,361	55.7	-

Factors
1) Sales
-Sales in 2011 increased by 16.1% to 16,041 dollars year-on-year.

-The increase in total sales resulted primarily from increased volume as a result of improved OEM production schedules in 2011 as well as the level of its content per unit, and to a lesser extent, the impacts of foreign currency exchange rate fluctuations primarily related to the Euro.

-The decrease of 120 million dollars in sales was due to the divestitures of several business to Autoliv during 2010.

Contracts

-The Company announced that its high-pressure common rail systems are featured in the Green-Quiet 2.0T diesel engine, which powers the Great Wall Motors "Wingle". The Wingle was introduced by Great Wall Motors in Italy in June 2011. The Green-Quiet 2.0T also has been installed on Great Walls' "Haval H5" manual and automatic SUV. The Company's common rail system, provides 1,800 bar injection pressure and fuel injection up to seven times per engine cycle, includes the servo-solenoid injector, high-pressure fuel pump and control unit. The company has entered into an agreement with Great Wall Motors to jointly develop new diesel engines to meet future European emission standards. (From a press release on August 18 2011)

-The Company is supplying electronically scanning radar (ESR) for the Ford "Focus" in Europe. Enabling Adaptive Cruise Control with Forward Alert, the Company's ESR is helping keep drivers in a wider range of vehicle segments safer. Its long-range coverage provides accurate range and speed data with effective object discrimination to enable audible driver warnings when there is potential for a collision. The Company's electronically scanning radar is available on multiple full- and mid-sized vehicles in Europe, the U.S. and Asia. (From a press release on June 27, 2011)

-The Company provides electronically the Adaptive Cruise Control (ACC) system with Collision Warning and Brake Support, to 2011 Ford "Explorer". The ACC system was jointly developed by Ford and the Company. The 2011 Ford "Explorer" also features the Company's Passive Occupant Detection System (PODS). Delphi PODS classifies the occupant in the front passenger seat and sends a classification message to the airbag controller, so that deployment can be adapted based on the occupant's size. (From a press release on January 19, 2011)

-The Company's Connectivity Navigation Radio (CNR) platform is now available on Audi "A6" Sedan and "A7" Sportback. Also featured on the Audi "A6" and "A7" are the Company's security system, LED lighting control module and interior wire harness. (From a press release on January 10, 2011)

Business Partnership

-The Company and Great Wall Motors signed a strategic cooperation agreement. Under the agreement, based on the present electronic control systems, fuel pumps and other products, both sides will to carry out co-operation in the electrical and electronic structural systems, electronics and safety, powertrain and thermal systems. In addition, the companies also signed a letter of intent for both sides to jointly research and develop active safety and navigation products, which will be applied to the Great Wall Motors' future models. In 2005, the Company's electronic control system has been applied to the Great Wall Motors' 491QE gasoline engine. In 2010, the "Lvjing 2.0T" engine developed by the Great Wall Motors adopted the Company's electronic control high pressure common rail system. Following "Lvjing 2.0T" diesel-powered engine, in October 2010, the Great Wall Motors' another high-power gasoline engine GW4C20 was ignited, with Delphi's products. (From a press release on November 7, 2011)

Recent Development Outside USA

-The Company announced that its diesel plant in Miroslava, Romania, which began production in 2009, is now fully operational. The Miroslava plant produces diesel fuel injection components, mainly pumps and injectors, for common rail systems. The latest product in the plant production range is the Combined Valve Adaptor (CVA) that includes the control valve of the injector. To date, the Company has invested more than 155 million euros in production projects at the site. Worldwide, the group now operates sites dedicated to diesel engine management system activities, with a presence in France, Spain, the United Kingdom, Romania, Hungary, Turkey, Mexico, Brazil, India, Singapore and Korea. (From a press release on November 7, 2011)

Awards

-In2011, the Company received a "Certificate of Appreciation" from Nissan Motor Company for mitigating a wiring harness component parts shortage caused by floods in Thailand that interrupted a competitor's supply.

-In 2011, Volvo Cars honored the Company's ground-breaking Collision Avoidance Detection System with the "2011 Volvo Excellence Award in Technology".

Divestitures in 2010

-The Company divested several assets and businesses in line with the reorganization process.

<Transaction with Autoliv>
Occupant Protection Systems operations (Korea and China)
-In March 2010, the Company sold its Occupant Protection Systems (OPS) operations in Korea and China to Autoliv. Existing customers include Hyundai-Kia, Chery and Tata. (From a press release on January 28, 2010)

Pyrotechnic Safety Switch assets in Europe
-The Company announced that it will sell Pyrotechnic Safety Switch (PSS) assets in Europe serving customers such as Daimler, Audi and Porsche to Autoliv. In the event of an accident, the pyrotechnic safety switch (PSS) or "battery dis-connect" is activated by the deployment of the airbag. The PSS cuts (isolates) the battery from the vehicle starter and alternator, which helps prevent short circuits and reduces the likelihood of a resulting fire. Applications for electric and hybrid vehicles include crash protection of vehicle wiring circuits and associated battery storage systems. (From a press release on April 9, 2010)

Beijing Delphi Automotive Safety Products Co., Ltd.
-The Company sold its 51 percent share in the Chinese seatbelt maker Beijing Delphi Automotive Safety Products Co., Ltd. (BDS) to Autoliv. BDS is a joint venture between Delphi and the Chinese company Beijing Hainachuan Automotive Parts Co., Ltd. (BHAP). The joint venture started in 2008 and its main customers include Dongfeng Yueda Kia Motor Co. (DYKMC) and Beijing Hyundai Motor Co. (BHMC). (From a press release on October 19, 2010)

R&D Expenditure

(in billion USD)

	FY2011	FY2010	FY2009
Total	1.2	1.0	0.3

 

R&D Structure

-The Company employed over 17,000 scientists, engineers and technicians around the world.

-The Company holds has 15 major technical centers;

• North America: 5 facilities
• Europe, Middle East and Africa: 5 facilities
• Asia Pacific: 4 facilities
• South America: 1 facilities

-The Company has inaugurated a new laboratory area, where fuel pumps undergo durability testing in its Luxembourg site. The site has evolved as the company's technical center. The site also serves as the global headquarters of Delphi Powertrain Systems and the European headquarters of the company. The Luxembourg technical center specializes in design, development and testing of components and systems related to energy and engine management as well as heating, ventilation and air conditioning (HVAC), power electronics, as well as energy storage for hybrid and electric vehicles. The Company's technical center Luxembourg has provided technologies to many vehicles. Examples include Mercedes' and Volkswagen's application of Delphi's diesel common rail systems; BMW's use of Delphi's ignition and fuel systems; Delphi radiators featured on select Bentley models; and air conditioning systems on Ferrari. Key recent technologies developed at the Company's technical centre Luxembourg include Multec homogeneous GDi injector; HVAC systems, Charge Air Coolers and low-cost, high-power inverter. (From a press release on October 10, 2011)

R&D Activities

-The Company will cooperate with Sheetak Inc., which has been awarded a 4.7 million USD contract by the U.S. Department of Energy's Advanced Research Projects Agency-Energy (ARPA-E) to develop a thermal energy storage system for supplemental heating or cooling for electric vehicles (EV) and hybrid electric vehicles (HEV). The Company will partner with Sheetak to accelerate systems integration and commercialization in this project. Currently in development, the system will be light-weight and operate without the need for air conditioning refrigerant. The system will significantly reduce electrical power draw from batteries, thereby extending the fuel economy and driving range of electric and hybrid vehicles. Sheetak, based in the U.S., is a provider of solid state energy conversion technology to the refrigeration, HVAC, and power generation markets. (From a press release on December 7, 2011)

Product Development

<Electrical / Electronic Architecture>
Aluminum cable
-The Company announced that its Aluminum Cable offers a weight reduction of up to 48 percent compared to traditional copper core cable. Since approximately 227g of aluminum can replace 454g of copper, about 1.8kg can be trimmed from a typical vehicle. This technology will be on the road next year. (From a press release on August 25, 2011)

Low-cost, high power inverter
-The Company developed a low-cost, high power inverter. The Company's low-cost, high-power inverter incorporates power semiconductor packaging technology developed to help manufacturers offer vehicles that meet fuel economy and emissions regulations at a more affordable cost. The newly developed package enables higher current and power density which helps decrease the cost, size and weight of the inverter. (From a press release on May 4, 2011)

Electrical center
-The Company developed a new electrical center technology using micro-fuses for circuit protection. This solution helps to reduce packaging size by 30 percent. By using micro-fuses, which are 35 percent smaller than traditional mini-fuses, more circuits can be placed in a given area on the PCB, allowing the electrical center to accommodate more content and functionality. (From a press release on April 13, 2011)

<Powertrain Systems>
New diesel common rail (CR) system
-The Company's new diesel common rail (CR) system includes the solenoid-type diesel common rail injector technology with the Company's next generation DFP6 fuel pump. Increased focus has been placed on minimizing the FIE system mass to reduce engine and vehicle weight. The main contributor to the FIE mass reduction comes from the CR pump, which allows for a mass reduction of 40 percent over previous generation fuel systems. (From a press release on August 25, 2011)

GDi engine
-The Company announced that downsizing a naturally aspirated engine by 30 percent to a GDi engine reduces engine mass by 20-30kg. This lower engine mass leads to reductions of 1.0-1.5 percent in fuel consumption and 1.5-2.5g/km in CO2 emissions. The Company's GDi fuel system includes a high-pressure fuel pump, fuel rail and Multec multi-hole injectors. (From a press release on August 25, 2011)

Fuel injection system
-The Company announced it will present new developments in Multec fuel injection system at the Stuttgart International Symposium in Germany. The Multec injection system includes the recently developed DFP6-type high pressure pump, the fast servo-solenoid injector as well as a new ECU. The pump provides 2,000 bar maximum rail pressure. (From a press release on February 21, 2011)

<Electronic and Safety>
Connected solutions, which use an open architecture platform
-The Company announced that its MyFi family of connected solutions, which use an open architecture platform, offers implementation of features including Bluetooth, WiFi, and cellular connectivity, natural voice recognition, hands-free operation and audio streaming. Last year, the Company introduced its first MyFi system, the connected navigation radio (CNR), on the Audi "A1". The company announced that it will introduce new MyFi product over the next twelve months, that allow drivers to access smart phone apps housed on their personal phones, listen and reply to text messages, and utilize a navigation engine, all while keeping their eyes on the road and hands on the wheel. Further into the future MyFi systems will integrate active safety technology that can monitor lane departure, warn drivers of drowsiness or imminent collision, and manage information flow from infotainment applications. (From a press release on September 2, 2011)

RACam (integrated Radar and Camera System)
-The Company developed RACam (integrated Radar and Camera System), which combines electronically scanning radar (ESR), vision sensing in a single module. RACam enables a suite of active safety features including adaptive cruise control, lane departure warning, forward collision warning, low speed collision mitigation, and autonomous braking for pedestrians and vehicles. The new system is expected to be on the road in 2014. The Company's Rear and Side Detection System (RSDS) will help alert drivers of approaching vehicles that may be difficult to detect in side-view mirrors. RSDS is scheduled for production during 2012. (From a press release on August 26, 2011)

Electronically Scanning Radar (ESR)
-The Company announced that its electronically scanning radar (ESR) weighs 61 percent less than its predecessor. Once only found on larger-sized vehicles, this technology can now be found on compact-sized vehicles. (From a press release on August 25, 2011)

Ultra-Light Radio
-The Company is applying its weight-saving techniques to the frames and casings of electrical and electronic systems. Delphi's Ultra-Light Radio incorporates a plastic composite technology to save up to 0.54kg when compared with a conventional metal-case radio. This solution also eliminates up to 30 components. (From a press release on August 25, 2011)

Sound generators for electric, hybrid powered vehicles
-The Company, a leading U.S. auto parts supplier, announced that it has developed sound generators designed to warn pedestrians of approaching electric powered vehicles, including hybrids, which are otherwise nearly silent. The company has engineered two types of compact and lightweight high-fidelity electronic sounder systems that use less power than conventional systems. In addition, the new sounders can reproduce melodies within a certain frequency range, representing the identity of individual vehicle manufacturers. The technology will be featured initially on a European automaker's vehicle coming to the market in 2012. (From an article in the Nikkan Jidosha Shimbun on February 22, 2011)

<Thermal Systems>
Diavia City Bus HVAC system
-The Company developed a new Diavia City Bus HVAC system for city buses that keeps passengers comfortable while reducing energy consumption when compared to traditional external roof top bus units. The new system delivers uniformly-cooled air to passengers regardless of where they are sitting in the vehicle. Using compact, multiple units installed inside the bus, the system is ductless, modular and uses brushless motors to reduce unit noise. The new internal HVAC system will be available for installation by bus body builders and OEMs later this year. (From a press release on October 20, 2011)

New car air-conditioning system
-The Company has developed a new car air-conditioning system using a new environmentally friendly refrigerant with a plan to supply it to a European automaker this fall. It has used the R-1234yf, a refrigerant with less than 1/300 GWP (global warming potential) of conventional refrigerants, and the electronic variable compressor that has improved the fuel efficiency. In Europe, use of low GWP refrigerant is imposed on new car models from 2011. Delphi plans to win orders by taking advantage of the early launch of the new air-conditioning system in order to be competitive in the field. (From an article in the Nikkan Jidosha Shimbun on October 3, 2011)

Five cylinder compact variable compressor (5CVC)
-The Company developed a newly redesigned five cylinder compact variable compressor (5CVC) that is significantly lighter than its predecessor. With a die-cast aluminum shell, this compressor provides improved comfort, fuel economy and dehumidification. The Company's 5CVC will be on the road in 2014. (From a press release on August 25, 2011)

Front-End Cooling Module
-The Company announced that its Front-End Cooling Module, which combines the radiator, charge air cooler, condenser and fan-motor-shroud assembly, can provide a weight savings of 4 kg as well as reduce the electrical power consumption of the cooling fan by 350W. (From a press release on August 25, 2011)

12mm Folded Tube Condenser
-The Company has developed new 12mm Folded Tube Condenser, which uses a fabricated tube construction to provide reduced weight and improved performance in a package that is the thinnest available. Available in 2015, the new 12mm Folded Tube Condenser also supports the efficiency of new R-1234yf refrigerant systems. (From a press release on August 25, 2011)

Air conditioning system
-The Company will launch an air conditioning system which uses a new refrigerant R-1234yf. R-1234yf has a GWP of four compared to 1,430 for the current R-134a. It will be featured on a European vehicle set to be unveiled at IAA 2011. (From a press release on August 24, 2011)

E3 HVAC Seat for commercial vehicles
-The Company developed a new seat-based heating, ventilation and air conditioning (HVAC) system for commercial vehicles. The system is part of the E3 HVAC Seat, which combines Delphi's Diavia HVAC application capability with the Italy-based Cobo group's steering column, seat, lighting, electric and electronic devices. The E3 HVAC has a cooling capacity of 6.2 kW and a heating capacity of 5.8 kW. It can provide climate control for the cab only or for the cab and seat cushion by channeling air flow from the vents. By adjusting the vents, the operator can select the most comfortable cab temperature and keep the seat dry. (From a press release on March 23, 2011)

Capital Expenditure

(in million USD)

	FY2011	FY2010
Electrical / Electronic Architecture	219	202
Powertrain Systems	228	186
Electronic and Safety	100	59
Thermal Systems	70	35
Eliminations and Other	13	18
Total	630	500

Investment Outside USA

<Romania>
-The Company has opened a new manufacturing facility at Moldova Noua, Romania. The site will produce wiring harness modules for vehicle manufacturers across Europe. Employment at the new plant could potentially approach 1,000 by the end of the year. 1,400 square meters of the Moldova Noua facility was opened as part of the first phase of development. An additional 2,400 square meters of the facility will be opened in September 2011. The Company currently operates three plants in Romania: Sannicolau Mare, Moldova Noua and Ineu. The plants manufacture wiring harnesses and components for diesel common rail systems. (From a press release on June 7, 2011)