BLASCO IBÁÑEZ, Vicente (1867-1928)

6.1 billion Euros, and profits increased slightly to 295 million Euros. New plants

and joint ventures in China, the U.S., Great Britain and Germany, as well as

acquisitions and the formation of new companies, strengthened the global

network as a system partner and full-service supplier. The technological

successes paid off in the market. Out of a total of about 40,000 employees,

over 71% work abroad.

pro forma

1998/1999 1998/1999 1999/2000

Order intake Million Euros 5,115 4,770 6,112

Sales Million Euros 5,208 4,863 6,108

EBITDA Million Euros 590 555 648

Income1)

Million Euros 291 275 295

Employees (09/30) 37,594 37,594 39,920

1)_{before income taxes and minority interest} AUTOMOTIVE SEGMENT IN FIGURES

Segments Automotive

8 3

Increased sales in all businesses

In major markets, our customers, the international automobile companies, sold more vehicles in 1999/2000 than in the previous year; this also provided us with good business. In the U.S., in particular, sport utility vehicles were produced in record numbers, while demand for heavy trucks declined. In Brazil, the automobile market recovered after the market slump of the previous year. Demand for the products of ThyssenKrupp Automotive remained also high in Europe. Our technical innovations proved particularly popular.

Body: 21% more sales

The Body business unit was able to increase sales by 21% to 1.5 billion Euros. The growth was achieved primarily in the U.S., where The Budd Company supplied body components, such as doors, engine hoods or side panels, made from steel or SMC plastic for the popular sport utility vehicles. But the European companies also posted an increase after production of the new Ford Transit picked up speed. In addition, there was the successful market introduction of safety-relevant components made from high-strength steels.

Budd received several major orders mainly from American auto manufacturers for the delivery of body parts for various automobile models and commercial vehicles. TKA Body Stampings in Great Britain, in particular, gained new orders from Toyota for steel body sheet parts. The Brackwede plant in Bielefeld further expanded its market share with high-strength side impact beams for new automobile models.

Chassis: In the fast lane

In the last fiscal year, the Chassis business unit had sales of nearly 2.3 billion Euros, an increase of 23%. The product program of components and subassemblies for chassis and suspension continued to assert itself in the market; we are among the market leaders in the new technology of hydroforming. The new plants in Tell City, Indiana, and Hopkinsville, Kentucky, in the U.S. have fully commenced production. In addition, there are the sales of the newly acquired aluminum foundry Stahl Specialty with sites in Kingsville,Texas, and Warrensburg, Missouri. The European companies were able to keep their sales at the level of the previous year in spite of numerous model phaseouts.

Germany 24% Rest of Europe 17%

South America 6% NAFTA 53% AUTOMOTIVE SALES BY REGION 1999/2000

New orders further solidified the market position. Waupaca Foundry will manufacture chassis components for the “Big Three” and automotive suppliers such as Bosch and American Axle. Budd will also supply Ford with chassis components for a complete midclass platform. Krupp Fabco also received major orders, mainly from Ford. The two English plants of TKA Chassis Products will equip new Nissan, VW, Porsche and Ford vehicles with components. Kloth Senking was awarded an order for aluminum components for a VW platform.

Powertrain: Higher RPMs

The Powertrain business unit achieved sales growth of 17% to 1.5 billion Euros. Above all, the results of the foreign subsidiaries contributed to this. In Brazil, the sales for crankshafts were 49% above the previous year’s value. The sales increase in the steering mechanisms/camshafts/coldforming product field was 27%. Demand declined in the case of turbine parts for aviation.

In 1999/2000, we were able to further expand our leading position in the world market for forged and cast crankshafts. Nearly all of the substantial orders were gained by Krupp Gerlach and Krupp Metalúrgica Campo Limpo. Krupp Presta also expanded its significant market position in respect of camshafts. New orders were received from Ford/Volvo and the VW Group. A similar result applies to the product field of steering mechanisms. Two new midclass models by VW and Ford which are going into production worldwide will be equipped exclusively with steering mechanisms from the plants of Krupp Presta. Our precision forged parts are used for new transmissions and differentials of DaimlerChrysler, VW, MAN and GM/Saab.

Systems/Suspensions: Excellent order situation

At 889 million Euros, the Systems/Suspensions business unit achieved 7% higher sales with axles, ve- hicle springs and stabilizers. The Systems Engineering product field, which manufactures innovative air springs and shock absorber units, did particularly well. Products of Systems Engineering are used, for

pro forma 1998/1999 1998/1999 1999/2000 Body 1,198 1,119 1,454 Chassis 1,826 1,705 2,255 Powertrain 1,316 1,228 1,538 Systems/Suspensions 834 779 889 Total 5,174 4,831 6,136 Consolidation 34 32 (28) Automotive 5,208 4,863 6,108 AUTOMOTIVE SALES Million Euros

Segments Automotive

8 5

Systems capabilities secure the future

example, in the Porsche Boxster, Smart MCC and Landrover models, as well as in S class vehicles by DaimlerChrysler. With its outstanding hydroforming and space frame technology, Krupp Drauz succeeded in winning attractive new orders.

Our order situation is excellent: Krupp Automotive Systems booked new orders for air spring systems and truck cab suspensions. Ford and VW are having modules and complete systems mounted. The complete axles for the new sport utility vehicle by Porsche will come from ThyssenKrupp

Automotive. The plan is to install shock absorbers and McPherson strut units by Krupp Bilstein in new models by DaimlerChrysler and General Motors. Krupp Hoesch Federn was also highly successful; springs and stabilizers manufactured there are now being used in new models of all reputable vehicle manufacturers.

More engineering and electronics competence

The goal of the newly formed company ThyssenKrupp Automotive Mechatronics is to develop and produce innovative subassemblies for active suspension systems and steering systems. In this connection, the plan is to use electronics know-how which ThyssenKrupp has gained in the development of Transrapid maglev technology. The complex and extremely fast regulatory electronics, which have already proven themselves in magnetic high-speed railways, can promote the development of innovative products at ThyssenKrupp Automotive.

Expansion of system competence

In the reporting period, the companies in the segment were able to expand market, cost and technology leadership for its core products. Technological trends toward more powerful components, the increasing use of alternative materials and the installation of electrical/electronics instead of mechanics characterize the challenges for ThyssenKrupp Automotive as one of the leading system providers of the international automobile industry. In addition to the expansion of design and engineering activities as well as system capabilities in the direction of electronics, the segment has expanded its capacities with regard to cast iron, aluminum casting, crankshafts, camshafts and stampings and rounded out its product program. A contribution to this is made by the newly formed company BV Chassis Systems, a joint venture of Budd [51%] and Visteon [49%], which manufactures the complete axle module.

Growth in South America and Asia

While automobile production in the industrial countries will increase only slightly in the future, automo- bile manufacturers in South America and Asia can expect considerable growth in the future. The enor- mous need to catch up and the rising purchasing power will drive demand for vehicles. ThyssenKrupp Automotive therefore intends to expand its presence in both of these world regions by means of capital investments. We want to be active as a supplier on-site; customer proximity is important for flexibility in production and comprehensive service. In Brazil, we are already an important local supplier. In China as well, our joint venture Krupp Presta HuiZhong Automotive Shanghai is building a good starting-position.

Production of truck cab suspension systems