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Driving the Future of Mobility BofAML Global Industrials Conference 2018

Wolfgang Schaefer – CFO

Ticker: CONADR-Ticker: CTTAYTwitter: @Continental_IRhttp://www.continental-ir.com

Agenda

2

Electrification4 12

Corporation Highlights 2017 and Outlook 20181 3

Automotive Trends2 7

Key Enabler: Digitalization3 9

Automated Driving5 15

BofAML Global Industrials Conference 2018March 20-21, 2018

EDMR - Equity and Debt Market Relations

ContiTech – Smart Solutions beyond Rubber8 25

Holistic Connectivity6 19

Tires: No Disruption but Evolution7 22

Continental Strategy – Outlook 2020 and Beyond9 27

› Sales up by 8.5% to €44.0 bn ; organic sales growth at 8.1%; FX negative at €435 mn

› Adj. EBIT 1 up by 10.1% to €4.7 bn ; adj. EBIT1 margin at 10.9% (PPA2 -€171 mn and special effects -€14 mn)

› NIAT3 amounted to €3.0 bn, up by 6.5%

› Free cash flow amounted to €1.8 bn including €596 mn cash outflow for acquisitions (mainly Hornschuch and Argus); free cash flow before acquisitions amounted to €2.3 bn

› Gearing ratio down to 13%; equity ratio up to 44%

› Value creation: trailing ROCE 4 up slightly to 20.6%

› Other topics:

› Order intake: lifetime sales in the Automotive Group increased to almost €40 bn

› Dividend to increase by €0.25 to €4.505 for FY 2017

1) Corporation Highlights 2017 and Outlook 2018Most Important KPIs for FY 2017

1 Before amortization of intangibles from PPA, consolidation and special effects2 Amortization of intangibles from PPA3 Attributable to the shareholders of the parent4 Trailing ROCE is calculated as reported EBIT for the last twelve months (LTM) divided by average operating assets for the LTM5 Subject to approval of the Annual Shareholders’ Meeting (ASM) on April 27, 2018

3



9,56910,030

9,61810,016 9,851

10,191 9,98410,524

11,000 11,03310,693

11,284

1,0901,292

644

1,284 1,166 1,163 1,0901,329

Q1/15 Q2/15 Q3/15 Q4/15 Q1/16 Q2/16 Q3/16 Q4/16 Q1/17 Q2/17 Q3/17 Q4/17

Sales (€ mn) Adj. EBIT (€ mn)

1) Corporation Highlights 2017 and Outlook 2018Sales and Adjusted EBIT1 by Quarter

4

1 Before amortization of intangibles from PPA, consolidation and special effects

FY Sales €39,232 mn FY Sales €40,549 mnAdj. EBIT1 €4,310 mn

FY Sales €44,009 mnAdj. EBIT1 €4,747 mn

1



1) Corporation Highlights 2017 and Outlook 2018Market Outlook 2018

5

Commercial Vehicle 2 Production (k units)

Commercial Vehicle Replacement 3 Tire Market (mn units)

PC & LT1 Production (mn units)

PC & LT1 Replacement Tire Market (mn units)

Worldwide production to increase more than 1%

Worldwide production to decrease by 1%

Worldwide replace-ment tire market to increase by 3%

Worldwide replace-ment market to increase by 2%

IHS and own estimates

LMC and own estimates

IHS and own estimates

LMC and own estimates

2017E 2018E Chg.

Europe 22.1 22.5 +2%

North America 17.1 16.8 -2%

South America 3.3 3.6 +8%

Asia 51.5 52.5 +2%

2017E 2018E Chg.

Europe 660 673 +2%

North America 513 559 +9%

South America 102 112 +10%

Asia 2,140 2,033 -5%

2017E 2018E Chg.

Europe 351 358 +2%

North America 285 290 +2%

South America 73 76 +4%

Asia 453 475 +5%

2017E 2018E Chg.

Europe 25.3 25.8 +2%

North America 24.5 25.3 +3%

South America 15.7 16.4 +5%

Asia 89.2 91.0 +2%

1 Passenger car and light truck <6t2 Medium and heavy vehicles >6t3 Radial and bias



1) Corporation Highlights 2017 and Outlook 2018Continental Corporation Outlook 2018

6

2017 2018EConsolidated sales adj. EBIT1 margin

€44.0 bn10.9 %

To increase to ~€47 bn at constant FX rates ~10.5% adj. EBIT1 margin

Automotive Groupadj. EBIT1

€26.6 bn€2.2 bn

To increase to ~€28.5 bn at constant FX rates ~8.5% adj. EBIT1 margin

Rubber Groupadj. EBIT1

€17.5 bn€2.6 bn

To increase to ~€18.5 bn at constant FX rates ~15% adj. EBIT1 margin

Raw materials cost impact More than €450 mnfor the Rubber Group

Raw materials to burden Rubber Groupwith about €50 mn, based on current estimates

Special effects -€14 mn -€100 mn

Financial resultTax rate

-€187 mn at constant FX2

29%<-€180 mn at constant FX rates<30%

CapexPPA amortization

€2.9 bn€171 mn

Capex at around 7% of sales ~€180 mn

Free cash flow before acquisitions €2.3 bn ~€2 bn

1 Before amortization of intangibles from PPA, consolidation and special effects2 Before effects of currency translation and effects from changes in the fair value of derivative instruments and other valuation effects



› Revenue pool for suppliers reached more than €1 trnin 2017

› Business related to “established” business will grow by ~1% p.a. and reach ~€1.1 trn in 2025

› Revenues share of Electrification1, Automated Driving and Holistic Connectivity represented in total <3% in 2017

› Revenue share of Electrification1, Automated Driving and Holistic Connectivity will grow by ~30% p.a. to >€200 bn in 2025

› It will account for ~15% of the overall supplier revenue market by 2025

7



Sources: Roland Berger and Continental estimates. FX rate assumption 1.13 EUR/USD.1 Not including market for electric vehicle batteries but including hybrid solutions.

2) Automotive TrendsNew Business Opportunities Arise

0

250

500

750

1,000

1,250

1,500

2017 2025

New Business Opportunities

Established Business

30% p.a.

1% p.a.

Global Supplier Revenue Pool (bn €)

8

2) Automotive TrendsFour ACES1 Will Drive Our Growth

1) Four ACES: autonomous, connected, electrified and shared mobility2) Total Addressable Market 3) Not including market for batteries but hybrid solutions4) McKinsey estimates a market for digital services of US70$ - 110 billion in 2025;

FX rate assumption of 1.13 EUR/USD

ElectrificationAutomated Driving Holistic Connectivity

TAM2 in bn €3TAM2 in bn € TAM2 in bn €4

Shared MobilitySources: McKinsey and Continental estimates



9



3) Key Enabler: DigitalizationThe Most Digitalized Portfolio in The Supplier Sector1

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Competitor 10

Competitor 9

Competitor 8

Competitor 7

Competitor 6

Competitor 5

Competitor 4

Competitor 3

Competitor 2

Competitor 1

ContinentalAutomotive

Today: Electronics/Sensors/SW products as % of sales Continental 2025: Electronics/Sensors/SW products as % of sales

Source: Company filings and Continental estimates. 1 Suppliers >€3 bn sales.

10



3) Key Enabler: DigitalizationStrong Order Intake Drives Sustainable Growth…

Automotive Group: Strong Order Intake (bn €)

1 Lifetime Sales

1

23.6 24.526.6

28.5 >3030

35

40

2015 2016 2017 2018E 2019E 2020E 2021E 2022E

Automotive Group Sales Order Intake (LTS)

11



3) Key Enabler: Digitalization… but Causes Sustained High R&D and Capex

1,47

5

1,58

9

1,83

6

2,09

7

2,43

1

2,67

6

7.6%

7.9% 8.8%

8.9% 9.9%

10.1

%

2012

2013

2014

2015

2016

2017

2018

E

2019

E

2020

E

2021

E

2022

E

R&D expenditure (€ mn) R&D as percentage of sales

1,03

6

1,01

6

1,12

6

1,27

5

1,49

7

1,79

0

5.3%

5.1%

5.4%

5.4%

6.1% 6.7%

2012

2013

2014

2015

2016

2017

2018

E

2019

E

2020

E

2021

E

2022

E

Capex (€ mn) Capex ratio

Automotive Group R&D (€ mn) Automotive Group Capex (€ mn)

› Until 2025 the internal combustion engine (ICE) will be the most dominant force amongst the different propulsion types

› More variants of hybridization due to decline in Diesel

› Strong increase in pure Electric Vehicles after 2025

› Breakthrough in battery technology might accelerate scenario

12

4) ElectrificationElectrification of Engines: Estimated Development

Global PC & LT1 Production by Engine Type (mn units)

1 Passenger car and light truck <6t



13

4) ElectrificationRelative Value of Continental’s Content in Powertrains1



HEV-related business including extended offering

Gasoline-related business

Diesel-related business

BEV-related business including extended offering

100%1 160% 160-360% 400%› Engine management systems for

diesel piezo common-rail injection (injector, ECUs, pressure pumps)

› Exhaust aftertreatment› Sensors and actuators

› Engine management systems for solenoid direct injection (injector, ECU, pressure pumps)

› Exhaust aftertreatment› Sensors and actuators› Turbochargers

› Engine management systems (gasoline/diesel)

› Exhaust aftertreatment› Sensors and actuators› Turbochargers

and› 48V solutions (12kW/ 15kW/ 25kW)

or› Plug-in hybrid solutions (incl. thermal

components & charging systems)

› High-voltage axle drive› Power electronics› Onboard charging systems› Battery management systems› DC/DC converter› Thermal management

components

Well positioned in all key technologies!1 Value of displayed gasoline content per car is indexed at 100%; all other values read relative to the gasoline content.

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2014 2017 Sales 2017

Mechanics and hydraulics Electronics Electrification

14

4) ElectrificationPowertrain Division: Order Intake Confirms Shift to Electronics & Electrification



1 Order Intake as Lifetime Sales

Order Intake

€ 13.4 bn∑ € 7.7 bn∑

15

5) Automated DrivingMarket for Automated Driving: Estimated Development

15

L5L4L3L0-L2 Total Market

PC & LT1 production (mn units)

1 Passenger car and light truck <6t



16

5) Automated DrivingMarket for Automated Driving: Three-Layer Model

16



System

ElectronicsSoftware

Integration ~€7 bn

Environmental ModelSoftware

Electronics~€2 bn

Market for Automated Driving~€35 bn1 by 2025

ComponentsSensors~€26 bn

Cooperation/Joint Venture

ADCU

Recent Additions to the Portfolio

1 Source: Continental estimates

DIGILENS

HUAWEI easyMILE

BMW intel NTT docomo

HERE Baidu China unicom

17

5) Automated DrivingADAS Sensors per Car

17



1 Sources: https://www.bmwgroup.com/content/dam/bmw-group-websites/bmwgroup_com/ ir/technologie_workshops/Technology_Workshops_Autonomous_Driving.pdf https://www.gm.com/content/dam/gm/events/docs/5265893-685163-Chartset-11-30-2017

2 Continental estimates, depending on customers and future regulatory requirements.3 Ultrasonic not in Continental portfolio.

Short Range

Radar

Surround View

Ultrasonic3

Camera

3D Flash Lidar

Long Range

Radar

Sensors per car

Level 4/5Level 3Level 2

441

401

33-402

25-292

18-222

BMW

GM

Continental

System Manufacturers Component Suppliers

OI 2017: ~€3.5

bn

OI 2016:

€3.5 bn

Sales (€ mn)

Incl

. Ele

ktro

bit,

HM

I and

HuD

n/a n/a

~2,

500

OI 2016:

€0.4 bn

OI 2016:

€1.3 bn

18

5) Automated DrivingLeading Position of Continental in ADAS

18



1 Continental ADAS = Radar, Lidar, Camera and ADCUs, 2017 OI includes ADAS related CVAM business OI 2 Bosch PR May 4th, 2017; Bosch has not communicated any future ADAS sales target; Bosch includes ultrasonic in ADAS sensors; Bosch target is a 2019 target 3 Denso reports ADAS sales as part of “Information and safety systems”; Denso’s ADAS target 03/2021 looks for JPY 200 bn; sales are annualized4 Autoliv active safety products: radar systems, vision and night systems, active seatbelts and brake systems, dynamic spot light and system integration; 2020 target 5 Mobileye 2016 sales; company has the target to achieve 1.1 bn USD sales by 20196 Hella: according to Jeffries Research7 Delphi 2016 sales represent company communication from Q2 2016 and target to achieve 1 bn USD sales by 20198 Valeo reports sales for comfort and driving assist only. It includes rain, lighting and ultrasonic sensors in DA sales; it has no official target for future ADAS sales communicated9 ZF has not provided any sales data on its ADAS business

19



~10%

~20%

~40%

>1,000

~1,400~1,500

Estimated vehicle population (mn units)

6) Holistic ConnectivityRise of Connected Vehicles

20



6) Holistic ConnectivitySoftware Drives Architecture, Process and Organization

morethan 170 Sensors

Actuatorsmorethan 150

Yesterday Today

up to

ECUs

Classic ECU

Performance/Safety ECU

“small ECU”/Sensor/Actor

Virtualized Performance Controller

90 <10

morethan 200 Sensors

Actuatorsmorethan 150

Tomorrow

Only

High performancecomputers

Increasing Computing Power

› Increasing computing powerwill lead to an centralized E/E architecture

› Hardware will be separated from software – software integration capabilities are needed

› Security supporting approach by multilayered, end-to-end solutions and services required

21



6) Holistic ConnectivityCentral Processing Unit in a Server Based Architecture

1 EEA = Electric/Electronic architecture2 I/O = Input / Output

Automated driving

Electrification

Connectivity

New Mobility

010011000101010011

Digitalization

IoTInternet of Things

SW defined carMaster for Cyber Security, SW over-the-air updates and vehicle diagnosis.Elektrobit SW management and Argus cyber security solutions are essential elements.

› Automotive and cross industry trends require new approaches in EEA*

› Move towards structures known from IT industry

› The In-Vehicle server is a cornerstone of modern vehicle architectures

› The In-vehicle Server offers a HW/SW platform realizing individual use cases:

High performance computing unit. Predefined appli-cations as well as new 3rd party SW and service inte-gration.

Redistribution of application SW. Separation of I/O* logic from appli-cation function + application fusion across domains.

In-vehicle communication. Increasing demand of in-vehicle network bandwidth.

22

7) Tires: No Disruption but EvolutionFour ACES Will Reduce Costs per Mile Traveled

Shared Mobility

Automated Mobility

Electrification

Connectivity

› Higher utilization of car park› Lower cost per mile traveled

› Results in greater access to mobility

Better safety

Fuel efficiency

Economies of scale



23

7) Tires: No Disruption but EvolutionGreater Access to Mobility for a Growing World Population

Increased global mobilityGrowth of global population More miles traveled

World population Miles per captiva Global miles traveled

2015 2020 20252015 2020 2025

Sources: Continental, World Bank, Morgan Stanley, Roland Berger

2015 2020 20252015 2020 2025

2015 2020 2025

63%

37%43%

53%

47%57%

2015 2020 2025



24

7) Tires: No Disruption but EvolutionTires Division Strategy 2025: Globalize Growth (mn units)1



0

40

80

120

2010 2015 2025 target

∑120

∑142 ∑>200

2 1 3

› 2010-2025: Continental growth to outperform global market growth

› Strongest growth in APAC, followed by The Americas

› Improving Global sales split

The Americas

APAC

EMEA

1 Continental global production capacity of PC&LT and CV tires

25

8) ContiTech – Smart Solutions Beyond RubberRelevant Markets and Growth Opportunities

Σ~€82 bn

Σ~€60 bn

1 Benecke-Hornschuch Surface Group (incl. Elastomer Coatings from 1/2018)

3 Industrial Fluid Systems

4 Vibration Control

5 Power Transmission Group

6 Conveyor Belt Group

7 Air Spring Systems

2 Mobile Fluid Systems1

2

3

4

5

67

20252017

› Balanced portfolio of OE Automotive and Non-OE Automotive businesses

› Growth through volume and (added) value1 expansion of products

1 Additional sales driven by servitization and software



26

8) ContiTech – Smart Solutions Beyond RubberUnveiling the Power of Digitalization



› Advanced use of process data helps to improve asset efficiency, logistics and maintenance by facilitating operational excellence.

Servitization and smart Conveyer Belts

Added value through functional integration

of electronics and software 1

Highly automated operations

Automation and horizontal integration

Functional integration Lifecycle integration

1 Example for combination of our air springs with the sensor technology, software, control devices for height adjustment and Continental compressors

Value Creation

2005 2010 2015 2020E 2025E

Rubber sales (€ bn) Automotive sales (€ bn) Automotive sales ACES (€ bn)

9) Continental Strategy – Outlook 2020 and Beyond2020E: Sales Exceed €50 bn and ROCE More Than 20%

27

2005-2010: 3% 2010-2015: 4% 2015-2020E: 1-2%Global PC & LT2

Production CAGR

RubberGroup

AutomotiveGroup

19%

12%

21%

>20%

14

26

39

>50

1 ACES: Automated Driving, Connectivity, Electrification and Shared Mobility2 Passenger car and light truck

1

Return on capital employed (ROCE)



28


EDMR - Equity and Debt Market Relations 28

29

Disclaimer

› This presentation has been prepared by Continental Aktiengesellschaft solely in connection with the Bank of America Merrill Lynch Global Industrials Conference on March 20-21, 2018, in London. It has not been independently verified. It does not constitute an offer, invitation or recommendation to purchase or subscribe for any shares or other securities issued by Continental AG or any subsidiary and neither shall any part of it form the basis of, or be relied upon in connection with, any contract or commitment concerning the purchase or sale of such shares or other securities whatsoever.

› Neither Continental Aktiengesellschaft nor any of its affiliates, advisors or representatives shall have any liability whatsoever (in negligence or otherwise) for any loss that may arise from any use of this presentation or its contents or otherwise arising in connection with this presentation.

› This presentation includes assumptions, estimates, forecasts and other forward-looking statements, including statements about our beliefs and expectations regarding future developments as well as their effect on the results of Continental. These statements are based on plans, estimates and projections as they are currently available to the management of Continental. Therefore, these statements speak only as of the date they are made, and we undertake no obligation to update publicly any of them in light of new information or future events. Furthermore, although the management is of the opinion that these statements, and their underlying beliefs and expectations, are realistic as of the date they are made, no guarantee can be given that the expected developments and effects will actually occur. Many factors may cause the actual development to be materially different from the expectations expressed here. Such factors include, for example and without limitation, changes in general economic and business conditions, fluctuations in currency exchange rates or interest rates, the introduction of competing products, the lack of acceptance for new products or services and changes in business strategy.

› All statements with regard to markets or market position(s) of Continental or any of its competitors are estimates of Continental based on data available to Continental. Such data are neither comprehensive nor independently verified. Consequently, the data used are not adequate for and the statements based on such data are not meant to be an accurate or proper definition of regional and/or product markets or market shares of Continental and any of the participants in any market.

› Unless otherwise stated, all amounts are shown in millions of euro. Please note that differences may arise as a result of the use of rounded amounts and percentages.



ContinentalFinancial Calendar

30

2018

Preliminary figures for fiscal 2017 January 9, 2018

Annual Financial Press Conference March 8, 2018

Annual Shareholders’ Meeting (incl. key data for Q1 2018) April 27, 2018

Q1 Financial Report May 8, 2018

Half-Year Financial Report August 2, 2018

Nine-Month Financial Report November 8, 2018

2019

Preliminary figures for fiscal 2018 January 2019

Annual Financial Press Conference March 2019

Annual Shareholders’ Meeting (incl. key data for Q1 2019) April 26, 2019

Q1 Financial Report May 2019

Half-Year Financial Report August 2019

Nine-Month Financial Report November 2019



ContinentalShare Data/ADR Data

31

Share Data

Type of share No-par value share

Bloomberg Ticker CON

Reuters Ticker CONG

German Security Identification Number (WKN) 543 900

ISIN DE0005439004

Shares outstanding as at December 31, 2017 200,005,983

ADR Data

Ratio 1:5 (ordinary share : ADRs)

Bloomberg Ticker CTTAY

Reuters Ticker CTTAY.PK

ISIN US2107712000

ADR Level Level 1

Exchange OTC

Sponsor Deutsche Bank Trust Company Americas



ContinentalBond Data

32

Issuer Continental AGContinentalRubber of America, Corp.1

Continental AG Continental AG

Issue Senior Notes Senior Notes Senior Notes Senior Notes

Principal amount €750 mn €500 mn €600 mn €750 mn

Offering price 98.950% 99.739% 99.410% 99.228%

Rating at issuance dateBa2 (Moody’s4)BB (S&P)BB (Fitch2)

BBB (S&P)BBB (Fitch)

BBB+ (S&P)BBB+ (Fitch)

Ba1 (Moody’s4)BB (S&P)BBB (Fitch2)

Current corporation and bond ratings 3 BBB+ (Fitch), BBB+ (S&P), Baa1 (Moody’s 4)

Coupon 3.0% p.a. 0.5% p.a. 0.0% p.a. 3.125% p.a.

Issue date July 16, 2013 November 19, 2015 December 5, 2016 September 9, 2013

Maturity July 16, 2018 February 19, 2019 February 5, 2020 September 9, 2020

Interest paymentSemi annualJanuary 16/July 16

AnnualFebruary 19,Commenced February 20, 2017

Not applicableAnnualSeptember 9

WKN A1X24V A1Z7C3 A2DARM A1X3B7

ISIN XS0953199634 DE000A1Z7C39 XS1529561182 XS0969344083

Denomination €1,000 with minimum tradable amount €1,000

1 Guaranteed by Continental AG2 Non-contracted rating at date of issuance3 Fitch since October 24, 2016; S&P since May 11, 2016; Moodyʼs since June 30, 20154 Non-contracted rating since February 1, 2014



ReferencesUseful Links

33

Continental Investor Relations website www.continental-ir.com

Annual and interim reports www.continental-corporation.com/en/investors/reports

2017 Fact Book (Investor presentation) www.continental-corporation.com/en/investors/reports

Investor Relationsevents and presentations

www.continental-corporation.com/en/investors/events/presentations

Sustainability at Continental (presentation and fact sheet for investors)

www.continental-corporation.com/en/investors/about-us/presentation-sustainability-at-continental-23118

Corporate Social Responsibility www.continental-sustainability.com

Corporate Governance Principles www.continental-corporation.com/en/company/corporate-governance/principles-and-declarations

Continental shares www.continental-corporation.com/en/investors/share

Continental bonds and rating www.continental-corporation.com/en/investors/debt-and-rating

Continental IR on Twitter twitter.com/Continental_IR



34

ContactEquity and Debt Markets Relations

Vahrenwalder Str. 930165 HanoverGermany

e-mail: [email protected]: +49 511 938 1080 www.continental-ir.com

Michael SaemannAnalysts, Institutional Investors and Sustainability Investors

Phone: +49 511 938 1307e-mail: [email protected]

Klaus PaeslerAnalysts, Institutional Investors, ADR and Private Investors

Phone: +49 511 938 1316 e-mail: [email protected]

Marvin KalberlahAnalysts, Institutional Investors,Social Media


Christopher MackeAnalysts, Institutional Investors


Sabine ReeseSustainability, ASM, CMD Organization, IR Website, Capital Market Disclosure Requirements


Rolf WollerHead of IR


Jana CrossAssistant to the Head of IRRoadshow and Conference Organization


Documents

Driving the Future of Mobility - Continental USA...Bitte decken Sie die schraffierte Fläche mit einem Bild ab. Please cover the shaded area with a picture. (24,4 x 7,6 cm) Driving