Bruno-Roland BERNARDInvestor Relat ions Director

…is an independent industrial Group fully focused on the design,

production and sale of components, integrated systems and modules for

cars and trucks, in both the OEM andaftermarket segments.

Sales development

Q 1 - 2 0 0 3 R e s u l t s4

Change in sales

Q1-2002 Q1-2003

2,5502,440

* at c o n s t a n t cu r r enc i e s

(in mill ion e u r o )

Net change*

+1.5 %

Gross changeo/w c u r r e n c i e s

- 4.0%

- 5.5%

Q 1 - 2 0 0 3 R e s u l t s5

Performance by region

North America

% change*: - 8%Production: + 2%Production: + 2%

South America

*at c o n s t a n t c u r r e n c i e s

Asia

Europe

% change*: + 2%Production: Production: -- 4%4%

% change*: + 26%Production: + 12%Production: + 12%

% change*: + 27%Production: + 15%Production: + 15%

Growing profitability

Q 1 - 2 0 0 3 R e s u l t s7

Q 1-01 Q 2-01 Q 3-01 Q 4-01 Q 1-02 Q 2-02 Q 3-02 Q 4-02 Q 1-03

Gross margin*

*u n a u d i t e d q u a r t e r l y f i g u r e s

+ 1.0 pt+ 1.0 pt

( i n % o f s a l e s )

15.015.0

16.516.5

17.517.5

Q 1 - 2 0 0 3 R e s u l t s8

Gross marginOngo ing actions (1)

l Rationalization of industrial footprint

l Increased supplier integration

Q 1 - 2 0 0 3 R e s u l t s9

l Rationalization of industrial footprint– Geographica l reorganizat ion

Gross marginOngo ing actions (2)

EuropeEuropeUnitedUnited StatesStates

(3)(3)Barcelona ( L ight ing)Jablonec ( W i r i n g)Bietigheim transfer ( W i p e r s )

31/12/2001143 sites

31/03/2003132 sites

03/2001170 sites

31/12/2002140 sites

Fort Worth( S w i t c h e s & D e t e c t i o nS y s t e m s )

(1)(1)

IndiaIndia

(4)(4) Wir ing

Q 1 - 2 0 0 3 R e s u l t s10

Gross marginOngo ing actions (3)

l Rationalization of industrial tool

l Increased supplier integration – Vo lume concentrat ion

- Q 1 -2001: 4,500 suppliers- Q 1 -2002: 3,500 suppliers- Q 1 -2003: 2,900 suppliers

– Valeo Integrated Partners- D e c e m b e r 2002: 80 V IPs- March 2003: 86 V IPs

Q 1 - 2 0 0 3 R e s u l t s11

Q 1-01 Q 2-01 Q 3-01 Q 4-01 Q 1-02 Q 2-02 Q 3-02 Q 4-02 Q 1-03

Operating income

*U n a u d i t e d q u a r t e r l y f i g u r e s

( i n % o f s a l e s )

2.02.0

3.83.8

4.54.5

+ 0.7 pt+ 0.7 pt

Q 1 - 2 0 0 3 R e s u l t s12

Operating income

Gross margin% s a l e s

R & D% s a l e s

S G & A% s a l e s

Operating income% s a l e s

Q1-2003 Q 1-2002 ∆

42216.5%

(154)6.0%

(170)6.7%

983.8%

+ 1.0 pt

- 1%

- 2%

+ 0.7 pt

4281 7 . 5 %

(152)6 . 2 %

(167)6 . 8 %

1094 . 5 %

(in mill ion e u r o )

Q 1 - 2 0 0 3 R e s u l t s13

P&L

• Operating income

• F inanc ia l expenses -net

• Other income and expenses - net• T a x e s

Ef fect ive ra te

• Net income before goodwill

• Net income

Q1-2003 Q 1-2002

98

(12)

(14)(25)

35.0%

46

20

109

(17)

(26)(21)

3 1 . 5 %

45

22

(in mill ion e u r o )

Cash generation

Q 1 - 2 0 0 3 R e s u l t s15

Cashflow 2002

Net debt down by 84 M euros to 564 M euros

• Net operational cash (before restructuring)– o/w change in operat ing work ing capital

• Ne t CAPEX

• Balance before restructur ing

• Restructuring

• Net cash f rom operat ing and invest ing act iv i t ies

+1 032+203

- 583

+449

-230

+ 219

Q 1 - 2 0 0 3 R e s u l t s16

Dividend per share

l Total yield> 5.5 %

l P a y out ratio61 %

2001 2002 proposal

Tax credit

Net 0.70

0.35

1.00

0.501.05

1.50

Div idends (82 M euros)Share cancel lat ion (51 M euros)

( in e u r o )

Q 1 - 2 0 0 3 R e s u l t s17

Shareholders’ equity / net debt

12/31/2002 03/31/2003

Shareholders' equity Net debt

2,101

564 563

2,070

Gear ing : 27%

(in million euro)

Gear ing : 27%

Q 1 - 2 0 0 3 R e s u l t s18

Provisions for reorganization expenses

12/31/2001 12/31/2002Utilizationsand reclassif ications

Written back Currenc ies

740

- 326

-9- 40

365

(in million euro)

Outlook

Q 1 - 2 0 0 3 R e s u l t s20

Return on assets

l Restored margins of maneuver

l Goal: Increasing return on assets

Profitability

Assets

Q 1 - 2 0 0 3 R e s u l t s21

Increasing profitability

Profitability

Assets

• Sales growth

• Cost base control

• Selective disposal program

• Optimal use of assets

• Investment control

Q 1 - 2 0 0 3 R e s u l t s22

Order intake

2001 2002 Q 1-2003

1.3Sales rat io

1.2

1.0

Q 1 - 2 0 0 3 R e s u l t s23

Expected increase in sales

l S u c c e s s achieved during range renewal– Discriminating factors

• compet i t i veness• quality• global capacity

l New products generated from R&D – Differentiating factor: technological offer

• Starter- alternators• Ultrasonic park assist system with slot measurement• Bending l ight system and bi- x enon l amps• Combined the rma l sys tems…

– Technology importer (Raytheon)

Q 1 - 2 0 0 3 R e s u l t s24

Awards

l A.T. Kea rney Award « Production Plant of the

Year »:

– « Best Ser ies Production » for the new wiper systems faci l i tyat Bietigheim ( Ge rmany ).

l « Ach i e vemen t Awa rd » f rom Toyo ta :

– Pro ject management for the supply of head lamps to the new Ya r i s.

l Two cert i f icates from Toyo ta :

– For quality recognition relating to the fog lamps and power outlets.

Q 1 - 2 0 0 3 R e s u l t s25

Expected increase in sales

l S u c c e s s achieved during range renewal– Discriminating factors

• compet i t i veness• quality• global capacity

l New products generated from R&D – Differentiating factor: technological offer

• Starter- alternators• Ultrasonic park assist system with slot measurement• Bending l ight system and bi- x enon l amps• Combined the rma l sys tems…

– Technology importer (Raytheon)

Q 1 - 2 0 0 3 R e s u l t s26

Business Wins

l Wiper Sys tems - GM (p ick-ups and S U V s - GMT

900)

– Turnaround at V E S I

– Techno log ica l edge : Flat B lades

l Renaul t Megane 2

– Highest Va leo content by car in the segment

Q 1 - 2 0 0 3 R e s u l t s27

Renault Megane 2

Motors Motors & & ActuatorsActuators

Electrical SystemsElectrical Systems

Wiper SystemsWiper Systems

Alternators and starters

Securi ty SystemsSecuri ty Systems

Electrical steering columnlock, hand free access

system

ABS Motors

Front Wiper System

Engine Cool ingEngine Cool ing

Front-end module,radiators, condensers

SwitchesSwitches & & Detection Detection SystemsSystems

Park assist system,

steering

angle sensor , top column

module, switches

Frpnt Lighting SystemsFrpnt Lighting Systems

Xenon and halogenhead lamps, fog lamps

Rear Lighting SystemsRear Lighting Systems

Rear lampsCentre high mounted stop lamps

TransmissionsTransmissions

Full clutch system

Climate Climate ControlControl

H V A C

Q 1 - 2 0 0 3 R e s u l t s28

Expected increase in sales

l S u c c e s s achieved during range renewal– Discriminating factors

• compet i t i veness• quality• global capacity

l New products generated from R&D – Differentiating factor: technological offer

• Starter- alternators• Ultrasonic park assist system with slot measurement• Bending l ight system and bi- x enon l amps• Combined the rma l sys tems…

– Technology importer (Raytheon)

Q 1 - 2 0 0 3 R e s u l t s29

Assets

Profitability

Assets

• Sales growth

• Cost base control

• Selective disposal program

• Optimal use of assets

• Investment control

Q 1 - 2 0 0 3 R e s u l t s30

Optimal use of assets

l Industrial efficiency– Standardizat ion– W C m a n a g e m e n t

l Asset turnover– 2001: 3.3– 2002: 3.8

l CAPEX contro l

– Stabilized at 6% of sales

Q 1 - 2 0 0 3 R e s u l t s31

2003 market prospects

l High inventory levels in United States

l Weak demand in Europe and North America

Fall in vo lumes

Q 1 - 2 0 0 3 R e s u l t s32

Valeo in 2003

l Significant order intake

l Sales in line with market

l Cont inu ing operating improvement