great name by taltal

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									A great name
in the automotive industry
12    _ Message from the Chairman
15    _ Executive Committee
16    _ Significant events
18    _ Human resources
12    _ Sustainable development

From initial concept to finished product: Faurecia’s capabilities

16    _ Acquisition
20    _ Innovation
24    _ Development
28    _ Production

32    _ Key figures
36    _ Stock market information
With 60,000 employees working at 160 sites in 28 countries and annual sales
of €10.7 billion, Faurecia is a major name in the automotive industry.
As experts in the design, development, production and delivery of six major
vehicle modules, namely seats, cockpits, acoustic packages, doors, front
ends and exhaust systems, Faurecia adopted two years ago a common
working method called the Faurecia Excellence System (FES). This continuous
improvement system, based on best practices taken from within and outside
the Group, creates value for customers, shareholders and employees alike.
In 2004, the Group’s priority was to explain and deploy the Faurecia Excellence
System throughout the organization. This initiative will continue until all of
Faurecia’s businesses are covered, from initial concept to finished product.

                                                                                  MESSAGE FROM PIERRE LÉVI
                                                                                          CHAIRMAN AND CHIEF EXECUTIVE OFFICER

2004 marked a new phase in Faurecia’s drive for                       As far as progress with the automakers is concerned, although
continuous improvement.                                               our top three customers, PSA Peugeot Citroën, Volkswagen
                                                                      and Renault-Nissan, still account for almost two thirds of our
With sales growth approaching 8%, a further 0.4 percentage
                                                                      annual sales, we also increased our business particularly with
point improvement in the operating margin, net income
                                                                      DaimlerChrysler, Ford, General Motors and Toyota in 2004. The
increased by a factor of eight, and a reduction of our debt by
                                                                      main vehicle launches in Europe this year are representative
almost €200 million, the 2004 results confirms our dynamism.
                                                                      of this progression. Examples include DaimlerChrysler’s
Faurecia’s continuous improvement initiative is the realization
                                                                      Mercedes SLK and Smart Forfour, the Ford Focus and Escape,
of our strategy to grow with the automakers by continually
                                                                      the Pontiac G6 and Opel Astra from General Motors, and the
offering more in terms of innovation, and to match the
                                                                      Toyota Corolla Verso to name just a few.
profitability of the best in the industry.
                                                                      2004 was also a year of rapid growth for the Group outside
In terms of growth, 2004 was a particularly good year with
                                                                      Europe. Although it accounts for less than 15% of the Group’s
annual sales up in all product lines, in all geographic areas
                                                                      annual sales, growth outside Europe contributed around two
and with the majority of automakers.
                                                                      percentage points to its overall growth in all regions.
Automotive Seating saw the most pronounced growth with
                                                                      In North America, we are making headway with the US
sales increasing 11% in 2004. Indeed, the seating market
                                                                      automakers in all our core businesses. 2004 saw an increase
is growing and becoming segmented with, for example,
                                                                      in automotive seating business with General Motors and
the widespread availability of rear seats offering numerous
                                                                      exhaust system business with Ford. With DaimlerChrysler
movement and storage options. 2004 saw the launch of many
                                                                      we are at the beginning of a period of growth.
Faurecia-equipped vehicles where the second or even the third
row of seats can be folded away into the car’s floor to make          In China, we are following our main customers as they move
a completely flat space.                                              into the regions of Shanghai, Changchung and Wuhan. We will
                                                                      soon have full production facilities set up there covering our
Exhaust Systems also performed well with an increase in sales
                                                                      core businesses of seating, interior systems and exhaust
of almost 9%. The new and forthcoming standards for the
                                                                      systems. In South Korea, we are continuing to develop our
processing of emissions should continue to make innovation
                                                                      exhaust system business with Hyundai. In Japan, we opened
in exhaust systems a matter of increasing importance,
                                                                      a Development Center in Shin-Yokohama to increase efficiency
particularly with the use of particulate filters for diesel engines
                                                                      and bring us closer to our Japanese customers.
likely to become more widespread.
                                                                      In South America, there has been an upturn in the automotive
On the basis that they would be more appropriately developed          market that has had a highly beneficial effect on our business.
by companies more specialized than Faurecia in these areas,
                                                                      Faurecia can continue to grow only if it remains innovative and
we sold two minor, non-strategic product lines: steering columns
                                                                      competitive when bidding for contracts. That is why we have
to Fuji Kiko and the Mechanics and Environment activity to PSA
                                                                      decided to considerably increase the number of innovation
Peugeot Citroën.
                                                                      projects we have in the exploratory phase. This initiative called
                                                                      “1,000 ideas” will ensure that we are more creative and


selective when deciding which ones to pursue. By the end            Seven values define the attitudes of responsibility and
of 2004, we had already achieved 50% of this objective.             commitment necessary to ensure long-term success. They
We will be able to see the positive impact of the initiative        now form the basis of Faurecia’s corporate culture and as such
in the next few years and get more out of the 5.6% of our           are an important aspect of our individual and Group performance
annual sales invested in R&D.                                       appraisal system. With more than 1,600 managers and
                                                                    professionals recruited in 2004, the introduction of individual
Clearly, it has been a year of rapid growth. However growth
                                                                    career development plans is a priority for Faurecia, as are
and profitability can only be built on the constant pursuit
                                                                    internal mobility and the development of its employees’ skills
of the optimum global cost position and, at the same time,
                                                                    at all levels of the organization from operators to managers.
on the trust our customers place in us. This confidence is
based on our capacity to master the development, launch and         Our commitment to continuous improvement also extends
production of our modules across the ten-year cycle from the        to our Safety and Environment policy, which is constantly
initial invitation to bid until production of the vehicle ceases.   being added to, particularly in the areas of safety at work,
                                                                    workstation ergonomics and environmental protection. Half
In structural terms, our cost position is developing favorably
                                                                    of the Group’s sites have now been granted ISO 14001
with the redistribution of our manufacturing sites and our panel
                                                                    certification. Faurecia’s move to join the UN Global Compact
of suppliers. We opened ten new sites in 2004, mainly outside
                                                                    and the introduction of a Code of Ethics demonstrate our
Western Europe, in Romania and Slovakia, South Africa,
                                                                    commitment to adhere all over the world to the universal
China, the USA and Mexico.
                                                                    principles of respect for human rights, the right to work and
At the same time, we are reducing the number of suppliers
                                                                    the environment.
by picking the best and encouraging them in turn to attain
a better-cost position.                                             We will be facing a particularly difficult environment in 2005,
                                                                    since, in addition to poor market conditions, we will suffer the
Faurecia’s efficiency and the trust our customers have in us rely
                                                                    effects of the highest increase in raw materials prices in thirty
on the competence and motivation of our 60,000 employees.
All our personnel are trained and then involved in the deployment
of the Faurecia Excellence System, which aims to achieve            In this respect, I know that I can rely on the motivation and
excellence in terms of development and production. As an            expertise of all Faurecia’s employees to continue to exceed
example, all the Group’s plants and programs are now measured       our customers’ expectations and strengthen their trust in us.
against the same frame of reference, and the Excellence System      The men and women of Faurecia all care about designing,
audit provides a means of comparing and measuring progress at       developing and producing modules that, in terms of perceived
all sites.                                                          quality, safety, comfort and respect for the environment,
                                                                    contribute to the success of our customers’ vehicles and
We have already seen the initial benefits. In two years, we have
reduced both the number of industrial accidents in the plants and
the number of defective parts (PPM) delivered to our customers      I am convinced that, despite the impact of the increase in raw
by a factor of three. We have also improved with respect to many    materials prices and driven by continuous improvement,
other indicators and plan to continue in the same way over the      Faurecia can achieve lasting growth.
coming years.

A culture of responsibility and commitment is being established.
All the plants are adopting an organizational structure in which
the operators themselves resolve problems, as close as possible
to the point where they occur. Teamwork, led by the management,
makes each person responsible for monitoring improvement

                                                                                                                     EXECUTIVE COMMITTEE

Left to right, top to bottom

Pierre Lévi
_                                        Patrick Bikard
                                         _                                Gérard Breining
                                                                          _                                  Gérard Chochoy
  Chairman and Chief Executive Officer     Group Industrial Management      Group Purchasing                   Automotive Seating Business Group

Arnaud de David-Beauregard
_                                        Jean-Michel Elter
                                         _                                Jean-Marc Hannequin
                                                                          _                                  Laurent Hebenstreit
  Group Development                        Group Customer Development       Exhaust Systems Business Group     Interior Systems Business Group

Thierry Lemâne
_                                        Bruno Montmerle
                                         _                                Christophe Schmitt
                                                                          _                                  Pierre-Jean Sivignon
  Group Communications                     Group Strategy                   Components Business Group          Chief Financial Officer

Jean-Pierre Sounillac
_                                        Guy Talbourdet
  Group Human Resources                    Modules and Systems Business
                                                                                  2004 SIGNIFICANT EVENTS

                                                                 single delivery all year and
 02                               03                             for never exceeding the set          07
                                                                 loading time.
A NEW SEAT FRAME PLANT           FAURECIA JOINS THE UN                                               EMPLOYEE EMPOWERMENT
IN CLEVELAND, MISSISSIPPI,       GLOBAL COMPACT                                                      BENEFITS QUALITY
                                 The Group joined the UN          06                                 Largely due to Employee
The Group announced the          Global Compact, confirming                                          Empowerment, Faurecia’s
refurbishment of an existing     its international commitment    FAURECIA COLLABORATES               automotive seating plant
facility in Cleveland,           to this initiative.             WITH A DESIGN SCHOOL
                                                                                                     at Brebières, France reduced
Mississippi, USA, dedicated      The Compact promotes            Eight teams of students             the number of defective parts
to the production of seat        the respect and development     from Strate College, an             delivered to the customer
frames for its customers’        of human rights, the right      international design school         by a factor of 43 between
various platforms. The site,     to work and environmental       based in Issy-les-Moulineaux        the beginning of January and
which represents an              protection.                     near Paris, France, exhibited       the end of June 2004.The site
investment of $12 million,                                       their futuristic vehicle interior   improved the circulation
will provide 250 jobs by the                                     design projects. The project,       of information so that each
end of 2006 and bring             04                             which lasted five months,           operator was aware of the
Faurecia closer to its                                           was carried out in close            customer’s concerns and
American customers.                                              cooperation with Faurecia’s         were made responsible
                                 EXHAUST SYSTEMS
                                 BUSINESS GROUP WINS             design and marketing                for poor quality. In addition,
                                 AWARD FROM TOYOTA               specialists. The concepts –
                                 ARGENTINA                                                           half-hour quality meetings
                                                                 visionary yet firmly anchored       were organized on the shop
                                 The Buenos Aires site
                                                                 in industrial reality – were        floor at the start of each shift.
                                 in Argentina, won Toyota’s
                                                                 aimed at different socio-
                                 Golden Award for its
                                                                 cultural groups and covered
                                 performance in logistics and
                                                                 aspects such as interior
                                 the Silver Award for quality.
                                                                 architecture, life on board,
                                 Faurecia won the logistics
                                                                 storage and trim.
                                 award for not missing a

                               FAURECIA OPENS A NEW DEVELOPMENT
                               CENTER IN JAPAN
                               The new development center at Shin-Yokohama, Japan, will bring together all of Faurecia’s
                               activities at the same site, namely seating, interior systems, front ends and exhaust
                               systems. The opening of this new center emphasizes the Group’s desire to strengthen
                               ties with Japanese automakers, with the aim of becoming their preferred partner.

                                                                 FAURECIA RECEIVES                SYNTES COCKPIT RECEIVES
                                                                 VOLKSWAGEN PRIZE                 INNOVATION AWARD
                                                                 The Volkswagen Group             Syntes, the structural
                                                                 awarded Faurecia a prize in      architecture of the cockpit,
RATE AT THE UNNA SITE                                            recognition of its operational   developed by Faurecia,
The Unna plant, Germany,                                         performance. The award was       and that is produced for
which makes seat frames for                                      presented during a ceremony      the Ford Group’s C-platform,
the Opel Vectra and Signum,                                      in Warsaw, Poland.               won an award from
Jaguar X-Type, MCC-Smart          USA: NEW JIT SITE                                               the Automotive Division
and Ford Focus, Mondeo            INAUGURATED                                                     of the Society of Plastics
and Fiesta, cut its FR0t          IN AUBURN HILLS,                11                              Engineers (SPE) for the most
rating (number of workplace
                                  MICHIGAN, USA                                                   innovative application
accidents per million                                            CHEVROLET MALIBU SEATS           of plastics in vehicle
                                                                 RANK FIRST IN J.D. POWER
hours worked) from 20.2                                                                           interiors.
in September 2003 to 0 in          10
                                                                 The seats for the Chevrolet
September 2004. This result                                      Malibu, manufactured by
                                  On October 12, 2004, in
was achieved thanks to an                                        Faurecia, were named “best
                                  the presence of Gene
awareness program initiated
                                  Stefanyshyn, Manager
                                                                 in class” in the mid-size              1 million
by the management team                                           vehicle category in a quality
focusing on safety at work
                                  of the G6 line at                                                 This is the number
                                                                 survey carried out by J.D.
using Faurecia Excellence
                                  General Motors, Pierre                                              hours without
                                                                 Power & Associates in the
System tools.
                                  Lévi officially opened                                              accidents with
                                                                 United States.
                                  the just-in-time                                                   work stoppages
                                  manufacturing site of
                                                                 COLOGNE JUST-IN-TIME
                                                                                                     recorded by the
 10                               Auburn Hills, Michigan,        PLANT RECEIVES FORD                  North America
                                  USA, which produces            Q1 LABEL                             Division of the
                                  complete seats for             Thanks to the rigorous              Exhaust Systems
PLANT IN CHINA                    the Pontiac G6. Auburn         application of FES methods          Business Group,
Faurecia opened a new             Hills supplies General         and tools, Faurecia’s JIT            which employs
manufacturing site at             Motors’ Lake Orion             plant in Cologne, Germany,            1,500 people
Changchun in the Jilin            plant.                         specializing in interior              and manages
province of Northeast China.                                     systems, has recorded                  seven sites.
The site produces mufflers,                                      no quality faults or late
catalytic converters and       BEST INNOVATOR 2004               deliveries. As a result,
complete exhaust systems       AWARD FOR FAURECIA                Ford granted the site the Q1
for the Audi A6, Volkswagen    Faurecia was selected from        award just fourteen months
Jetta, FAW Red Flag and        among ten finalists to receive    after production started
Mazda 6.                       the “Best Innovator 2004”         on the Ford Fiesta 3-door.
                               award for its “Innovation
                               management process”. The
                               award, which was presented
                               in Paris by the French minister
                               for Research, François
                               d’Aubert, is sponsored
                               by AT Kearney and the
                               French magazine L’Expansion.

                                                                                  HUMAN RESOURCES

SKILL DEVELOPMENT                       The deployment of Employee               Its deployment develops work
                                        Empowerment is a fundamental lever       practices at the sites and is organized
Faurecia has always considered          for Faurecia’s industrial performance.   according to six priorities:
that its employees are its principale   Forming the basis of the Faurecia
asset and that the development          Excellence System (FES), it supports     1. 2004 saw an acceleration in the
of their skills is key to the Group’s   the whole system by developing           transfer of skills to operators,
success. The company’s commitment       the role of management and the           which allows for problems to be
to skill development is manifested      competence of our teams, as well as      resolved as close as possible to the
in the deployment of Employee           the working methods that will ensure     point where they occur. Each site
Empowerment for the benefit             continuous improvement.                  identifies the activities that can be
of all staff and in the introduction                                             taken on board by the production
of a specific management system                                                  teams and organizes the transfer
aimed at its engineers and managers.                                             of skills to the operators concerned.

In addition, to increase responsiveness       3. Operational communication             5. Professional development
and the ability to adapt to customers’        has also been strengthened within        within the Group is another priority.
changing requirements, Faurecia is            the Group. Indeed, operational           Faurecia provides opportunities for its
training operators to work at several         efficiency depends on the ability        personnel to develop professionally,
workstations thus making the most             to communicate quickly. A daily          based on the development of
of employees’ job flexibility.                process of communication with each       polyvalence on the shop floor. Certain
This is reinforced by Organizing              team means that problems are dealt       career paths have been defined in this
Human aspects of Production, which            with more quickly. Operational           way. An operator will, for example,
is underpinned by a maximum of four           communication is also about making       have the opportunity to become
hierarchical levels. The size of each         dedicated communication zones            a GAP leader with responsibility for an
team is reduced, enabling managers            available to all staff to ensure         Autonomous Production Group before
to monitor and develop the                    total transparency of performance        becoming a Supervisor. The Group
performance of each individual.               indicators displayed in each workshop.   makes promotion conditional
                                                                                       on mastering the job and makes
2. In addition, teamwork has also             4. 2004 also saw the further             professional development one of the
been developed. This is a necessity           integration of the continuous            basic drivers of its own development.
for Faurecia, even more than individual       improvement initiative. Employee
performance improvement, because              Empowerment makes continuous             6. Employability has also been
it determines the Group’s ability             improvement the responsibility           developed. Faurecia develops
to satisfy its customers’ requirements        of teams and individuals. At Faurecia,   technical and behavioral skills
in terms of quality, cost and delivery        each team is responsible for defining    of employees by giving them
(QCD). The roles and responsibilities         its performance indicators in terms      additional responsibilities and through
of each person are clearly defined.           of quality, cost, delivery and people    the development of team-working
                                              (QCDP), measuring them and               methods. This gives Faurecia the
                                              improving them. Each manager plays       image of a dependable company that
                                              a key leadership role in this process.   helps to increase the employability

Faurecia University
Faurecia University develops and implements training programs
designed to enhance the development of managers and
professionals, as well as specialist skills. The training program
aims to ensure the success of the organization’s core businesses.
The university also contributes to the deployment of the Faurecia
Excellence System, in close cooperation with the Group’s
industrial management department. Faurecia University therefore
plays a leading role in building a strong corporate culture. Finally,
all the training courses put in place demonstrate Faurecia’s
commitment to investing in the development of its employees.
Throughout 2004, almost 3,000 employees participated in training
programs run by Faurecia University. This represents an increase
of more than 27% compared with the previous year. Faurecia
University provided over a million hours of training in the Group
in 2004.

of its personnel both internally          managerial staff were highlighted        development of Faurecia’s managerial
and externally.                           in 2004 by the declaration of a common   staff of 8,000 people by focusing
                                          value base to be applied on a day-       on the following aspects: level of
Recruitment is crucial to the Group’s     to-day basis. These behaviors, drawn     performance, potential, succession
success and forms an integral part        up on the basis of the seven Faurecia    planning, mobility and identification
of its management and development         values (transparency, accountability,    of experts. Beyond the identification
system. To attract talented people,       teamwork, drive, speed, entrepreneur     and monitoring of individual action
the recruitment process has been          and master your future), provide         plans, this initiative is consolidated
made considerably more professional.      a common frame of reference and          by activity and by function.
In 2004, Faurecia recruited more than     increase the ability of teams to work    The main objective is to encourage
1,600 managers and professionals          together.                                the emergence of talented individuals
on permanent contracts. In addition       Performance management within            internally and ensure they reach the
the Group is focused on recruiting        Faurecia, based on the achievement       highest levels of responsibility in
young graduates from selected             of personal and group objectives,        the company. For this reason, special
schools in each country. Bearing in       evolved in 2004 and also incorporates    attention is paid to succession
mind Faurecia’s specialties, priority     an appraisal of behaviors with           planning, a valuable career and
is given to engineering and technical     reference to the seven Faurecia          mobility management tool.
degrees. More generally, all              values. Emphasis is also placed          The company is committed to offering
management positions available can        on structuring individual development    its managers the opportunities for
be viewed on the Faurecia website.        plans. These plans allow                 professional development that they
The installation of new recruitment       for greater clarity and objectivity      deserve within an international group.
software led to more than 100 positions   in performance appraisal and the         Mobility can be geographic, functional
being filled in less than six months.     development of company employees.        or organizational. In 2004, it affected
                                          Career management is a major             12% of managers and professionals.
In the case of more experienced           component of Faurecia’s Human            The target for 2005 is 15%.
personnel, the Group gives priority       Resources policy. Every year, all
to their capacity to progress within      executive and managerial positions
the company and internationally.          are monitored through a process
The Faurecia management model             called the staffing review. This
and the behaviors expected of its         analyzes the composition and

                                                                                                     HUMAN RESOURCES

THE DEVELOPMENT                                                                  Safety at work is one of the
OF ECONOMIC                                                                      fundamental aspects the Faurecia
AND SOCIAL DIALOG                                                                Excellence System and is an
                                                                                 imperative condition that the Group
The European Works Council, set up                                               owes to its employees. The company’s
in 2003 at a Group level, is a high-level                                        progress in terms of safety and
consultative and discussion body                                                 working conditions intensified
to complement the contractual policy                                             throughout the year. At an individual
and social dialog being developed                                                plant level, initiatives raising the
within the European subsidiaries. The                                            management’s awareness with regard
second meeting chaired by Pierre Lévi                                            to moral, civil and penal responsibility
took place on June 9 and 10, 2004                                                of each individual, and the creation
at the Group’s head office in Nanterre,                                          of HSE (Health, Safety and the
France.                                                                          Environment) core teams on the shop
The policy of consultation and                            12                     floor are already resulting in the
negotiation continues to evolve                                                  introduction of more accident
                                            This is the number of sites
in all the subsidiaries. Agreements                                              prevention measures. Similarly,
                                            opened by Faurecia in 2004.
on working hours and job flexibility                                             the introduction of model production
                                            In detail, Automotive Seating
have been signed in Portugal, Spain,                                             lines (see page 30) has meant that
                                            acquired four new sites, including
Germany and France. In 2004,                                                     more prevention measures can be
                                            two in the United States,
all companies in France reached                                                  integrated into the manufacturing
                                            one is a just-in-time site in
an agreement on wages. In addition,                                              processes by revising safety
                                            Auburn Hills, Michigan,
with the signing of seven profit-sharing                                         regulations at the same time
                                            that supplies General Motors,
agreements, almost all companies are                                             as other Faurecia Excellence System
                                            and the other is in Cleveland,
now covered by this scheme. In Spain,                                            standards.
                                            Mississippi. The other two sites
several single-plant collective                                                  On the subject of ergonomics
                                            are located in Talmaciu,
bargaining agreements at a plant level                                           in the working environment, Faurecia
                                            Romania and Wuxi, China.
have been signed (Vitoria, Burlada                                               has for several years been aware
                                            Exhaust Systems has also
and Vigo). And finally in Germany,                                               of Musculo Skeletal Disorder (MSD).
                                            opened four new sites. Three
local negotiations have led to                                                   As far back as 1998, a prevention
                                            of them operate in just-in-time
some innovative cost-reduction                                                   policy was drawn up by the
                                            mode – Poissy, France, for PSA
and flexibility solutions, thereby                                               Automotive Seating Business Group
                                            Peugeot Citroën, Rastatt,
maintaining jobs that would                                                      to define the available ergonomic
                                            Germany, for DaimlerChrysler,
otherwise have been threatened.                                                  analysis tools and to implement a series
                                            and Lordstown, Ohio, USA, for
Program management, closely tied                                                 of corrective and preventive measures
                                            Chevrolet. The fourth site was
to the life and commercial success                                               designed to improve workstations.
                                            opened at Hermosillo in Mexico
of our customers’ vehicles, calls for                                            In 2004, the scope of this policy
                                            for Ford. Interior Systems
constant redistribution of industrial                                            was extended to the entire Group.
                                            opened two new sites, one
and human resources. In 2004,                                                    An Ergonomics memorandum giving
                                            at Kosice, Slovakia and the other
as in other years, Faurecia’s facilities                                         the essential rules to be followed when
                                            at Boeblingen, Germany. The
and their work loads were determined                                             designing workstations, packaging
                                            latter is a just-in-time site for
by several factors: close-proximity                                              and supply flow racks, or the human-
support for customers, their                                                     machine interfaces and environment
                                            Modules and Systems has also
performance in terms of quality, cost                                            of the workstation, was disseminated
                                            expanded with a new just-in-time
and delivery, and the commercial                                                 throughout the Group. It is designed
                                            site at Rosslyn, South Africa.
success of the vehicles supplied.                                                to be used as a training resource
                                            Finally, a development center was
                                                                                 for all employees involved in work
                                            opened at Shin-Yokohama, Japan
                                                                                 organization and workstation design.
                                            in June 2004.

                                                                          SUSTAINABLE DEVELOPMENT

In 2004, the Group introduced a new       The Group is determined to improve         To ensure that the manufacturing
system for monitoring its Health,         safety at work. For 2005, Faurecia         processes do not contribute
Safety and Environment (HSE)              has set an objective of a maximum          to the depletion of natural resources
organization at its 160 sites. The        of five workplace accidents per million    or pollute the environment, during
system takes the form of a document       hours worked (expressed as FR0t).          2004, the Group’s sites also set up
sent to each site every six months        91 sites have already achieved this        environmental management systems
including a series of questions           objective in 2004 accounting for more      based on the ISO 14001 international
and monitoring indicators. The            than half the Group’s sites. It is worth   standard. Attaining this standard
questionnaire is a reflection of the      pointing out, moreover, that some thirty   is part of the Faurecia Excellence
Group’s responsible, consistent           sites did not report a single accident     System (FES). 73 sites had been
and long-term approach to the HSE         during the entire year. At the end         certified by the end of 2004.
issue. HSE contacts have been             of December 2004, Faurecia was             Note that only 30 sites in the Group
appointed at various sites and to date    showing an FR0t rating of 8.7, a 46%       are subjected to the self-monitoring
the network consists of the equivalent    improvement compared with 2003.            of their waste water and atmospheric
of around fifty full-time employees for   A similar policy has been developed        emissions imposed by the
the whole of the company.                 in ergonomics.                             government. All the sites concerned

proved to be in compliance with          In addition, Faurecia officially joined   company, in all Faurecia establishments
the regulations in force. The Group’s    the UN Global Compact in March            worldwide. It was drawn up and widely
other sites are not subjected to this    2004. This initiative unites private      distributed, and is available on the
requirement because of either the type   companies, UN bodies as well as           Group’s Intranet site, so that all
or the intensity of their activity.      associations and trade unions around      employees have access to it and can
These indicators show that the           ten universal principles of respect       adhere to it at all times and under
organization of production within        for human rights, the right to work       all circumstances.
Faurecia takes the environment into      and the environment. “Our
account.                                 requirement for excellence is reflected
As an example, the Group has put         in our continuous improvement
in place an ambitious plan to overhaul   initiative”, explains Pierre Lévi,
its paint lines, all of which are now    Chairman and Chief Executive Officer.
ready to use water-soluble paints,       “Signing up to the Global Compact for
thus reducing the use of solvents.       us represents a commitment to adhere
The new-generation paint lines are       to these principles for the good of our
also equipped with incinerators          employees and the environment in
capable of processing the effluent       which we work. It will help us forge
when solvents are present. They have     better links internationally and
also been designed to reduce energy      promote the sharing of best
consumption.                             practices.” The Group is also
On a wider scale, Faurecia has           committed to disseminating these
embarked on an ambitious plan to         principals among its suppliers.
replace solvents with water-based        Finally, in December 2004, Faurecia
substances, particularly in painting,    published a Code of Ethics that was
but also for removing foam from molds    drawn up in accordance with
and for thermocoating. This reduction    Faurecia’s Mission Statement. This
in solvent use minimizes atmospheric     code defines the basic principles
discharges and helps to prevent risks    of behavior that must be applied
to employees and people in the           on a daily basis in relations between
neighborhood.                            people both internally and outside the

                                                  FROM INITIAL CONCEPT TO FINISHED PRODUCT: FAURECIA’S CAPABILITIES

from initial concept
to finished product:
Faurecia’s capabilities
Acquisition, innovation, development, production

                             In a global industry where ten or so          Faurecia takes into account new
                             automakers share 90% of the market,           social trends, vehicle functionalities,
                             Faurecia has put the emphasis on              modularity and design.
                             customer satisfaction and anticipating        Innovation research is therefore
                             the expectations of vehicle users.            focused more than ever on perceived
                             Instead of relying solely on its              quality, safety, modularity,
                             technological expertise, Faurecia has         environmental-friendliness and
                             had to extend its know-how from               the integration of new functionalities,
                             production to engineering, even to the        taking into account, for example,
                             extent of designing six major vehicle         the increase in the number of
                             modules, working further and further          on-board communication resources.
                             upstream on the automakers’ programs.         Not forgetting, of course, the cost
                             The Group’s areas of expertise have           of the vehicle. In all these areas,
                             as much to do with module and system          Faurecia’s goal is to move forward
                             architecture as with industrial               and innovate, and to this end
                             production control. For this,                 it is constantly improving.


win over
Winning trust and becoming a key partner

                            Considering that vehicles have a five           In this context, the Group’s image
                            to seven-year lifecycle, Faurecia               is of course vital. This image is built
                            must generate €1.5 billion in new               around the Group’s capacity for
                            contracts every year just to maintain           innovation, proximity to the customer
                            its sales at the level of the previous          and a good understanding
                            year. The acquisition of new                    of the issues they face, the credibility
                            programs is therefore a key issue               of our program teams, a solid
                            for the future of the Group. It relies          program management system, sound
                            first and foremost on the trust that            industrial processes and high-quality
                            the automaker has in Faurecia.                  products.

THE BEST                                by making sure that sales teams are      The Customer Councils were set up
TECHNICAL SOLUTION                      kept constantly up-to-date, not only     in 2004, as part of the Group’s
AT THE BEST COST                        with the latest innovations and the      commitment to improving customer
                                        Group’s program development and          relations. The main role of these
In 2004, almost 300 sales personnel     management capabilities, but also        councils is to coordinate sales
from all over the world attended        on product quality and services          information across the organization
a conference focusing on the            offered by Faurecia. In the process      in order to gain a better understanding
challenges facing Faurecia. The first   of acquiring new customers, the trend    of our customers’ needs. Each council
point to be emphasized was the need     nowadays is towards ever-closer          is headed by a member of the Executive
for employees at all levels of the      relations. In parallel, the Group’s      Committee and includes representatives
company, including members of the       employees must strengthen their          from each product line.
Executive Committee, to strengthen      capacity for innovation. In short,
their relationship with the customer    the challenge facing Faurecia
and to highlight the credibility,       in the next few years is to become
professionalism and experience          a key partner for all the automakers
of our teams.                           by always being in a position to offer
The conference also focused             the best service at the best cost.
on improving internal coordination


   Main launches
   in 2004
   A third of all new vehicles launched worldwide in 2004 –
   almost 30 models – incorporate at least one of the six modules
   that Faurecia produces.
   The main launches include:

               Audi A6
               seat structures, cockpit,
               acoustic package, front end
               and exhaust system.

               BMW 1 Series
               cockpit and front end.

               Chevrolet Cobalt
               exhaust system.

               Citroën C4
               seats, doors, acoustic package,
               front end and exhaust system.

               Ford Focus
               doors, acoustics package
               and exhaust system.

               Mercedes-Benz SLK
               cockpit and doors.

               Opel Astra
               seats, acoustic package
               and exhaust system.

               Renault Grand Scenic
               seats, cockpit and acoustic package.

               Pontiac G6

               Seat Toledo
               seat structures and cockpit.

               Smart Forfour
               seats and acoustic package.

               Toyota Corolla Verso
               seat structures, cockpit and front end.

               Volkswagen Golf Plus
               seat structures and acoustic package.


Innovation, the driving force behind Faurecia

                              “Growth through innovation is a key             With its “1,000 ideas” initiative,
                              component of our strategy and must              launched in 2004 and designed
                              become our mind-set. We must rely               to stimulate new ideas in terms of
                              on our innovation process to speed              processes and products, the Group
                              up development of the best ideas                more than doubled the number
                              and use them to win new programs.”              of new projects compared
                              These words, spoken by Faurecia’s               with the previous year. 433 new
                              Chairman and CEO Pierre Lévi                    ideas went into development and
                              at the Group Innovation Committee               593 other projects were being
                              Meeting in December 2004,                       evaluated at the end of the year.
                              sums up the importance                          What is the purpose of innovation?
                              of innovation for the company.                  Above all, to invent original technical
                              Research & Development, which                   solutions that, within the bounds
                              alone occupies 5,000 engineers                  of the automakers’ brand strategies,
                              in 28 development centers around                give them the means to differentiate
                              the world, was allocated resources              themselves. Innovation is therefore
                              equivalent to 5.6% of the Group’s               a lever for growth that enables
                              sales in 2004.                                  Faurecia to become a key partner.

More than 300 patents were filed              new features: the Noveo system,                 into a single part, resulting in weight
in 2004 making it an important year           available on the Toyota Yaris,                  and cost reductions as well as
for innovation at Faurecia.                   Volkswagen Golf Plus and Smart                  improvements in safety. In addition,
In addition, at the 2004 Paris                ForFour, which allows the seat back to          Syntes can be applied to all vehicles
International Motor Show, Faurecia            be folded down onto the cushion with            using the same platform and has
unveiled some of its latest innovations,      one hand, or the Maxx system,                   already been fitted to more than
such as the double-walled floor for the       providing a power-adjustment system             1.7 million vehicles, notably the Ford
Peugeot 1007, which incorporates              for the second row enabling floors              Focus and C-Max, Mazda 3, Volvo S40
numerous functions in a single part           to be folded flat. 2004 also saw the            and V50, resulting in widely differing
and represents real progress in terms         introduction of PU cast skin, a new             looks based on a common structure.
of safety. Other innovations include          technology whereby liquid                       Syntes was given a 5-star rating by
the front end for the BMW 1 Series,           polyurethane is injected into a mold;           Euro NCAP and received an award
a lightweight, economical metal/plastic       the resulting skin, with a feel very close      from the Society of Plastics Engineers
hybrid, or the package tray for the           to leather at a competitive price,              (SPE) in the USA.
Renault Modus, which offers                   is already used for the door panels of
outstanding acoustic comfort. Beyond          the Mercedes SLK. Another Faurecia
the Paris Motor Show, many other              innovation is the Syntes metal/plastic
innovations were unveiled, particularly       hybrid cockpit structure that integrates
in terms of modularity. Among these           structural and air-distribution functions

                                      Faurecia’s three key innovations in 2004

                                           Syntes: this metal/plastic hybrid cockpit structure integrates structural and air-distribution
                                           functions into a single part. It reduces vehicle cost and weight and also increases comfort
                                           by reducing vibrations. It behaves extremely well in crash tests. Designed for a global
                                           platform, it can be tailored for different makes of car and reduces capital outlay for the

                                           mEasy: this system optimizes adjustments to the vehicle’s front end module by
                                           mechanizing the alignment of the headlights and bumper system with the wings. It reduces
                                           the amount of adjustment necessary to achieve correct spacing and flush-mounting
                                           and therefore improves the vehicle’s perceived quality. It also reduces assembly time for
                                           the automaker.

                                           Particulate filter: thanks to this filter, soot particles in the exhaust are trapped
                                           by a porous ceramic substrate and build up on the walls of the filter. Once the maximum
                                           limit of particulate build-up has been reached, it is burned off by raising the temperature.
                                           This mechanism is triggered by the engine control system with the intervention of the
                                           catalytic converter further up the line. The filter is treated every 150,000 – 200,000 kilometers.
                                           It significantly reduces the impact of diesel engines on the environment and incorporates
                                           a mechanism enabling easy detachment from the catalytic converter.


Faurecia also won the “Best                devised a method of evaluating                 in the form of products or functions
Innovator” award in the “Innovation        and developing quality as perceived            for the benefit of both automakers
Management Process” category of an         by the consumer (based on the Touch,           and motorists.
award sponsored by AT Kearney and          Appearance, Light, Color [TALC]
the French magazine L’Expansion.           method). The evaluation is based
2004 also saw the launch of seven          on the five senses and translates
new particulate filter systems fitted      subjective feelings into concrete
to the Mercedes A, C and E Class.          measures. Like all Faurecia teams
In short, the spotlight was turned on      engaged in Research & Development,
all major areas of innovation this year,   the design department monitors
including perceived quality, comfort       the latest social, sociological and
(acoustic, thermal and postural),          technological trends and throughout
safety, the environment, cost and          2004 was committed to developing
integration. The design department of      the credibility of the Group’s
Faurecia’s Interior Systems Business       innovation effort and “selling” it.
Group, a decentralized structure           Teamwork among the R&D, marketing
consisting of 40 people based in           and design departments has
France, Germany and the USA, has           transformed ideas into reality

                                                        Mitis and innovation take shape

                                                        At Faurecia, innovation is not a fashion, it is an obsession, and we
                                                        needed a way of presenting it to automakers. Enter Mitis, which was
                                                        presented to the Group’s staff and customers starting in June 2004.
                                                        Mitis is a virtual demonstrator capable of presenting a coherent
                                                        selection of new concepts designed for the vehicle interior. Two key
                                                        areas were chosen by the designers and multi-disciplinary experts
                                                        who worked on the project: 1) defining new requirements of
                                                        consumers and 2) side impact. Mitis was able to show a side-on
                                                        collision to demonstrate several new solutions, including radar
                                                        to adapt the structure of the vehicle, a cross-car beam to strengthen
                                                        the vehicle body and an airbag located in the door.


Solutions for every stage of vehicle development

                             Faurecia works together with                    technical and program management
                             automakers earlier and earlier in               expertise. While the Group’s capacity
                             program development with the result             for innovation is undoubtedly one
                             that its input is sought at every stage         of its main strengths, another
                             of a vehicle’s development. Faurecia            is its expertise in managing complex,
                             simultaneously develops 150 programs            large-scale international projects.
                             a year with automakers thanks to its

This vital stage, development, in fact    version of the PMS was produced,         from its suppliers in 2004. In parallel,
comprises several phases and calls for    incorporating the acquisition phase      sourcing strategies based on cost
a wide set of skills. It requires a       (anticipating the customer’s             models have enabled precise
constant process of adaptation to         requirements prior to any official       identification of the competitive levers
customers’ projects and regular           request for quotation). It includes      used by the Group’s suppliers,
exchanges with them. It is for this       procedures for determining technical     and led to the setting of objectives
reason that customer specific teams       challenges and planning product          and the definition of a preferred panel
were appointed during the past year.      launches, and enables a program’s        of suppliers for each product sector,
The objective of these teams is,          operational profitability to be          particularly in low-cost countries.
together with the automaker,              monitored even before the contract       This strategy also helps to speed up
to develop a product tailored to          has been awarded.                        the process of reducing the number
requirements in terms of functionality,   Faurecia’s involvement further and       of suppliers while improving their
style, brand positioning and cost.        further upstream in the automakers’      quality.
It is also Faurecia’s responsibility      development process has been
to validate the product, conduct          one of the factors contributing
the necessary engineering and tooling,    to a marked improvement in quality
design the production processes           throughout the year.
and resources, and plan the logistics.    At a purchasing level, it has become
These elements are described              essential for suppliers to be
in the the Program Acquisition            integrated into the development
and Management System (PMS)               process. It is the Group’s
that provides a rigorous methodology      responsibility to select and manage
and a common standard for the whole       the suppliers for all programs.
Group. In the interest                    As a result, Faurecia saw a reduction
of continuous improvement, a new          of more than 70% in quality shortfalls

                                                     FROM INITIAL CONCEPT TO FINISHED PRODUCT: AURECIA’S CAPABILITIES   ••• DEVELOPMENT

Run at Rate,
or mass production trial

To check that a particular manufacturing process runs smoothly,
the Faurecia Group has strengthened its new product production start-
up procedures by developing a key phase called the “Run at Rate”.
This entails carrying out mass production trials of all production lines
well before start of production (SOP). It is used to check that quality
and quantity requirements are being met. The tests analyze
the non-stop, full-speed operation of the production system over
a period of up to eight hours, focusing on the functioning of
the machines, the competence of the operators and the implementation
of the Faurecia Excellence System. At least two Runs at Rate
are carried out for each program, one three months before SOP
and the other actually on start-up.

                                                                                 The number of suppliers that Faurecia
                                                                                 aims to have by 2007. The objective
                                                                                 is to work with the best and integrate
                                                                                 them further and further upstream.

Produce and deliver optimum quality according to the same standards all over
the world

                            Faurecia owes it to its customers not           effort aimed at the Group’s
                            only to design innovative products,             production teams and focused
                            but also to manufacture them all over           on the deployment of the Faurecia
                            the world with optimum reliability.             Excellence System (FES).
                            For this reason the Group has made              The implementation of the FES has
                            manufacturing excellence one of its             led to a more efficient organizational
                            main concerns. To achieve this,                 structure for the Group’s production
                            Faurecia’s approach to industrial               activities, with a limited number
                            management needs to be understood               of hierarchical levels, development
                            by all employees and its production             of supervisory staff on the shop floor,
                            system has to be continuously                   and the introduction of management
                            improved. To this end, 2004 saw an              teams comprising an average
                            enormous organization and training              of five people.

In 2004 the Faurecia Excellence                 of training courses for employees,         was also improved and now allows
System (FES) played a decisive role             all of whom have been encouraged           for comparison between sites and
in the Group’s continuous                       to take responsibility for ensuring that   technologies.
improvement initiative, in terms of             products are thoroughly checked.           These indicators also concern
quality, cost and lead time. Its                Secondly, productivity has been            Employee Empowerment and
potential for improving production              improved at the Group’s 160 sites          the programs themselves.
processes has already been                      by working on production-line design       These results were achieved only
recognized by its employees and                 as well as organization and                thanks to a rigorous policy aimed
customers.                                      ergonomics. Production flows were          at 100% involvement of the Group’s
On the quality side first of all, Faurecia      analyzed and product flow times            employees. In this respect, 2004 saw
recorded a 40% improvement in                   reduced. To achieve this, Faurecia         the widespread setting-up of GAPs
the quality rating of its products.             adopted a method based on the              (Autonomous Production Groups),
This is the result of a number                  requirements and constraints of            small autonomous teams responsible
of initiatives carried out both with            the workstation to determine all           for their own performance in terms
suppliers, to reduce the number                 the upstream production processes.         of quality, cost and lead time.
of defective components, and on the             The definition of performance              These teams are required to hold daily
production lines, with the introduction         indicators for quality and productivity    meetings to define specific objectives

    Model lines arrive
    at the plants

            2004 saw the development of model production lines
            at Faurecia plants. By the end of the year, all the
            Group’s sites had at least one in place. What
            is a model line? Each plant deploys all aspects of the
            Faurecia Excellence System (FES) on a production line
            in order to improve performance in terms of safety,
            quality, productivity, logistics and Employee
            Empowerment. For an average six-month period,
            experts from the FES networks get all the employees
            and functions concerned to work together to achieve
            the level of quality sought, and when they find
            a system that works, they put it into general use
            throughout the plant.


to be achieved and look at ways to
improve. Particular attention was paid
to GAP leaders and their level of
motivation and involvement.

                                                     Half of Faurecia’s plants
                                                     are just-in-time

                                                            Almost half of the Group’s 160 sites now operate in just-
                                                            in-time (JIT) mode, which means that they are able to deliver
                                                            according to the customer’s manufacturing rate, catering
                                                            directly to their assembly lines, sometimes in less than three
                                                            hours. To meet these increasing demands while ensuring
                                                            the necessary level of reliability and safety, JIT plants are most
                                                            often in close proximity (less than 30 km to the customer),
                                                            or even within the automaker’s manufacturing facilities.


                                                                                                                   Interior vehicle modules

                                                                                                                   Acoustic package
                          Other modules                                                                            No. 2 in Europe, No. 4 worldwide
                                                                                                                   Door and door panel
                           Exhaust system                                                                          No. 1 in Europe, No. 2 worldwide
          No. 1 in Europe, No. 2 worldwide
                                 Front end                                                                         No. 1 in Europe, No. 3 worldwide
          No. 1 in Europe, No. 2 worldwide
                                                                                                                   Instrument panel and cockpit
                                                                                                                   No. 1 in Europe, No. 1 worldwide

                                       9,610.7                     9,865.5
                                                                                                               719.0                     In €M
                                                              593.4                 675.9
                                   574.6                                                                     1,714.9
                                                            1,777.7                1,587.9
                                                                                                             3,500.9                     BY ACTIVITY
                                3,297.6                                                                                                  INTERIOR VEHICLE MODULES
                                                                                                                                         •_ Interior vehicle
                                                                                                                                         • Seating
                                                                                   4,353.2                   4,784.7
                                                            4,031.6                                                                      OTHER MODULES
                                3,519.2                                                                                                   _
                                                                                                                                         •_ Front end
                                            2001                      2002                   2003                      2004
                                                                                                                                         • Exhaust system

2004 sales increased to €10,719.5 million, a 5.9% rise over 2003. Excluding monoliths, at constant exchange rates and on a comparable
basis, sales increased by 7.9%. All of Faurecia’s modules contributed to this growth in sales, which was achieved with the majority
of Faurecia’s customers and throughout all global regions.

                                                            In %


                                                            Faurecia’s sales*   ORGANIC GROWTH MAINTAINED
                                                                                Faurecia achieved its objectives in 2004 in the context
                                                     +0.7                       of a 1% increase in European automotive production,
                                                                                which is the Group’s principal market and accounts
                                                            automotive          for 84.8% of sales.
                           (1.3)             (1.1)
              2001       2002              2003        2004                     * Excluding monoliths, at constant exchange rates and on a comparable basis.

                                                                                                           Toyota 1.5%
 In %                       2002          2003      2004
                                                                                                      Others 3.9%              PSA Peugeot Citroën 28.8%
 PSA Peugeot Citroën        25.7         28.2       28.8                                      BMW 5.6%
 Volkswagen Group           23.4         23.4       22.2                           GM Group 7.2%
 Renault-Nissan             16.2         15.5       14.4
 Ford Group                 10.0          8.6        8.6               DaimlerChrysler 7.8%

 DaimlerChrysler             6.3          6.4        7.8
 General Motors Group        7.2          7.1        7.2                    Ford Group 8.6%
 BMW                         4.5          5.2        5.6
 Others                      5.4          4.2        3.9
 Toyota                      1.3          1.4        1.5
                                                                              Renault-Nissan 14.4%

                                                                                                                                    Volkswagen Group 22.2%


                                                 EUROPE                                   OUTSIDE OF EUROPE

                                    Other European countries 8.8%
                                                                                         North America 9.6%
                                     United Kingdom 3.3%
                                                                                                South America 1.5%
                                     Spain 12.1%                                                  Asia 2.9%
                                                                                                     Other countries 1.2%
                               Portugal 1.6%

                            Germany 25.3%

                                                                     France 33.7%

At constant exchange rates and on a comparable basis, Faurecia’s sales increased 9% in North America and more than doubled in Asia
for the year 2004.

                             2003         2004       NUMBER OF INDUSTRIAL SITES PER GEOGRAPHICAL AREA

  France                      42           41
  Germany                     27           28
                                                     In 2004, like all other years, Faurecia’s industrial footprint and the workload
  Spain                       21           21        of its plants were determined by a multitude of factors: geographical proximity
  Portugal                     8             8       to customers, performance of the site in terms of quality, cost and delivery,
  United Kingdom               7             6       and the commercial success of the customers’ vehicles.
  Rest of Europe (1)          21           23
                                                     (1) Rest of Europe: Austria, Belgium, Czech Republic, Hungry, Italy, Luxembourg, the Netherlands,
                                                         Poland, Romania, Slovakia, Sweden, Turkey.
  North America (2)           13           16        (2) North America: Canada, Mexico, United States. (3) South America: Argentina, Brazil
  South America (3)           10           10        (4) Asia: China, India, Japan, South Korea. (5) Rest of world: South Africa, Tunisia.

  Asia (4)                     8           10
  Rest of world (5)            6             7

  Total                      163          170

FAURECIA’S                                                                                                  FAURECIA’S PROFITABILITY

                                                                                                            EBITDA/OPERATING INCOME
NUMBER OF EMPLOYEES WORLDWIDE* 2002                                    2003                2004             •_ EBITDA* (in €M)
                                                                                                            •_ In % of sales
           France                              24,628               24,966              24,504              •_ Operating income (in €M)
           Germany                             11,355               10,317              10,304              • In % of sales                                   706.0
           Spain                                 6,113               6,117               5,832
           Portugal                              3,032               2,896               3,003                     586.1
           United Kingdom                        1,534               1,361               1,326                                                          6.6
           Rest of Europe (1)                    5,001               6,163               7,605                                    6.3
                                                                                                             5.9                                                      366.3
           North America (2)                     4,958               4,790               5,386
           South America (3)                     1,192               1,295               1,770
           Asia   (4)                              153                  625              1,529
           Rest of world (5)                       912               1,048               1,248                                                     3.0                   3.4
           Total                               58,878               59,578              62,507
* Includes temporary workers.                                                                                         2002                 2003                  2004
                                                                                                            * Operating income + depreciation, amortization and
RECRUITMENT                                                                                2004             depreciation in value of property, plant and equipment
                                                                                                            and intangible assets.

           France                                                                        1,645
           Germany                                                                          703             NET INCOME                                        198.3
                                                                                                            In €M
           Spain                                                                            397
           Portugal                                                                         352             •_ Before goodwill
           United Kingdom                                                                   185             • After goodwill
           Rest of Europe (1)                                                            1,219                                          120.5

           North America (2)                                                             1,639
           South America (3)                                                                693
           Asia (4)                                                                         107                     54.5

           Rest of world       (5)                                                          272
           Total                                                                         7,212
                                                                                                             2002                 2003                 2004

Faurecia’s employees are located at 160 sites in 28 countries. To attract talented
people, the recruitment process has been made considerably more professional.
In 2004, Faurecia recruited more than 1,600 managers and professionals
on permanent contracts.

(1) Rest of Europe: Austria, Belgium, Czech Republic, Hungry, Italy, Luxembourg, the Netherlands, Poland,
Romania, Slovakia, Sweden, Turkey. (2) North America: Canada, Mexico, United States.                        EBITDA/OPERATING INCOME
(3) South America: Argentina, Brazil. (4) Asia: China, India, Japan, South Korea.
(5) Rest of world: South Africa, Tunisia.
                                                                                                            Operating income in 2004 was
                                                                                                            €366.3 million and represented 3.4%
EVOLUTION IN WORKPLACE ACCIDENTS (FR0T)                                                                     of sales, compared with 3.0% in 2003.
Faurecia has set an objective of a maximum of five workplace accidents per                                  During the same period, EBITDA increased
million hours worked (expressed as FR0t). 91 sites have already achieved this                               to 6.6% of sales, versus 6.3% the
objective in 2004 accounting for more than half the Group’s sites. At the end                               previous year.
of December 2004, Faurecia was showing an FR0t rating of 8.7, a 63%
improvement compared with the beginning of 2003.                                                            NET INCOME

     25                                                                                                     Net income before goodwill rose
                                                                                                            to €198.3 million, an increase
     20 23.4
                                                                                                            of €77.8 million versus 2003. Goodwill
     15                                                                                                     was €114.6 million compared
                                                             8.7                                            to €110.4 million in 2003.
     10                                                                                                     Net income improved to €83.7 million,
                                                                   FR0t 12 months rolling average           up €73.6 million compared to
          5.0                                                5.0   Objective FR0t by the end of 2005        the previous year.
                        2003                     2004


                                 1,707.1          1,695.7                                         1,903.5                    1,896.0

        NET DEBT                                                                SHAREHOLDERS’
        In €M                                                                   EQUITY
                                                                                In €M

                                       2002            2003         2004                                2002         2003         2004
The control and reduction of debt is a major priority for Faurecia. Net debt has been reduced significantly and as of December 31,
2004 it was €1,497.5 million compared to €1,695.7 million at the end of 2003.

With shareholders’ equity of €1,896.0 million, gearing was 0.79 as of December 31, 2004 compared to 0.93 at the end of 2003.

                                                                    531.8                           380.0                         378.3

        CASH FLOW FROM                                                          CAPITAL
        OPERATIONS                                            5.0               EXPENDITURES
         _                                                                       _                3.9
        •_ In €M                                                                •_ In €M                       3.4
        • In % of sales                          4.3
                                                                                • In % of sales

                                       2002            2003          2004                               2002         2003          2004
Cash flow from operations in 2004 was €531.8 million or 5.0% of sales, compared with 4.3% of sales in 2003.

Capital expenditures were €378.3 million, 3.5% of sales versus 3.4% in 2003.


                                              GROSS EXPENDITURE: €596.5 million (5.6% of sales)
                                              NET EXPENDITURE: €272.8 million
                                              NUMBER OF R&D AND D&D CENTERS: 28
                                              HEADCOUNT: 5,000 engineers and technicians

                                              Research and development expenditure was 5.6% of sales in 2004
                                              and is a significant factor for Faurecia’s future growth.


Fiscal year: January 1 through December 31
ISN code: ISIN FR0000121147
Nominal value: €7
Listed on the Euronext Paris, Eurolist
Stock eligible for deferred settlement (SRD)

                                                                                                                                        % change as of Dec. 31, 2004
       60                                                                                                                               Compared to       Compared to
       58                                                                                                                               Dec. 31, 2003     Dec. 31, 2002
       54                                                                                                           Faurecia                +16.6%            +47.5%
                                                                                                                    SBF 120 adjusted         +8.2%            +26.4%
       48                                                                                                           DS Autoparts
       46                                                                                                           Europe adjusted         +14.9%            +77.6%
             D     J     F     M      A     M     J      J     A     S   O   N      D

STOCK MARKET DATA                                                                 2004                    2003                  2002

            Market capitalization at the end of the period (in €M)           1,399.4                 1,199.9                   947.6
            Share price (in €)
            - highest                                                            69.60                  73.90                  61.40
            - lowest                                                             48.00                  27.00                  33.00
            At year end (in €)                                                   57.80                  49.57                  39.20
            Shareholders’ equity per share (in €)                                78.31                  75.61                  78.74

PER SHARE DATA                                                                    2004                    2003                  2002

            Earnings per share after dilution (in €)
            - Before amortization of goodwill                                     8.26                    5.04                  2.29
            - After amortization of goodwill                                      3.49                    0.42                 (2.49)
            Cash flow per share (in €)                                           22.29                  18.18                  15.69
            Dividend (in €)                                                      1.10*                   0.91                   0.91
            - Tax credit                                                             -                  0.455                  0.455
            - Total                                                               1.10                  1.365                  1.365

* Dividend proposed at the Annual General Meeting on May 23, 2005.

SHAREHOLDER STRUCTURE                                                                       2004                                2003

            Number of shares outstanding at year end (in thousands)          24,212                                        24,206
            PSA Peugeot Citroën                                              71.39%                     (83.6)            71.41%
            Employees funds                                                  0.36%                        (0.2)            0.37%
            Treasury stock                                                   1.57%                             -           1.71%
            Publicly held                                                    26.68%                     (16.2)            26.51%
                                                                                   (Voting rights in parentheses)



Group Communications
+33 (0)1 72 36 70 05
Financial information
available on line at
(“finance & shareholders” section)
Faurecia Headquarters
2, rue Hennape
92735 Nanterre Cedex – France

2005 Financial Calendar
January 13
& Full-Year 2004
Sales Announcement
February 17
& Full-Year 2004
Results Announcement,
presentations in Paris and London
April 13
First-Quarter 2005
Sales Announcement
May 23
Annual General Meeting, Paris
July 21
First-Half 2005
Results Announcement,
presentations in Paris and London
                                     Photo credits: A. Gonin; S. Muratet; B. Schittny; G. Uféras/Rapho.
October 13
Third-Quarter 2005                   We would like to thank the teams at our R&D and D&D centers located in Hagenbach,
Sales Announcement                   Germany and Seloncourt, France and at our production sites in Audincourt, Beaulieu,
                                     Pulversheim, France and Scheuerfeld, Germany for their generous time and
                                     cooperation in facilitating the photo shoots necessary for many of the images that
                                     appear in this document.

                                     Design and publishing:
                                     Translation: Semantis.

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