The way forward for GT

1. CONFIDENTIAL The way forward for GT Summary of review December 5, 2006

2. Content Product and customer segment overview Deep dive selected segments Company profiles potential partners The way forward

3. Possible product and customer/partner segments INITIAL HYPOTHESIS Increased cost and quality Attractive Unattractive 5 Assessed in further detail x Hi-tech, niche version • For special situations, e.g remote control • Tailor made solution • For special situations, e.g., mine sweeping Flexible ready made model with multiple features • Too sophisticated and expensive • Too sophisticated and expensive? • Difficult to meet customer needs with one model • Scale needed Product definition 2 3 4 Basic model with selected options • Too expensive • Possible solution with low cost manufacturing • For aid/ emergency use • For specific projects • Affordable solution for mid-tier 1 • Large segment, but low income • Good “value for money” • Local manu-facturing • Use of local companies as agents/franchisees • For aid-projects • For development programs Self-assembly kit with critical parts • Want ready-made • An alternative for DIY-segment? Industrial, western users, e.g., construction, forestry work, military Local manufacturers/ Individual users in developing countries High-end players developing countries (companies, local authorities) International aid organization e.g., Red Cross, UN Increased buying power Customer / Partner Source: Interviews

4. Possible product and customer/partner segments INITIAL HYPOTHESIS Increased cost and quality Attractive Unattractive 5. “The ultimate transporter” Assessed in further detail x Hi-tech, niche version Flexible ready made model with multiple features Product definition 2. “The low-cost professional transporter” 3. “The aid-to-aid transporter” 4. “The multipurpose transporter” Basic model with selected options 1. “The transporter-in-a-box” Self-assembly kit with critical parts Industrial, western users, e.g., construction, forestry work, military Local manufacturers/ Individual users in developing countries High-end players developing countries (companies, local authorities) International aid organization e.g., Red Cross, UN Increased buying power Customer / Partner Source: Interviews

5. Most attractive product/customer mix-combinations Most attractive 2. “The low-cost professionalized transporter” 1. “The transporter-in-a-box” 3. “The aid-to-aid transporter” 4. “The multipurpose transporter” 5. “The ultimate transporter” Customer • Local 3rd world manufacturers “franchisees” • Local farmers/ project developers in developing countries • Aid agencies with local projects • Local companies • Local 3rd world manufacturers building from ready made chassis • Local authorities in developing countries • International aid organizations, e.g., UN, Red Cross (can also act as door openers for number 1 and/or 2) • Construction • Forestry industry • Construction • Forestry industry • Military Core technology • Kit with patented joints • Assembly manual for illiterate (ref. IKEA) • Simple, robust, low cost tractor. Either sold as basic version or as chassis • A vehicle with valuable re-use properties • Flexible and robust vehicle • Flexible and robust vehicle • Customer tailored solution Example of add-on accessories and services • Water pump • Electricity generator • Grinder • Biofuel engine • Other agricultural equipment • Water pump • Electricity generator • Grinder • Biofuel engine • Other agricultural equipment • Water pump • Electricity generator • Grinder • Biofuel engine • Water pump • Electricity generator • Forestry tools • Spare parts • Water pump • Electricity generator • Remote control • Mine sweeper • Forestry tools • Spare parts Production system • Kit made at “one” central plant in low-cost country • Local assembly • Chassis made at “one” central plant • Local assembly (ref. production system for buses) • Produced at one global plant • Also potentially entry point for #1 and #2 • Produced at one global plant • Produced at one global plant, potentially with local modifications add-ons

6. Content Product and customer segment overview Deep dive selected segments Company profiles potential partners The way forward

7. Product • Minimum kit with critical parts enabling local manufactures and farmers to build their own vehicle from scratch, using locally available parts where possible (used cars etc.) • Easy assembly manual for illiterate (ref. IKEA) describing functions and how to assemble the tractor • Possibility to sell optional add-on kits, e.g., water pump, electricity generator, grinder Value to customer • Advanced vehicle built from cheap parts • High flexibility in choosing parts and final solutions; Easy to repair • For franchisees: A basis for building a local business • For society: Lower cost of rural development • For countries in rapid development (e.g., Mozambique), allow development prior to development of road infrastructure, “The mobile phone of road infrastructure” Ability to pay vs. production cost • Partly a very low income segment, requiring all costs to be kept at a minimum • However, a mid-segment also exist (e.g. plantation owners etc.) • Kit with parts to be produced as cheaply as possible, ideally at high scale in low-cost country (India?) Potential partners • Global agricultural equipment / automotive manufacturer seeking exposure to developing markets, e.g., Tata Motors • A network of local franchisees • Local players in developing countries, e.g., partnership enabled through NORAD’s MatchMaking Program 1. “The transporter-in-a-box” Source: Interviews

8. 10.000 Key challenges: “The transporter-in-a-box” • Scale • Currently relatively high share of subsistent farmers with limited transportation needs in African developing countries • Potentially large market in the future, with higher share of cash crop farmers • Competition • Old trucks, owned and operated by individuals at low cost • Low reliability and quality, but sufficient for most needs • Possible go-to-market approach • Sale of self-assembly kits through international aid organizations to gain market access • Local authorities and companies targeted when product is know in the market • Or…. • Local manufacturers and individual users in a franchise system • Key challenges • Understand current transportation needs of rural population • End users ability to pay given very low average income (~1 USD/day) • Convince international aid organizations of product quality and concept to gain partnership • Or……. • Sign-up local franchisees • Recommended focus: • In parallell focus on aid organizations • and potential franchisees in top 5 countries – Countries • with weak infrastructure, but in commercialization • stage (e.g Mozambique) Source: Interviews

9. 10.000 Average income in African developing countries typically ~1 USD/day Private consumption per head; USD/year Kenya Nigeria Angola Source: EIU

10. 2. “The low-cost professionalized transporter” • Simple, robust yet cheap vehicle targeted at local companies and authorities, without will to build the product from scratch • Optional add-ons tailored to customers needs, e.g., water pump, electricity generator, grinder, biofuel engine • Either sold as ready made or as chassis for local completion (lower cost, value to local partner, possible tailoring) Product Value to customer • Advanced yet cheap vehicle • Easy maintenance • High flexibility in choosing add-ons and final solution • Possibility for local assembly • For chassis buyer: A basis for building a local business Ability to pay vs. production cost • Requires will from local companies / government to invest in this type of equipment Potential partners • Global agricultural equipment / automotive manufacturer seeking exposure to developing markets, e.g., Tata Motors • Local players in developing countries, e.g., partnership enabled through NORAD’s MatchMaking Program • Export/import agencies • Local manufacturers and individual users in a franchise system(?) Source: Interviews

11. 3.500 Example: Optimum conditions for biofuel production in developing countries – “The low-cost professionalized transporter” can solve transportation issues and accelerate growth Optimum temperature for sugar cane cultivation from 25 to 35C Example Brazil alone – Potential to quadruple global bioethanol production Source: Centro de Estudos Avançados em Economia Aplicada, H. Ruete, IEA meeting 2005

12. 4.4 Feedstock cost for biodiesel production USD/ton Production volume Billion gal Example: Potential for significant bioethanol production in Mozambique at competitive cost, lack of infrastructure limiting development Mozambique Malaysia Bioethanol volumes Billion gal Production cost 2005 USD/gal Potential in Mozambique 35.0 Mozambique ~0.8-1.0 Rapeseed oil EU Malaysia palm oil* 5.7 660 Palm oil Malaysia EU mandate 3.3 Europe 1.89 Global biodiesel* 1.1 390 Domestic fuel consumption – 2005 Billion gallon Domestic fuel consumption – 2005** Billion gal 1.60 Production cost of gasoline at 60 USD/bbl Mozambique 0.1 Malaysia 4.4 * Assuming same specific density, given existing mandates in 2010 ** Includes gasoline and diesel Source: FAOSTAT; NREL; SRI; Oil world

13. 10.000 Key challenges: “The low-cost professionalized transporter” • Scale • Chassis-approach allows for success even with moderate scale • Competition • “New” trucks, tractors and agricultural equipment from well-known brands – Possibility to compete on price, but need to convince user of product qualities • Third hand trucks/combi-vans • Possible go-to-market approach • Partner with low cost manufacturer and distributor to enable market access and low cost production • Sell chassis to local players thereby creating local pull and a broader distribution network • Key challenges • Understand needs of local authorities and companies • Identify and successfully enter partnership with low cost manufacturer and distributors with access to customers Source: Interviews

14. 3. “The aid-to-aid transporter” Product • Robust and flexible vehicle targeted at international aid organizations, with valuable re-use properties if left behind to local inhabitants • Selected add-ons installed on original vehicle, to maintain flexibility of use, e.g., water pump, electricity generator • Optional advanced add-ons for specific purposes, e.g., biofuel engine, grinder Value to customer • Robust and flexible vehicle with good terrain qualities • Easy maintenance, flexibility to use local parts for repairs • Makes sense to “Leave behind” • High flexibility in choosing add-ons and final solution Ability to pay vs. production cost • High will to pay for right solution, however potential customers need to be convinced of product qualities • Potentially a door opener for later sale of “The transporter-in-a-box” and “The low-cost-village tractor” Potential partners • International aid organizations • Global agricultural equipment/automotive manufacturer seeking exposure to developing markets, e.g., John Deere (already has a Gator model) Source: Interviews

15. 10.000 Key challenges: “The aid-to-aid transporter” • Scale • Potential large scale, if international aid organizations are convinced of product and concept • Competition • High cost brands, e.g., Toyota Land Cruisers • Second hand military vehicles • Focus on well known solutions and – in emergency situations – availability of vehicle within short timeframe (~24 h) • Possible go-to-market approach • Initially target smaller aid organizations and specific projects, e.g., Flykningehjelpen, Kirkens Nødhjelp, to prove product qualities and gain recommendations • Partner with low cost production company • Approach larger, international aid organizations like UN when the product is a proven success and production ready to be scaled up • Key challenges • Gain access to aid organizations and convince them of product qualities to build portfolio of success stories • Convince international aid organizations to try new, innovative solutions over well known products • Ability to deliver large qualities of product in short time frame • Team up with established chain (e.g. Toyota) and offer GT to expand their product range Source: Interviews

16. 4. “The multipurpose transporter” Product • Robust and flexible vehicle target at western customers with high quality demands, but limited need for costly special solutions • Selected basic add-on options available, e.g., water pump, electricity generator, forestry tools • Additional supply of spare parts and after-sale service Value to customer • Robust and flexible vehicle for high demanding customers • Most common add-on options easily available Ability to pay vs. production cost • Willing to pay for high quality product, but not for add-ons/unnecessary advanced technology Potential partners • Global construction equipment / automotive manufacturer, e.g., Terex Source: Interviews

17. 10.000 Key challenges: “The multipurpose transporter” • Scale • A flexible solution can cover multiple user needs and segments with same base model • Niche product with relatively limited scale potential • Competition • High cost agricultural or construction equipment, often with more advanced, but less flexible solutions • Possible go-to-market approach • Develop prototypes in collaboration with selected local customers, e.g., Kran Entreprenøren • Partner with global agricultural equipment/automotive manufacturer to enable production and gain access to niche customers • Key challenges • Build “one model that fits all” without making it to costly • Successfully partnering with global company to reach customers and support product with well known brand Source: Interviews

18. 5. “The ultimate transporter” Product • Technologically advanced and robust vehicle target at western customers with high demands and special needs, e.g., construction industry, forestry industry, military • Custom made vehicle developed in collaboration with customer • Advanced options for specific purposes available or tailor-made, e.g., remote control, mine sweeping, in addition to basic add-on options • Additional supply of spare parts and after-sale service Value to customer • Advanced, robust and flexible vehicle • High flexibility in choosing final solution Ability to pay vs. production cost • High will to pay for right solution • Solution developed in collaboration with final customer Potential partners • Global construction equipment / automotive manufacturer, e.g., Caterpillar • Military • UN Source: Interviews

19. 10.000 Key challenges: “The ultimate transporter” • Scale • Limited volume production, but potentially high margin product • Competition • High cost, custom build or tailored equipment • Specialized construction, automotive or defense equipment providers • Possible go-to-market approach • Close partnership with potential customers, designing and developing tailored solutions • Promote flexibility and tailor made solutions towards new customers, rather than pre-made products, e.g., “We can make the perfect product for your needs” • Identifying production partner that can build tailor made solutions from base model at low cost • Key challenges • Convince users of product qualities and ability to develop tailored solutions to that will meet their needs • Develop and build customer tailored products at low cost • Ability to re-use learning when developing new solutions Source: Interviews

20. Content Product and customer segment overview Deep dive selected segments Company profiles potential partners The way forward

21. Company profiles potential partners • John Deere • Valtra (AGCO Corporation) • CNH • Toyota • Terex • Caterpillar • Volvo • Hitachi • Tata Motors • Kverneland Group

22. Content Product and customer segment overview Deep dive selected segments Company profiles potential partners The way forward

23. Assessment of match/ability to acheive traction Large segment Summary of hypothesis Sizeable segment Ability to achieve traction • “The aid-to-aid transporter” • Special projects • Some emergency situations • 3rd world franchisees: • Kit • Chassis 4. “The multipurpose transporter” • 5. “The ultimate transporter” • For niche use • For rental firms • 1. “The • transporter-in-a-box” • Local farmers Match of needs (GT offering vs. customer needs)

24. Recommended next steps • 1. Zoom in on max 3 customer/product segments to pursue in phase 1 – base selection on “match”/ability to achieve traction assessment • 2. Make targeted presentation material for 3 prioritized clusters and decide on top 3 partners in each category to reach out to • 3. As appropriate: • Arrange for funding/partner arrangement • Leverage World-Bank link • Seek publicity to create “competition among partners” • 4. Do road show to 3 x 3; Start with top priority category

25. “The ultimate transporter” • Caterpillar • John Deere • Terex • Rental company, e.g. HSS, Hertz • Norwegian Armed Forces Suggested top 3 segments and potential partners Potential partners “The transporter-in-a-box” • 3rd world manufacturers/franchisees, e.g. in Mozambique – link through NORAD’s MatchMaking Program? • Tata Motors, or other kit/chassis producer respecting IP • Danfoss (?) “The low cost professional transporter” • John Deere • Valtra (AGCO Corporation); CNH • 3rd world manufacturers/franchisees, e.g. in Mozambique – link through NORAD’s MatchMaking Program? • Toyota European Aid Centre (Portugal)