VP Commercial Operations - JCB

Ken Bianco

Company History

Mr. JCB builds his first product (a tipping trailer) out of a small garage in the United Kingdom.

In 1953 JCB invents the backhoe loader, a staple in the modern workplace, and continues to expand production through the 60’s

JCB begins to export its machines as demand grows. JCB also introduces the telescopic handler.

JCB further expandsits range to include the Fastrac, the world’s fastest tractor.

JCB invents the Monoboom skid steer with a side entry for unmatched safety.

JCB begins production on its new engine and Savannah, GA is the new home for JCB USA.

65 Years in the making…

JCB Worldwide – 18 Manufacturing Facilities

JCB’s Product Range

Over 300 Products

Products Range from 500kg to 46 tons!

The Best Selling Backhoe and Telescopic Handler in the World

Fully Integrated JCB Drive-Train

WE BUILD OUR OWN:• Axels• Engines• Transmissions• Rams• Chassis• Cabs• Arms

About 95% of the BHL is Built By JCB

JCB in Savannah, GA – 10 Years as a Local Manufacturer

The JCB HMEE

2010 North American Dealer Network

JCB NORTH AMERICA84 Dealer219 Locations87% Market Coverage

Export History From Savannah (Through 2008)

YEAR 2005

590

2006

849

2007

1611

2008

1352UNITS

COUNTRIES: Panama, Mexico, Chile, United Kingdom, Guatemala, Venezuela, Colombia, Jamaica, Malaysia, Ecuador, Australia, South Africa, Thailand, Indonesia.

The Next Generation Skid Steer – Made in Savannah

NEW GENERATION JCB SKID STEERSavannah designed, engineered, built and shipped globally

Why Savannah, GA.

Location, Location, Location…

PORTS• Savannah• Brunswick

JCB Logistics & Supply Chain

Why Georgia?

BENEFITS• Airport / Ports• I 95• Rail (CSX, Norfolk Southern)• Services to all Major Foreign Ports• Diverse Economy• Excellent Climate• State Encouragement• Right Demographics

Why Georgia? - Construction Equipment Growth Potential (2000-2005)

150% - 200%100% - 150%

75% - 100%50% - 75%25% - 50%

GLOBAL LOGISTICS

Current Inbound / Outbound Flow

SUPPLIER CUSTOMER(Dealer)

INBOUND OUTBOUND

INCOTERMS - EXWORKSINCOTERMS – LANDED CIF

Future Inbound / Outbound Flow

SUPPLIER CUSTOMER(Dealer)

INBOUND OUTBOUNDINCOTERMS - EXWORKS INCOTERMS – LANDED CIF

LLP

Supply Chain Control | Visibility | Reduce Congestion | Standardize Packaging

NORTH AMERICA LOGISTICS

North American Challenges

• Fluctuating Diesel Prices• Changing Government Regulations• Rising Port Fees (i.e. 4% per year)• Rising Warehouse Fees• Road Congestion and Safety

North American Challenges – Load Optimization Matters

HEAVYLINE

High MarginEx. $2000 TruckloadP/Unit Cost = $2000

COMPACT

Lower MarginEx. $2000 TruckloadP/Unit Cost = $500

COMPACT

Lower MarginEx. $2000 TruckloadP/Unit Cost = $2000

North American Challenges - Transport

• New EPA Requirements• New Engines Reduce Soot / NOx• New Engines Heavier / Costly (+14k)• $6k More per 100k Miles to Operate

North American Challenges – Customs Compliance / Anti-Terrorism Compliance

C-TPAT (Customs Trade Partnership Against Terrorism)

• Facilities Security / Pre-Employment Verification / Inbound Cargo Screening• Compliance Beneficial – Upfront Setup Burden – Backend Benefits

ISF (Importer Security Filing)

• Importer Electronically Submit Advanced Cargo Info to US Customs• Significant Change in Supply Chain Security• JCB Experience has Been Positive but Still a Significant Investment inTraining / Education / Systems

North American Initiatives – Supply Base Localization

10 Hour Spin

4 Hour Spin

60% of Localized Content Within 10 Hour Spin

North American Initiatives - Freight Consolidation

NORTH CAROLINA SAMPLE• Current Transport: 3276m p/ week• 5% of the Purchase Price

North American Initiatives - Freight Consolidation

NORTH CAROLINA SAMPLE• Future Transport: 900m p/ week• 2.7% of the Purchase Price• $600k Savings per Year• 114k Less Miles per Year• Transition to Returnable Packaging

High Georgia Port Utilization

Halifax

Baltimore

Georgia Ports - 63%

Galveston

Tacoma

Hueneme

The Future – Local Manufacturer to Global Exporter

Backhoe Across America