# MESSAGE TO OUR STAKEHOLDERS

_Source: `DeepSeekOCR_Ardian_pruned_1k/consumer-cyclical-auto-parts/NYSE_APTV_2022/NYSE_APTV_2022.mmd` · pages 1-7_

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MESSAGE TO OUR STAKEHOLDERS

More than a decade ago, Aptiv recognized that demands for a safer, greener and more connected world would reshape the future of the automotive industry, and since that time we have continued to refine and execute our strategy to capitalize on these megatrends. While the recent pandemic and supply chain challenges tested our resilience, our ability to meet customer demands and achieve record new bookings confirmed the strength of our portfolio, the commitment of our global workforce and the value of our mission.

Today, the megatrends are accelerating, driven by the growing appeal of feature-rich, highly electrified vehicles. Our ability to enable these advanced features at a price consumers can afford is a testament to our capabilities. We are uniquely positioned as the industry's only full-system solutions provider, which enables us to optimize the performance and cost of the solutions we develop. Each day, our products help customers solve their toughest challenges, support the sustainability of our planet and deliver long-term value for our shareholders.

While we are proud of the resilient and innovative company that we have built, we are even more excited about how we are positioned for the future.

## DEMAND ACCELERATING FOR ELECTRIFIED, FEATURE-RICH VEHICLES

During 2022, battery electric vehicles (BEVs) accounted for approximately 10 percent of new-vehicle production, reflecting continued strong growth driven by more stringent government regulations and increasing consumer demand. As a result, we expect the market for high-voltage electrification to increase by more than 20 percent annually between now and 2030.

The demand for higher levels of vehicle safety also increased, which is reflected in almost 20 percent of new vehicles built including Level 2 or higher advanced driver-assistance systems (ADAS). Multiple OEMs have now launched hands-free driving applications, many of which are enabled by Aptiv solutions that deliver greater levels of efficiency, flexibility and robustness across the broadest possible range of driving scenarios.

2022 also saw a step-function increase in OEMs beginning the transition to next-generation hardware and software architectures. By 2030, we expect that nearly 1 out of every 4 vehicles produced will use a highly centralized, software-defined architecture approach similar to the one Aptiv has been developing.

## A CLEAR PATH FORWARD

Aptiv is leading the transformation in advanced vehicle architectures. This effort has been informed by the experience of launching more than 200 BEV architecture platforms and 60 high-complexity, software-intensive programs across more than 20 OEMs — all while maintaining exceptional levels of quality and delivery.

Our Smart Vehicle Architecture \( ^{™} \)  (SVA \( ^{™} \) ) solution, introduced in 2017, comprises hardware and software building blocks designed to efficiently enable new software-defined functionality. We have worked with multiple global OEMs on advanced development programs. In doing so, we have leveraged our expertise in both the "brain" (software and compute) and the "nervous system" (power and data distribution) of the vehicle to serve as a trusted technology partner. This resulted in more than 4 billion in new SVA \( ^{™} \)  business awards during 2022 — up significantly from less than 1 billion total when we entered the year. We continue to be recognized for our innovation. In 2022, we won our 25th Automotive News PACE Award for the central vehicle controller, a key component of SVA \( ^{™} \) .

At the same time, Aptiv's high-voltage solutions are reducing weight and mass while also improving range and enabling faster charging — critical factors for BEV adoption. We have a comprehensive high-voltage portfolio, which we expanded during 2022 to include integrated power electronics. This solution combines six devices into one while also hosting battery management system software, and we won our first program to deliver this integrated solution to a major OEM.

During 2022, Aptiv also acquired an 85 percent equity stake in Intercable Automotive Solutions, a pioneer in the design and manufacture of high-voltage power distribution and interconnect technology. The company's industry-leading busbar technologies enhance our high-voltage product portfolio, and Intercable Automotive is able to leverage Aptiv's global scale and manufacturing footprint.

## THE NEXT CHAPTER FOR APTIV

Consumers increasingly are demanding advanced, software-enabled features, which need to be supported across the full life cycle of the vehicle. This requires a continued evolution of the in-vehicle software architecture, as well as the development tools and processes OEMs use to enable these solutions.

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We acquired Wind River, a global leader in delivering software for mission-critical intelligent systems, whose technology is in more than 2 billion edge devices for more than 1,700 customers across multiple end-markets, including telecommunications, aerospace and defense and industrial. Wind River's proven solutions are ideally suited to support next-generation vehicle architectures through software abstraction and a cloud-native approach that modernizes software development, deployment and operation over the life cycle of the vehicle.

This acquisition is an enabler for our future, positioning us to move away from legacy monolithic architectures that have historically defined our industry to a more agile, cloud-native approach. This modernizes software development and life-cycle management, enables new business models and accelerates the industry's digital transformation. As a result, Aptiv is better positioned to execute against the attractive opportunities in software-defined mobility, and Wind River can accelerate its growth in other high-value industries by providing its world-class team with additional resources.

## POSITIONED FOR THE EMERGING
INTELLIGENT EDGE

In the future, the vehicle will increasingly become an intelligent edge device integrated into the broader internet of things ecosystem, enabling more advanced

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"I offer my deepest thanks to our 200,000 employees around the world, whose determination and sacrifices have positioned us for the future, and I thank all our stakeholders for their continued support of our mission."

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processing to take place in the cloud, powered by machine learning for insights and deep personalization.

We are well positioned to leverage our entire hardware and software portfolio to address this expanded opportunity. Aptiv's solutions are not limited to the automotive industry, as applications in industrial, transportation, renewable energy and other attractive markets are being shaped by the same technology trends and customer needs, including increasing data, power and connectivity requirements. Looking ahead, our ability to serve these markets nearly doubles our total addressable market opportunity to $400 billion by 2030.

## REALIZING OUR VISION FOR TODAY AND BEYOND

The strategy we developed roughly a decade ago has proved to be the right one, helping us stay focused on our goals and allowing us to successfully navigate the challenges facing our industry. Our priority remains to deliver on our commitments to our customers and our shareholders — both today and in the future.

I offer my deepest thanks to our 200,000 employees around the world, whose determination and sacrifices have positioned us for the future, and I thank all our stakeholders for their continued support of our mission.

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Kevin P. Clark
Chairman and Chief Executive Officer

Kun P. Clark

"Consumers increasingly are demanding advanced, software-enabled features, which need to be supported across the full life cycle of the vehicle. This requires a continued evolution of the in-vehicle software architecture, as well as the development tools and processes OEMs use to enable these solutions."

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