PSA - 2019 Universal Registration Document

GROUPE PSA Activities and strategy

Refinancing strategy 1.3.2.3.1. Following the institution of the partnership with Santander in Europe and Brazil, and with BNP Paribas Personal Finance in Europe,the financingrequiredby the joint companiesis handledby the partners. Accordingly, BPF finances activities mainly in Argentina, Mexico and Russia. For the financingof activitiesoutsidethe scopeof the partnerships with Santanderand BNP ParibasPersonalFinance,BPF relies on a capital structure and an equity ratio that is compliant with regulatory requirements,and are backed by the quality of the bank’s assets. Its financing is ensured by the broadest possible range of liquidity sources, matching of maturities of assets and liabilities. For more informationon BPF’srefinancingstrategy,pleaserefer to BPF’s AnnualReportat www.banquepsafinance.com. Financial services to end customers 1.3.2.3.2. Financial services to Peugeot Citroën DS as well as Opel and Vauxhallend customersrepresented69% of BanquePSA Finance’s total loans outstanding, amounting to €29,476 million at 31 December 2019, versus €26,256 million at 31 December 2018 under IFRS 8 (under IFRS 8presentation,loans outstandingof this type amounted to €10 million, or 12% oftotal loansoutstanding). Banque PSA Finance serves both individualsand corporatefleets with: loansfor the purchase of new andsecond-hand cars; n short- and long-termoperating leases (hire); n finance leases (vehicles sold with a buybackcommitment); n an array of relatedservices,such as insurance,maintenanceand n extendedwarranties. Spurredby a sustainedfocus on buildingcustomerloyalty for the Groupe PSAbrands, BPF offers diversifiedfinancingproductsand services,as well as bundledoffers,that togetherwiththe six brands provide a comprehensive rangeof mobilitysolutions. Wholesale financing 1.3.2.3.3. Banque PSA Finance, via its subsidiaries and partners, provides financingfor newanddemonstrationvehiclesand,wherenecessary, spare parts for the dealer networksof Peugeot,Citroën,DS, Opel andVauxhall within the areaswhere BPF isestablished. As at 31 December 2019, wholesale financing for the Peugeot, Citroënand DS, as well as Opel Vauxhaulldealershipnetworksheld steady, representing 31% of BPF’s total loans outstanding, amountingto €13,111 millionunder IFRS 8(loansoutstandingof this type amountedto €75 million,or 88% of total loans outstanding, underIFRS 8). As the financialpartnerof thedealernetworks,BanquePSAFinance also helpsthe dealersmanage,trackand controltheir financialrisks in line withcountry-specific developments. Insurance andservices 1.3.2.3.4. In addition to retail lending, every year BPF expands its offering with insuranceproducts(creditinsurance,privatehealth insurance, auto insurance, etc.)and automotive services coordinated with Groupe PSA’sbrands(extendedwarranties,maintenancecontracts, roadside assistance, etc.). BPF sold 1,981,141 insurancepolicies and/or services across the entire scope, up by 2.4%, or on average a little less than two contractsper customer financed.

in termsof the cockpitof the future,Faureciaannouncedits plan n to acquire the remaining50% of its SAS joint venture,which it holds equally with Continental.Created in 1996, the SAS joint venturehas becomea majorplayerin the assemblyand logistics of complex modules for vehicle interiors. It has almost 4,500 employees at 20 sitesin Europe,NorthAmericaand South America,and its annualrevenuefor all of 2019was approximately €740 million. The purpose of this acquisition is to expand Faurecia’ssystemsintegrationoffering toall interiormodules.The transaction was finalised inJanuary 2020. Industrial footprint 1.3.2.2.2. Today, the Faurecia Group works with virtually all the car manufacturers, requiringa world-widepresenceso as to be as close as possible to its customers. It can adapt its worldwideproductionfacilitiesto fit the needsand expectationsof car manufacturers.While two thirds of its facilities manufacturecomponentsand are therefore located to optimise production and logistics costs, the other third operate on a just-in-timebasis. Customers 1.3.2.2.3. The FaureciaGroup has a diversifyingportfoliowith the arrival of newcomers,Chinese car manufacturers,commercialvehicles and producers ofhigh-powerengines. In 2019,the FaureciaGroup’smajorcustomerswere the Volkswagen Group with 18.5% of sales, followed by Ford with 14.6%, then Renault-Nissan-Mitsubishi w th13.8%,Groupe PSAwith13.1%,FCAwith 6.7%, GM with 5.3%, BMW with 3.9% and Daimler with 3.3%. Closely involved in the sales policy of the Groupe PSAbrands, Banque PSA Finance (BPF), directly and wholly controlled by Groupe PSAcompanies,worksin 17 countries,alongsidepartnersin most of those countries,to distributedfinancingand serviceoffers designedto stimulatevehicle sales by the dealershipnetworksfor the Groupe PSA brands. Throughits local operating entities, BPF: providesdealersof the brandswithfinancingfor their inventories n of new and used vehicles,and of spare parts, along with other financing suchas for working capital; offers individualsand businessesa completerange of financing n andservices,as wellas savings products in FranceandGermany. BPF’s commercialoffer will typicallytie insuranceand servicesinto the financingpackagein orderto bestmeet the increasingmobility needsof individuals or companies. Since 2015, BPF has instituted a business model based on cooperation agreements, featuring two major partnerships in Europe,with GroupSantanderConsumerFinancefor the Peugeot, Citroën,DS brands,and with BNP ParibasPersonalFinancefor the Opel and Vauxhallbrands.BPF also operatesin joint-arrangement with Santanderin Brazil. The governanceschemedeployedunder these cooperation agreements means that loan decisions are independentof the brands,while also allowingthe developmentof commercial offers that are appropriate, innovative and fully supportiveof the Push toPassandPace!growthplans. For more information on the implementation of the legal transactionsin each country of the Cooperation,please refer to BPF’s AnnualReportat www.banquepsafinance.com. BANQUE PSA FINANCE 1.3.2.3.

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GROUPE PSA - 2019 UNIVERSAL REGISTRATION DOCUMENT