HK000KL3_Short

DONGFENG MOTOR GROUP CO., LTD

Nov. 14, 2006, Singapore

DONGFENG MOTOR GROUP CO., LTD

Nov. 14, 2006, Singapore

HK000KL3

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Group StructureGroup Structure

Dongfeng Motor Group（ the Company ）

Subsidiaries Sino-foreign JVsOther companies

in which equity intereststhe Company has direct

Dongfeng(Shiyan) Special Purpose

Commercial Vehicle Co.,

China Dongfeng MotorIndustry Import&Export

Co., Ltd

Dongfeng Motor Tender Info. Co., Ltd

Dongfeng Motor Co.,Dongfeng Honda

Engine

Dongfeng HondaDongfeng Honda

Auto Parts

Dongfeng Nissan Diesel

Dongfeng MotorFinance Co., Ltd

Dongfeng SUV Co., Ltd

Dongfeng ElectricalMotor Joint Stock

Dongfeng PeugeotCitroen Co., Ltd

Honda Auto(China) Co., Ltd

50%

50%

50%

44%

Dongfeng Motor Corporation

Public Shareholders

66.68%

33.32%

96%

95%

35.2%

50%

50%

20%

10%

40%

36.44%

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Xinjiang Auto

Liuzhou Auto

ShanghaiHangzhou

Dongfeng Honda Auto Parts

Shiyan Base

Xiangfan Base

Wuhan Base

Guangzhou Base

Layout of Major Production Facility

Four Major Production Facilities

Shiyan Base: CV, Auto Parts , Auto Manufacturing Equipments

Wuhan Base: Headquarter, PV

Xiangfan Base: LCV, Engines, PV

Guangzhou Base: PV, Engines, Auto Parts and Components

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Highlights in the First Nine Months of 2006

Highlights in the First Nine Months of 2006

Aggregate auto sales volume amounted to 532,000 Units

PV sales volume reached 345,000 units, representing 34.75% Y0Y growth, which is higher than industry average(31.39%)

Several newly launched models, including new Dongfeng Nissan Teana, Dongfeng Peugeot 206, Dongfeng Citroen C-Triomphe and Dongfeng Honda Civic were well received by the market and the recently launched Nissan Sylphy also became a new growth driver for the Group.

In IH2006 sales volume broke through 100,000 units, recording a YoY increase of 38% and a profit of RMB190 ml, operational level

remarkably improved

注 1 ： 2004年可比口径的净利润为 13.2亿人民币，具体参见本报告第 16页

Sales revenue YoY increased 9.8%

Net porfit YoY increased68.75%

Gross profit margin YoY increased 47.65%

Net ROE YoY increased 7.2%

RRemarkable Market Performance of emarkable Market Performance of Newly Newly

Launched ProductsLaunched Products

PPV Growth Rate Higher than V Growth Rate Higher than Industry Average from January to Industry Average from January to

September of 2006September of 2006

FFavorable Financial Performance avorable Financial Performance in 1Hin 1H

TTurning Around of DPCA, with urning Around of DPCA, with Remarkably Improved OperationRemarkably Improved Operation

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1. Chinese Auto Industry Continues to Maintain Strong Growth Momentum

2. Well Positioned PV Business Entered a Fast Development Stage

3. Production Capacity Expansion Projects Steadily Pushed Forward

I. Business PerformanceI. Business Performance

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1. PRC Auto Industry Maintains a Good Growth Momentum from January to September

1. PRC Auto Industry Maintains a Good Growth Momentum from January to September

5,758

4,136

5,170

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

2005 2005,1-9 2006,1-9

PRC Total Auto SalesPRC Total Auto Salesunit ： ,00

0

PRC Total PV SalesPRC Total PV Sales

3,971 3,6822,802

01,0002,0003,0004,0005,000

2005 2005,1-9 2006,1-9

unit ： ,000

PRC Total CV SalesPRC Total CV Sales

1,4881,334

1,787

0

500

1,000

1,500

2,000

2005 2005,1-9 2006,1-9

unit: ,000

资料来源：中国汽车工业协会注 1 ：按照中国汽车工业协会的分类方法，乘用车包括基本型乘用车（轿车）、MPV 、 SUV和交叉型乘用车

Growth Rate: 31.39%

Growth Rate:

11.6%

Growth Rate:

25.01%

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384782

285486

0

50,000

100,000

150,000

200,000

250,000

300,000

350,000

400,000

450,000

2005,1-10 2006,1-10

Sales of PV-Sales of PV- Dongfeng Honda Dongfeng Honda AutomobileAutomobile

Sales of PV- Dongfeng Sales of PV- Dongfeng Peugeot Peugeot CitroënCitroën

Sales of PVSales of PV － － Dongfeng Motor Co. LtdDongfeng Motor Co. Ltd Total sales of PV - Dongfeng Total sales of PV - Dongfeng Motor GroupMotor Group

20,839

0

15,000

30,000

2005,1-10 2006,1-10

Source: Forcast of China Association of Automobile Manufactures (CAAM)

Each JV strategically launched competitive new models directed at each Each JV strategically launched competitive new models directed at each sub-segment, which fastly pushed forward the Group’s PV industry.sub-segment, which fastly pushed forward the Group’s PV industry.

2. Well Positioned PV Business Entered a Fast Development Stage

2. Well Positioned PV Business Entered a Fast Development Stage

147,993

050,000

100,000150,000

2005,1-10 2006,1-10

Growth rate:

19.7%

Growth rate:

125%

Unit:,000

Unit:,000

116,654160,575

0

100,000

200,000

2005,1-10 2006,1-10

Growth rate:

37.65%

Unit: ,000

PSA Peugeot Citroën

Growth rate:

34.78%

,ooo units

47,071

177,136

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3.Production Capacity Expansion Projects Steadily Pushed Forward

3.Production Capacity Expansion Projects Steadily Pushed Forward

In 2006, the Group steadily pushed forward its capacity expansion In 2006, the Group steadily pushed forward its capacity expansion projects, which laid a solid foundation for its future sustainable projects, which laid a solid foundation for its future sustainable

developmentdevelopment

CContinue to Push Forward ontinue to Push Forward Production Capacity Expansion Production Capacity Expansion

Projects in a Timely MannerProjects in a Timely Manner

320

425

320

625

413

820

0

100

200

300

400

500

600

700

800

900

CV PV

2005 1H2006 2008E

On March 26, Dongfeng Honda 120,000 units Capacity put into production.

On February 28, DFL’s PV engine production base completed construction and went into production. As of June 30 2006,DFL has formed a total annual PV production capacity of 285,000 units.

Push Forward PV Production Push Forward PV Production Capacity Expansion ProjectsCapacity Expansion Projects

DPCA progressively push forwarded its 2nd phase capacity expansion project. By the end of June, an annual production capacity of 220,000 units was formed. Last month, its second plant was broken ground for construction. By 2009, total annual capacity will reach 450,000 units.

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1. Steady Revenue Growth

2. Continuous Growth of Gross Profit Margin

3. Robust Profit Growth

4. Turning Around of DPCA in 1H2006

5. Continuous Improvement of Operation Efficiency

6. Further Reduction of Liability Level

II. Financial PerformanceII. Financial Performance

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1. Steady Revenue Growth1. Steady Revenue Growth

SSales Revenueales Revenue

23,282

21,192

20,000

20,500

21,000

21,500

22,000

22,500

23,000

23,500

1H2005 1H2006

9.9%

RMB million

Composition of RevenueComposition of Revenue

35%28%

61% 70%

4% 2%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

1H2005 1H2006

CV PV Others

Rapid sales growth as well as a steady pricing policy guaranteed Rapid sales growth as well as a steady pricing policy guaranteed a continuous and steady growth of the Group’s sales revenuea continuous and steady growth of the Group’s sales revenue

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2. Continuous Growth of Gross Profit2. Continuous Growth of Gross Profit

2,7663,330

4,084

13.1%

16.2%17.5%

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

10,000

2005 1H 2005 2H 2006 1H

0%

4%

8%

12%

16%

20%

Gross profit Gross profit margin

DDFG’s Overall Gross Profit and Gross FG’s Overall Gross Profit and Gross Profit MarginProfit Margin

14.0% 10.3% 13.0%

0.0%10.0%20.0%

2005 1H 2005 2H 2006 1H

12.9% 18.2% 19.6%

0.0%10.0%20.0%

2005 1H 2005 2H 2006 1H

CV Gross Profit MarginCV Gross Profit Margin

PV Gross Profit MarginPV Gross Profit Margin

RMB million

Significant growth of the Group’s PV gross profit and gross profit Significant growth of the Group’s PV gross profit and gross profit margin guarantees the steady increase of the Group’s gross profit margin guarantees the steady increase of the Group’s gross profit

marginmargin

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3.Robust Profit Growth3.Robust Profit Growth

660

940

1,114

0

300

600

900

1,200

1,500

Net Profit

DDFG’s Total Net ProfitFG’s Total Net ProfitSales GrowthSales Growth

RMB Million

Fast growth of PV sales volume and steady pricing policy Fast growth of PV sales volume and steady pricing policy guaranteed a continuously steady growth of the Group’s sales guaranteed a continuously steady growth of the Group’s sales

revenuerevenue

164 187233

141 103

125

0

50

100

150

200

250

300

350

2005 1H 2005 2H 2006 1H

PV CV

000’ units

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4. Successful Turning Around of DPCA in 1H 2006

4. Successful Turning Around of DPCA in 1H 2006

Strong Growth of Sales Strong Growth of Sales VolumeVolume

72,470 67,927

100,000

0

50,000

100,000

150,000

2005 1H 2005 2H 2006 1H

38%

Reduce Cost and Improve Reduce Cost and Improve EfficiencyEfficiency

Unit

-338

120

190

-400

-200

0

200

400

2005 1H 2005 2H 2006 1H

Net ProfitNet Profit

Robust sales and constant cost reduction and improvement of Robust sales and constant cost reduction and improvement of efficiency contribute to DPCA’s successful turning aroundefficiency contribute to DPCA’s successful turning around

RMB Million

Constant increase of localization rate and cost reduction through technology advancement

Cost reduction through centralized procurement

Cost reduction through improvement of management

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5.Continuous Improvement of Operational Efficiency

5.Continuous Improvement of Operational Efficiency

16.72%

15.18%15.40%

14.00%14.50%

15.00%15.50%16.00%

16.50%17.00%

2005 1H 2005 2H 2006 1H

Improvement of operation efficiency led to steady growth of the Improvement of operation efficiency led to steady growth of the Group’s ROA and ROEGroup’s ROA and ROE

NNet Profit Marginet Profit Margin Return on EquityReturn on Equity

4.80%

3.10%

4.60%

0.00%1.00%

2.00%3.00%4.00%

5.00%6.00%

2005 1H 2005 2H 2006 1H

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6. Further Reduction of Liability Level6. Further Reduction of Liability Level

24.3%

1.0%2.2%

0%

5%

10%

15%

20%

25%

30%

June 30,2005 Dec.31,2005 June 30,2006

e

Net Debt / CapitalNet Debt / Capital Total Liabilities / Total AssetsTotal Liabilities / Total Assets

Significant drop of net debt makes the Group’s capital structure Significant drop of net debt makes the Group’s capital structure more flexible and healthiermore flexible and healthier

70.7%

62.3% 62.4%

58%

60%

62%

64%

66%

68%

70%

72%

June 30,2005 Dec.31,2005 June 30.2006

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III. Future ProspectIII. Future Prospect

1. Prospect of PRC Auto Industry in 2H 2006

2. Outlook of DFG

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1. Prospect of PRC Auto Industry in 2H 2006

1. Prospect of PRC Auto Industry in 2H 2006

At the beginning of 2006, CAAM estimated that PRC At the beginning of 2006, CAAM estimated that PRC automobile industry annual sales growth for 2006 automobile industry annual sales growth for 2006

would reach 13% would reach 13%

13%

000’ units

Source: Forcast of China Association of Automobile Manufactures (CAAM)

6,500

5,758

5,200

5,400

5,600

5,800

6,000

6,200

6,400

6,600

2005A 2006E

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2. Outlook of DFG 2. Outlook of DFG

SSpecific Measurespecific Measures

000 ’units Passenger Vehicles ： In the 2H, Dongfeng Nissan Sylphy, Geniss

and Dongfeng Citroen T21 successively launched to the market.

Further improve localization rate and reduce cost through advancement of technology, management and central procurement, so as to improve competitive edge of our products in the market.

Commercial Vehicles ： Strengthen marketing of newly launched

products Safeguard competitiveness of old products Promote export and expand overseas market

share

SSales Planningales Planning

230200

70

250

0

50

100

150

200

250

300

DFL-PV DPCA DHAC CV

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`̀

Thanks!