Annual and

Sustainability

Report

2023

CONTENT

Autoliv at a Glance

Year in Brief

04

CEO Message – Transforming with a Changing Industry

06

70 Years of Saving More Lives

08

Vision / Mission / Key Behaviors

10

Financial Summary 2023

12

Financial and Sustainability Targets

14

Strategy for Change

Customer Focus

Strengthening Our Position in a Changing Market

18

Customer Collaboration

20

Competitive Products and Solutions

Products for Saving More Lives

22

Innovation as an Enabler to Save More Lives

24

Efficient Value Delivery

Operational Excellence

28

Value to Customers

30

The Autoliv Way

Outstanding People Embracing Change

32

Sustainability

A Driving Force in Sustainable Mobility

34

Sustainability Materiality Assessment

36

Sustainability Governance

38

Road Safety – a Global Challenge

40

Climate and Circularity

43

TCFD Disclosure

48

A Safe and Inclusive Workplace

50

Responsible Business

52

Sustainability Appendix

59

The Autoliv Share

Creating Shareholder Value

64

Board and Management

Board of Directors

68

Executive Management Team

69

Contacts

70

Multi-Year Financial Summary

71

23

Forward-Looking Statements

Except for historical information, matters discussed in the annual report are forward-looking statements and are based on

management’s estimates, assumptions and projections. Actual results could vary materially. Please review the “Risk Factors”

and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections in the Company’s

annual report on Form 10-K for the fiscal year ended December 31, 2023, and subsequent SEC filings, for factors that could

affect the Company’s performance and cause results to differ materially from management’s expectations. The information

in this report reflected management’s estimates, assumptions and projections as of January 26, 2024. Autoliv has not made

updates since then and makes no representation, express or implied, that the information is still current or complete. The

Company is under no obligation to update any part of this document.

This report includes content supplied by S&P Global. Copyright © Light Vehicle Production Forecast, January 2024. All rights

reserved.

Cover:

One of our latest steering wheels include an interactive screen that enhances the driving experience. The display is

integrated into the steering wheel, and feature mini-LED and multi-touch technologies to enable easier interactions, making

driving safer.

03

Location

3)

Headcount

Tech cente

r

Production

Sales

support

Other

2)

BRAZIL

1)

1,159

CANADA

448

CHINA

1)

9,466

ESTONIA

1)

895

FRANCE

1,669

GERMANY

783

HUNGARY

1)

1,680

INDIA

1)

4,178

INDONESIA

1)

193

2,184

MALAYSIA

1)

MEXICO

1)

15,615

PHILIPPINES

1)

1,291

POLAND

1)

2,343

ROMANIA

1)

10,010

SOUTH AFRICA

1)

234

SOUTH KOREA

480

SPAIN

421

SWEDEN

538

SWITZERLAND

20

THAILAND

1)

4,516

TUNISIA

1)

4,397

TURKEY

1)

3,055

UNITED KINGDOM

250

USA

4,321

AUTOLIV AT A GLANCE

Year in Brief

The World’s

Largest Automotive

Safety Supplier

A

utoliv, Inc. (NYSE: ALV; Nasdaq Stockholm:

ALIV.sdb) is the worldwide leader in automotive

safety systems. At Autoliv, we challenge and

redefine the standards of mobility safety to sus

-

tainably deliver leading solutions. We develop, manufacture

and market protective systems, such as airbags, seatbelts,

and steering wheels, for all major automotive manufactur-

ers in the world. In 2023, our products saved 35,000 lives

and reduced more than 450,000 injuries.

A major focus area for us is new safety solutions driven

by the evolution of the global automotive market trends. To

extend into new market areas beyond light vehicles and oc-

cupant safety, Autoliv’s Mobility Safety Solutions (MSS)

complements our core business by pursuing new areas for

profitable growth in adjacent markets. Our focus is on areas

where we can leverage our technological know-how, opera-

tional capabilities, and global footprint. In 2023, we focused

on commercial vehicles, electrical safety solutions like py-

rotechnical safety switches and safety products for motor-

cycles and bikes.

The rise of electric vehicles (EVs) and connected cars in

the global market is one of the trends that are currently trans-

forming the automotive industry. We are well-positioned to

sustainably adapt to the business opportunities that come

with these changes.

CHINA

20%

ASIA

19%

AMERICAS

34%

EUROPE

27%

Share of total sales by division

04

Colleagues at Autoliv in Michigan U.S. celebrating Autoliv´s 70 years anniversary.

Key Figures

2023

*) Non-U.S. GAAP Measure. See "Non-U.S. GAAP Performance Measures" section in the 10-K filed with the SEC.

35,000

Lives Saved

05

$10.5b

net sales

70,300

associates worldwide

8.8%

adj. operating margin*

45%

market share

23%

renewable electricity use

$577m

shareholder returns

$982m

operating cash flow

29%

improvement in GHG

emissions intensity

AUTOLIV AT A GLANCE

CEO Message

Market development

It was an intense and challenging year for the automotive indus-

try. 2023 was marked by inflationary pressure and strong devel

-

opment for domestic Chinese OEMs (vehicle manufacturers).

Despite the inflationary environment and rising interest rates,

global car production increased by almost 10% and, according

to S&P Global, is expected to grow by one million vehicles per

year in the coming five years. We have also continued to see

supply chain stability improvements, with reduced customer call

off volatility throughout the year, although the progress stagnat

-

ed in the second half of the year.

The rise of electric vehicles (EVs) and connected cars, and

the emergence of Chinese OEMs on the global scene are some

of the trends that are currently transforming the automotive in-

dustry. We are well-positioned to sustainably manage the busi-

ness opportunities that come with these changes.

Strong financial performance

Throughout 2023, we implemented several strategic initiatives

to meet the needs of the evolving global automotive industry,

such as successfully negotiating price adjustments, optimizing

our footprint, and implementing structural cost reductions. As a

result, we have delivered a significantly improved profit, in line

with our guidance at the beginning of the year.

At our Investor Day in June, we reiterated our target of a

12% adjusted operating margin*. We have built a solid founda-

tion in 2023, and expect 2024 to be an important step towards

our financial targets.

Reshaping Autoliv to meet the market today and in the future

In June, we announced forceful actions and footprint optimiza

-

tion to respond to a prolonged challenging market environment

and our intention to reduce our workforce by up to 2,000 indirect

employees. Most of these reductions are now communicated

and we aim to complete these activities by 2026. This unfortu-

nately means that we have to part ways with a number of Autoliv

team members in order to secure our long-term competitive-

ness.

The footprint optimization is particularly focused on Europe,

with consolidations in Germany, France and Sweden and

planned site closures in the UK, Italy and the Netherlands.

These actions will help to strengthen the company’s competitive

position in the long term, adapting it to a substantially lower level

of light vehicle production in postpandemic Europe.

A relentless focus on quality and innovation

Quality is at the heart of everything we do and we continuously

strive to improve our performance. This requires us to always

focus on quality across the value chain and, as part of our prod

-

uct life-cycle management program, we continue to develop a

proactive End-to-End approach to achieve Zero Defects.

Autoliv’s Mobility Safety Solutions (MSS) is complementing

our core business by pursuing new, attractive areas for profitable

growth in adjacent markets. We are focusing on areas where we

can leverage our technological know-how, operational capabili-

ties, and global footprint. In 2023, our efforts primarily focused

on the products for commercial vehicles, electrical safety solu-

tions like pyrotechnical safety switches, and safety systems for

motorcycles and bikes.

A strong position with fast-growing Chinese OEMs

China manufactures the most EVs in the world and has become

the leading light vehicle exporter. It is encouraging for our me-

dium- and long-term potential that we continue to improve our

position with China's fast-growing domestic OEMs.

We announced several collaborations with Chinese OEMs in

The world is changing at an accelerating pace and Autoliv launched a number of strategic

initiatives in 2023 to meet the needs of its customers, to enhance shareholder value, and

deliver safe mobility solutions for society. During the year, Autoliv delivered significantly

improved profits supported by new collaborations, footprint optimization, structural cost

reductions, cost compensations, and a committed focus on sustainability, innovation,

and quality.

Transforming

with a Changing

Industry

2023 that are allowing us to bring new innovations to the mar-

ket at a rapid pace. We signed strategic cooperation agreements

with NIO, Chery, and Great Wall Motor. Together, we are driving

innovation and developing advanced technologies with a focus

on quality and addressing opportunities and challenges in the

rapidly evolving global automotive market.

New safety products to meet evolving customer demands

Already the market leader in safety products for light vehicles,

we are well-positioned to meet the needs for additional safety for

EVs as well as motorcycles and bikes. We view the strong elec-

tric vehicle trend as positive as the electrification can create de

-

mand for new safety solutions and more advanced products. We

are well-positioned regardless of how the demand for electric

vehicles develops as we have a strong presence with both EV

and internal combustion engine (ICE) platforms.

The Bernoulli Airbag™ is a recent example of how we in-

novate to sustainably adapt to the business opportunities that

come with evolving customer and market demands. This new

technology enables cost-efficient large airbags like the ones

needed in newer electric vehicles with roomier cockpits and

comfortable seating.

We are also pioneering improved safety for more than 500

million road users through our holistic approach to motorcycle

and bikes safety. The first new motorcycle safety product to

reach the market will be the Bag-on-Bike airbag. This airbag can

significantly reduce the risk of serious injury for powered two-

wheeler riders in frontal crashes.

Sustainability – an integral part of our business

Sustainability is an integral part of our vision of Saving More

Lives and a fundamental driver for market differentiation and

stakeholder value creation. Our products save 35,000 lives and

reduce more than 450,000 injuries every year. Our ambition is to

save 100,000 lives per year.

Our business directly contributes to the realization of sev-

eral UN Sustainable Development Goals (SDGs) and, as a UN

Global Compact signatory, we are committed to following its prin-

ciples.

Autoliv supports the UN Road Safety Fund (UNRSF) and

its mission to increase awareness and availability of life-saving

products where they are most needed. Through Autoliv’s col-

laboration with the UNRSF, we contribute our knowledge and

experience of global traffic safety challenges, while gaining ad

-

ditional insights into the most challenging road safety situations

facing the world today.

Autoliv is committed to providing safe and healthy working

conditions for our employees. We make health and safety an

integral part of everyday business by integrating it into our pro-

duction system and throughout all our projects and processes. In

2023, we took several steps to better manage high-risk activities.

Risk assessments and implementing new ways of working sup-

port an even safer work environment.

As part of our Green Factory program, we identify areas that

will help us save both energy and costs. Our manufacturing fa-

cilities carry out assessments covering energy use, greenhouse

gas (GHG) emissions, water, and waste, to assess their perfor-

mance and identify opportunities for improvement.

We are committed to climate action. During the year, we made

progress in reducing GHG emissions from our own operations.

For example, year-over-year we reduced GHG emissions from

our own operations by 17%. I also want to highlight our use of

renewable electricity, which has increased from 1% in 2021, to

13% in 2022, to 23% in 2023. I am proud of our team’s success

and eager to see continued action throughout all parts of Autoliv.

Celebrating 70 years of Saving More Lives

In 2023, we celebrated our 70th anniversary. Since our founding,

we have been pioneers in automotive safety and we have deliv-

ered many world firsts to the market. Brave decisions, a focus on

quality and innovation, and a desire to remain at the technologi

-

cal forefront have made Autoliv the worldwide market leader.

In 2023, our colleagues took part in global birthday celebra-

tions. Together, we celebrated seven decades of Saving More

Lives in our plants and offices across the world.

I am proud of the outstanding efforts of the Autoliv team and

what the team continues to achieve in a challenging environment.

We have a strong foundation that we continue to build on.

Going forward

2023 developed in line with our outlook at the beginning of the

year. We laid a solid foundation in 2023 and expect 2024 to be

an important step towards our 12% adjusted operating margin*

target. Our order intake was strong in 2023 and we ended the

year on a positive note, having executed on our strategic initia-

tives, secured cost compensations, and delivered a sales growth

of 18%, which is a gratifying result considering the environment

in which we operate.

Autoliv’s tax rate for 2023 was lower than previously antici-

pated, with a full-year tax rate of around 20%. This is due to the

ongoing reorganization of our global functions and European

operations. These changes are also expected to reduce the nor-

malized tax rate to be within a range of around 25-30% onwards.

At Autoliv, our everyday work is guided by our important vi-

sion of Saving More Lives. While celebrating our 70th anniver-

sary with the team, I reflected on how well Autoliv has performed

in a challenging market these past few years. I am convinced that

Autoliv's clear vision and strategy for long-term growth, with a fo-

cus on quality, technology, sustainability, and innovation, ensure

that we are well-positioned to adapt to future market trends and

demands.

We welcome you to join us on this exciting continuing journey.

Mikael Bratt

President and CEO

For 70 years, we have been

pioneers in automotive safety

and we have delivered many

world firsts to the market.

07

70 Years

of

Saving More Lives

1956

The founder Lennart Lindblad

develops the company’s first

seatbelt, a two-point static belt.

1980

Autoliv becomes a subsidiary

of Electrolux when the house-

hold goods manufacturing

group acquires Gränges AB,

an industrial conglomerate.

In 1984, the Company’s

name is changed to

Electrolux Autoliv AB.

1998

Our inflatable curtain side

airbag is introduced. It pro-

tects the occupants’ heads

in a side-impact collision and

covers the upper side of the

vehicle.

1997

Autoliv Inc. is formed through a merger of

Autoliv AB, Europe’s leading automotive

safety company, and Morton ASP, the

leading airbag manufacturer in North

America and Asia. Morton ASP began

airbag production in 1980.

1953

The company is founded by Lennart

Lindblad under the name Lindblads

Autoservice AB. After 25 years, Lennart

Lindblad leaves the company in 1977.

In 2023, Autoliv celebrated its 70 years anniversary.

The Autoliv story began in 1953 when two brothers,

Lennart and Stig Lindblad, founded a small

automotive parts and service company

in Vårgårda, Sweden.

08

AUTOLIV AT A GLANCE

2012

The world's first outside pedestrian protection

airbag. This helps car manufacturers meet stricter

Euro NCAP requirements. Autoliv introduces the

environmentally friendly airbag inflator APG,

recognized by the PACE Award.

2018

Autoliv spins off its electronics

segment. The new independent

company, Veoneer Inc., begins

trading on the New York Stock

Exchange and Nasdaq Stockholm

on July 2, 2018.

2022

Introducing airbag systems for powered

two-wheelers. The system is mounted

on the vehicle frame and will deploy in

milliseconds, for greater rider safety.

For 70 years, we have been pioneers

in automotive safety solutions and we

have delivered many world firsts to

the market. Brave decisions, a focus

on quality and a desire to remain at

the technological forefront have made

Autoliv a worldwide market leader.

Celebrating 70 years all over the world

2023

Autoliv unveils a patented

revolutionary new passenger

airbag module based on

Bernoulli’s principle that

can inflate larger airbags

more efficiently and

reduce development

time and costs.

09

Our Key Behaviors

Driving Improvements

in all Areas of Our

Business

We are the market leader in our industry and

what we do matters. This calls for a focused

approach to our ways of working. Our Key

Behaviors express the essence of our ways

of working in a clear and consistent way and

define how we strive to achieve success

together with colleagues, customers, and

partners.

Saving

More Lives

Our Vision

Providing World-Class

Life-Saving Solutions

for Mobility and Society

Our Mission

Take

Ownership

Be Curious

Add Value

Collaborate

Make it

Easy

AUTOLIV AT A GLANCE

Vision/Mission/Key Behaviors

Through the Autoliv Awards and Recognition Program, we ac-

knowledge and recognize colleagues who exceed expectations in

enhancing Autoliv’s performance and profitability. The award cat

-

egories and winning projects in 2023 are presented below, each

of which made outstanding contributions in their respective areas:

Machine safety improvements

Airbag cushion folding process

Reducing helium consumption

Leadership Academy

Successful design of a steering

wheel with an illuminated logo

These great achievements truly embody the desired Autoliv Key

Behaviors and ways of working.

Every day, our products save lives.

Every time they do, there is a person

and a story behind it.

I wanted to share an incident with you involving my 17-year

old son Riley. On a Monday afternoon, he was on his way

home from Fremont High School when he veered off the

road in his 2002 Jeep Grand Cherokee. He veered off the

road directly before a canal. He jumped the canal in his

Jeep and impacted on the far side bank with the front of his

vehicle. When the front of the vehicle dug into the ground,

the Jeep flipped over onto the roof coming to rest on the

driveway of a house.

Riley was able to get out of the vehicle almost unsca-

thed. All he had was a small goose egg on his head. We are

firm believers in seatbelts in our family and he was wearing

his.

I was a police officer for 20 years and have seen a lot of

serious accidents. I truly believe if he had not been wearing

his seatbelt, or had a vehicle without airbags, his injuries

would have been severe. Even though the airbags are 21

years or older, they functioned perfectly!

William Taylor

Security Supervisor

Autoliv Tremonton, United States

Survivor

Story

11

We ended the year again with strong profit

-

ability and cash flow after managing to off

-

set significant market challenges, especially

high inflationary pressure on costs for labor

and energy and a volatile and unpredictable

Light Vehicle Production (LVP).

2023 was another important step towards our targets. We

continued to strengthen our position as the market leader

through our high order intake, strong sales growth and the

solid profitability and cash flow performance.

In 2023, the high cost inflation continued to be driven

by labor and energy costs rather than by raw materials as

in 2022. Through price adjustments, we managed to gradu-

ally offset the inflation, resulting in a year that generated new

company records for sales, adjusted operating income*, op-

erating cash flow as well as adjusted earnings per share*.

A continued strong end-consumer demand for new

vehicles and re-stocking in some markets resulted in

global LVP growing by about 9%, and finally recovering

to pre-pandemic level. All regions grew strongly, with Eu-

rope leading the way with 13% growth. Despite some im-

provements, we continued to experience late changes

to call-offs with short notice as global car manufacturers

(OEMs)

managed

their

output

to

match

availability

of components. This negatively impacted our production ef-

ficiency and profitability.

Our sales increased organically* by 18%, outperforming

global LVP by around 9 percentage points. This was the sixth

consecutive year that we outperformed global LVP by 5 to

12 percentage points, driven by price increases, increased

market shares and higher safety content per vehicle. Our

adjusted operating margin* improved from 5.3% in the first

quarter to 12.1% in the fourth quarter, as a result of success

-

ful negotiations regarding cost compensation and our strong

focus on continuous improvements throughout the organi-

zation. For the full year the adjusted operating margin* im-

proved by 2 percentage points to 8.8%.

Operating cash flow improved from prior year to a new

record of $982 million, mainly due to higher adjusted oper-

ating profit* and positive working capital effects. Free cash

flow* amounted to $414 million, an increase of $186 million.

Capex, net in relation to sales was 5.4%, and cash conver-

sion improved to around 85%.

In 2023, we paid $2.66 per share in dividends, an in-

crease of around 3% from 2022, and repurchased and re-

tired 3.67 million shares.

In 2023, the GHG emissions in our own operations were

reduced by 17% compared to 2022, and our use of renew-

able electricity increased from 13% to 23%.

2023

Summary

AUTOLIV AT A GLANCE

Financial Summary 2023

*) Non-U.S. GAAP Measure. See "Non-U.S. GAAP Performance Measures" section in the 10-k filed with the SEC.

12

Adjusted Operating Profit

& Margin*

US$ (Millions) and in relation to sales %

0

200

400

600

800

1,000

1,200

23

22

21

20

19

0

2

4

6

8

10

Adjusted Operating Income*

Adjusted Operating Margin*

Sales and Global LVP

US$ (Millions) and Units (Millions)

0

2,000

4,000

6,000

8,000

10,000

23

22

21

20

19

15

35

55

75

95

Sales

LVP

Organic Growth* vs. LVP

Change

Percentage Points

0

2

4

6

8

23

22

21

20

19

Outperformance

Return on Equity

%

0

5

10

15

20

25

23

22

21

20

19

Gross Profit

Gross Margin

Gross Profit & Gross Margin

US$ (Millions) and in relation to sales %

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2,000

23

22

21

20

19

10

12

14

16

18

20

Sales by Division

Americas

34%

Europe

27%

China

20%

Asia

19%

Operating Cash Flow & Cash

Conversion

*

US$ (Millions) and in %

500

600

700

800

900

1,000

1,100

23

22

21

20

19

0

50

100

150

200

250

300

Operating Cash Flow

Cash Conversion*

Return on Capital Employed

%

0

5

10

15

20

25

23

22

21

20

19

Leverage Ratio

Net Debt/ EBITDA

0.0

0.5

1.0

1.5

2.0

2.5

3.0

23

22

21

20

19

Long-Term Target: 1.0x

0.5-1.5x

Long-Term

Range

Leveraging Industry

Trends into Sustainable

Growth and Higher

Profitability

AUTOLIV AT A GLANCE

Financial and Sustainability Targets

Financial targets

Autoliv is providing world-class life-saving mobility solu-

tions while transforming our operations for the new age of

electrification and autonomous driving, as well as digitali-

zation and automation throughout the whole value chain.

Our ability to consistently outperform light vehicle pro-

duction growth and leverage our growth into higher profit-

ability is rooted in our continuous investment in new safety

technologies, a strong focus on quality, and a superior and

cost effective production and engineering footprint. In the

medium-term, we intend to continue to grow our core busi-

ness – airbags, seatbelts and steering wheels – through

successful execution of the current product launch pro-

grams and order book.

In order to maintain the growth momentum, we are

pursuing an ambitious innovation program that includes

creating several world first safety products and investing

in capabilities beyond the light vehicle market. To success-

fully leverage growth into higher profitability, we rely on

driving End-to-End operational excellence while providing

superior quality to our customers in terms of product per

-

formance and delivery reliability.

Sustainability targets

Sustainability is an integral part of our business strat-

egy and an important driver for market differentiation and

stakeholder value creation, helping to ensure that our busi-

ness will continue to thrive and contribute to sustainable

development in the long term.

Guided by our vision of Saving More Lives and our mis-

sion to provide world-class, life-saving solutions for mobil-

ity and society, we have set short- and long-term sustain-

ability targets in key areas. Our sustainability targets and

ambitions are anchored in well-established international

frameworks such as the UN Global Compact and Science

Based Targets.

Our sustainability approach is based on four focus ar-

eas – Saving More Lives, A Safe and Inclusive Workplace,

Climate and Circularity and Responsible Business – each

consisting of long-term ambitions and more specific short-

term targets.

14

LVP+~ 4%

Average annual organic growth*

Excluding cost compensations

4-6%

Average annual organic growth*

2022-

2024

Long-

Term

(beyond

2024)

Financial Key Targets: Organic sales growth*

~12%

Adjusted operating margin*

~13%

Adjusted operating margin*

Target

Long-

Term

Ambition

Financial Key Target & Ambition: Profitability

100,000

Lives saved per year

Saving

More

Lives

A Safe and

Inclusive

Workplace

Climate and

Circularity

Responsible

Business

100%

in target group completed

Antitrust training

100%

in target group Code of

Conduct certified

100%

direct material suppliers

sustainability audited

100%

direct material suppliers respond

to conflict minerals survey

Carbon

neutrality

in own operations

by 2030

Year-on-year

reduction

in waste

0.35

Incident Rate

by 2024

95%

of senior and mid-level

management trained

in unconscious bias

Year-on-year

improvement in

employee

experience

22%

women in senior

management

by 2024

Net-zero

emissions

across our supply

chain

by 2040

Sustainability Key Targets and Ambitions

Year-on-year

improvement in

energy

intensity

*) Non-U.S. GAAP Measure. See "Non-U.S. GAAP Performance Measures" section in the 10-k filed with the SEC.

STRATEGY FOR CHANGE

Strategy

for Change

Customer Focus

•

We create value for the customer by creating a fit between

the customer need and our offering

Competitive Products and Solutions

• Develop competitive products and solutions to meet the

identified customer needs

• Create efficient processes and actively manage our

portfolio to deliver on our profitability targets

Efficient Value Delivery

•

We align our value chain to ensure value is delivered to our

customers at the right time, in the right place, at the right

cost and with the right capital intensity

The Autoliv Way

•

The Autoliv Way gives us a common view of what great

looks like at Autoliv and how we get there

Autoliv's Strategic Framework consists of four

elements that directly support our financial

and sustainability objectives and targets.

Our focus areas require everyone's commitment in order to realize our

strategy and meet our objectives and targets:

16

PROFITABLE & CAPITAL

EFFICIENT GROWTH

The

Autoliv

Way

17

Strengthening

Our Position in a

Changing Market

STRATEGY FOR CHANGE

Customer Focus

Our strategy, business priorities and targets are deeply

rooted in the growing global demand for traffic safety. 1.2

million lives are lost annually on the roads according to the

World Health Organization (WHO). Vulnerable road users

– pedestrians, cyclists, and motorcyclists – make up about

half of these fatalities. Road traffic accidents are a ma-

jor cause of death among all age groups and the leading

cause of death for children and young adults between the

ages of 5 and 29. In addition, tens of millions suffer non-

fatal traffic-related injuries, causing not only human suffer-

ing, but also costs corresponding to about 10% of GDP in

a majority of countries. This underlines the importance of

our commitment to save more lives and reduce the num-

ber of injuries on our roads.

Market development

The automotive safety market is driven by two fundamen-

tal factors: Light Vehicle Production (LVP) and safety con-

tent per vehicle (CPV). In the long term, new technologies

such as autonomous driving and drivetrain electrification

are expected to have positive effects on the safety con-

tent per vehicle. With advanced protective systems for

new flexible seating positions, safety integration in seats,

human-machine interface (HMI) in steering wheels, and

protection systems outside the vehicle for vulnerable

road users, there is an increasing need for innovations in

safety systems. In the medium-term, content per vehicle is

expected to grow mainly due to increased government reg-

ulations and test rating requirements in growth markets,

as well as from higher installation rates of knee airbags,

front-center airbags, more advanced steering wheels and

more advanced seatbelt systems in more mature markets.

Market position

Our long-term focus on quality, delivery and cost in eve

-

rything we do is the foundation for our long-term success.

We have been involved in only around 2% of recalls of air-

bags and seatbelts in the last 10 years, an important indi-

cator that we are delivering on our quality strategy. Since

2017, our market share has increased by 7 percentage

points to 45% in 2023. Our market position is strong in all

product categories, with 47% in airbags, 45% in seatbelts

and 40% in steering wheels. All three product categories

have substantially improved their positions since 2017. All

of our largest regions have increased their market shares

since 2017, to 48% in Americas, 50% in Europe, 36% in

China and 44% in Asia excluding China.

Global Light Vehicle Production

LVP has increased at an average annual growth rate of

1.9% since 1997. However, global LVP has declined from

the peak of 92 million in 2017, to 87 million in 2023. We

expect that light vehicle production will continue to grow

both in the medium and long-term. The growth is expected

to take place in all regions. With many regions having al-

ready rebuilt vehicle inventories, we see a short-term light

vehicle production outlook that is more reliant on end-cus-

tomer demand.

18

Safety Content Per Vehicle

A global development towards increased safety stand-

ards with stricter regulations and increasingly stringent

rating frameworks is a strong driver of safety content in

vehicles. Other drivers are the premium vehicle trend

and the increasing focus on safety in medium- and low-

income markets. By continuously researching, develop-

ing and introducing new technologies with higher value-

added features, Autoliv can influence safety content

per vehicle. In 2023, global average CPV increased to

around $261. As a result of the increase, the automo-

tive safety market has outgrown LVP historically and we

expect this trend to continue. Since 2017, CPV has in-

creased in all regions, except in Japan, due to currency

effects. In recent years, India introduced regulations

leading to mandatory frontal airbags for all new models,

and most vehicle manufacturers has also decided to make

side airbag systems standard on future vehicles.

Competitive landscape

Although Autoliv is the undisputed leader in automotive

safety, we face a variety of competitors in a landscape that

is constantly evolving. We consider our key competitors to

be ZF and Joyson Safety Systems (JSS), which we regard

as global, full-scope competitors. ZF is a broad-based au-

tomotive supplier. JSS was formed through the combina

-

tion of KSS and Takata and is owned by Ningbo Joyson

Electronic. In Japan, Brazil, South Korea and China, we

also compete with a number of domestic suppliers, often

with close ties to domestic vehicle manufacturers. We also

face competition from product specialists.

Market Share by Product Area

1)

Airbags

47%

Seatbelts

45%

Steering

wheels

40%

Content per Vehicle

1)

US$ per vehicle

0

50

100

150

200

250

300

350

400

450

India

China

EEU

Japan

WEU

NA

Average 2023: ~$261

2023

2017

Competitive Landscape

Global Industry Leader

1)

Autoliv global market share

Customer

Collaboration

Building on a long history of collaboration with OEMs, Autoliv

has one of the industry’s most diverse customer bases, re-

flecting a strong sales mix with high-volume global vehicle

manufacturers, global premium brands, as well new entrants

to the automotive industry. Technology-driven trends are

disrupting the automotive industry, necessitating collabora-

tion to address the challenges and opportunities that the in-

dustry is facing, notably connectivity, automation, emissions

and safety. In 2023, Autoliv announced partnerships with

three leading Chinese vehicle manufacturers to address

opportunities and challenges in the rapidly evolving global

automotive landscape.

Autoliv currently delivers products to around 100 vehicle

brands around the world and has a leading market position

with almost all OEMs. During 2023, we launched a record

number of new products on a number of important electric

vehicles (EVs) and internal combustion engine vehicles

(ICE), supporting our future growth.

Sales by customer and vehicle type

In 2023, our top five customers represented 48% of sales

and the ten largest represented 78% of sales. This reflects

the concentration in the automotive industry. The five larg

-

est customers in 2023 accounted for 46% of global Light

Vehicle Production (LVP) and the ten largest for 66%. The

top ten customer list includes many of the major Asian ve-

hicle manufacturers as well as one pure EV manufacturer.

Asian vehicle producers have steadily become increasingly

important, mainly driven by growth among Japanese and

Chinese OEMs. As a group, Japanese OEMs now represent

around 31% of our global sales, compared to their 29%

share of global LVP. This is a result of our high order intake

with Japanese OEMs in recent years, built on our strong lo

-

cal presence in Japan and our global manufacturing foot

-

print. Globally, European-based brands accounted for 29%

of our sales in 2023. U.S.-based brands (including Chrysler

and new EV OEMs) accounted for 23% of our global sales,

while domestic Chinese OEMs accounted for around 6% of

our sales in 2023. The fastest growing customer in 2023 was

Honda followed by a global EV manufacturer and Toyota.

The Company estimates that its sales in 2023 for EVs

(not including plug-in hybrid vehicles) amounted to around

$1.4 billion. The positive sales trend for EVs is expected to

continue as around 45% of our total order intake in 2023

was for future EVs. Additionally, we have been successful in

winning contracts with new automakers. New automakers,

mainly in North America and China, accounted for around

25% of our order intake, up from 12% just two years ago.

Sales by region

With operations in 25 countries and having one of the broad-

est customer bases of any automotive supplier, Autoliv has

the best global footprint in the industry. In 2023, the Asian

market, the China and Asian divisions combined, accounted

for 39% of Autoliv's sales. The second largest market was

Americas, representing 34% of sales. The European mar-

ket accounted for 27% of sales in 2023, which is roughly 10

percentage points less than a decade ago, reflecting a weak

LVP as well as our strong market share gains in Asia and

North America over the past few years.

STRATEGY FOR CHANGE

Customer Focus

20

Important Launches in

2023

Fisker Ocean

Xpeng P7i

Wey Blue Ocean

Toyota Alphard

Zeekr X

Dodge Ram Rampage

Hyundai MUFASA

Nio ES 6

BMW i5/5-series

Sales by Product

Seatbelts

Airbags and

Steering Wheels

33%

67%

Sales by Division

Americas

34%

Europe

27%

China

20%

Asia

19%

Sales by Customer

Nissan /Mitsubishi/Renault 10%

Stellantis 10%

VW 9%

Toyota 9%

Hyundai/Kia 7%

Ford 7%

General Motors 6%

EV Maker 5%

Mercedes 4%

Volvo 2%

Others 9%

Subaru 2%

Chinese OEMs 6%

BMW 3%

Honda 9%

Based on our extensive research into

real-life accidents, we develop and

engineer automotive safety solutions

to save more lives and prevent injuries

on the roads. What sets us apart from

our competitors is the Autoliv Circle of

Life, a research-based approach to

Saving More Lives in real-life

situations.

SIDE AIRBAG

Protects in side collisions

Side airbags reduce the risk of chest injuries by approximately 25%. With

dual-chamber side airbags, both the pelvis and the chest areas are protected

which further reduces the risk of serious injuries in side-impact crashes.

ACTIVE HOOD LIFTER

Reduces pedestrian head injuries

Active hood lifters help to mitigate the impact of a pedestrian's head against

the structure beneath the hood, meaning the engine, suspension, etc.

KNEE AIRBAG

Reduces leg injuries

Knee airbags, which deploy from a vehicle’s lower dashboard, distribute the impact

forces on an occupant's legs, thereby reducing leg and knee injuries. Additionally,

they are designed to control the movement of the occupant so that the driver and

passenger airbags can provide optimal protection.

4

3

2

1

INTEGRATED CHILD BOOSTER SEAT

Provides protection

and comfort

The integrated booster seat is specially

designed to provide safety for children,

together with the car's seatbelt.

Products for

Saving More

Lives

22

STRATEGY FOR CHANGE

Competitive Products and Solutions

PYRO SAFETY SWITCH

Prevents fire and electrocution

Pyro safety switches can disconnect or

cut power during/after an accident.

11

PEDESTRIAN AIRBAG

Protects pedestrians

The pedestrian airbag aims to mitigate and

reduce the severity of a head impact in case

of a pedestrian-vehicle accident.

SEATBELT

Top life-saving device

Seatbelts are considered the primary restraint system, because of their

vital role in occupant safety, and can reduce fatalities by as much as 45%.

SIDE-CURTAIN AIRBAG

Reduces head injuries

Reduces the risk of life threatening head injuries

by approximately 50%.

STEERING WHEEL

With the lives of others

in your hands

The steering wheel is a vital part of

the safety system and controls many

of the vehicle’s functions.

DRIVER AND PASSENGER AIRBAG

Saves lives and reduces injuries

The driver airbag reduces fatalities in frontal crashes

by approximately 25% (for belted drivers) and

reduces serious head injuries by over 60%.

6

5

7

8

9

10

FRONT CENTER AIRBAG

Enhances front-row protection

Front center airbag can prevent front-row passengers

from colliding with each other during side impacts.

23

Innovation as

an Enabler to

Save More Lives

At Autoliv, we are accelerating our innova-

tion agenda which is shaped by industry

megatrends, key industry technology and

product development. A major focus area

is new occupant safety solutions driven by

the evolution of advanced driver assistance

systems and new interiors.

Our research and innovation capability allow our develop-

ment teams to redefine the standards of safety for future

challenges such as electrified and autonomous cars and

create specially designed safety procucts for motorcyclists

and cyclists.

The Autoliv Circle of Life

The Autoliv Circle of Life is a research-based approach to

Saving More Lives in real-life situations, beyond standard-

ized test scenarios. This means that instead of using the ex-

isting pre-defined load cases, Autoliv conducts traffic safety

research to verify or develop new test methods and tools

to continuously push the agenda of road safety. The effect

of new innovations is estimated from real life data and can

later be verified. This research-based approach has enabled

Autoliv to be a leader in automotive safety.

Shifting demographics, sustainability, and fast develop-

ment of new technology will shape our industry’s future, and

global megatrends like automation, electrification, and con

-

nectivity are changing and influencing the future transport

system. Our understanding of these trends, paired with our

approach to Real Life Safety, enables us to embrace and

influence the new horizons in mobility. As trends and new

technologies reshape the mobility landscape, staying com-

petitive requires disruptive strategies – and innovation.

The Bernoulli Airbag™

Autoliv’s research-based approach, paired with Swiss

mathematician and physicist Daniel Bernoulli's fundamen-

tal principles of fluid dynamics, has resulted in a revolution

-

ary new passenger airbag. This new technology can inflate

very large airbags, like the ones needed in newer electric ve-

hicles with roomier cockpits and comfortable seating, with a

smaller single stage inflator.

The Bernoulli Airbag™ is an example of our commit-

ment to saving lives and redefining the standards of safety

so our customers can build the safest possible vehicles. By

doing this, we can affect other aspects of the safety system

and offer our customers options that do not exist today. The

Bernoulli Airbag™ is a significant step forward in making

vehicles safer in a more efficient and sustainable manner.

The Bernoulli Airbag

TM

– our innovative and costefficient

solution for very large airbags.

24

STRATEGY FOR CHANGE

Competitive Products and Solutions

Developing safety for mobility and society

Our innovation agenda supports our evolution into safety

for mobility and society. Autoliv’s Mobility Safety Solutions

(MSS) utilizes our research and technology to develop

products and services for businesses adjacent to Autoliv’s

core areas of airbags, steering wheels, and seatbelts for

light passenger vehicles. Such adjacent products and ser-

vices include electrical safety solutions with our pyrotech-

nical safety switches, safety solutions for commercial ve-

hicles, and providing components to customers outside of

light vehicle markets.

Motorcycles and bikes

The number of motorcycles and bikes in the world con-

tinues to rise. In many regions, they offer an affordable

way to travel and in other parts of the world they are used

for convenience or leisure. Motorcycle and bike riders have

not benefited to the same extent as car occupants from the

many developments in vehicle safety. Today, some motor-

cycles are equipped with advanced safety systems, but

there is a need for more safety products. Autoliv's exten-

sive research into motorcycle and bike riding behavior and

crashes has resulted in two sets of solutions: on-vehicle

safety solutions and on-rider safety solutions (wearables).

Our first product to reach the market will be an on-motor

-

cycle airbag system, which is planned to go into production

for the first customer in 2025, that can improve rider pro

-

tection in frontal and oblique crashes. Our goal is to offer a

complete and cost-efficient airbag system, that can improve

rider protection in front and oblique crashes, to facilitate the

introduction of this technology for a wide variety of motorcy-

cles. The Autoliv airbag system will include an airbag and an

in-house-developed electronic crash sensor.

UNRSF collaboration – accelerating road safety

progress in low- and middle-income countries

Autoliv's global presence, in-depth knowledge of how peo-

ple are injured, and effective solutions are all highly valu

-

able assets to support progress towards the global road

safety targets. Since 2022, Autoliv supports the UN Road

Safety Fund (UNRSF), which is the lead agency in charge of

coordinating funding and deployment of road safety projects

in low- and middle-income countries. Autoliv supports the

UNRSF financially and with expertise to stimulate and guide

global efforts to improve road safety policies, technical regula

-

tion, and safe system capacities. Autoliv has built strong cred-

ibility among policymakers and key road safety stakeholders,

as demonstrated by the election of Autoliv's CEO Mikael

Bratt to the Advisory Board of the UNRSF. Through the col-

laboration with UNRSF, Autoliv has gained greater access

to the highest level of political forums and a stronger voice

in the prioritization of policy actions to reach the Sustainable

Real

Life

Safety

Crash

Statistics on

a Macro Level

Start of

Production

In-Depth

Studies of

Crashes and

Incidents

Biomechanics

and Human

Factors

Finding

the Best

Technology

for Safety

Needs

Developing

New Test

Methods

Validation of

New Safety

Systems for

Real-Life

Traffic

The Autoliv

Circle of Life

for

Traffic Safety

26

Development Goals by 2030. As motorcycle safety is a high

priority in low- and middle-income countries, Autoliv will focus

its attention on efforts that drive progress in motorcycle safety

and rider protection and continue to advocate for substantial

enhancements to the safety of vulnerable road users.

Equity in vehicle road safety – the SAFER Human

Body Model

Autoliv is a forerunner in road safety equity. Current occu

-

pant substitutes used for estimating injury risk in crash test-

ing are limited to three sizes representing small, mid-size

and large occupants, and are based on 1970s U.S. popula-

tion height and weight distributions. In an effort to change

this, Autoliv has been working with finite element human

body models since 2008. These virtual representations of

humans with bones and flesh are much more detailed than

traditional crash test dummies. Together with SAFER,

an open research arena for vehicle and traffic safety, our

SAFER Human Body Model (HBM) can be morphed seam-

lessly to represent any weight and height – for both males

and females. The work culminated in a PhD thesis in 2023

on Human Body Model Morphing for Assessment of Crash

Rib Fracture Risk for the Population of Car Occupants.

There are various projects, both ongoing and planned, to

make our SAFER HBM ever better. As presented at the

27

th

International Technical Conference on the Enhanced

Safety of Vehicles (ESV) in Yokohama, Japan in April 2023,

SAFER HBM can today predict human kinematics and

injury risk for various human shapes and road user types.

Assessing injury risk for a diverse population in a range of

crashes will promote more personalized safety solutions for

car occupants as well as for vulnerable road users.

Electrical safety solutions

With the further electrification of society, new innovative

solutions are required to enable a safe transition to a more

sustainable future. Utilizing Autoliv’s competence from

our core business, we have developed several different

products for electrical safety, with the common denomina-

tor being utilization of pyrotechnics. The products range

from highvolume, off-the-shelf products, primarily the Pyro

Safety Switch, to tailor-made solutions. Today, most of our

products for electrical safety target the automotive industry,

but we also see potential to grow in new markets such as

electricity transmission and energy storage.

The triple helix model of innovation at Autoliv

An ever-changing world presents us with challenges, and

we cannot solve all problems ourselves. For Autoliv, collab-

oration is a success factor. We often collaborate according

STRATEGY FOR CHANGE

Competitive Products and Solutions

Inflatable Helmet

Concept for Bike Riders

Airbag System on Motorbike

Pyrotechnical

Safety Switches

Integrated Seat Airbag

for "Zero Gravity"

Collaboration

Industry partners

Academia

Policy Makers

Saving

More Lives

From 35,000

to 100,000

lives annually

Growth

Outgrowing

the market

New products

and services

New businesses

Innovative Capabilities

Future Advantages

Operational Capabilities

Efficiency, Quality and

Standardization

Differentiating Capabilities

Competitive Advantages

27

to the triple helix model of innovation, which refers to the

open collaborative spirit between academia, industry, and

government, and aims to foster economic and social devel-

opment.

Cross-sector collaboration ensures that the engine of

private sector innovation is pointed in the right direction –

towards targets with the greatest societal benefit, leveraging

the opportunities of technology. Autoliv strategically choos-

es its partners to develop its innovative capabilities, differen

-

tiate itself from its competitors, and become more efficient

in manufacturing. Collaboration is an enabler to save more

lives and creates growth and profitability for Autoliv.

Autoliv has a global research and innovation network

and specific research collaborations with world-leading uni

-

versities within biomechanics, human factors, and data sci-

ence. We partner with universities, research institutes and

policymakers, engaging with innovative start-ups and other

industrial partners to innovate, develop and produce scal-

able and quick-to-market safety innovations.

Operational

Excellence

STRATEGY FOR CHANGE

Efficient Value Delivery

We align our value chain to ensure value is

delivered to our customers at the right time,

in the right location, with the right quality,

at the right cost and with the right capital

intensity.

RD&E Effectiveness

We are enhancing our engineering productivity through

the Engineering 4.0 program. This program is aimed at

streamlining our processes through different initiatives,

such as one flow of project data and virtual engineering

to optimize part and product development and to reduce

prototype and testing. Furthermore, our engineering pro-

cesses are made more efficient through digitalization, au-

tomation and smart connectivity.

Robust and competitive end-to-end supply chain

The success of Autoliv is dependent on competitive and

innovative suppliers and partners who are successful in

their respective businesses.

During the past years the global trade system has suf-

fered from shortages, wars, natural disasters and geopo-

litical tensions. This has required focus on building a cost-

and capital efficient supply chain which at the same time is

resilient, adaptive and sustainable.

Autoliv will continue to combine commercial supplier

initiatives, development of our supply chain and supplier

portfolio with improved change management. This is central

for our ability to continuously reduce product cost. We are

identifying core and non-core processes in our make vs. buy

studies and developing relevant associated strategies. Our

supply chain has improved and reinforced its End-to-End

and cross-functional abilities to reduce costs pre and post

start of production.

Quality assured projects with seamless launches

We see increasing complexity and functionality of our

products, in combination with shorter develop time expec-

tations from our customers. To meet customer require

-

ments while achieving profitable and sustainable launches

into serial production, we are strengthening the focus on

proactive quality assurance, profitability improvement and

program management capability.

Cost reductions through operational excellence and

optimized footprint

Benchmark manufacturing in Autoliv will ensure that our

manufacturing operations operate at benchmark levels.

We will continue to drive our Autoliv Production System

(APS), aiming for a top rating for all plants. We have al-

ready raised a meaningful number of our plants to a top

rating. APS principles are also be expanded to other non-

manufacturing areas. We have developed a roadmap for

our Manufacturing 4.0 program and will accelerate our

path to the connected factory. Further, we are reviewing

and optimizing our manufacturing and technical center

footprint. We continously evaluate our footprint to be able

to meet the customers demands and remain competitive.

Mega trends

Autoliv strategy

Safety research

Market insights

28

Built in Quality throughout the product lifecycle for

Zero Defects at target cost

Our products save lives. They do not get a second chance.

Therefore, we have a Zero Defect mindset that empha-

sizes the importance of getting things right the first time.

It aims to eliminate defects, improve product or service

quality, and reduce costs associated with waste. We work

to build in quality in all dimensions across the product life

-

cycle, with the total cost and End-to-End process in mind.

Feedback loop for continuous improvement

Operational excellence at Autoliv seatbelt plant in Tsukuba, Japan.

29

Value to

Customers

Every year, we compete in several hundred

tenders for new business. To remain the pre-

ferred choice for our customers, we work dili-

gently with quality, reliability, technology and

flexibility. This is, and has been, instrumental

in building our brand and business over the

last 70 years.

The trust our customers have in Autoliv is further sup-

ported by incorporating sustainability into everything we

do. We are uniquely positioned to benefit from the industry

transformation. Our ability to consistently outperform mar-

ket growth is rooted in a strong focus on innovation, quality

and a superior production system serving around 100 car

brands globally. To ensure that we maintain and strengthen

our position as the industry leader, we have developed a

number of strategies.

Brand Strength

We are committed to further strengthening the visibility and

recognition of the Autoliv brand. In a fast-changing world,

company reputation and public responsibility are increas-

ingly important to all stakeholders and can have a direct

influence and impact on commercial potential. A strong

Autoliv brand is equally important as we develop our new

adjacent business areas. Based on our proven market suc-

cess, we are taking further steps to increase our visibility

beyond our current customer strongholds.

Sustainability

The automotive industry is undergoing a major transforma-

tion, as sustainability becomes a defining issue for car buy-

ers as well as governments and regulators. Our sustain-

ability approach of Saving More Lives, safe and inclusive

workplace, climate and circularity and responsible busi-

ness is aligned with and supports our customers' broader

sustainability agendas.

Innovation (i)

Our ability to consistently outperform market growth is de-

pendent on our ability to provide new safety technologies.

We have accelerated our innovation agenda, focusing on

key industry technology and product trends. A major focus

area is new passive safety solutions driven by the evolu-

tion of new interiors for electrical and self-driving vehicles.

Quality Leadership (Q5)

Continued focus on quality is imperative for remaining the

preferred choice of our customers. Accordingly, we are

committed to delivering the highest quality, safety and per

-

formance in our products and services, in alignment with

our vision of Saving More Lives. We continue to invest in

our quality culture and Zero Defect mindset. We are adapt

-

ing our processes to incorporate quality earlier in the de

-

sign process and cooperate more closely with suppliers to

further improve our Zero Defect performance by applying

our Q5 methodology – quality in all dimensions.

One Product One Process (1P1P)

1P1P is Autoliv’s journey towards a global standardization

of products and processes. Its main objective is to create

lower total cost by reduction of complexity through global

management of knowledge. We thereby ensure the best

technical solutions (product robustness), providing higher

value for our customers (customer excellence). Essen-

tially, the idea is that there should be only one process for

every product and one product for every function.

Autoliv Production System (APS)

APS is how we stay competitive and grow towards excel-

lence in our daily work. It contributes to every single part of

Autoliv and it is particularly central to manufacturing. APS

is the backbone of how we drive operations across our pro-

duction network. Combined with digitalization of manufac-

turing and automation of processes, we are continuously

progressing our operational excellence journey.

STRATEGY FOR CHANGE

Efficient Value Delivery

30

31

Our position as a worldwide leader in auto-

motive safety systems, saving 35,000 lives

every year, is achieved by our 70,000 out-

standing colleagues around the world. Their

diverse assets, breadth and depth of exper-

tise and desire to develop, in combination

with Autoliv’s ambition to enable fulfilling

careers, supports our vision of Saving More

Lives.

Guided by our vision, 2023 was a dynamic year for Autoliv,

with both highlights and challenging moments for our col-

legues. Examples include the global celebration of Auto-

liv’s 70

th

anniversary, during which our colleagues’ passion

and pride in the company was clear, as well as the improve-

ment and cost reduction activities carried out during the

year, including reducing positions and closing some of our

facilities.

People development

We want all our colleagues to achieve professional success

and reach their full potential. This creates a clear win-win

situation since we need high-performing people doing their

utmost to deliver on our vision and safeguarding our market

leading position. Key components of this continuous ambi-

tion include Speak Up (page 55), our strategic workforce

planning where we identify talent requirements, gaps and

strategies to enable people to grow, and our Key Behaviors

(page 10), which remind us all how to act to bring the best

version of Autoliv to life every day.

The dialogue between managers and team members,

which includes all of these components, is a cornerstone of

everyone’s growth. This dialogue is summarized in an an

-

nual Performance and Development Dialogue (PDD). Dur-

ing 2023, 99% of targeted employees conducted a PDD

with their managers.

To further support our people’s growth, we use several de-

velopment channels, such as facilitated and self-paced

development programs, technical and specialist career

paths, international assignments and continuous on-the-

job training.

Health and safety

Ensuring a safe workplace is a top priority for us and our

goals are clear: we want zero accidents, and we want to

prevent all occupational injuries. Autoliv’s management is

strongly committed to providing safe and healthy working

conditions for all our employees and contractors, and we

work actively to make health and safety an integrated part

of our daily work, on all levels and across functions. Just

like our vision, Saving More Lives, ensuring a safe work en-

vironment is a collective achievement. In 2023, we contin-

ued our safety leadership training and performed general

awareness-raising activities as well as activities with a par-

ticular focus on high-risk tasks.

Diversity and inclusion

Our workforce reflects the diversity of the countries and

cultures in which we operate. The more diverse our organi-

zation, the better we will be at anticipating, leveraging, and

adapting to future needs and changes. We believe that eve-

ryone should be respected and treated fairly, and we are

committed to providing an inclusive and diverse workplace

where everyone can be their authentic selves and deliver

results. Inclusive ways of working are a fundamental part of

our Key Behaviors.

Labor rights

We strive to offer fair terms and conditions of employment.

Our Key Behaviors, Code of Conduct, talent development

strategies and employment policies support the principles

in the United Nations Universal Declaration of Human

Rights, and the International Labour Organization’s Funda

-

mental Principles and Labour Standards.

Outstanding

People Embracing

Change

STRATEGY FOR CHANGE

The Autoliv Way

32

33

A Driving Force

in Sustainable

Mobility

Our sustainability approach is designed to

create long-term stakeholder value by focus-

ing on the most material areas supported by

long-term ambitions and concrete targets.

Guided by our vision of Saving More Lives, our mission

is to provide world-class, life-saving solutions for mobility

and society. Sustainability is an integral part of our busi-

ness strategy and a fundamental driver for market differ

-

entiation and stakeholder value creation, helping to ensure

that our business will continue to thrive and contribute to

sustainable development in the long term. To truly be a

driving force in sustainable mobility, we strive to systemati-

cally assess and manage key impacts, risks and opportuni-

ties to society and the environment related to our business,

operations and supply chain. We also engage with our cus-

tomers to ensure that we are part of driving the transition to

low-carbon and circular mobility, thus realizing new busi

-

ness potential for us and our customers.

Our sustainability approach is based on four focus ar-

eas with broad ambitions and more specific short-term

targets defined for each area. These areas represent the

strongest links to our business risks and opportunities and

the greatest impact on key stakeholder groups, society and

the environment. All four areas represent global challenges

where we believe that our work can make a positive differ

-

ence, through our ways of working or by inspiring and col-

laborating with others. We are a signatory of the UN Global

Compact and our work and policies, such as our Code of

Conduct, are aligned with international frameworks such

as the ILO core conventions and the OECD Guidelines.

Our core business and sustainability work contribute to

our goal of the realization of a number of UN Sustainable

Development Goals (SDGs). Our core business contrib-

utes to reducing the number of road fatalities (SDG 3) and

making transportation systems safer for everyone, includ-

ing vulnerable road users (SDG 11). We support research

and knowledge sharing that benefit developing markets

(SDG 17). Over time, our climate and circularity agenda

aims to not only reduce our own negative environmental im-

pact (SDG 9, SDG 13) but also help drive green innovation

(SDG 12) among direct material suppliers, vehicle manu-

facturers and energy providers (SDG 7). By proactively

managing health and safety risks and labor rights (SDG 8),

promoting diversity and inclusion (SDG 5) and holding all

employees to the highest ethical business standards (SDG

16), we lay the foundation for a high-performing organiza

-

tion where every employee has the means to speak up and

drive improvement.

For more information about performance data, defini

-

tions, etc., see the Sustainability Appendix on pages 59-63.

SUSTAINABILITY

34

100,000 lives saved

per year

• Zero accidents

• Embrace inclusive ways of working

Saving More Lives

Focus Area

Targets and Ambitions

Contribution to UN

Sustainable Development Goals

Responsible Business

Climate and Circularity

A Safe and Inclusive

Workplace

• Carbon neutrality in own operations by 2030

• Net zero emissions across our supply

chain by 2040

• Proactively prevent corruption and

other unethical business practices

• Respect human rights

• Manage supply chain sustainability risks

35

Sustainability Materiality

Assessment

An integrated approach to assessing the

impacts, risks and opportunities of our busi-

ness allows us to focus on managing the

most material topics.

The starting point for sustainability management and report-

ing is understanding our most material topics. Our materi-

ality assessment process aims to identify the key sustain-

ability topics in our own operations and our value chain. The

process is based on the double materiality principle: both

impact materiality (how Autoliv impacts people and the en-

vironment) and financial materiality (how various sustain

-

ability topics impact Autoliv) are considered.

The materiality assessment process is aligned with the

Enterprise Risk Management (ERM) process with activities

carried out continuously throughout the year. We continu-

ously develop our materiality assessment process to align

with future management and reporting requirements.

Assessment activities during the year included:

•

Cross-functional workshops with internal topic experts

and representatives from key functions to ensure a broad

inside-out understanding of current and future material

topics

•

Review of industry-related reports etc. regarding im-

pacts, risks and opportunities

•

Market research as well as direct dialogue to understand

our customers’ sustainability priorities, challenges and

opportunities for collaboration

•

Review of investor-driven sustainability/ESG assess-

ments as well as meetings with key shareholders

•

Review of the results of the quarterly employee surveys

and reports filed through the Autoliv Helpline and other

Speak Up channels

For many topics, we also carry out topic-specific assess

-

ments to gain a deeper understanding of both impact and

financial materiality. For example, for climate change, we

have carried out a value chain GHG footprint assessment,

identified emission sources and reduction levers, and identi

-

fied key transition and physical risks and opportunities that

could impact our business.

Sustainability impacts and performance of our supply

chain cut across most of the above topics, in particular re-

garding climate change, circularity, product safety, health

and safety, labor rights and business ethics.

While many of the topics listed above have been con-

sidered as material for several years, some topics such as

inclusion and circularity are growing in importance driven

by trends of natural resources scarcity, digitalization, more

complex operating environments and new legislation. The

material topics are covered by our sustainability focus ar-

eas, with targets and action plans defined to ensure that we

make measurable progress.

SUSTAINABILITY

36

Shaping the

industry agenda

Autoliv is engaged in several global and regional associa-

tions and organizations, as well as academic and public-

private partnerships, in order to contribute actively to driv-

ing progress in our most material areas. Autoliv is an active

member of committees that shape the organizations’ posi-

tions and communication on key topics such as furthering

traffic and vehicle safety standards in regulations and rat

-

ings, equity in crash safety, and how the automotive supplier

industry can actively drive low-carbon mobility.

Moreover, Autoliv is actively engaging to contribute to the

resilience of the automotive supplier sector, to encourage

enhancements in national and international traffic and vehi

-

cle safety standards, research funding and capacity, advo-

cating for greater priority to road traffic safety in global policy

and national legislation as well as how the industry can sup-

port the transition towards low-carbon mobility.

Examples of some of the organizations Autoliv is a mem-

ber of include:

•

Since 2022, Autoliv is a Board member of the UN Road

Safety Fund (UNRSF) Advisory Board. UNRSF’s aim is

to promote road safety in developing countries in order to

meet Sustainable Development Goal 3.6 of halving road

traffic fatalities by 2030. Autoliv is advising the UNRSF

about its direction and operational work. Through its part-

nership with the UNRSF, Autoliv has been able to work

more actively on the global policy level and communicate

its recommendations, and to directly support the UN-

funded initiatives carried out in low- and middle-income

countries, both financially and with our expertise.

•

In the U.S., the Automotive Safety Council (ASC) focus-

es on promoting global deployment of automotive safety

technology. ASC is active in providing industry guidance

on road traffic safety-related legislation.

•

In Europe, Autoliv is actively engaged in a number of

working groups of the European Association of Auto-

motive Suppliers (CLEPA). Much of the work relates to

shaping future safety regulations as well as industry’s

role in the EU sustainability agenda through collabora-

tion with other automotive suppliers on topics such as

circularity, the EU Taxonomy, corporate sustainability

due diligence and reporting.

Climate change

Circularity

Life-saving products and

innovations

Product safety

Health and safety

Inclusion

Labor rights

Anti-corruption

Antitrust

In 2023, key material topics identified included:

Environment

Social

Governance

37

Sustainability

Governance

SUSTAINABILITY

Autoliv’s sustainability work is managed

within a well-defined governance structure,

with clearly established ownership and re-

sponsibilities at all levels in the organization.

The underlying principle of our governance model is in-

tegrating sustainability responsibilities into the ordinary

course of business and company processes. This means

that the ultimate responsibility for executing sustainability

activities and targets lies with the line organization and is

monitored through management reporting. According to our

Key Behaviors, we expect every employee to take owner-

ship of sustainability topics by proactively contributing im-

provement ideas as well as by following company policies

and standards.

Ultimate oversight of the company’s sustainability ac-

tivities lies with the Board of Directors. The Board sets the

direction for sustainability activities and regularly monitors

progress on Autoliv’s sustainability strategy and targets

through its Nominating and Corporate Governance Com-

mittee (NCGC). The Board reviews and approves the Code

of Conduct as well as the Annual and Sustainability Report

and the Modern Slavery Act Statement.

Implementation responsibility for sustainability lies with

the Executive Management Team (EMT). The EMT has

appointed a Sustainability Board charged with providing

regular direction and oversight. The Sustainability Board

consists of the CEO and other EMT members and meets

on a quarterly basis. The Sustainability Board reviews and

approves Autoliv’s sustainability strategy, annual and long-

term plans, targets and policies for key topics, and monitors

implementation and performance.

Integration of sustainability into Autoliv’s business is led

by the HR & Sustainability function. The Vice President,

Sustainability, who reports to the Executive Vice President,

HR & Sustainability, coordinates, develops and monitors

Autoliv’s sustainability agenda and facilitates the Sustain-

ability Board meetings and other sustainability-related re-

porting to management. Everyday sustainability topics are

managed, as appropriate, by the HR & Sustainability func-

tion, divisions and other corporate functions such as supply

chain management, research, development and engineer-

ing, and legal and compliance. Divisions and corporate

functions have dedicated sustainability resources such as

climate coordinators, health & safety coordinators, eco-de-

sign/life-cycle assessment (LCA) experts and supply chain

sustainability specialists.

Risk management

Autoliv has a global risk management organization and

utilizes several different tools, such as an enterprise risk

management (ERM) framework which includes annual, di-

visional, functional and corporate risk mapping activities,

monitoring of risk trends, implementation of risk improve-

ment plans and follow-up of the effectiveness of risk miti

-

gation measures. Risk reporting is carried out on a regular

basis to the Board of Directors and the Audit and Risk Com-

mittee. With regard to sustainability-related risks, the ERM

framework takes into consideration the double materiality

perspective. This means assessing both how Autoliv’s op-

erations impact people and the environment, and how vari-

ous sustainability topics impact Autoliv’s business. Sustain-

ability risks, such as product safety, climate change, natural

resources scarcity, environmental compliance, health and

safety and other labor rights, business ethics, business

conduct and supply chain sustainability, are included in the

ERM framework.

We assess how sustainability relates to business risks,

such as legal proceedings, regulatory changes, contingent

liabilities, supply chain disruptions and operational disrup-

tions. Furthermore, there are relevant corporate standards

for topics such as site risk management, loss prevention,

emergency procedures, business contingency planning

and physical security. A more detailed description of Autoliv’s

material operational, strategic and financial risks, including

sustainability-related risks, can be found in the “Risk Fac-

tors” and “Risks and Risk Management” sections of the

10-K filed with the SEC. More information on climate-related

risks can be found in the TCFD disclosure, on pages 48-49.

38

Sustainability Governance

Board of Directors

Executive Management Team

Organization

All employees

EVP, HR & Sustainability

Nominating & Corporate Governance Committee

Sustainability Board

Functions

VP, Sustainability

Divisions

39

Ambition:

Road Safety

– a Global

Challenge

As the global leader in automotive safety,

our core business, supported by multi-level

stakeholder engagement, is making a signif-

icant contribution to global road safety.

When the UN Sustainable Development Goals (SDGs)

were launched, road safety was made a global priority for

good reason: according to the WHO global status report on

road safety 2023, around 1.2 million people die in traffic in

-

cidents every year, a figure likely to increase significantly un

-

less disruptive action is taken. According to the World Health

Organization (WHO), road traffic injuries are the leading

cause of death among young people between the ages of 5

and 29. As well as being a public health problem, road traffic

injuries carry a huge cost for society: according to some

estimates, the global macroeconomic cost of road traffic in

-

juries is around 10% of global GDP. Many families are driven

into poverty by the loss of a breadwinner or by the expenses

of prolonged medical care.

In August 2020, the UN General Assembly adopted

the resolution "Improving global road safety", proclaiming

the Second Decade of Action for Road Safety 2021-2030.

The target, represented as SDG 3.6, is to reduce road traf-

fic deaths and injuries by at least 50% by 2030. According

to the resolution, vehicle safety is a key component and

member states are encouraged to adopt vehicle safety

regulations that make seatbelts, airbags and active safety

systems standard equipment. In addition to safer vehicles,

infrastructure improvements, road user behavior and pro-

tective equipment are also key to achieving the target.

SUSTAINABILITY

100,000

Lives saved per year

2023

outcome:

35,000

lives saved

More than

450,000

injuries reduced

The countries most successful in curbing road traffic

injuries apply a Safe System Approach - a combina-

tion of five critical factors underpinned by collaboration

between key stakeholders:

Safe System Approach

•

•

•

•

•

Our ambition and approach

Saving More Lives is our core business and our most im-

portant contribution to sustainable development and the

realization of SDG 3.6. According to our estimations, our

products in use already save 35,000 lives and reduce more

than 450,000 injuries every year. Our long-term ambition is

for our products to save 100,000 lives per year. Achieving

this ambition is based on:

•

Retaining our strong market position and continuing to

grow in our core business, including increasing content

per vehicle. This needs to be done while maintaining the

highest level of quality as our products never get a second

chance.

•

Successfully expanding our business in new mobility seg-

ments aimed at motorcyclists, cyclists and pedestrians

•

Proactively broadening the scope of research and devel-

opment to also cover a wider range of occupant protec-

tion parameters regarding height, weight, age and gender

•

Increased multi-stakeholder efforts, in particular educa

-

tion to increase seatbelt use since seatbelts are the most

effective way of reducing fatalities and serious injuries

Read more about our innovation agenda on pages 24-27.

Research and development collaborations

We proactively engage with national and international au-

thorities as well as academia to further our impact. Below

are some examples of our collaborations during 2023.

•

Research and development for improved motorcyclist

safety continued in close dialogue with customers and

partners. In addition to in-vehicle solutions, we are also

exploring how to increase the comfort and safety of per-

sonal protective equipment, such as helmets with integrat

-

ed airbags that provide improved protection of the head

and face and inflatable vests that improve protection of the

thorax and shoulders.

•

To reach SDG 3.6, there is a need to accelerate technol-

ogy adoption and a Safe System Approach in develop-

ing countries. Even though Africa has only a few percent

of the total motor vehicles in the world, more than 10% of

traffic fatalities globally occur on African roads. Together

with a regional Non Governmental Organisation (NGO)

and other partners, Autoliv works in the project AfroSAFE

to promote the Safe System Approach, build connections

with key stakeholders and provide guidance on minimum

safety standards.

•

Autoliv is a member of the multi-stakeholder Research

Consortium for Crashworthiness in Automated Driving

Systems, which aims to collaboratively work towards vali-

dation methods for automated driving systems. We are

also part of an Massachusetts Institute of Technology

(MIT) consortium on Advanced Vehicle Technology to bet-

ter understand and increase safety related to automated

driving.

•

Around 15% of the over 8,000 car occupant fatalities in

the EU in 2020 occurred in crashes with Heavy Goods

Vehicles (HGVs). In addition to supporting the Swedish

Transport Administration with collision testing, Autoliv en-

gaged in research around relevant injury criteria together

with University of Virginia and potential protection systems

together with Chalmers University of Technology, Volvo

AB and the Swedish Transport Administration.

Share of global population, road traffic deaths, paved inter-urban roads, and registered

motor

vehicles,

by

cou

ntry

income l

e

v

el, 2021

16%

32%

43%

9%

Population

28%

38%

34%

<1%

<1%

Powered vehicles

8%

35%

44%

13%

Estimated road fatalities

88%

2%

10%

Paved roads

1)

1) Excludes expressways

Source: WHO global status report on road safety 2023

SUSTAINABILITY

•

In 2023, the UN created a working group to revise the UN

vehicle safety regulations regarding occupant protection.

The group's role is to determine how greater diversity in

terms of representation of crashes and occupants should

be implemented in crash safety regulations, and to as-

sess virtual crash testing as a method to further improve

equity in occupant protection. The group gathers around

50 participants and, as a member, Autoliv is actively con-

tributing with relevant research findings and know-how.

More information about our engagement in industry asso-

ciations and other organizations is available in Materiality

Assessment on pages 36-37

.

Collaboration with universities

To ensure real-life benefits and to develop evidence-based

test methods for product development, Autoliv engages in

collaboration with universities globally. One such collabora-

tion relates to Vulnerable Road Users (VRUs).

To be able to better protect VRUs, several studies have

been initiated during last year with focus on two-wheelers.

Current helmet standards and ratings do not consider the

complexity of neither facial impact protection performance

nor Traumatic Brain Injury (TBI). Both virtual and physical

test methods are being developed and newly developed

brain injury assessment tools and injury-specific risk func

-

tions will be used for evaluation and optimization of safety

systems. In this area, we collaborate with the Royal Institute

of Technology in Sweden, and Imperial College London,

and a Swedish helmet manufacturer with the aim of influ

-

encing standards and ratings.

Autoliv is a forerunner in the emerging area of equity in

vehicle safety. Current occupant substitutes used for esti-

mating injury risk in crash testing are limited to three sizes

representing small, mid-size and large occupants, based on

1970’s U.S. population height and weight distributions. The

mid-size male has historically been the one most frequently

used in rating and regulatory testing. However, over the past

decades, there has been a consistent trend of increasing

population weight. Car crash injury statistics highlight that

both obese male and female occupants are at increased

risk of injury and death when compared to average weight

males. Beyond sex and size, injury and fatality risks in-

crease substantially with age.

Autoliv researchers have looked upon safety-belt fit as an

important safety aspect for many years, and how safety

belts distribute forces on human bodies. Our hypothesis

is that the belt system and how it distributes load on the

body to protect people can still be developed further, pro-

vided that next generation tools and evaluation methods

become ready to use and widely accepted. For this rea-

son, to enable the development of safety systems that are

as effective as possible for everyone, Autoliv is actively

researching tools and methods that can be used to repre-

sent the contemporary population in different crash sce

-

narios, for example through virtual crash testing with human

body models representing the population variability in age,

height, and weight for both males and females.

Equity in

vehicle safety

According to research, the seatbelt is the

top life-saving device, belts alone reduce

occupant fatalities by 45%.

1) Kahane, 2015

42

Ambitions:

Autoliv’s approach aims to reduce green-

house gas (GHG) emissions and increase

circular use of materials, also supporting its

customers’ transition to lowcarbon friendly

mobility.

Ambition and approach

We are committed to operating our business in an en-

vironmentally sustainable manner, taking into account

our environmental impact throughout the life-cycle of

sourcing, design, production and end of life. Our key en-

vironmental impacts are (GHG) emissions, energy use,

waste generation and water use. With particular empha-

sis on climate action, we actively engage with customers,

suppliers and other stakeholders to take on the decarboni-

zation challenge across the value chain and drive sustain-

able mobility.

Environmental management

Autoliv’s environmental management system (EMS) em-

phasizes continuous improvement and is aligned with ISO

14001 requirements. The EMS establishes the require

-

ments for a standardized approach to environmental man-

agement, including identification of material environmental

aspects, objective setting, competence development, per-

formance follow-up and standardized reporting. At year end,

92% of all manufacturing facilities were externally certified

in accordance with ISO 14001.

Climate action

In 2021, we launched an updated climate strategy including

new long-term climate target and ambition:

•

Carbon neutrality in own operations by 2030

•

Net-zero emissions across our supply chain by 2040

These climate ambitions, aligned with a 1.5°C trajectory,

helping to ensure our competitiveness now and in the future.

Carbon neutrality

in own operations

Net-zero emissions

across our supply chain

Climate and

Circularity

CO

e

In addition to these ambitions, we have adopted separate

Science Based Targets for 2030 covering our own opera-

tions (Scope 1+2) as well as our supply chain (Scope 3 up-

stream). More information about the targets is available on

page 60.

Our GHG footprint

To fully understand our GHG footprint as well as key climate-

related risks and opportunities, we carried out a value chain

GHG footprint assessment and scenario analysis in 2021.

The assessment was carried out in accordance with the

GHG Protocol Scope 3 Calculation Guidance. Scope 1 + 2

emissions were calculated based on actual operational data

covering energy consumption and fugitive emissions,while

Scope 3 emissions were modelled based on actual and es-

timated sourcing data and generic emission factors.

The assessment showed that for the emissions covered

by our long-term ambitions, materials used in our production

(in particular steel, textiles and other plastics, and magne-

sium) were the largest contributors, followed by emissions

from logistics and electricity used in our own operations.

Downstream Scope 3 emissions, in particular use-phase

emissions, constituted the largest share of the total GHG

footprint. Since we consider our possibility to reduce down-

stream Scope 3 emissions to be greatly limited (such reduc-

tions are mainly driven by our customers' work on electrifica

-

tion), they are excluded from our long-term ambitions and

Science Based Target covering Scope 3.

Autoliv’s GHG footprint across own operations and our supply chain¹ 2023 (kton CO

2

e)

Total

Scope 1

Scope 2

Scope 3¹:

Purchased goods

and services

Scope 3¹:

Upstream

transportation

GHG emissions

from fossil fuels and

fugitive emissions in

operations

GHG emissions

from purchased

electricity, heat and

steam in operations

GHG emissions

from materials used

in products and

packaging

(Scope 3 Category 1)

GHG emissions

from upstream

transportation

(Scope 3 Category 4)

GHG emissions

from business travel,

employee commuting

and more (Scope 3

Categories 2, 3, 5, 6, 7)

Scope 3¹:

Other upstream

Own operations

Upstream activities

4,130 (100%)

240 (6%)

460 (11%)

260 (6%)

3,070 (74%)

100 (2%)

1) Considering the challenges related to accurately modelling upstream Scope 3 emissions, such as the accuracy of historical data and the availability and applicability of emission fac-

tors, actual upstream Scope 3 emissions may differ materially from those modelled. The modelling primarily aims to identify the major sources of Scope 3 emissions across the value

chain, which supports Autoliv in developing specific activities for improvement and implementing the relevant measures. Autoliv aims to, over time, increase the accuracy of reported

upstream Scope 3 emissions by addressing material uncertainties. The illustration above does not include modelled downstream Scope 3 emissions, which include emissions from the

use phase of vehicles where Autoliv's products are installed.

Autoliv's climate program

Based on the results of the GHG footprint assessment, we

designed a climate program organized into a number of op-

erational initiatives focusing on the most important decar-

bonization levers or value creation and enabling activities.

A number of cross-cutting initiatives related to governance,

performance measurement, business strategy integration,

risk management and competence development support

the operational initiatives. Guided by our 1.5°C aligned long-

term ambitions, the climate program and related processes

such as risk assessments represent Autoliv’s low-carbon

transition plan.

Decarbonization levers

The most impactful decarbonization levers identified within

our own operations include:

Transitioning to low-carbon electricity at our facilities us-

ing a mix of on-site solar generation, long-term Power

Purchase Agreements (PPA), Renewable Energy Cer-

tificates (REC) and Energy Attribute Certificates (EAC)

Continued focus on energy and materials efficiency

Phasing out current fossil-fuel equipment such as natu

-

ral gas furnaces with electric alternatives

Phasing out fugitive emissions

Key initiatives that we intend to implement to reach net-zero

emissions across our supply chain include:

•

Transitioning to recycled, bio-based and other low-car-

bon materials in our products as well as in packaging

•

Requiring our suppliers to use low-carbon electricity in

their production

•

Reducing the GHG footprint of our logistics through

route, capacity and footprint optimization as well as a

shift towards low-carbon transportation modes and ve-

hicles

Below is a summary of some of the work and key achieve-

ments within the program during the year.

Low-carbon supply chain

In 2023, we carried out our regular climate survey to our

direct material suppliers, with the purpose of better under-

standing the current situation at our supply base: if suppliers

can quantify their GHG emissions, whether they are using re-

newable electricity, and whether their climate-related targets

and roadmaps are aligned with Autoliv’s net-zero ambition.

We also released our Sustainable Sourcing Requirements

for direct material suppliers, that include climate-related re-

quirements and expectations such as renewable electricity

targets by 2024, 2025 and 2030.

Low-carbon materials are crucial to meet our GHG emis-

sion reduction targets. In 2023, we engaged with a broad

range of raw material suppliers on sustainable material

solutions, to systematically review and validate options for

increasing the recycled content, bio-based and low-carbon

materials in our product. Examples covering key materials

include:

•

Textiles:

We are assessing low-carbon alternatives

based on higher recycled content or bio-based mate-

rials, prioritizing new materials interchangeable with

currently used materials

•

Steel:

In addition to a fossil-free steel partnership with

SSAB, we made progress on a broader low and fossil-

free steel buying program

•

Magnesium:

an estimated 20% of purchased magne-

sium came from recycled sources, a significant improve

-

ment from an estimated less than 5% in 2022

In the low carbon logistics program, focus is on shifting

transportation from air to sea, optimizing routes and im-

proving capacity utilization. During the year, we continued

work on developing division-level strategies based on local

conditions, and set emissions reduction targets for logistics

and packaging. We also carried out successful local pilots in

Asia using hydrogen fuel cell and electric light goods vehi-

cles as well as low-carbon packaging solutions with biode-

gradable bags replacing plastic bags.

Low-carbon and efficient operations

With a focus on renewable electricity, we expanded purchas-

ing of renewable electricity and initiated a long-term solar

PPA agreement in the U.S. In 2023, 23% of our total elec-

tricity consumption came from renewable instruments, up

from 13% in 2022. In addition to renewable electricity instru-

ments, several production have installed or are in the pro-

cess of installing on-site solar generation capacity. While still

representing less than 1% of our total energy consumption,

we are working to grow this share over the coming years.

As part of our Green Factory Program, we regularly con-

duct assessments covering energy, water and waste in order

to continuously improve environmental performance in our

operations. To ensure better integration of our climate pro-

gram into our operations, these assessments were made an

integral part of Autoliv’s operational excellence assessment.

As part of the program, we set site-level targets for GHG

emissions and energy intensity for all manufacturing sites.

With a greater focus on energy, we implemented a num-

ber of energy efficiency projects in all divisions during the

Low-carbon electricity in the

supply chain

Low-carbon material sourcing

Low-carbon logistics

Energy and resource efficiency

Phase-down of natural gas equipment

Elimination of fugitive emissions

Renewable energy for operations

Low-carbon product design

Low-carbon sales strategy

Low-Carbon

1)

Supply Chain

1)

Low-Carbon

1)

Program governance

and performance

measurement

Business strategy

integration

Risk management

Organization and compe

-

tence development

year, targeting areas such as air compressor leaks, waste

heat recovery, installing LED lighting, and replacing older

equipment with new, more efficient equipment. We im

-

proved the operational energy intensity, measured as total

energy consumption per part delivered, by 3% compared to

2022. We also conducted energy management workshops

and trainings in different divisions.

To reduce our GHG emissions from natural gas in the

production processes, we undertook several studies and

trials to assess the potential for energy efficiency improve

-

ment, e.g. from gas reduction and heat recovery, and

electrification of some equipment. The trials were conduct

-

ed to ensure that any abatement measures do not compro-

mise product quality. Preliminary results showed significant

improvement potential for some equipment, to be further

assessed and implemented where feasible.

Sulfur hexafluoride (SF

6

), used in steering wheel pro-

duction, is our largest source of fugitive emissions, mak-

ing up around 6% of Autoliv’s total Scope 1+2 emissions.

We launched an action plan in 2022 to fully phase out the

remaining use of SF₆. As a first step, SF₆ emissions were

reduced in 2023.

Despite an increase in total energy consumption, our ef-

forts in particular in increasing renewable electricity use and

SF

6

phase-out combined with updated emission factors

lead to a 17% decrease in Scope 1+2 emissons compared

to 2022.

Low-carbon product offerings

Our ambition is to develop attractive, low-carbon product

offerings to support our customers in their transition to zero-

emission, low environmental impact vehicles. We are see-

ing constantly increasing ambition levels among our cus-

tomers who are increasing requirements on us as a supplier.

During the year, all product lines developed action plans

for net-zero aligned product roadmaps as well as set emis-

sions reduction targets. We continued our work to evalu-

ate our products’ overall environmental footprint through-

out their life cycle. These life-cycle assessments (LCAs)

help prioritize actions in product development such as

light-weighting and sourcing of low-carbon materials. The

LCAs also allow us to proactively engage with customers,

highlighting the carbon footprint of our products and how

embedded emissions can be reduced. We already offer

our customers specific products that support their carbon

footprint reduction strategies, such as products with lower

weight and higher content of recycled non-ferrous metals

and low-carbon polymers. Examples include increased use

of recycled magnesium and switching to textile fabrics with

a significantly lower GHG footprint.

Cross-cutting initiatives

During the year, we extended our climate program train-

ing to also include mid-level management and employees

across divisions and corporate functions.

In addition to renewable electricity instruments, many sites have

installed or are in the process of installing on-site solar generation

capacity. Here represented by Autoliv in Utah, U.S.

SUSTAINABILITY

46

We continued the implementation of our Sustainabil-

ity Guidelines for Capex investments, with specific climate

impact guidance and assessment. The guidelines aim to

ensure that all investments are aligned with our 2030 cli-

mate ambitions and specify exclusion criteria for invest-

ments that could lead to increased GHG emissions above

certain emission thresholds beyond 2030. The guidelines

also encourage investments with positive climate impact,

such as, installation of solar panels, improvements to ener-

gy efficiency, and replacement of fossil-fuel equipment with

electric alternatives.

To strengthen our capacity for accurate and transparent

GHG accounting and forecasting, we are implementing a

corporate-wide GHG accounting solution covering both our

own operations and Scope 3 upstream activities with focus

on direct materials and logistics. The solution enables better

product carbon footprinting and target setting, and helps us

track both climate and financial impacts of a large number

of projects. During the year, we trained and onboarded 340

users across the organization and began tracking over 200

projects.

Read more about climate-related governance and risk

management in the TCFD disclosure, pages 48-49.

Circularity and natural resources

Waste and circularity

In 2023, we expanded our approach to natural resources

management in our own operations and value chain with the

aim of implementing a comprehensive circularity approach.

We undertook an assessment to evaluate our circularity-re-

lated risks and opportunities, in order to set our priorities for

the coming years. As part of the assessment, we evaluated

our current status and identified a large number of potential

circularity initiatives in three key areas:

• materials recirculation, including share of recycled content

in input materials

• materials efficiency, including materials utilization and

lightweighting rate

• product utilization rate, ensuring the lifetime of our product

lasts the lifetime of a vehicle

Identified initiatives include, for example, circular prod

-

uct design principles, scrap optimization in the supply chain

and within our operations for key input materials, further

improvements in lightweighting, closed loop processes for

select materials, increased recycled inputs for strategic

materials, and packaging optimization and reuse. The work

continues in 2024 with the aim of finalizing our circularity

strategy including further validating and prioritizing the op-

portunities and risks identified, setting our ambition and de

-

fining the roadmap.

We continuously manage and monitor waste manage-

ment practices at site level through the Green Factory pro-

gram, in which waste management is part of the quarterly

assessment. Directing waste away from landfill remains a

priority at our production sites. The rate of reuse, recycling

and energy recovery increased to 91% (90% in 2022) of to-

tal waste reported.

Water

Our most water intensive operations are associated with the

production of airbag components, accounting for around

60% of water withdrawal. Based on the WRI Aqueduct Wa

-

ter Risk Atlas, around 20% of Autoliv’s facilities are located

in regions with high or extremely high water stress levels.

Nevertheless, only one of the ten most water intensive pro-

duction sites is located in high water stress region.

During the year, we conducted water footprint analysis

within our own operations and across key raw materials val-

ue chain as well as water risk assessments for our facilities.

Based on the ENCORE sectoral water impact methodol-

ogy, the largest water footprint in the value chain came from

steel, aluminium and textiles (PET).

Biodiversity

To better understand our impact on biodiversity, we con-

ducted an initial assessment on biodiversity risks and de-

pendencies, both faced by and associated with our opera-

tions, and related to our supply chain. The assessment was

based on both the recommended approach from the Task-

force for Nature-related Financial Disclosures (TNFD) and

EU Corporate Sustainability Reporting Directive. Using an

established methodology (LEAP) and tool (ENCORE), we

performed an initial screening of biodiversity risks at all our

manufacturing sites and and certain materials value chains.

Based on the initial results, we then conducted a more de-

tailed assessment of biodiversity impacts and dependen-

cies on select Autoliv sites and raw materials supply chains.

In 2024, we will continue assessing biodiversity with the

overall goal of implementing key aspects into existing pro-

cesses such as environmental impact assessments.

Materials management and substances of concern

For Autoliv as a global automotive component manufac-

turer, compliance with chemical and material regulations is

essential for our business. At the core is our standard that

defines Autoliv's requirements for material data reporting

and substance use restrictions, applicable for both Autoliv

and its suppliers. This standard is updated twice a year to

reflect the latest legal and customer requirements. Through

reporting to the automotive industry databases IMDS and

CAMDS, we trace the content in our components delivered

to customers and confirm compliance regarding applicable

legal and customer requirements.

We follow up continuously with our suppliers to find al

-

ternative materials in case a substance needs to be phased

out. In 2023, special efforts were devoted to identifying

PFAS used in our parts and assessing suitable alternatives.

47

TCFD Disclosure

Autoliv considers the management of cli-

mate-related risks and opportunities to be a

key component of ensuring long-term busi-

ness success. This disclosure is aligned with

the Task Force on Climate-Related Financial

Disclosures (TCFD) recommendations.

Governance

The Board of Directors is ultimately responsible for the over-

sight of sustainability-related matters, including climate

change, and has delegated certain responsibilities to its

committees. The Board of Directors and the Nominating

and Corporate Governance Committee (NCGC) receive

regular updates on climate-related matters and perfor-

mance. In 2021, the Board of Directors endorsed Autoliv’s

current long-term climate ambitions as well as the strategic

direction for reaching the ambitions. Throughout 2023, the

Board and NCGC received updates on progress related to

the climate program and our plans for 2024.

The Executive Management Team (EMT) is respon-

sible for implementation of sustainability-related matters,

including climate change. The Sustainability Board, which

consists of the CEO and several EMT members, has over-

all operational oversight of Autoliv's climate program. Other

relevant Management Boards, such as the Industrial & Prod-

uct Board, Innovation Board and Commercial Board, focus

on specific climate program initiatives such as low-carbon

product design. Performance against climate-related targets

is reviewed regularly by the EMT, divisional and other func-

tional management teams and followed up in monthly busi-

ness reviews. The underlying governance principle of the

climate program is close integration into existing govern-

ance structures.

Supported by the VP Sustainability, the Executive Vice

President HR & Sustainability, is ultimately responsible for

the overall direction and governance of the program, and for

ensuring implementation progress.

For more information about sustainability governance,

see pages 38-39.

Strategy

Scenario analysis

In 2021, as part of the development of the updated climate

strategy, we carried out our first climate scenario analysis.

The analysis, which covered both transition and physical

risks, was based on a 2°C (equivalent to RCP 4.5) sce

-

nario and a 3-4°C (equivalent to RCP 8.5) scenario. Transi

-

tion risks were assessed on a 2030-2040 timeframe, while

physical risks were assessed on a 2050 timeframe.

From a financial impact perspective, the most material tran

-

sition risks identified were:

•

the risk of a global decrease in overall vehicles sales

•

increasing prices for raw materials with a large carbon foot-

print as a result of various carbon pricing mechanisms

•

potential revenue loss if Autoliv fails to meet increasingly

strict supplier requirements from OEMs who themselves

have set strict GHG emissions reduction targets

SUSTAINABILITY

48

The most material physical risks identified, generally con

-

nected to a 3-4°C scenario, were factors that would lead to

significant production disruptions. These include wildfires,

flooding and extreme heat. These risks were seen as par

-

ticularly high in countries and regions such as the South-

west U.S., Mexico, India and China. These risks are also ex-

pected to impact suppliers and customers in these regions.

The most material opportunities identified pertained

to building a strong position among climate-progressive

OEMs including electric vehicel (EV) manufacturers as a

supplier of low-carbon components as well as opportunities

to increase operational energy and materials efficiency.

Strategy and business impact integration

Climate change is integrated into Autoliv’s business strate-

gy, which is cascaded through established steering mecha-

nisms such as annual business planning and target setting.

To realize key climate-related business opportunities,

we are continuously working on low-carbon product offer

-

ings and forming partnerships with customers to help them

reduce the carbon footprint of their products. In addition, ef-

forts to increase the energy and materials efficiency of our

operations will support in reducing related Opex. As part of

our climate transition plan, we aim to gradually further devel-

op and use scenarios as a supporting tool in quantifying the

financial impacts of climate-related risks and opportunities,

including setting a price on carbon and other climate-related

financial KPIs.

Autoliv's strategic plan was updated in 2022, covering

the years 2023-2025. Climate is included as one of the focus

areas in the strategic plan. During 2023, we focused on fur-

ther integrating climate considerations into the company's

strategic product planning process and other key process-

es, such as Capex decisions.

Risk management

Climate-related risks are generally integrated into the En-

terprise Risk Management (ERM) process. For more infor-

mation about ERM and management of sustainability risks,

see pages 38-39.

Transition risks are generally considered mitigated

through continuous legal and market intelligence reviews,

sales forecasting and external stakeholder engagement.

Physical risks are generally considered mitigated through

site risk and impact assessments as well as ongoing busi-

ness continuity management.

Metrics and targets

In addition to Autoliv's long-term ambitions and Science

Based Targets, the climate program covers a number of

more detailed performance metrics and related targets.

These cover the most important emissions reduction levers

such as sourcing of low-carbon raw materials, low-carbon

logistics and a transition towards renewable electricity use.

Since 2022, GHG emissions from own operations

(Scope 1+2) is a performance component to the long-term

equity incentive program. The program covers around 300

participants, including the CEO and all EMT members.

For more information on GHG emissions and target out-

comes, see pages 61-62.

Climate risk assessment

Transition risks

Most material risks

Potential financial impacts

Policy and legal

Carbon pricing mechanisms leading to

increasing prices for raw materials with a

large carbon footprint

Increased Opex

Technology

Decrease in overall vehicle sales

Loss of revenue

Market

Higher demand for renewable electricity

and low-carbon raw materials

Increased Opex

Reputational

Increasing stakeholder requirements or

expectations on Autoliv to aggressively re-

duce GHG emissions in its own operations

and/or supply chain

Loss of revenue, reduced

access to capital

Physical risks

Acute/short term

Wildfires

Extreme heat

Flooding

Loss of revenue related to production

disruptions

Disruption to water and energy supply

Chronic/long term

Extreme heat

Water stress

Costs related to the need to relocate

production

49

Ambitions:

A Safe and

Inclusive

Workplace

Health, safety, and inclusion are pillars of

our people strategy, ensuring that we create

value from and for our most valuable asset -

our employees.

Health and Safety

Our ambition and approach

Autoliv is committed to providing safe and healthy working

conditions for our employees and contractors. We believe

that work-related injuries and illnesses are preventable and

continually strive to eliminate all workplace accidents. The

responsibility for health and safety (H&S) starts with senior

management. All employees share a responsibility for iden-

tifying and eliminating unsafe conditions and behaviors and

speaking up.

Health and safety management system

We make H&S an integral part of everyday business by

integrating H&S into our production system and all our

projects and processes that may affect the working environ

-

ment of our employees. All production sites are required to

implement Autoliv’s health and safety management system

(HSMS), which is aligned with ISO 45001 requirements.

The cornerstone of our HSMS is the global safety assess-

ment that is an integrated part of the Autoliv Production

System. These quarterly assessments establish the princi

-

ples and internal standards by which H&S activities and op-

erations are managed, provide a factual basis for identifying

significant hazards and risks, and support in implementing

continuous improvement activities to eliminate or mitigate

these hazards and risks.

The HSMS is supported by local leadership teams who

encourage operators and visitors to engage in and proac-

tively speak up about health and safety concerns and to

take responsibility for safety. Implementation of the system

is monitored through internal audits and external certifica

-

tion audits. At year end, 61% of production sites were ISO

45001 certified.

SUSTAINABILITY

Zero accidents

Embrace inclusive

ways of working

0.35

95%

22%

1

As part of our continuous focus on accident prevention, we

are continuously expanding the use of leading H&S indica-

tors. In 2022, we added identified unsafe acts and condi

-

tions to monthly management reporting and during 2023,

the reporting of unsafe acts and conditions significantly in

-

creased surpassing the target of 1 per employee. This re-

flects an increased awareness of the importance of report

-

ing safety issues.

H&S training and awareness building

During 2023, H&S continued to be a key topic at EMT and

Divisional Management Team meetings. Leadership safety

training continued throughout the year and in 2024 the train-

ing will be deployed to team leaders in operations. All em-

ployees working in production are trained in relevant H&S

topics and H&S is included as a mandatory item in daily

team meetings. In addition, they are trained in the use of

on-site H&S reporting tools and empowered to immediately

stop production if an actual or potential serious risk is identi-

fied.

Focus on high-risk activities

During 2023, we continued the focus on high-risk activi-

ties within our operations. To better control these risks, we

have developed and implemented internal standards cov-

ering a number of high-risk areas:

•

Working at height

•

Lock-out/tag-out

•

Traffic safety

•

Machine safety

•

Lifting and rigging

•

Contractor safety

These standards are implemented and followed up through

the global safety assessment.

We are increasingly focusing on incidents that could have

resulted in a serious injury or fatality. All such incidents are

reviewed by the responsible management team and shared

globally so that measures can be put in place to prevent re-

peat incidents.

Inclusion

Our ambition and approach

Inclusive ways of working are an asset and a fundamen-

tal part of the Autoliv Key Behaviors that were launched in

2021. Including a multitude of perspectives is an integral

aspect of successful decision-making in all parts of the or-

ganization and helps drive innovation and create long-term

sustainable shareholder value in a rapidly changing industry.

We believe that everyone should be respected and treated

fairly, and we are committed to providing an inclusive and di-

verse workplace where everyone can be themselves, deliver

results and bring their authentic selves to work.

Activities during the year

During 2023, we continued our activities to deliver on inclu-

sion targets, including a focus on increasing the share of

women in management. While we did not meet our target

for the share of women in senior management compared to

2022, we took important steps to create a more diverse can-

didate base, and began to use scientific selection methods

to increase objectivity in both internal and external recruit-

ment. We also continued unconscious bias training for sen-

ior and middle management to enhance managers’ insight

and ability to take diversity into account in everyday work.

Measuring inclusion and Employee Experience

The company-wide quarterly employee survey includes

statements that measure key aspects of an inclusive work

environment including: whether employees feel that they

can be themselves at work (“Authenticity”) and whether they

have the same opportunity to advance in the organization

(“Perceived fairness”). The scores were lower in 2023 com-

pared to 2022, largely attributable to a general decrease in

employee sentiment related to organizational changes im-

plemented from the second quarter. Women were, in gen

-

eral, more positive than men and had a more positive per-

ception of inclusion within the company.

For more information about employee development, see

pages 32-33.

Leadership

commitment

Leaders at all levels of the

organization are ac-

tively involved in creating

a behavior that supports

and promotes strong H&S

performance and continu-

ous improvement.

Workplace safety

is a condition

for employment

Every employee is

responsible for

contributing to their

own workplace safety.

Continuous

improvement

Processes and proce-

dures are implemented

to monitor H&S, verify

implementation, identify

defects and provide

opportunities for

improvement.

Employee

involvement

Employees are actively

engaged in all aspects of

H&S performance, including

establishing goals, identify-

ing and reporting hazards/

risks, investigating incidents

and tracking progress.

Recognition

and control

of risks

Processes and procedures

are implemented to pro-

actively identify, prevent,

reduce and/or control

potential hazards/risks.

Autoliv's H&S work principles

51

Ambitions:

Responsible

Business

Responsible business practices are key in

ensuring that we understand the impacts of

our business operations, comply with laws

and regulations, and meet stakeholder ex-

pectations.

Our Responsible Business strategy

Responsible business is a fundamental element of Autoliv’s

sustainability framework. To recruit and retain the best talent

and to build enduring relationships with our customers and

suppliers, it is essential that Autoliv is known for the quality

and integrity of its conduct as well as its products and ser-

vices. Through our approach to responsible business, we

work to continually strengthen how we:

•

Proactively prevent corruption and other illegal or

unethical business practices wherever we operate

•

Respect human rights across our value chain

•

Manage sustainability risks and impacts across our

supply chain

Targets:

100%

of target group completed

Antitrust training

Outcome:

100%

of target group Code

of Conduct certified

Outcome:

100%

direct material suppliers

sustainability audited

Outcome:

100%

direct material suppliers respond

to conflict minerals survey

Outcome:

Compliance and Corporate Integrity

Autoliv’s Compliance and Corporate Integrity Program

Autoliv’s compliance program is designed in accordance

with a number of frameworks and best practice guidance,

such as guidelines for effective compliance programs under

the Organizational Guidelines issued by the U.S. Sentenc-

ing Commission, the U.S. Department of Justice - Evalua

-

tion of Corporate Compliance Programs, and the UK Bribery

Act Guidance. The program serves to ensure that adequate

procedures are in place to prevent Autoliv from taking part in

any corrupt business practices, or other illegal and unethical

behavior, and that the company adheres to applicable laws

and regulations. The program also drives compliance with

relevant standards including the Autoliv Code of Conduct,

as well as corporate standards.

Leading with Integrity

Leading with Integrity is at the core of Autoliv’s Compliance

and Corporate Integrity program. We strongly believe that

leaders play the most important role in enabling, inspiring,

and making it easy for employees to make responsible deci-

sions. They also play an important role in fostering an open

and transparent culture where all employees feel safe and

encouraged to Speak Up. In 2023, we launched a number

of initiatives under the “Leading with Integrity” umbrella. For

example, we introduced the Leading with Integrity Library,

which provides helpful resources and ready-to-use material

for leaders. Resources include Listen Up Leaders – creating

a speak up culture, Respect in the Workplace workshop ma-

terial, leader-led discussions about the purpose of our Code

of Conduct as well as the “Integrity Check” game.

Saving Lives with Integrity: Our Code of Conduct

In 2022, Autoliv introduced a revised Code of Conduct. Sev-

eral training courses and activities were arranged through-

out 2023 with the aim to increase awareness of the new

Code of Conduct. These included leader-led discussions

focused on different aspects of our Code, responsible busi

-

ness approach and Code of Conduct training specifically for

production staff.

Autoliv’s onboarding process for new employees in-

cludes an introduction to the Code of Conduct through

team-based discussions on the role of our Code, our In-

tegrity Check, what we should expect from each other, and

speaking up. During 2023, over 8,000 new employees par-

ticipated in face-to-face Code of Conduct trainings. In addi-

tion, a new Code of Conduct e-learning was developed dur-

ing the year, to be rolled out to all non-production employees

in 2024.

Each year, all Autoliv employees in a leadership role

must complete a Code of Conduct certification. The certi

-

fication requires the disclosure of known violations of the

Code and an acknowledgement that the leaders are aware

of and promote the Code to their teams. At year end, 93% of

target group employees had completed certification.

Compliance and Corporate Integrity Program

Colleagues at Autoliv in Shanghai, China.

53

Is it legal

and consistent

with our

Code?

Do I

have all the

information to

support a good

decision?

Do I still

feel proud of

myself and

Autoliv?

Do I know

how to explain

the decision

to those

impacted?

Have I

discussed

with the right

people?

SUSTAINABILITY

Autoliv's

Integrity

Check

If you answer any of these questions with a “no” or “I’m

not sure”, pause and seek additional guidance.

Part of the training related to our Code of Conduct is an

interactive game – Integrity Check. The aim is to help em-

ployees get a deeper understanding and inspire discussions

about decision making with integrity in a new and engaging

way. The roll-out of the game is ongoing and will continue

during 2024 with the aim that all top management leaders

should complete the game activity with their teams.

54

Speaking Up

Autoliv has embraced a broad definition for Speaking Up:

“any communication or discussion with the intent to bring

positive change, show encouragement or highlight an issue

for improvement”. To help ensure that our broad definition

of Speaking Up is consistently referenced and promoted

across workstreams and strategic initiatives, implementa-

tion of the Speak Up policy is the joint responsibility of sev-

eral functions: Compliance & Corporate Integrity, Health &

Safety, Quality, and HR. Although we believe this broader

definition will benefit our business in all aspects, we make

it clear that Autoliv employees are responsible for immedi-

ately reporting suspected or known violations of the Code

of Conduct, the law or Autoliv’s policies. All employees are

frequently informed of the multiple channels available for

raising such issues. In most cases, this should be to their

manager or a member of local management. When this is

not possible (for any reason), colleagues in HR, the Legal

Department, or Compliance Officers are always available,

or the Autoliv Helpline can be used.

In December 2022, we launched a Speaking Up e-

learning for all employees and additional training for leaders

on their role in creating a Speak Up culture. The e-learning

takes employees through a series of situations where they

are asked to make a decision about what to do next. By the

end of 2023, 98% of employees had completed the Speak-

ing Up e-learning and 97% of managers had completed the

additional manager training. Awareness of Speak Up chan-

nels and confidence in speaking up are measured in quar

-

terly employee surveys.

In 2023, 68% of employees who participated in the sur-

veys felt safe to speak up at Autoliv, same result as in 2022.

While many teams report that they feel safe to speak up, we

know this sentiment is not yet universal in all parts of Autoliv.

The Code of Conduct and Speak Up policy firmly state that

no employee or third party should be adversely affected for

reporting in good faith or for refusing to carry out a directive

believed to constitute a violation of the Code or other Autoliv

policies, laws, or regulations.

In order to measure how well we have communicated to the

employees about our Speak Up philosophy and program,

we launched a Speak Up awareness survey for employees

in our Europe, Asia and China divisions. The results of the

survey are analyzed and discussed within the respective

management teams and form the basis for continued com-

munication and training about Speaking Up, both for em-

ployees and for management.

Autoliv Helpline

The Autoliv Helpline is a third-party operated reporting ser-

vice available to all employees as well as any third party.

Reports can be made anonymously (where allowed by law)

and/or confidentially in the language of any country where

Autoliv operates. All reports are investigated to determine

whether there is any violation of the law, the Code of Con-

duct or other Autoliv policies.

Reporting

In 2023, a total of 426 reports were received by the Compli-

ance team. Around 89% were received via the Helpline re-

porting system (phone or online) and the other reports were

raised internally, meaning reported directly to management,

HR, Legal or Compliance teams. Of the reports received,

70% were, opened for investigation. Of the investigations

closed in 2023, 36% of the allegations or cases were sub-

stantiated or partially substantiated. Compared to previous

years, 2023 saw an increase in the number of reports related

to harassment and conflict of interest. Substantiated cases

are presented to appropriate management for decision on

disciplinary action and other remediation activities. All high

risk case are presented to Executive Management and Audit

and Risk Committee of the Board on a regular basis.

Helpline

Other

trusted local

leaders

Compliance

team

Specialist

colleagues

(e.g. HR, HSE,

APS, Quality,

Legal)

Direct line

manager

Speaking Up@Autoliv:

“Any communication or discussion

with the intent to bring positive change,

show encouragement or highlight

an issue for improvement”.

55

Tax policy

At Autoliv, tax planning is carried out in compliance with the

Tax Policy approved by the Board of Directors. The basic

principle is to respect all relevant laws, disclosure require

-

ments and regulations, while safeguarding shareholder in-

terests and the Autoliv brand. All tax planning must be in line

with Autoliv’s business purpose and no baseless organiza-

tional structure is permitted. All Autoliv affiliates are required

to pay all tax obligations and meet relevant payment dead-

lines, to fully comply with all relevant tax laws and account-

ing rules and regulations in the tax jurisdictions in which the

business operates, and to be open and transparent with

tax authorities about their tax liability. When disputes arise,

Autoliv will proactively seek to work cooperatively with full

transparency.

Human rights

Human rights are an integral part of Autoliv’s sustainability

agenda and cut across all sustainability focus areas. We are

committed to respecting the UN Universal Declaration of Hu-

man Rights as well as human rights-related commitments

laid out in the UN Global Compact Principles and OECD

Guidelines for Multinational Enterprises. We are continuously

assessing the quickly evolving legislatory landscape as well

as customer- and investor-related expectations. During 2023

we continued the work to further develop our human rights

due diligence processes, with particular focus on mapping

human rights-related risks for select raw materials supply

chains. This work will continue in 2024.

Human rights commitments are included in our Code

of Conduct and our Supplier Code. These Codes are sup-

ported by topic-specific policies that cover specific human

rights, such as our Health & Safety Policy, Respect in the

Workplace Policy and Conflict Minerals Policy. Implementa

-

tion of our commitments is ensured through management

attention and reporting, management systems, standards,

risk and impact assessments, other tools and training.

Human rights are also a cross-cutting theme in our com-

munity engagement activities. One such example is our and

other large Swedish companies’ long-standing collabora-

tion with the NGO Pratham to ensure effective education for

30,000 children in Assam in India.

Key human rights-related commitments include:

•

Our products save lives, and we need to ensure the

quality and safety of our products as they never get a

second chance

•

We are committed to offering a safe and inclusive

workplace and respecting all other labor rights

•

Our climate ambitions are aligned with the goal of

limiting global warming to 1.5°C, thereby mitigating the

most severe impacts on societies and the environment

•

Our supply chain sustainability risk management

processes consider human rights risks and impacts

Labor rights

Autoliv is committed to offering fair terms and conditions of

employment to all employees regardless of employment

type, status, or location. These commitments extend across

our supply chain. Our talent development strategies and

employment policies support the International Labour Or-

ganization’s Fundamental Principles and Labor Standards.

We are committed to:

•

Providing fair and equitable wages, working hours,

benefits, and other conditions of employment in

accordance with applicable laws

•

Recognizing and respecting employees’ right to

freedom of association and collective bargaining

•

Providing decent and safe working conditions

•

Prohibiting child, forced, and bonded labor

•

Promoting a safe workplace free from any form

of discrimination or harassment

SUSTAINABILITY

Human Rights in the

Automotive Industry

As a global automotive supplier, Autoliv faces human

rights risks in a number of areas. As laid out in the report

"Shifting Gears, An Assessment of Human Rights Risks

& Due Diligence in the Automotive Industry", published by

the Automotive Industry Action Group (AIAG), the most

salient risks and issues include:

Child labor and forced labor

Workplace health and safety, discrimination

and harassment

Working conditions, wages and freedom of

association

Conflict minerals

Climate change and environmental

degradation

56

Autoliv is committed to engaging in open and transparent

dialogue with all employees and, where applicable, with

representatives of organized labor groups and unions. We

recognize and respect employees' rights to freedom of as-

sociation and collective bargaining. Approximately 50 per-

cent of our work force is covered by a collective bargaining

agreement. In addition, we have a number of different mech

-

anisms through which employees can bring up topics with

management. These include Autoliv's Speak Up channels

(including the Autoliv Helpline), an employee suggestion

program, local health and safety committees, and opera-

tional committees. The major unions representing Autoliv

employees in different regions are disclosed as part of the

10-K filed with the SEC.

During 2023, to accelerate structural cost reductions,

announcements were made regarding site closures and in-

direct headcount reductions. Autoliv is committed to man-

aging any workforce reductions responsibly. In all cases, ne-

gotiations were carried out with local unions and authorities

in accordance with laws and regulations. Depending on the

circumstances, certain employees were offered relocation,

severance pay, early retirement packages, or other addition-

al compensation.

In the later parts of the year, Autoliv's operations in

Queretaro, Mexico, were subject to mass media atten-

tion related to alleged labor rights breaches and a review

into its operations by the U.S Interagency Labor Commit-

tee for Monitoring and Enforcement established under the

United States- Mexico-Canada (USMCA) Agreement. With

over 16,000 employees in Mexico, Autoliv's announced

headcount reductions sparked conversations about labor

practices, worker rights, and the dynamics of employee-

employer relationships within the company. On December

6th, Autoliv's local subsidiary finalized a collective bargain

-

ing agreement for employees at the Queretaro facility.

Supply chain sustainability

Our ambition and approach

Through responsible sourcing practices and supplier collab-

oration, Autoliv aims to create positive social and environ-

mental value across our supply chain. We expect suppliers

and third parties to enact the same standards and process-

es as we do when it comes to proactively managing key sus-

tainability impacts and risks such as GHG emissions, labor

rights, and anti-corruption.

To manage our global supply chain in a responsible man-

ner, we focus on integrating sustainability into relevant supply

chain management processes. Suppliers are monitored in

a live risk tool covering such factors as natural disasters,

financial status, reputation, risks, and responsible sourcing

practices. Autoliv’s lead buyers are updated regularly with

information related to their suppliers, allowing them to take

immediate action when necessary.

While our main focus is on direct material suppliers, dur-

ing 2023 we continued to expand the scope of our supply

chain sustainability risk management to indirect suppliers.

Our approach is to work with suppliers, to the greatest ex-

tent possible, to resolve issues before determining to poten-

tially phase out the supplier. Further information related to

supply chain risks is available in the 10-K filed with the SEC.

Supplier Code of Conduct and Sustainable

Sourcing Requirements

We expect our suppliers to comply with the laws and regula-

tions in the areas where they operate and to follow Autoliv’s

policies and procedures, including our Standards of Busi-

ness Conduct and Ethics for Suppliers (Supplier Code of

Conduct). In situations where an Autoliv requirement may

differ from local laws or regulations, we expect our suppli

-

ers to follow the most stringent requirements. The Supplier

Code conveys our expectation that suppliers will uphold our

social, ethical and environmental standards in conducting

their businesses in areas including human rights and work-

ing conditions, environmental protection, and business con-

duct and ethics. For direct material suppliers, the Supplier

Code is included in the Autoliv Supplier Manual (ASM). All

direct material suppliers are required to acknowledge their

compliance with the ASM as part of our general terms and

conditions and by signing a separate acknowledgement let-

ter for the ASM. In the case of indirect suppliers, a reference

to the Supplier Code is included in the general terms and

conditions attached to purchasing orders. In early 2023, a

revised Supplier Code of Conduct was rolled out to suppli-

ers, with strengthened requirements in particular related to

conflict minerals and environmental impacts.

Launched in end of 2023, our Sustainable Sourcing

Requirements are being communicated to direct material

suppliers. The document contains further detailed require

-

ments and expectations related to the four focus areas of

the Supplier Code of Conduct.

Supplier audits

Autoliv has dedicated teams responsible for the qual

-

ity management of our supply base, including mandatory

steps such as pre-qualification audits for new direct mate

-

rial suppliers. Sustainability criteria are included as a mod-

ule in these prequalification audits and must be met before

becoming an Autoliv supplier. These audits ensure that our

suppliers adhere to Autoliv’s standards as well as to appli-

cable local laws and regulations, and establish a process

for working with suppliers that fail to meet our policies and

standards. If audited suppliers don’t meet our requirements,

an internal escalation process is in place to ensure that non-

conformities are corrected. At year-end, 99% of active di-

rect material suppliers within audit scope had undergone a

sustainability audit. Our audit practices are aligned with the

AIAG guidelines.

57

SUSTAINABILITY

Conflict minerals & Extended minerals

Pursuant to U.S. Securities and Exchange Commission

(SEC) rules, conflict minerals include certain minerals (tin,

tantalum, tungsten and gold, also known as 3TG) that origi-

nated in the Democratic Republic of Congo or an adjoining

country and are sold to benefit groups financing armed con

-

flicts in those regions. We recognize the need to end the ille

-

gal extraction and trade of natural resources, and the human

rights violations, conflicts and environmental degradation

that result from this trade. We have designed our conflict

minerals approach in accordance with the internationally

recognized OECD Due Diligence Guidance for Responsi-

ble Supply Chains of Minerals from Conflict-Affected and

High-Risk Areas, specifically as it relates to our position as

a downstream purchaser. The OECD Due Diligence Guid-

ance has a broader scope and covers more minerals than

3TG. Our Conflict Minerals Policy provides further clarifica

-

tion regarding conflict minerals, and its principles are incor

-

porated into our Supplier Code of Conduct and the Sustain-

able Sourcing Requirements.

In order to comply with the SEC’s conflict minerals rules

and regulations and to ensure responsible sourcing of com-

ponents, parts or products containing conflict minerals, we

continuously review our supply chain and work with our sup-

pliers to identify and improve the traceability of potential

conflict minerals. We support industry initiatives, such as

the Responsible Minerals Initiative (RMI), and utilize exter-

nal expert guidance to validate that the metals used in our

products come from sustainable sources and do not con-

tribute to conflicts. In cases where we find potential risks and

conflicts with smelters identified within our supply chain,

we take immediate action to mitigate the potential risks. In

some cases, this means discontinuing sourcing from suppli-

ers that are in violation of our requirements to ensure sourc

-

ing from designated RMI active or conformant suppliers.

To ensure our understanding of the potential use of

conflict minerals, we have implemented an annual conflict

minerals campaign covering our direct material suppliers.

The scope of the annual campaign includes all direct mate-

rial suppliers that have conducted business with us during

the current calendar year and have listed 3TG in their Bill of

Materials. This information is extracted from the automotive

industry standard reporting platform IMDS. The response

rate to the latest completed campaign, which ended in

May 2023, was 97%. Most non-responding suppliers were

customer-directed suppliers. We are working with these

customers to mitigate this issue for future conflict minerals

campaigns. We publish an annual report on our conflict min

-

erals campaign on our website.

In addition to conflict minerals, we also have in place an an

-

nual reporting campaign related to tracing extended miner-

als (cobalt and mica) used in components supplied to us.

Autoliv does not permit the sourcing of cobalt or mica from

high-risk smelters, and suppliers must be able to trace co-

balt and mica content in components or raw materials by

part number from their facility back to the supplier sourcing

from the identified smelters.

Airbag component manufacturing.

58

Pages 34-63 comprise Autoliv’s Sustainability Report 2023.

Reporting scope

The report covers Autoliv Inc. and all companies over which

Autoliv Inc. directly or indirectly exercises control (opera-

tional control approach). Reported information covers the

full calendar year. Exceptions to this scope:

•

Health and safety reporting excludes office locations

•

Environmental reporting excludes office locations as

well as other locations with an insignificant

environmental impact

•

Scope 1+2 emissions for 2023 are based on actual ac-

tivity data for January-November and estimated activity

data for December. Estimations are based primarily on

historical activity data (Q4 2022 and Q1-Q3 2023)

The excluded locations are considered non-material in

terms of their impact on total figures.

GHG emissions and energy

All GHG emissions are reported as CO₂e. Due to their na

-

ture or to availability, some emission factors used may only

cover CO₂, however the difference has been assessed as

non-material.

Energy consumption and GHG emissions are based on

activity data reported in volume or quantity in an internal re

-

porting system. The data is based primarily on invoices, but

may be estimated if exact measurements or invoices do not

exist.

Scope 1+2

Regarding Scope 1+2 emissions, Autoliv applies the GHG

Protocol Corporate Accounting and Reporting Standard.

Autoliv's primary Scope 2 GHG accounting approach is

market-based, and related GHG emissions targets and oth-

er metrics are based on market-based Scope 2 emissions.

The following emission factor sources were used to calcu-

late 2023 GHG emissions:

•

Scope 1 energy fuels

1)

: Defra 2022

•

Scope 1 fugitive emissions

2, 3)

: Defra 2022, IPCC AR5,

producer stated GWP

•

Scope 2 location-based electricity and district

heating/steam: IEA 2022

•

Scope 2 market-based electricity: provided by supplier,

or national grid average for the sites where suppliers

were unable to provide a specific emission factor

•

Scope 2 market-based district heating/steam:

IEA 2022

1) Gasoline, diesel, fuel oil, LPG. 2) Mainly SF

6

, fugitive CO

2

, N

2

O and various refrigerants.

3) The emission factor for SF

6

at one facility has been adjusted down by 20% to account

for not all gas being released into the atmosphere. The adjustment is based on tests at the

facility and has been applied also to the SF₆ emission factor used for 2021 and 2022. The

adjustment is a best estimate associated with inherent uncertainty as the exact reduction

has not been established.

2021 and 2022 emissions have been calculated mainly using

older sets of the same emission factor sources. The updated

emission factors for 2023 represent around a 40 kton reduc-

tion in Scope 1+2 emissions between 2021-2022 and 2023,

impacting in particular market-based electricity emissions.

Sustainability

Appendix

59

SUSTAINABILITY

Scope 3

Reported Scope 3 emissions have been modelled in ac-

cordance with the GHG Protocol Scope 3 Calculation Guid-

ance based on a combination of spend data (e.g. logistics

spend) and activity data (e.g. materials purchased). Gener-

ic emission factors have been applied as supplier-specific

emission factors are generally not available. Reporting is

limited to Scope 3 upstream categories as those are consid-

ered material for Autoliv and are covered by Autoliv's sup-

ply chain climate ambition and the Scope 3 Science Based

Target.

Science Based Targets

In January 2022, the Science Based Targets initiative

(SBTi) approved Autoliv's Science Based Targets (SBTs):

•

Reduce absolute Scope 1+2 emissions by 75% from a

2018 base year

•

Reduce absolute Scope 3 upstream emissions by 15%

from a 2018 base year

The Scope 1+2 SBT is 1.5°C aligned and has a baseline of

423 kton. 2023 Scope 1+2 emissions of 358 kton is a 15%

absolute reduction compared to the baseline.

The scope 3 SBT is 2°C aligned and has a baseline of

3,100 kton. 2023 Scope 3 upstream emissions of 3,770

kton is an 18% absolute increase compared to the baseline.

Energy

Energy conversion for energy fuels have been taken from

public data. The same energy conversion factors have been

applied to all reported energy consumption 2021-2023 with

the exception of natural gas. There has been a small change

to the 2021-2022 factor and the higher conversion factor ap-

plied to natural gas for 2023 represents an increase of 28

GWh direct energy in 2023 compared to 2021-2022 how-

ever, does not impact Scope 1 emissions.

Changes and corrections

In 2023, there were no material changes in reporting scope.

Previously reported 2021 and 2022 location-based

Scope 2 emissions have been corrected due to earlier cal-

culation error. The correction resulted in a change of loca-

tion-based Scope 2 emissions from 285 to 291 kton CO

2

e

for 2021 and from 276 to 316 kton CO

2

e for 2022. The cor-

rection of location-based Scope emissions does not impact

reported market-based Scope 2 emissions.

The 2021-2023 Incident Rates differ from prior Autoliv

reports and releases due to a previous miscalculation; they

have been adjusted upwards to reflect the correct Incident

Rate. The Company continues to focus on ways to reduce

injuries and lower the Incident Rate.

External reporting frameworks

The following external reporting frameworks have been con-

sidered for the structure and content of this Sustainability

Report:

•

We consider the Sustainability Report aligned with the

general requirements of the EU Non-Financial Report

-

ing Directive (NFRD). Autoliv’s assessment, supported

by third party legal expertise, is that for the year 2023,

Autoliv Inc. was not required to report in accordance

with the EU Non-Financial Reporting Directive (NFRD)

or the EU Corporate Sustainability Reporting Directive

(CSRD).

•

This Sustainability Appendix includes references to the

voluntary SASB Auto Parts Sustainability Accounting

Standard.

•

A TCFD Disclosure is included on pages 48-49.

•

A statement prepared to comply with the reporting ob-

ligation of California’s Voluntary Carbon Market Disclo-

sure Act (VCMDA) is available on autoliv.com.

External assurance

Scope 1+2 emissions for 2023, reported in accordance

with the GHG Protocol Corporate Accounting and Report-

ing Standard, have been subject to limited review carried

out by EY. The limited review was conducted in accordance

with ISAE 3410 assurance standard. The auditor's report is

available on autoliv.com. An additional statement prepared

to comply with the disclosure obligations of California’s Vol-

untary Carbon Market Disclosure Act (VCMDA) is available

on the Climate Action page on autoliv.com.

UN Global Compact Communication on Progress

This Sustainability Report serves as Autoliv’s Communica-

tion on Progress related to the UN Global Compact. The

following sections demonstrate our commitment to imple-

menting the Global Compact principles:

•

Road Safety - a Global Challenge: Principle 1

•

A Safe and Inclusive Workplace: Principle 6

•

Climate and Circularity: Principles 7-9

•

Responsible Business: Principles 1-6, 10

60

Saving More Lives

Targets & Metrics

2023

2022

2021

Comments

100,000

lives saved per year

35,000

Close to

35,000

Close to

35,000

We estimate that in addition to lives saved,

our products reduce more than 450,000

injuries annually.

Share of global recalls (%)

1

~2%

~2%

~2%

The share is calculated as a ten year rolling

average based on information from national

official databases.

1) SASB TR-AP-250a 1.

A Safe and Inclusive Workplace

Targets & Metrics

2023

2022

2021

Comments

Health and Safety

0.35

Incident Rate

by 2024

0.38

0.38

0.48

Number of reportable injuries, i.e. injuries

that require treatment beyond first aid or results

in one or more days of lost time, per 200,000

employee hours of exposure. See comments

under Changes and corrections on page 60.

Work-related fatalities

0

2

1

Share of production sites

ISO 45001 certified (%)

61%

56%

Not

available

Comparable number for 2021 is

not available.

Inclusion

95%

of senior and mid-level

management trained in unconscious

bias

by 2023

96%

52%

42%

Year-on-year improvement in Employee

experience.

Continuous

- Authenticity

- Perceived fairness

73

59

80

73

80

73

2021-2022 results are from the annual employ-

ee survey, 2023 results from the Q3 quarterly

employee survey. Results are comparable.

22% women in senior management

by 2024

19%

18%

17%

Senior management consists of around

110 employees and include the Executive

Management Team.

Share of women in the workforce (%)

49%

49%

47%

Share of women in the Executive

Management Team (%)

8%

0%

8%

Climate and Circularity

Targets & Metrics

2023

2022

2021

Comments

Carbon neutrality in own operations

by 2030

358 kton

CO

2

e

430 kton

CO

2

e

435 kton

CO

2

e

Scope 1+2 market-based

emissions.

Year-on-year improvement

Continuous

3%

improve-

ment

2%

improve-

ment

2%

improve-

ment

Total energy consumption

per part delivered.

Year-on-year reduction in waste

Continuous

12%

increase

9%

increase

3%

increase

Total waste.

Climate and Circularity

Targets & Metrics

2023

2022

2021

Comments

GHG Emissions

GHG emissions intensity (Scope 1+2)

34.2

48.5

56.3

Ton CO

2

e per million USD sales (FX adjusted).

Direct Scope 1 GHG emissions

(kton CO

2

e)

- Natural gas

- Other energy fuels

– SF

6

- Other fugitive emissions

Total

57

9

22

7

95

52

10

35

5

102

51

9

37

6

103

Indirect Scope 2 GHG emissions

(kton CO

2

e)

- Electricity, market-based

- District heating/steam, market-based

Total, market-based

- Electricity, location-based

- District heating/steam, location-based

Total, location-based

247

16

263

290

16

306

311

17

328

299

17

316

316

15

331

276

15

291

Upstream Scope 3 emissions (kton CO

2

e)

- Purchased goods and services (category 1)

- Upstream transportation (category 4)

- Other upstream (categories 2, 3, 5, 6, 7, 8)

Total

3,070

460

240

3,770

3,000

510

190

3,700

Energy

1

Energy intensity

100.5

110.5

119.5

MWh per million USD sales (FX adjusted).

Energy use (GWh)

- Direct - natural gas

- Direct - other energy fuels

Direct total

- Indirect - electricity

- Indirect - district heating/steam

Indirect total

Total

282

39

321

704

28

732

1,053

250

40

290

661

29

690

980

245

36

281

615

27

642

923

Included in total direct energy use but not

part of the breakdown is around 240 MWh

of on-site solar PV generation.

Share of renewable energy/electricity (%)

- Renewable energy

- Renewable electricity

15%

23%

9%

13%

1%

1%

Renewable electricity is calculated as as the share

of purchased electricity covered by a 'green tariff',

EAC/REC/GO or PPA and may come from any

renewable source. 100% of direct energy is

considered non-renewable.

Waste

1

Waste (kton)

113

101

93

Share of waste by type (%)

- Non-hazardous

- Hazardous

89%

11%

89%

11%

89%

11%

Share of waste by treatment (%)

- Reuse, recycling, energy recovery

- Landfill

91%

9%

90%

10%

89%

11%

Climate and Circularity

Targets & Metrics

2023

2022

2021

Comments

Other

Water withdrawal (m

3

)

2,290,000

2,360,000

2,310,000

100% of water withdrawal is reported as

coming from municipal or third party sources.

Share of production sites

ISO 14001 certified (%)

92%

96%

89%

Number of significant spills,

and related fines

0

0

0

A significant spill is defined as having a financial

impact of USD 100,000 or more.

Responsible Business

Targets & Metrics

2023

2022

2021

Comments

Business Ethics

100% in target group completed

antitrust training

Continuous

98%

99%

96%

Target group is based on the risk exposure

of certain employee groups.

100% in target group Code of

Conduct certified

Continuous

93%

99%

99%

Target group is employees in a leadership role.

Supply Chain Sustainability

100% direct material suppliers

sustainability audited

Continuous

99%

98%

81%

Percentage is based on active direct material

suppliers within audit scope who have undergone a

sustainability audit.

100% direct material suppliers respond

to conflict minerals survey

Continuous

97%

89%

99%

Compliance Speak Up

Number of Compliance Speak Up reports

– Reported through Autoliv Helpline (%)

– Reported through other channels (%)

426

318

284

Other channels include internal reports directly

to management, HR, the Legal or Compliance

teams.

89%

11%

89%

11%

88%

12%

Compliance Speak Up reports

per 100 employees

0.61

0.46

0.47

Labor Rights

Share of employees covered by collective

bargaining agreements (%)

~50%

~50%

~50%

Around 80% of the countries where Autoliv has

employees have collective bargaining agre-

ements.

63

By ensuring customer satisfaction, main-

taining tight cost control and developing new

products, we generate cash for long-term

growth, financial stability and competitive

returns to our shareholders.

Autoliv has a strong cash flow and cash generation focus.

Our operating cash flow has always exceeded our capital

expenditures. On average, our continuing operations ex-

cluding antitrust payment in 2019 have generated $828

million in cash per year over the last five years, while our

capital expenditures, net, have averaged $465 million per

year during the same period.

Capital efficiency

Our strong cash flow reflects both Autoliv’s earnings perfor-

mance and our capital efficiency. During 2023, our capital

turnover rate, meaning our sales in relation to average capi-

tal employed, increased from 2.4 to 2.7 times, significantly

better than our 5-year average capital turnover rate of 2.2.

Our cash flow model

When analyzing how best to use each year’s cash flows

from operations, Autoliv’s Executive Management and the

Board of Directors use a model for creating shareholder

value that considers variables such as the marginal cost

of borrowing, the return on marginal investments and the

price of Autoliv shares. When evaluating the various uses of

cash, the need for flexibility is weighed against acquisitions

and other potential uses of cash.

Investing in operations

To create long-term shareholder value, cash flow from op-

erations should only be used to finance investments in op-

erations until the point when the return on investment no

longer exceeds the cost of capital. Our historical weighted

average cost of capital has been approximately 10% to

13% in the past ten years. Autoliv’s pre-tax return on capital

employed has generally exceeded this level, except during

the COVID-19 pandemic in 2020. During the last five years,

the return on capital employed has varied between 10%

and 20%, i.e. about one to two times the pre- tax cost of

capital. In 2023, $569 million was reinvested in the form of

capital expenditures, net. This corresponds to 58% of the

year’s operating cash flow of $982 million. Capital expendi-

ture, net, was 51% higher than depreciation and amortiza-

tion as we invest in footprint optimization, capacity increas-

es and flexible automation to drive increased efficiency and

support the sales growth we expect from executing on our

strong order book in the coming years.

Creating

Shareholder

Value

THE AUTOLIV SHARE

64

Share buybacks

Dividend

0

100

200

300

400

500

600

23

22

21

20

19

Capital Turnover Rate

Times, sales in relation to average

capital employed

Shareholder Returns

US$ (Millions)

Trade working capital

0

1,000

2,000

3,000

4,000

5,000

23

22

21

20

19

Property, plant and equipment

Goodwill and other intangible assets

Assets by Category

US$ (Millions)

Operating cash flow

Capital expenditures, net

0

200

400

600

800

1,000

23

22

21

20

19

Cash flow vs. Capex

US$ (Millions)

0

1

2

3

23

22

21

20

19

Return on Capital Employed

%

0

5

10

15

20

25

23

22

21

20

19

Capex and D&A

US$ (Millions) and in relation to sales %

150

225

300

375

450

525

600

23

22

21

20

19

0

1

2

3

4

5

6

7

Capex, net

Capex, net % of sales

D&A % of sales

65

Acquisitions, divestments and investments in assets

In order to accelerate company growth and create share-

holder value over time, we could use some of the cash flow

generated for acquisitions and for investments in assets

such as joint ventures and intellectual property. These in-

vestments are typically made to consolidate our position in

the industry, increase our vertical integration or expand into

new markets. In the near future, we do not consider acquisi

-

tions as a high priority part of our strategy.

Shareholder returns

Autoliv has historically used both dividend payments and

share repurchases to create shareholder value. Autoliv

does not have a set dividend policy. Instead, the Board of

Directors regularly analyzes which method is most effec-

tive in order to create shareholder value. For the full year

2023, the dividend was increased from $2.58 to $2.66 per

share. In total, $225 million was used to pay dividends to

shareholders in 2023. Historically, the dividend has usually

represented a yield of approximately 2-3% in relation to

THE AUTOLIV SHARE

200

400

600

800

1,000

1,200

2023

2022

CASH IN

CASH OUT

Cash

IN

Cash

IN

Cash

OUT

Cash

OUT

982

569

226

352

165

713

485

226

115

113

Autoliv's average share price, except in 2020, when a divi-

dend was only paid for one quarter as a response to the ef

-

fects of the COVID-19 pandemic. In 2023, this yield was

around 2.9%. Repurchases of shares can create more

value for shareholders than dividends, if the share price

appreciates over the long term. This has been the case for

Autoliv as the Company's existing 5.0 million treasury

shares have been repurchased at an average cost of $56.13

per share while the closing share price at the end of 2023

was $110.19.

During 2023, Autoliv repurchased and retired 3.67 mil-

lion shares, equal to $352 million, under the current stock

repurchase program authorized by the Board to repurchase

up to $1.5 billion, or 17 million common shares (whichever

comes first), between January 2022 and the end of 2024.

At end of 2023, total number of shares repurchased under

the program was approximately 5.1 million for a total of

$467 million.

Capital structure

Our debt limitation policy is to maintain a financial leverage

commensurate with a “strong investment grade credit rat-

ing”. Our long-term target is to have a leverage ratio (Net

Debt, including pension liability, in relation to EBITDA) of

around 1 time and to be within the range of 0.5 and 1.5

times. In addition to the above, the objective is to provide

the Company with sufficient flexibility to manage the in-

herent risks and cyclicality in Autoliv’s business and allow

the Company to realize strategic opportunities and fund

growth initiatives while creating shareholder value. In 2023,

Autoliv remained inside the target range as cash flow re-

mained solid and EBITDA improved. On December 31,

2023, the leverage ratio was 1.2 times. Autoliv holds a “BBB

with stable outlook” long-term credit rating from Standard &

Poor's. We aim to maintain a strong investment grade rat-

ing as our current capital structure should provide flexibility

to generate further shareholder returns and the funding of

our capital requirements.

Shareholder information

Autoliv’s common stock is traded on the New York Stock

Exchange (NYSE) while Autoliv's Swedish depositary re-

ceipts (SDRs) are traded on NASDAQ Stockholm’s list for

large market cap companies. As of December 31, 2023,

Autoliv estimates that approximately 36% of outstand-

ing shares were SDRs (vs. 49% a year earlier) while 64%

were common stock (vs. 51% a year earlier). In 2023, ap-

proximately 84% of total volume was traded on the NYSE.

During 2023, the number of shares outstanding decreased

by more than 3.5 million to 82.6 million (excluding treasury

shares). Stock options (if exercised) and granted restricted

stock units and performance shares could increase the

number of shares outstanding by 0.3 million shares in to-

tal. Combined, this would add 0.4% to the Autoliv shares

outstanding.

Ownership distribution of institutional investors

The largest shareholders, December 31

st

, 2023

1)

1. Cevian Capital

11%

2. Fidelity Management & Research Company

7%

3. BlackRock

6%

4. Alecta

6%

Rest of World 3%

Rest of Europe 11%

United Kingdom 10%

Sweden 33%

United States 43%

Company estimates, end of 2023.

1) Shareholders holding more than 5% at the end of 2023, based on the

13-D/G filings and company estimates, of outstanding shares

67

BOARD AND MANAGEMENT

1. Jan Carlson

Chairman since 2014.

Director since 2007.

2. Mikael Bratt

President and CEO of Autoliv Inc.

Director since 2018.

3. Laurie Brlas

Director since 2020. Member of

the Audit and Risk Committee and

the Nominating and Corporate

Governance Committee.

4. Hasse Johansson

Director since 2018. Member of the

Audit and Risk Committee.

5. Leif Johansson

Director since 2016. Chair of

the Nominating and Corporate

Governance Committee. Member

of the Leadership Development and

Compensation Committee.

6. Franz-Josef Kortüm

Director since 2014. Member of

the Nominating and Corporate

Governance Committee.

7. Frédéric Lissalde

Director since 2020. Chair of the

Leadership Development and

Compensation Committee. Member

of the Nominating and Corporate

Governance Committee.

8. Xiaozhi Liu

Director since 2011. Member of

the Leadership Development and

Compensation Committee.

9. Gustav Lundgren

Director since 2022. Member of the

Audit and Risk Committee.

10. Martin Lundstedt

Director since 2021. Member of

the Leadership Development and

Compensation Committee.

11. Thaddeus “Ted” Senko

Director since 2018. Chair of the Audit

Committee.

Board of Directors

68

4

11

3

5

10

2

1

7

9

8

6

1. Mikael Bratt

President and CEO.

Employed 2016.

2. Petra Albuschus

Executive Vice President,

Human Resources & Sustainability.

Employed 2023.

3. Kevin Fox

President, Autoliv Americas.

Employed 1996.

4. Magnus Jarlegren

President, Autoliv Europe.

Employed 2019.

5. Jordi Lombarte

Executive Vice President and

Chief Technology Officer.

Employed 1991.

6. Jonas Jademyr

Executive Vice President, Quality

and Program Management.

Employed 2023.

7. Colin Naughton

President, Autoliv Asia.

Employed 1995.

8. Anthony Nellis

Executive Vice President, Legal

Affairs; General Counsel & Secretary.

Employed 2002.

9. Staffan Olsson

Acting Head of Operations.

Employed 2020.

10. Christian Swahn

Executive Vice President,

Supply Chain Management.

Employed 2019.

11. Fredrik Westin

Executive Vice President,

Finance and Chief

Financial Officer.

Employed 2020.

12. Sng Yih

President, Autoliv China.

Employed 2022.

Executive Management Team

69

7

2

12

11

8

1

3

6

5

4

10

9

Contacts

and Calendar

AUTOLIV, INC.

Visiting address:

Klarabergsviadukten 70, Section B,

7th Floor, Stockholm, Sweden

Postal address:

P.O. Box 70381, SE-107 24 Stockholm, Sweden

Tel: +46 (0)8 587 20 600

E-mail: info@autoliv.com

www.autoliv.com

CONTACT OUR BOARD

Autoliv, Inc.

P.O. Box 70381, SE-107 24 Stockholm, Sweden

Tel: +46 (0)8 587 20 600

E-mail: legalaffairs@autoliv.com

The Board, individual directors and the committees of

the Board can be contacted using the address above.

Contact can be made anonymously and communication

with individual directors is not screened. The relevant

chairman receives all such communication after it has

been determined that the content represents a message

to such chairman.

STOCK TRANSFER AGENT AND REGISTRAR

www.computershare.com

INVESTOR REQUESTS

Autoliv, Inc.,

P.O. Box 70381, SE-107 24, Stockholm, Sweden

Tel: +46 (0)8 587 20 600

E-mail: ir@autoliv.com

2024 PRELIMINARY FINANCIAL CALENDAR

April 26, Financial Report Q1

May 10, Annual Stockholders Meeting

July 19, Financial Report Q2

October 18, Financial Report Q3

Concept and Design:

PCG

Photos:

Christian Wyrwa, Jason Loudermilk Photography,

Kun Li, Getty Images, Shutterstock, Björn Nilsson Graphics,

NYSE, Spectrum Digitale Medien GmbH, Autoliv colleagues

70

Multi-Year Financial Summary

(Dollars in millions, except per share data, unaudited)

2023

2022

2021

2020

2019

Sales and Income

Net sales

$10,475

$8,842

$8,230

$7,447

$8,548

Airbag sales

1)

7,055

5,807

5,380

4,824

5,676

Seatbelt sales

3,420

3,035

2,850

2,623

2,871

Operating income

690

659

675

382

726

Net income attributable to controlling interest

488

423

435

187

462

Earnings per share – basic

5.74

4.86

4.97

2.14

5.29

Earnings per share

– assuming dilution

2)

5.72

4.85

4.96

2.14

5.29

Gross margin

3)

17.4%

15.8%

18.4%

16.7%

18.5%

S,G&A in relation to sales

(4.8)%

(4.9)%

(5.3)%

(5.2)%

(4.7)%

R,D&E net in relation to sales

(4.1)%

(4.4)%

(4.7)%

(5.0)%

(4.7)%

Operating margin

4)

6.6%

7.5%

8.2%

5.1%

8.5%

Adjusted operating margin

5,6)

8.8%

6.8%

8.3%

6.5%

9.1%

Balance Sheet

Trade working capital

7)

1,232

1,183

1,332

1,366

1,417

Trade working capital in relation to sales

8)

11.2%

12.7%

15.7%

13.6%

16.2%

Receivables outstanding in relation to sales

9)

20.0%

20.4%

20.0%

18.1%

18.6%

Inventory outstanding in relation to sales

10)

9.2%

10.4%

9.2%

7.9%

8.5%

Payables outstanding in relation to sales

11)

18.0%

18.1%

13.5%

12.5%

10.8%

Total equity

2,570

2,626

2,648

2,423

2,122

Total parent shareholders’ equity per share

30.93

30.30

30.10

27.56

24.19

Current assets excluding cash

3,475

3,119

2,705

3,091

2,557

Property, plant and equipment, net

2,192

1,960

1,855

1,869

1,816

Intangible assets (primarily goodwill)

1,385

1,382

1,395

1,412

1,410

Capital employed

3,937

3,810

3,700

3,637

3,772

Net debt

6)

1,367

1,184

1,052

1,214

1,650

Total assets

8,332

7,717

7,537

8,157

6,771

Long-term debt

1,324

1,054

1,662

2,110

1,726

Return on capital employed

12)

17.7%

17.5%

18.3%

10.0%

20.0%

Return on total equity

13)

19.0%

16.3%

17.1%

9.0%

23.0%

Total equity ratio

31%

34%

35%

30%

31%

Cash flow and other data

Operating Cash flow

982

713

754

849

641

Depreciation and amortization

378

363

394

371

351

Capital expenditures, net

569

485

454

340

476

Capital expenditures, net in relation to sales

5.4%

5.5%

5.5%

4.6%

5.6%

Free Cash flow

6,14)

414

228

300

509

165

Cash conversion

6,15)

85%

54%

69%

270%

36%

Direct shareholder return

16)

577

339

165

54

217

Cash dividends paid per share

2.66

2.58

1.88

0.62

2.48

Number of shares outstanding (millions)

17)

82.6

86.2

87.5

87.4

87.2

Number of employees, December 31

62,900

61,700

55,900

61,000

58,900

1) Including steering wheels, inflators and initiators. 2) Assuming dilution and net of treasury shares. 3) Gross profit relative to sales. 4) Operating income relative to sales. 5) Excluding effects

from capacity alignments, antitrust related matters and Andrews litigation settlement. 6) Non-U.S. GAAP measure, for reconciliation see Financial Report October – December 2023 filed

with Form 8-K on January 26, 2024. 7) Outstanding receivables and outstanding inventory less outstanding payables. 8) Outstanding receivables and outstanding inventory less outstanding

payables relative to annualized fourth quarter sales. 9) Outstanding receivables relative to annualized fourth quarter sales. 10) Outstanding inventory relative to annualized fourth quarter sales.

11) Outstanding payables relative to annualized fourth quarter sales. 12) Operating income and income from equity method investments, relative to average capital employed. 13) Income

relative to average total equity. 14) Operating cash flow less Capital expenditures, net. 15) Free cash flow relative to Net income. 16) Dividends paid and Shares repurchased. 17) At year end,

excluding dilution and net of treasury shares.

71

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

☒

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2023

or

☐

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from

_________

to _________

Commission file number: 001-12933

AUTOLIV, INC.

(Exact name of registrant as specified in its charter)

Delaware

51-0378542

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer

Identification No.)

Klarabergsviadukten 70, Section B7,

Box 70381,

SE-107 24

Stockholm, Sweden

(Zip Code)

(Address of principal executive offices)

+46 8 587 20 600

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class:

Trading Symbol(s):

Name of each exchange on which registered:

Common Stock (par value $1.00 per share)

ALV

New York Stock Exchange

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

Yes

☒

No

☐

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.

Yes

☐

No

☒

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934

during the preceding 12 months (or for such shorter period that the registrant was required to file such reports); and (2) has been subject to such filing

requirements for the past 90 days.

Yes:

☒

No:

☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of

Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Yes:

☒

No:

☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company or an

emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company”

in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new

or revised financial accounting standards pursuant to Section 13(a) of the Exchange Act.

☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal

control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262 (b)) by the registered public accounting firm that prepared

or issued its audit report.

☒

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the

filing reflect the correction of an error to previously issued financial statements.

☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received

by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b).

☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).

Yes:

☐

No:

☒

The aggregate market value of the voting and non-voting common equity of Autoliv, Inc. held by non-affiliates as of the last business day of the second

fiscal quarter of 2023 amounted to $7,260 million.

Number of shares of Common Stock outstanding as of February 12, 2024: 82,646,049.

Auditor Firm Id: 1433

Auditor Name: Ernst & Young AB

Auditor Location: Stockholm, Sweden

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the registrant’s definitive Proxy Statement for the annual stockholders’ meeting to be held on May 10, 2024, to be dated on or around March

25, 2024 (the “2024 Proxy Statement”), are incorporated by reference into Part III of this Annual Report on Form 10-K. The 2024 Proxy Statement will be

filed with the U.S. Securities and Exchange Commission within 120 days after December 31, 2023.

1

AUTOLIV, INC.

Index

PART I

Item 1.

Business

3

Item 1A.

Risk Factors

10

Item 1B.

Unresolved Staff Comments

21

Item 1C.

Cybersecurity

22

Item 2.

Properties

24

Item 3.

Legal Proceedings

27

Item 4.

Mine Safety Disclosures

27

PART II

Item 5.

Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

28

Item 6.

[Reserved]

Item 7.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

30

Item 7A.

Quantitative and Qualitative Disclosures about Market Risk

49

Item 8.

Financial Statements and Supplementary Data

51

Item 9.

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

88

Item 9A.

Controls and Procedures

88

Item 9B.

Other Information

89

PART III

Item 10.

Directors, Executive Officers and Corporate Governance

90

Item 11.

Executive Compensation

90

Item 12.

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

90

Item 13.

Certain Relationships and Related Transactions, and Director Independence

90

Item 14.

Principal Accountant Fees and Services

90

PART IV

Item 15.

Exhibit and Financial Statement Schedules

91

2

NOTE ABOUT FORWARD-LOOKING STATEMENTS

This Annual Report on Form 10-K contains statements that are not historical facts but rather forward-looking statements within the

meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include those that address activities,

events or developments that Autoliv, Inc. (“Autoliv,” the “Company” or “we”) or its management believes or anticipates may occur in the

future. All forward-looking statements are based upon our current expectations, various assumptions and/or data available from third

parties. Our expectations and assumptions are expressed in good faith and we believe there is a reasonable basis for them. However,

there can be no assurance that such forward-looking statements will materialize or prove to be correct as forward-looking statements are

inherently subject to known and unknown risks, uncertainties and other factors which may cause actual future results, performance or

achievements to differ materially from the future results, performance or achievements expressed in or implied by such forward-looking

statements.

In some cases, you can identify these statements by forward-looking words such as “estimates,” “expects,” “anticipates,” “projects,”

“plans,” “intends,” “believes,” “may,” “likely,” “might,” “would,” “should,” “could,” or the negative of these terms and other comparable

terminology, although not all forward-looking statements contain such words.

Because these forward-looking statements involve risks and uncertainties, the outcome could differ materially from those set out in the

forward-looking statements for a variety of reasons, including without limitation: general economic conditions, including inflation;

changes

in light vehicle production; fluctuation in vehicle production schedules for which the Company is a supplier; global supply chain disruptions

including port, transportation and distribution delays or interruptions; supply chain disruptions and component shortages specific to the

automotive industry or the Company; disruptions and impacts relating to the ongoing war between Russia and Ukraine and the ongoing

conflict in the Red Sea; changes in general industry and market conditions or regional growth or decline; changes in and the successful

execution of our capacity alignments: restructuring, cost reduction, and efficiency initiatives and the market reaction thereto; loss of

business from increased competition; higher raw material, fuel, and energy costs; changes in consumer and customer preferences for

end products; customer losses; changes in regulatory conditions; customer bankruptcies, consolidations or restructuring or divestiture of

customer brands; unfavorable fluctuations in currencies or interest rates among the various jurisdictions in which we operate; component

shortages; market acceptance of our new products; costs or difficulties related to the integration of any new or acquired businesses and

technologies; continued uncertainty in pricing and other negotiations with customers; successful integration of acquisitions and operations

of joint ventures; successful implementation of strategic partnerships and collaborations; our ability to be awarded new business; product

liability, warranty and recall claims and investigations and other litigation, civil judgments or financial penalties and customer reactions

thereto; higher expenses for our pension and other postretirement benefits, including higher funding needs for our pension plans; work

stoppages or other labor issues; possible adverse results of pending or future litigation or infringement claims, and the availability of

insurance with respect to such matters; our ability to protect our intellectual property rights; negative impacts of antitrust investigations or

other governmental investigations and associated litigation relating to the conduct of our business; tax assessments by governmental

authorities and changes in our effective tax rate; dependence on key personnel; legislative or regulatory changes impacting or limiting

our business; our ability to meet our sustainability targets, goals and commitments; political conditions; dependence on and relationships

with customers and suppliers; the conditions necessary to hit our financial targets; and other risks and uncertainties identified in Item 1A

-“Risk Factors” of this Annual Report on Form 10-K, Item 1A, and Item 7 - “Management’s Discussion and Analysis of Financial Condition

and Results of Operations” in this Annual Report.

For any forward-looking statements contained in this or any other document, we claim the protection of the safe harbor for forward-looking

statements contained in the Private Securities Litigation Reform Act of 1995, and we assume no obligation to update publicly or revise

any forward-looking statements in light of new information or future events, except as required by law.

3

PART I

Item 1. Business

General

Autoliv, Inc. (“Autoliv”, the “Company” or “we”) is a Delaware corporation with its principal executive offices in Stockholm, Sweden where

it currently employs approximately 105 people. The Company functions as a holding corporation and owns two principal subsidiaries,

Autoliv AB and Autoliv ASP, Inc. The Company's fiscal year ends on December 31.

of product offerings.

Passive safety systems are primarily meant to improve safety for occupants in a vehicle. Passive safety systems include modules and

components for frontal-impact airbag protection systems, side-impact airbag protection systems, seatbelts, steering wheels, inflator

technologies, and battery cut-off switches.

To expand its product offerings, the Company has formed Mobility Safety Solutions. By combining its core competence and industry

experience, the Company also develops and manufactures mobility safety solutions such as pedestrian protection, battery cut-off

switches, connected safety services, and safety solutions for riders of powered two-wheelers.

The Company has 63 production facilities in 23 countries and its customers include the world’s largest car manufacturers. The Company’s

sales in 2023 were $10.5 billion, approximately 67% of which consisted of airbag and steering wheel products and approximately 33% of

which consisted of seatbelt products. The Company's business is conducted in the following geographical regions: The Americas, Europe,

China, and Asia, excluding China.

On December 31, 2023, the Company had approximately 70,300 personnel worldwide, with 11% being temporary personnel.

Additional information required by this Item 1 regarding developments in the Company’s business during 2023 is contained under Item 7

in this Annual Report.

Reportable Segment

The Company has one reportable segment based on the way the Company evaluates its financial performance and manages its

operations. The Company's business is comprised of passive safety products –principally airbags (including steering wheels and inflators)

and seatbelts. For more information regarding the Company’s segment reporting, see Note 1, Basis of Presentation, to the Consolidated

Financial Statements in this Annual Report.

Products, Market, and Competition

Products

Providing life-saving solutions is a key priority as the world population grows and develops. However, population expansion in growth

markets and the rise of megacities creates new complexities. To meet this challenge, the Company develops safety solutions for both

mobility and society that work in real life situations.

The Company's passive safety systems such as seatbelts and airbags substantially

mitigate human consequences of traffic accidents.

The airbag module is designed to inflate extremely rapidly and then quickly deflate during a collision or impact. It consists of the container,

an airbag cushion, and an inflator. The purpose of the airbag is to provide the occupants a cushioning and restraint during a crash event

to prevent any impact or impact-caused injuries between the occupant and the interior of the vehicle.

Seatbelts can reduce the overall risk of serious injuries in frontal crashes by as much as 60% due to advanced seatbelt technologies such

as pretensioners and load limiters.

The Company also manufactures steering wheels that are crafted to ensure they meet safety requirements and are functional as well as

stylish.

Market and Competition

Consumer research clearly shows that consumers want safe vehicles, and several significant trends are likely to positively influence

overall safety content per vehicle. These include:

1) Society becoming increasingly focused on Vision Zero and its goal of reducing traffic fatalities and their associated costs;

2) Demographic trends of increased urbanization, aging driver populations, and increased safety focus in growth markets;

3) Evolving government regulations and test rating systems to improve the safety of vehicles in various markets, such as the

updated European New Car Assessment Program (Euro NCAP), China NCAP, and USNCAP; and

4) The trend towards more electrical vehicles may lead to roomier interiors that may require more advanced passive safety systems,

as well as products to cut the electrical power in case of an accident.

The automotive passive safety market is driven by two primary factors: light vehicle production (LVP) and content per vehicle (CPV).

4

The first growth driver, LVP, has increased at an average annual growth rate of around 1.9%

since the start of Autoliv in 1997 despite

the substantial headwinds from recent supply chain disruptions and semiconductor shortages, including in 2022. According to S&P Global,

LVP is forecasted to grow to close to 90 million by 2026 from approximately 87 million in 2023, due to growing demand and export in

medium- and low-income markets.

Unlike LVP, where Autoliv can only aim to be on the best-selling platforms, Autoliv can influence CPV more directly by continuously

developing and introducing new technologies with higher value-added features. Over the long term, this increases average safety CPV

and has caused the Company's markets to grow faster than the LVP.

Since 1997, the Company’s sales compound annual growth rate (CAGR) for passive safety has been around 5% compared to the market

rate of around 2.8% which includes an LVP growth of around 1.9%. The Company's outperformance is a result of a steady flow of new

passive safety technologies, strong focus on quality and a superior global footprint both in products and engineering. This has enabled

Autoliv to increase its global market share in passive safety from 27% in 1997 to around 45% in 2023.

In high-income markets (Western Europe, North America, Japan, and South Korea) the average CPV is around $330. CPV growth in

these regions mainly come from new safety systems such as active seatbelts, knee airbags, and front-center airbags along with improved

protection for pedestrians and rear-seat occupants like bag-in-belt or more advanced seatbelts.

In medium- and low-income markets (all markets other than the markets above), the Company sees great opportunities for CPV growth

from more airbags and advanced seatbelt products. Average CPV in these markets is around $200 or almost $130 less than in the high-

income markets.

As a result of higher installation rates of airbags, more advanced seatbelt products, and more complex steering wheels, CPV is expected

to increase at a similar pace in both high-income and medium- and low-income markets over the next three years.

In the next three years all LVP growth is expected to come in medium- and low-income regions with lower CPV, leading to a dilution of

the average global CPV. Despite this negative regional LVP mix effect, the annual passive safety market (seatbelts and airbags, including

steering wheels), is expected to grow from around $23 billion in 2023 to more than $25 billion over the next three years, based on the

current macro-economic outlook and the Company's internal market intelligence and estimates.

The highest growth rate is expected in steering wheels, where Autoliv has a global market share of around 40%, generated by the trend

toward higher-value steering wheels with leather and additional features.

In seatbelts, Autoliv has reached a global market share of around 45%, primarily due to being the technology leader with several important

innovations such as pretensioners and active seatbelts. The Company's strong market position is also a reflection of its superior global

footprint. Seatbelts are the primary life-saving safety product globally and are also an important requirement in low-end vehicles in the

medium- and low-income markets. This provides the Company with an excellent opportunity to benefit from the expected growth in this

segment of the market.

The market for airbags, where Autoliv has a global market share of around 47%, is expected to grow mainly as result of higher installation

rates of inflatable curtains, side airbags, and knee airbags. Additionally, the front center airbag is expected to start to contribute to the

market growth.

The Company's ability to consistently outperform market growth is rooted in a steady flow of new safety technologies, a strong focus on

quality, and a superior production and engineering footprint.

The Company's competitors

Autoliv is the clear market leader in passive safety components and systems for the automotive industry with an estimated global market

share of around 45%.

ZF, one of the Company's largest competitors, is a global leader in driveline and chassis technology as well as in passive safety

technologies and is one of the largest global automotive suppliers.

Another large competitor is Joyson Safety Systems (JSS), a subsidiary of Ningbo Joyson Electronic Corp. JSS is the result of the merger

between Key Safety Systems (KSS) and Takata Corporation after KSS acquired Takata in 2018.

In Japan, Brazil, South Korea, and China, there are a number of local suppliers that have close ties with the domestic vehicle

manufacturers. For example, Toyota uses “keiretsu” (in-house) suppliers Tokai Rika for seatbelts and Toyoda Gosei for airbags and

steering wheels. These suppliers generally receive most of the Toyota business in Japan, in the same way, Mobis, a major supplier to

Hyundai/Kia in South Korea, generally receives a significant part of their business.

Other competitors include Nihon Plast and Ashimori in Japan, Yanfeng and Jinheng in China, Samsong in South Korea, and Chris Cintos

de Seguranca in South America. Collectively, these competitors account for the majority of the remaining market share in passive safety.

Additional information concerning the Company's products, markets and competition is included in the “Risks and Risk Management”

section under Item 7 of this Annual Report.

5

Manufacturing and Production

See “Item 2. Properties” for a description of Autoliv’s principal properties. The component factories manufacture inflators, propellant,

initiators, textile cushions, webbing, pressed steel parts, springs, and overmolded steel parts used in seatbelt and airbag assembly and

steering wheels. The assembly factories source components from a number of parties, including Autoliv’s own component factories, and

assemble complete restraint systems for “just-in-time” delivery to customers. The products manufactured by Autoliv’s consolidated

subsidiaries in 2023 consisted of 148 million complete seatbelt systems (of which 100 million were fitted with pretensioners), 127 million

side airbags (including curtain airbags and front center airbags), 63 million frontal airbags, 6 million other airbags and 22 million steering

wheels.

Autoliv’s “just-in-time” delivery system is designed to accommodate the specific requirements of each customer for low levels of inventory

and rapid stock delivery service. “Just-in-time” deliveries require final assembly or, at least, distribution centers in geographic areas close

to customers to facilitate rapid delivery. The fact that the major automobile manufacturers are continually expanding their production

activities into more countries and require the same or similar safety systems as those produced in Europe, Japan, or the U.S. increases

the importance for suppliers to have assembly capacity in several countries. Consolidation among the Company's customers also

supports this trend.

Autoliv’s assembly operations generally are not constrained by capacity considerations unless there is a disruption in the supply of raw

materials and components. When dramatic shifts in LVP occur, Autoliv can generally adjust capacity in response to any changes in

demand within a few days by adding or removing work shifts and within a few months by adding or removing standardized production

and assembly lines. Most of Autoliv’s assembly factories can make sufficient space available to accommodate additional production lines

to satisfy foreseeable increases in capacity. As a result, Autoliv can usually adjust its manufacturing capacity faster than its customers

can adjust their capacity as a result of fluctuations in the general demand for vehicles or in the demand for a specific vehicle model,

provided that customers promptly notify Autoliv when they become aware of such changes in demand. However, these types of

adjustments can be costly and can impact Autoliv's operating margin.

When significant volatility in LVP occur, as we have seen in 2022 and 2023 due to supply disruptions, or when there is a shift in regional

LVP, the capacity adjustments can take more time and be more costly. Currently, the volatility of LVP and orders from the Company,

while more stable, continue to be more volatile than prior to the Covid-19 pandemic. Additionally, when there is significant demand for a

given product due to a major recall of a competitor’s product, like certain of the Company's customers have experienced, capacity

adjustments may take time.

The Company could experience disruption in its supply or delivery chain, which could cause one or more of its customers to halt or delay

production. For more information, see Item 1A – “Risk Factors” in this Annual Report.

Quality Management

Autoliv believes that superior quality is a prerequisite to being considered a leading global supplier of automotive safety systems and is

key to the Company's financial performance, because quality excellence is critical for winning new orders, preventing recalls, and

maintaining low scrap rates. Autoliv has for many years emphasized a “zero-defect” proactive quality policy and continues to strive to

improve its working methods. Autoliv’s products are expected to always meet performance expectations and be delivered to its customers

at the right times and in the right amounts. The Company believes its continued quality improvements further enhance the Company's

reputation among its customers, employees, and governmental authorities.

Although quality has always been paramount in the automotive industry, especially for safety products, automobile manufacturers have

become increasingly focused on quality with even less tolerance for any deviations. This intensified focus on quality is partially due to an

increase in the number of vehicle recalls for a variety of reasons (not just safety), including a few high-profile vehicle recalls. This trend

is likely to continue as automobile manufacturers introduce even stricter quality requirements and regulating agencies and other

authorities increase the level of scrutiny given to vehicle safety issues. The Company has not been immune to the recalls that have been

impacting the automotive industry.

The Company continues to drive its quality initiative called “Q5,” which was initiated in the summer of 2010. It is an integral part of

the

Company's strategy of shaping a proactive quality culture of zero defects. It is called “Q5” because it addresses quality in five dimensions:

products, customers, growth, behavior, and suppliers. The goal of Q5 is to firmly tie together quality with value within all of

the Company's

processes and for all of its employees, thereby leading to the best value for its customers. Since 2010, the Company has continually

focused on this quality initiative to provide additional skills training to more employees and suppliers. These activities have significantly

improved the Company's quality performance.

In the Company's pursuit of quality excellence, the Company developed a chain of four “defense lines” to deal with potential quality issues.

The defense lines are: 1) robust product designs, 2) flawless components from suppliers and the Company's own in-house component

companies, 3) manufacturing flawless products with a system for verifying that the Company's products conform with specifications, and

4) an advanced traceability system in the event of a recall.

The Company's pursuit of quality excellence extends from the earliest phases of product development to the proper disposal of a product

following many years of use in a vehicle. Autoliv’s comprehensive Autoliv Product Development System (“APS”) includes several key

check points during the process of developing new products that are designed to ensure that such products are well-built and have no

hidden defects. Through this process, the Company works closely with its suppliers and customers to set clear standards that help to

ensure robust component design and lowest cost for function in order to proactively prevent problems and ensure the Company delivers

only the best designs to the market.

6

The APS, based on the goals of improving quality and efficiency, is at the core of Autoliv’s manufacturing philosophy. APS integrates

essential quality elements, such as mistake proofing, statistical process control and operator involvement, into the manufacturing

processes so all Autoliv associates are aware of and understand the critical connection between themselves and the Company's lifesaving

products. This “zero-defect” principle extends beyond Autoliv to the entire supplier base. All of the Company's suppliers must accept the

strict quality standards in the global Autoliv Supplier Manual, which defines the Company's quality requirements and focuses on preventing

bad parts from being produced by its suppliers and helps eliminate defective intermediate products in the Company's assembly lines as

early as possible. In addition, Autoliv’s One Product One Process (“1P1P”) initiative is its strategy for developing and managing

standardization of both core products and customer-specific features, leading not only to improved quality, but also greater cost efficiency

and more efficient supply chain management.

IATF 16949:2016 is one of the automotive industry’s most widely used international standards for quality management. All Autoliv facilities

that ship products to OEMs are regularly certified according to the International Automotive Task Force (IATF) standards.

Environmental and Safety Regulations

For information on how environmental and safety regulations impact the Company's business, see “Risk Factors – ‘Our business may be

adversely affected by laws or regulations, including environmental, occupational health and safety, and other governmental regulations’,

“Global climate change could negatively affect our business”, “Our goals, targets, and ambitions related to sustainability and emissions

reduction, and our public statements and disclosures regarding them, expose us to numerous risks” and “Our business may be adversely

affected by changes in automotive safety regulations or concerns that drive further regulation of the automobile safety market”” in Item

1A and “Risks and Risk Management” in Item 7 of this Annual Report.

Climate change

The Company is committed to operating its business in an environmentally sustainable manner, meaning developing and producing

products in a resource efficient way while limiting the Company's environmental impact in the most material areas of greenhouse gas

emissions, energy use, waste, and water. With particular emphasis on climate action, the Company actively engages with its customers,

suppliers, and others to drive sustainable mobility.

In June 2021, the Company launched an updated climate strategy including new long-term climate ambitions:

•

Carbon neutrality in own operations by 2030, and

•

Net-zero emissions across our supply chain by 2040

These industry-leading climate ambitions are aligned with a 1.5°C trajectory and should position the Company as the supplier of choice

for the most climate-focused customers, helping to ensure the Company's competitiveness now and in the future. In addition to these

ambitions, the Company adopted Science Based Targets (SBTs) for 2030 covering its own operations as well as the supply chain. The

targets were approved in January 2022 and are available at the SBTi website.

For more information about how climate change impacts the Company's business, see "Risk factors – Global climate change could

negatively affect our business” in Item 1A of this Annual Report.

Raw Materials

Direct material purchased from external suppliers represents approximately 55% of the Company's net sales in 2023. The Company

mainly purchases manufactured components and raw materials for its operations. The Company takes several actions to manage the

raw material fluctuations, such as competitive sourcing and looking for alternative materials. The Company is also taking necessary

actions to gradually implement raw materials with a lower carbon emission footprint.

For information on the sources and availability of raw materials, see "Operational Risks - Component costs" in Item 7 and “Risk Factors

– Changes in the source, cost, availability of, and regulations pertaining to raw materials and components may adversely affect our profit

margins” in Item 1A of this Annual Report.

Intellectual Property

The Company has developed a considerable amount of proprietary technology related to automotive safety systems and relies on many

patents to protect such technology. The Company's intellectual property plays an important role in maintaining its competitive position in

a number of the markets the Company serves. For information on the Company's use of intellectual property and its importance to the

Company, see “Risk Factors – If our patents are declared invalid or our technology infringes on the proprietary rights of others, our ability

to compete may be impaired” in Item 1A of this Annual Report.

7

Backlog

The Company has frame contracts with automobile manufacturers and such contracts are typically entered into up to three years before

the start of production of the relevant car model or platform and provide for a term covering the life of such car model or platform including

service parts after a vehicle model is no longer produced. These contracts, however, do not typically provide minimum quantities, firm

prices, or exclusivity but instead permit the automobile manufacturer to resource the relevant products at given intervals (or at any time)

from other suppliers. We sometimes refer to this backlog as our order intake or order book. For more information about order intake see

“Risk Factors – The cyclical nature of automotive sales and production can adversely affect our business. Our business is directly related

to LVP in the global market and by our customers, and automotive sales and LVP are the most important drivers for our sales” in Item 1A

of this Annual Report.

Dependence on Customers

In 2023, the Company's top five customers represented around 48% of its consolidated sales and the Company's top ten customers

represented around 78% of its consolidated sales. This reflects the concentration of manufacturers in the automotive industry. The five

largest OEMs in 2023 accounted for around 46% of global LVP, and the ten largest OEMs accounted for around 66%

of global LVP. A

delivery contract is typically for the lifetime of a vehicle model, which is normally between five and seven years depending on customer

platform sourcing preferences and strategies.

For information on the Company's dependence on customers, see “Risk Factors – Our business could be materially and adversely

affected if we lost any of our largest customers or if they were unable to pay their invoices” in Item 1A of this Annual Report, and

“Dependence on Customers” under the section “Strategic Risks” in Item 7 of this Annual Report, and Note 19 “Segment Information” to

the Consolidated Financial Statements

Customer sales trends

Asian vehicle producers have steadily become increasingly important, mainly driven by growth with Japanese and Chinese OEMs. As a

group they represented around 44% of global sales in 2023, of which Japanese OEMs accounts for more than two thirds. This is a result

of the Company's stronger market position based on its local presence in Japan. The Chinese OEMs as a group accounted for around

6% of the Company's global sales in 2023, with Great Wall representing more than 1% of the Company's global sales. European based

brands accounted for 29% of the Company's global sales in 2023. The U.S. based OEMs (including Chrysler and new EV manufactures)

accounted for 23% of the Company's global sales in 2023. Globally one of the Company's strongest growing customers from 2022 to

2023 was Honda, closely followed by Toyota.

Research, Development and Engineering, net (R,D&E)

No single customer project accounted for more than 4% of Autoliv’s total R,D&E, net spending during 2023. To support Autoliv’s product

portfolio, additional expertise is brought in-house via technology partnerships and licensing agreements.

During 2023, gross expenditures for R,D&E amounted to $618 million compared to $595 million in 2022. Of these amounts, $193 million

in 2023 and $205 million in 2022 were related to customer-funded engineering projects and crash tests reimbursed by the customers.

Net of this income, R,D&E expenditures in 2023 was $425 million compared to $390 million in 2022. Of the R,D&E, net expense in 2023,

85% was for projects and programs where the Company has customer orders, typically related to vehicle models in development. The

remaining 15% was mainly for new innovations, products and standardizations that will yield benefits over time.

Regulatory Costs

The fitting of seatbelts in most types of motor vehicles is mandatory in almost all countries and many countries have strict laws regarding

the use of seatbelts while in vehicles. In addition, most developed countries require that seats in intercity buses and commercial vehicles

be fitted with seatbelts. In the U.S., federal legislation requires frontal airbags on the driver-side and the passenger-side of all new

passenger cars, sport utility vehicles, pickup trucks, and vans.

For information concerning the material effects on the Company's business relating to its compliance with government safety regulations,

see “Risk Factors – ‘Our business may be adversely affected by laws or regulations, including environmental, occupational health and

safety, and other governmental regulations’ and ‘Our business may be adversely affected by changes in automotive safety regulations or

concerns that drive further regulation of the automobile safety market’” in Item 1A of this Annual Report and in Item 7 under the section

“Risks and Risk Management” of this Annual Report.

8

Human Capital Management

The Company's drive for excellence is what makes Autoliv the world’s leading supplier of automotive safety systems. From the earliest

stages of product development to sales and design to the final delivery of the finished product, Autoliv's employees are driven by the

Company's mission to Save More Lives.

The successful execution of the Company's strategies relies on its ability to shape a quality and performance-oriented culture, and to

adapt quickly to sudden shifts in its circumstances, such as supply chain disruptions and geopolitical instability. As the Company moves

forward its workforce (employees plus temporary personnel) strives to respond with agility to new possibilities to grow and improve the

Company's business whilst delivering with excellence to its customers. The Company builds a winning team by focusing on creating a

work environment that attracts, retains, and engages its employees.

The table below shows the Company's total workforce as of December 31, 2023, and 2022.

2023

2022

Total workforce

70,300

69,100

Whereof:

Direct workforce in manufacturing

52,500

50,600

Indirect workforce

17,800

18,500

Temporary workforce

11

%

11

%

Diversity and Inclusion

When attracting, developing and retaining talent, the Company seeks individuals who hold varied experiences and viewpoints to create

an inclusive and diverse workplace that allows each employee to do their best work and drive the Company's collective success. The

Company's workforce reflects the diversity of the countries and cultures in which it operates. At the end of 2023, 49% of the Company's

workforce and 20% of the Company's senior management positions were held by women.

The Company has operations in 25 countries, with 18% of its workforce located in Asia (excluding China), 31% in the Americas, 14% in

China, and 37% in Europe (including South Africa, Tunisia and Turkey).

The table below show the Company's workforce by age group and gender in % at the end of 2023.

% of Men

Age group

% of Women

1%

>60

1%

5%

51-60

5%

10%

41-50

11%

18%

31-40

16%

15%

21-30

14%

2%

<20

2%

Talent Attraction, Development, and Retention

The Company believes that attraction, development, and retention of talent is essential to its success, especially in today's environment.

The Company offers an inclusive work environment where its employees are challenged and achieve great things together. Supporting

the development of the employees is essential in a highly competitive and rapidly changing environment. An important cornerstone of

each employee’s growth is the ongoing dialogue between the team member and manager, which is summarized during an annual

Performance and Development Dialogue (PDD). During the year, 99% of targeted employees conducted a PDD with their managers. To

provide opportunities for professional and personal growth of the employees, the Company has a multitude of development channels,

including technical and specialist career paths, international assignments, and other such programs.

The Company provides market-based competitive compensation through its salary, annual incentive, and long-term incentive programs

and benefits packages that promote employee well-being across all aspects of their lives.

Health and Safety

The Company is committed to providing a zero accident work environment that promotes the health, safety, and welfare of its employees.

Autoliv’s production facilities implement the Company's health and safety management system, which is supported by leadership teams.

Implementation of the system as well as the ISO 45001 health and safety management system is monitored through internal and external

audits. At the end of 2023, 61% of production facilities were certified according to ISO 45001.

The Company further supports employees’ health and well-being by providing the means necessary to allow many of its employees to

work remotely.

9

Labor Relations

The Company offers fair terms and conditions of employment. The Company's overall purpose, Code of Conduct, talent development

strategies, and employment policies support the principles in the United Nations Universal Declaration of Human Rights, and the

International Labor Organization’s Fundamental Principles and Labor Standards.

The Company considers its relationship with its employees to be good. While there have been a small number of minor labor disputes

historically, such disputes have not had a significant or lasting impact on the Company's relationship with its employees, and customer

perception of its employee practices or its business results.

Major unions in Europe to which some of the Company's employees belong include: IG Metall in Germany; Unite the union in the United

Kingdom; Confédération Générale des Travailleurs (CGT), Confédération Française Démocratique du Travail (CFDT), Confédération

Française de l’Encadrement Confédération Générale des cadres (CFE-CGC), Force Ouvrière (FO), Confédération Française des

Travailleurs Chrétiens (CFTC), Solidaires, Unitaires, Démocratiques (SUD) and Conféderation Autonome du Travail (CAT) in France;

Union General de Trabajadores (UGT), Union Sindical Obrera (USO), Comisiones Obereras (CCOO) and Confederacion General de

Trabajadores (CGT) in Spain; IF Metall, Unionen, Sveriges Ingenjörer and Ledarna in Sweden; Industriaal- ja Metallitöötajate

Ametiühingute Liit (IMTAL) in Estonia; Vasas Szakszervezeti Szövetség (Hungarian Metallworkers‘ Federation) in Hungary; Samorzadny

NiezalezĪny Zwiazek Zawodowy Pracownikow and Zakladowa Organizacja Związkowa NSZZ Solidarnosc in Poland; National Union of

Metal Workers South Africa (NUMSA) in South Africa; Union Générale des Travailleurs Tunisiens (UGTT) and Union des travailleurs

Tunisiens (UTT) in Tunisia, and Türk Metal Sendikasi in Turkey.

In addition, the Company’s employees in other regions are represented by the following unions: Unifor in Canada; Sindicato de Jornaleros

y Obreros Industriales y de la Industria Maquiladora de H.Matamoros, Tamaulipas (CTM); Sindicato Nacional de Trabajadores de la

Industria Metalúrgica y Similares, Federación Valle de Toluca (CTM); Sindicato Nacional “Nueva Cultura Laboral” de trabajadores de la

fabricación, manufactura, ensamble de autopartes mecánicas y eléctricas y componentes de la Industria Automotriz, C.R.O.C.; Sindicato

Nacional de Trabajadores de la Industria Arnesera, Eléctrica, Automotriz y Aeronáutica de la República Mexicana; “Nueva Cultura

Laboral” “de trabajadores de la fabricación, manufactura, ensamble de autopartes mecánicas y eléctricas y componentes de la industria

Automotriz (CROC); Sindicato Nacional de Trabajadores de la Industria de Autopartes en General y/o Similares, Conexos y sus Servicios

de la República Mexicana, in Mexico; Sindicato Industrial de Trabajadores de la Transformación, Construcción, Automotriz, Agropecuaria,

Plásticos y de la Industria en General, del Comercio y Servicios, Similares, anexos y conexos del Estado de Querétaro “Ángel Castillo

Resendiz”; Sindicato dos Metalúrgicos de Taubaté e Região in Brazil; Autoliv India Employees Association, Bangalore & Mysore in India;

Korean Metal Workers Union (FKTU) in South Korea; Autoliv Japan Roudou Kumiai in Japan, and All-China Federation of Trade Unions

in China.

In many European countries, Canada, Mexico, Brazil and South Korea, wages, salaries and general working conditions are negotiated

with local unions and/or are subject to centrally negotiated collective bargaining agreements. The terms of the Company's various

agreements with unions typically range between one to three years. Some of the Company's subsidiaries in Europe, Canada, Mexico,

Brazil and South Korea must negotiate with the applicable local unions with respect to important changes in operations, working and

employment conditions. Twice a year, members of the Company’s management conduct a meeting with the European Works Council

(EWC) to provide employee representatives with important information about the Company and a forum for the exchange of ideas and

opinions. In many Asia Pacific countries, the central or regional governments provide guidance each year for salary adjustments or

statutory minimum wage for workers. The Company's employees may join associations in accordance with local legislation and rules,

although the level of unionization varies significantly throughout its operations.

Available Information

The Company files or furnishes with the United States Securities and Exchange Commission (the “SEC”) periodic reports and

amendments thereto, which include annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, proxy

statements, and other information. Such reports, amendments, proxy statements, and other information are made available free of

charge on the Company's corporate website at www.autoliv.com and are available as soon as reasonably practicable after they are

electronically filed with the SEC. The Company's Corporate Governance Guidelines, committee charters, code of conduct, and

other documents governing the Company are also available on its corporate website at www.autoliv.com. The SEC maintains an

internet site that contains reports, proxy statements and other information at www.sec.gov. Hard copies of the above-mentioned

documents can be obtained free of charge by contacting the Company at: Autoliv, Inc., P.O. Box 70381, SE-107 24, Stockholm,

Sweden.

10

Item 1A. Risk Factors

Our business, financial condition, operating results and cash flows may be impacted by a number of factors. A discussion of the risks

associated with these material risk factors is included below.

RISKS RELATED TO GEOPOLITICAL DEVELOPMENTS

Although we have minimal operations in Russia no operations in the Middle East, we face risks related to the war in Ukraine

and the Red Sea Conflict, which has had, and is expected to continue to have, an adverse impact on our business and

financial performance

The macro-economic uncertainty has been exacerbated by the war in Ukraine, the war in Israel/Gaza and the Red Sea Conflict. Although

the length and impact of the ongoing war/conflicts is highly unpredictable, it exacerbated volatility in commodity prices, energy prices,

inflationary pressures, credit markets, foreign exchange rates and supply chain disruptions. Furthermore, governments in the United

States, United Kingdom, Canada, and European Union have each imposed export controls on certain products and financial and

economic sanctions on certain industry sectors and parties in Russia. Existing or additional sanctions could further adversely affect the

global economy and further disrupt the global supply chain. Inflation is also currently high world-wide and may continue for an unforeseen

time.

Due in part to the negative impact of the war in Ukraine, we have experienced exacerbated increases in raw materials and increased

costs for transportation, energy, and commodities. Although have negotiated and continue to negotiate with our customers with respect

to these additional costs, commercial negotiations with our customers may not be successful or may not offset all of the adverse impact

of higher transportation, energy and commodity costs. Additionally, even if we are successful with respect to negotiations with customers

relating to cost increases, there may be delay before we recover any increased costs. These may have a material negative impact on our

business and results of operations.

RISKS RELATED TO OUR INDUSTRY

The cyclical nature of automotive sales and production can adversely affect our business. Our business is directly related to

LVP in the global market and by our customers, and automotive sales and LVP are the most important drivers for our sales

Automotive sales and production are highly cyclical and can be affected by general or regional economic or industry conditions, the level

of consumer demand, recalls and other safety issues, labor relations issues, technological changes, fuel prices and availability, vehicle

safety regulations and other regulatory requirements, governmental initiatives, trade agreements, political volatility (especially in energy

producing countries and growth markets), changes in interest rate levels and credit availability, and other factors. Some regions around

the world may at various times be more particularly impacted by these factors than other regions. Economic declines that result in a

significant reduction in automotive sales and production by our customers have in the past had, and may in the future have, a material

adverse effect on our business, results of operations, and financial condition. Our sales are also affected by inventory levels of our

customers. We cannot predict when our customers will decide to either increase or reduce inventory levels or whether new inventory

levels will approximate historical inventory levels. This may exacerbate variability in our production schedules and order intake and, as a

result, our revenues and financial condition. Uncertainty regarding inventory levels may be exacerbated by consumer financing programs

initiated or terminated by our customers or governments as such changes may affect the timing of their sales. Changes in automotive

sales and LVP and/or customers’ inventory levels will have an impact on our financial targets, earnings guidance, and estimates. In

addition, we base our growth projections in part on business awards, or order intake, made by our customers. However, actual production

orders from our customers may not approximate the awarded business or our estimated order intake. Any significant reduction in

automotive sales and/or LVP by our customers, whether due to general economic conditions or any other factors relevant to sales or

LVP, could have a material adverse effect on our business, results of operations, and financial condition.

Growth rates in safety content per vehicle, which can be impacted by changes in consumer trends, political decisions, crash

test ratings and safety regulations could affect our results in the future

The Company estimates that the average global content of passive safety systems per light vehicle increased in 2023 to around $261.

Vehicles produced in different markets may have various passive safety content values. For example, in high-income markets, the

premium vehicle segment has an average passive safety content values of over $350 per vehicle, whereas in growth markets such as

China and India the average passive safety content per vehicle is approximately $209 and $104, respectively. Due to the majority of the

growth in global LVP over time being concentrated in growth markets, our operating results may be impacted if the passive safety content

per vehicle remains low and if the penetration of automotive safety systems does not increase in these regions. As passive safety content

per vehicle is also an indicator of our sales development, should these trends continue, the average value of passive safety systems per

vehicle could decline.

We operate in a highly competitive market

The market for passive safety systems is highly competitive. We compete with a number of other companies that produce and sell similar

products. Among other factors, our products compete on the basis of price, quality, manufacturing and distribution capability, design and

performance, technological innovation, delivery, and service. Some of our competitors are subsidiaries (or divisions, units or similar) of

companies that are larger and have greater financial and other resources than us. Some of our competitors may also have a “preferred

status” as a result of special relationships or ownership interests with certain customers. Our ability to compete successfully depends, in

large part, on our success in continuing to innovate and manufacture products that have commercial success with our customer and end-

consumers, differentiating our products from those of our competitors, continuing to deliver quality products in the time frames required

by our customers, and maintaining best-cost production. We continue to invest in technology and innovation which we believe will be

11

critical to our long-term growth. Our ability to maintain and improve existing products, while successfully developing and introducing

distinctive new and enhanced products that anticipate changing customer and consumer preferences and capitalize upon emerging

technologies will be a significant factor in our ability to remain competitive. If we are unsuccessful or are less successful than our

competitors in predicting the course of market development, developing innovative products, processes, and/or use of materials or

adapting to new technologies or evolving regulatory, industry or customer requirements, we may be placed at a competitive disadvantage.

For example, our customers are increasingly focused on developing electric vehicles. If we fail to be awarded business on electric vehicle

models, or these electric vehicles are not successful commercially, it will harm our future business prospects. Our competitive environment

continues to change, including increased competition from entrants outside the traditional automotive industry, creating uncertainty about

the future competitive landscape. Given the competitive nature of our business, the amount of awards we are awarded relative to our

peers may decrease over time and our past order intake is not an indicator of future levels or order intake. Additionally,

OEMs rigorously

evaluate our performance and products against those of our competitors on the basis of product quality, reliability and cost-effectiveness.

If one or more of our OEM customers determine that they could achieve overall better financial results by incorporating a competitor’s

new or existing product, it could affect our ability to be competitive and may decrease our current market share. The inability to compete

successfully could have a material adverse effect on our business, results of operations, and financial condition.

The discontinuation, lack of commercial success, or loss of business with respect to a particular vehicle model for which we

are a significant supplier could reduce our sales and harm our business

A number of our customer contracts generally require us to supply a customer’s annual requirements for a particular vehicle model and

assembly facilities, rather than for manufacturing a specific quantity of products. Such contracts range from one year to the life of the

model, which is generally four to seven years. These contracts are often subject to renegotiation, sometimes as frequently as annually,

which may affect product pricing, and generally may be terminated by our customers at any time. Therefore, the discontinuation of, the

loss of business with respect to, or a lack of commercial success of a particular vehicle model or brand for which we are a significant

supplier could reduce our sales and harm our business prospects, operating results, cash flows, or financial condition.

We are working to expand our product offerings beyond light passenger vehicles to include other mobility safety solutions. If

we are not successful in expanding our product offerings or if it takes longer or costs are more than expected, it could harm

our business

The Company is working to expand its product offerings to focus on mobility safety solutions. Because mobility safety product offerings

are currently in the development stages, it is difficult for us to anticipate the level of sales they may generate. The expansion of our

product offering will require us to invest time and resources to develop innovative products, such as wearables and helmets, that keep

pace with continuing changes in industry standards and to reach new customers who have rapidly changing preferences. Our product

offerings might not receive customer acceptance if customer preferences shift to other products, and our future success depends in part

on our ability to anticipate and respond to these changes. If we are not successful in expanding our product offerings or if it takes longer

or costs are more than expected, it could negatively impact our financial results, competitive position, and future business prospects.

RISKS RELATED TO OUR BUSINESS

We may incur material losses and costs as a result of product liability, warranty, and recall claims that may be brought against

us or our customers

We face risks related to product liability claims, warranty claims, and recalls in the event that any of our products actually or allegedly are

defective, fail to perform as expected, or the use of our products results, or is alleged to result, in bodily injury and/or property damage.

We may not be able to anticipate all of the possible performance or reliability problems that could arise with our products after they are

released to the market. Additionally, increasing regulation and reporting requirements regarding potentially defective products, particularly

in the U.S., may increase the possibility that we become involved in additional product liability or recall investigations or claims. See –

“Our business may be adversely affected by changes in automotive safety regulations or concerns that drive further regulation of the

automobile safety market”. Although we currently carry product liability and product recall insurance in excess of our self-insured amounts,

no assurance can be made that such insurance will provide adequate coverage against potential claims, such insurance is available or

will continue to be available in the appropriate markets, or that we will be able to obtain such insurance on acceptable terms in the future.

The cost of such insurance has risen in recent years and our self-insured amounts have risen as well. Although we have invested and

will continue to invest in our engineering, design, and quality infrastructure, we cannot give any assurance that our products will not suffer

from defects or other deficiencies or that we will not experience material warranty claims or product recalls. In the future, we could

experience material warranty or product liability losses and incur significant costs to process and defend these claims. A successful claim

brought against us in excess of available insurance coverage, if any, or a requirement to participate in any product recall, could have a

material adverse effect on our operating results, cash flows, or financial condition. Future recalls could result in costs not covered by

insurance in excess of our self-insurance, further government inquiries, litigation, reputational harm, and could divert management’s

attention away from other matters. The main variables affecting the costs of a recall are the number of vehicles ultimately determined to

be affected by the issue, the cost per vehicle associated with a recall, the determination of proportionate responsibility among the

customer, the Company, and any relevant sub-suppliers, and actual insurance recoveries. Every vehicle manufacturer has its own

practices regarding product recalls and other product liability actions relating to its suppliers, and the performance and remedial

requirements vary between jurisdictions. Due to recall activity in the automotive industry over the past decade, some vehicle manufactures

have become even more sensitive to product recall risks. As suppliers become more integrally involved in the vehicle design process and

assume more of the vehicle assembly functions, vehicle manufacturers are increasingly looking to their suppliers for contribution when

faced with recalls and product liability claims. Product recalls in our industry, even when they do not involve our products, can harm the

reputations of our customers, competitors, and us, particularly if those recalls cause consumers to question the safety or reliability of

products similar to those we produce. In addition, with global platforms and procedures, vehicle manufacturers are increasingly evaluating

our quality performance on a global basis; any one or more quality, warranty or other recall issue(s) (including issues affecting few units

and/or having a small financial impact) may cause a vehicle manufacturer to implement measures which may have a severe impact on

our operations, such as a global, temporary or prolonged suspension of new orders. In addition, as our products more frequently use

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global designs and are based on or utilize the same or similar parts, components or solutions, there is a risk that the number of vehicles

affected globally by a failure or defect will increase significantly with a corresponding increase in our costs. A warranty, recall or product

liability claim brought against us in excess of our available insurance may have a material adverse effect on our business. Vehicle

manufacturers are also increasingly requiring their outside suppliers to guarantee or warrant their products and bear the costs of repair

and replacement of such products under new vehicle warranties. A vehicle manufacturer may attempt to hold us responsible for some or

the entire repair or replacement costs of defective products under new vehicle warranties when the product supplied did not perform as

represented. Accordingly, the future costs of warranty claims by our customers may be material. However, the final amounts determined

to be due related to these matters could differ materially from our recorded warranty estimates and our business prospects, operating

results, cash flows or financial condition may be materially impacted as a result. In addition, as we adopt new technology, we face an

inherent risk of exposure to the claims of others that we have allegedly violated their intellectual property rights. We cannot assure that

we will not experience any material warranty, product liability or intellectual property claim losses in the future or that we will not incur

significant costs to defend such claims. See “If our patents are declared invalid or our technology infringes on the proprietary rights of

others, our ability to compete may be impaired”.

Escalating pricing pressures from our customers may adversely affect our business

The automotive industry continues to experience aggressive pricing pressure from customers. This trend is partly attributable to the major

automobile manufacturers’ strong purchasing power. As with other automotive component manufacturers, we are often expected to quote

fixed prices or are forced to accept prices with annual price reduction commitments for long-term sales arrangements or discounted

reimbursements for engineering work. Price reductions have impacted our sales and profit margins and are expected to continue to do

so in the future. Our future profitability will depend upon, among other things, our ability to continuously reduce our cost per unit and

maintain our cost structure, enabling us to remain cost-competitive. Our profitability is also influenced by our success in designing and

marketing technological improvements in automotive safety systems, which helps us offset price reductions by our customers. If we are

unable to offset continued price reductions through improved operating efficiencies and reduced expenditures, these price reductions

may have a material adverse effect on our business prospects, operating results, cash flows or financial condition.

We could experience disruption in our supply or delivery chain, which could cause one or more of our customers to halt or

delay production

We, as with other component manufactures in the automotive industry, ship our products to customer vehicle assembly facilities

throughout the world on a “just-in-time” basis for our customers to maintain low inventory levels. Our suppliers (external suppliers as well

as our own production sites) use a similar method in providing raw materials to us. However, this “just-in-time” method makes the logistics

supply chain in our industry very complex and vulnerable to disruption. Disruptions in our supply chain may result for many reasons,

including closures of one of our own or one of our suppliers’ facilities or critical manufacturing lines due to strikes or other labor disputes,

mechanical failures, electrical outages, fires, explosions, critical pollution levels, critical health and safety and other working conditions

issues (including epidemics and pandemics), natural disasters, war, political upheaval, as well as logistical complications due to labor

disruptions, weather or natural disasters, acts of terrorism or violence (such as the conflict in the Red Sea), mechanical failures, and

legislation or regulation regarding the transport of hazardous goods. Additionally, we may experience disruptions if there are newly

imposed trade restrictions or delays in customs processing, including if we are unable to obtain government authorization to export or

import certain materials, including materials that may be viewed as dangerous such as the propellant used for our inflators. As we continue

to expand in growth markets, the risk of such disruptions is heightened. The unavailability of even a single small subcomponent necessary

to manufacture one of our products, for whatever reason, could force us to cease production of that product, possibly for a prolonged

period. Similarly, a potential quality issue could force us to halt deliveries while we validate the products. Even when products are ready

to be shipped, or have been shipped, delays may arise before they reach our customer. Also, similar difficulties for other suppliers may

force our customers to halt production, which may in turn impact our sales shipments to such customers. When we fail to timely deliver,

we may have to absorb our own costs for identifying and resolving the ultimate problem as well as expeditiously producing and shipping

replacement components or products. Generally, we must also carry the costs associated with “catching up,” such as overtime and

premium freight. If we are the cause of a customer being forced to halt production, the customer may seek to recoup all of its losses and

expenses from us. These losses and expenses could be very significant and may include consequential losses such as lost profits. Where

a customer halts production because of another supplier failing to deliver on time, we may not be fully compensated, if at all. Thus, any

such supply chain disruptions could severely impact our operations and/or those of our customers and force us to halt production for

prolonged periods of time which could expose us to material claims for compensation and have a material adverse effect on our business

prospects, operating results, or financial condition.

Adverse developments affecting our suppliers could harm our profitability

Any significant disruption in our supplier relationships, particularly relationships with single-source suppliers, could harm our profitability.

Furthermore, some of our suppliers may not be able to sufficiently manage the currency commodity cost volatility and/or sharply changing

volumes while still performing as we expect. For example, recalls or field actions from our customers can stress the capacity of our supply

chain and may inhibit our ability to timely deliver order volumes. We may incur costs as we try to make contingency plans to manage the

risks for delivery delays, production delays, production issues or delivery of non-conforming products by our suppliers.

Changes in the source, cost, availability of and regulations pertaining to raw materials and components may adversely affect

our profit margins

Our business uses a broad range of raw materials and components in the manufacture of our products, nearly all of which are generally

available from a number of qualified suppliers. Our industry may be affected from time to time by limited supplies or price fluctuations of

certain key components and materials. Strong worldwide demand for certain raw materials has had a significant impact on prices and

short-term availability in recent years. Such price increases have and could materially increase our operating costs and materially and

adversely affect our profit margin, as direct material costs amounted to approximately 55% of our net sales in 2023, of which approximately

half is the raw material cost portion. Inflation is currently high world-wide and may continue for some time. Commercial negotiations with

our customers and suppliers may not always offset all of the adverse impact of higher raw material, energy, labor, logistics, and commodity

costs. Even where we are able to pass price increases along to our customer, there may be (i) a lapse of time before we are able to do

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so such that we must absorb the cost increase, and (ii) a negative impact on our relationships with such customers and suppliers which

may limit our success in securing future awards from customers and securing acceptable supplies from suppliers. In addition, no

assurances can be given that the magnitude and duration of such cost increases or any future cost increases could not have a larger

adverse impact on our profitability and consolidated financial position than currently anticipated. Furthermore, if costs for raw materials

go down, the price for our products may decrease as well as the price is indexed to the cost of raw materials. Additionally, various

government regulators require companies that manufacture products containing certain minerals and their derivatives that are known as

“conflict minerals”, originating from the Democratic Republic of Congo or adjoining countries to perform due diligence and report the

source of such materials. There are significant resources associated with complying with these requirements, including diligence efforts

to determine the sources of conflict minerals used in our products and potential changes to our processes or supplies as a consequence

of such diligence efforts. As there may be only a limited number of suppliers able to offer certified “conflict free” conflict minerals, there

can be no assurance that we will be able to obtain necessary conflict free minerals from such suppliers in sufficient quantities or at

competitive prices. We may face reputational challenges if we determine that certain of our products contain minerals not determined to

be conflict free or if we are unable to sufficiently verify the origins for all minerals used in our products through the procedures we may

implement. Furthermore, our customers are also increasingly requiring us to track sustainable sources of certain raw materials, which

also requires additional diligence efforts and there can be no assurance that we will be able to obtain these materials in a cost-efficient

and sustainable manner. Accordingly, these rules and customer requirements may adversely affect our business prospects, operating

results, cash flows, or financial condition.

Our business could be materially and adversely affected if we lost any of our largest customers or if they were unable to pay

their invoices

We are dependent on a few large customers with strong purchasing power. This is the result of customer consolidation in the last few

decades. In 2023, our top five customers represented around 48% of our consolidated sales, and our largest customer contract accounted

for around 2.8% of our consolidated sales. Although business with any given customer is typically split into several contracts (either on

the basis of one contract per vehicle model or on a broader platform basis), the loss of business from any of our major customers (whether

by lower overall demand for vehicles, cancellation of existing contracts or the failure to award us new business) could have a material

adverse effect on our business, results of operations, and financial condition. Similarly, further consolidation of our customers in the future

could make us more reliant upon a smaller group of customers for a significant portion of our consolidated sales and negatively impact

our bargaining power when contracting with such customers. Customers may put us on a “new business hold,” which would limit our

ability to quote or be awarded all or part of their future vehicle contracts if quality or other issues arise in the vehicles for which we were

a supplier. This could have a significant negative impact on our order intake. Such new business holds range in length and scope and

are generally accompanied by a certain set of remedial conditions that must be met before we are eligible to bid for new business. Meeting

any such conditions within the prescribed timeframe may require additional Company resources. A failure to satisfy any such conditions

may have a material adverse impact on our financial results in the long term. There is a risk that one or more of our major customers may

be unable to pay our invoices as they become due or that a customer will simply refuse to make such payments given its financial

difficulties. If a major customer would enter into bankruptcy proceedings or similar proceedings whereby contractual commitments are

subject to stay of execution and the possibility of legal or other modification, or if a major customer otherwise successfully procures

protection against us legally enforcing its obligations, it is likely, absent special relief such as having a “preferred status”, that we will be

forced to record a substantial loss. Additional information concerning our major customers is included in Note 19, Segment Information,

of the Consolidated Financial Statements in this Annual Report.

Our inability to effectively manage the timing, quality and costs of new program launches could adversely affect our financial

performance

To compete effectively in the automotive supply industry, we must be able to launch new products to meet our customers’ timing,

performance, and quality standards. At times, we face an uneven number of launches and some launches, for various reasons, may have

shortened launch lead times. We cannot provide assurance that we will be able to install and certify the equipment needed to produce

products for new programs in time for the start of production, or that the transitioning of our manufacturing facilities and resources to full

production for such new programs will not impact production rates or other operational efficiency measures at our facilities. In addition,

we cannot provide assurance that our customers will execute on schedule the launch of their new product programs, for which we might

supply products. Additionally, as a Tier 1 supplier, we must effectively coordinate the activities of numerous suppliers in order to launch

programs successfully. Given the complexity of new program launches, especially involving new and innovative technologies, we may

experience difficulties managing product quality, timeliness and associated costs. In addition, new program launches require a significant

ramp up of costs; however, the sales related to these new programs generally are dependent upon the timing and success of the

introduction of new vehicles by the Company’s customers. Our inability to effectively manage the timing, quality and costs of these new

program launches could adversely affect our business prospects, operating results, cash flows, or financial condition.

Changes in our product mix may impact our financial performance

We sell products that have varying profit margins. Our financial performance can be impacted depending on the mix of products we sell

during a given period. Our earnings guidance, estimates, and financial targets assume a certain geographic sales mix as well as a product

sales mix. If actual results vary significantly from this projected geographic and product mix of sales, our operating results and financial

condition could be negatively impacted.

We are involved from time to time in legal proceedings and our business may suffer as a result of adverse outcomes of current

or future legal proceedings

We are, from time to time, involved in litigation, regulatory proceedings, and commercial or contractual disputes that may be significant.

These matters may include, without limitation, disputes with our suppliers and customers, intellectual property claims, shareholder

litigation, government investigations, class action lawsuits, personal injury claims, product liability claims, environmental issues, antitrust,

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customs and VAT disputes, and employment and tax issues. In such matters, government agencies or private parties may seek to recover

from us very large, indeterminate amounts in penalties or monetary damages (including, in some cases, treble or punitive damages) or

seek to limit our operations in some way. The possibility exists that claims may be asserted against us and their magnitude may remain

unknown for long periods of time. These types of lawsuits could require a significant amount of management’s time and attention and a

substantial legal liability or adverse regulatory outcome and the substantial expenses to defend the litigation or regulatory proceedings

may have a material adverse effect on our customer relationships, business prospects, reputation, operating results, cash flows, and

financial condition. No assurances can be given that such proceedings and claims will not have a material adverse impact on our

profitability and consolidated financial position or that our established reserves or our available insurance will mitigate such impact.

We may be subject to civil antitrust litigation that could negatively impact our business

The Company may be subject to civil antitrust lawsuits in the future in countries that permit such civil claims, including lawsuits or other

actions by our customers. The Company was previously the subject of an investigation by the European Commission (“EC”) regarding

possible anti-competitive behavior among certain suppliers to the automotive vehicle industry. The Company paid a fine to resolve these

matters in 2019. As a result of the outcome of the EC investigation, we are and we could be, subject to subsequent civil disputes with

non-governmental third parties and civil or stockholder litigation stemming from the same facts and circumstances underlying the EC

investigation. These types of lawsuits require significant management time and attention and could result in significant expenses as well

as unfavorable outcomes that could have a material adverse impact on our customer relationships, business prospects, reputation,

operating results, cash flows or financial condition, and our insurance may not mitigate such impact. See Note 17, Contingent Liabilities,

to the Consolidated Financial Statements in this Annual Report.

Work stoppages, slow-downs or other labor issues at our customers’ facilities or at our facilities could adversely affect our

operations

Because the automotive industry relies heavily on “just-in-time” delivery of components during the assembly and manufacture of vehicles,

a work stoppage or slow-down at one or more of the Company’s facilities could have a material adverse effect on our business. Similarly,

if any of our customers were to experience a work stoppage or slow-down, that customer may halt or limit the purchase of our products.

Similarly, a work stoppage or slow-down at another supplier could interrupt production at one of our customers’ facilities which would

have the same effect. While labor contract negotiations at our facilities historically have rarely resulted in work stoppages, no assurances

can be given that we will be able to negotiate acceptable contracts with these unions or that our failure to do so will not result in work

stoppages. A work stoppage or other labor disruption at one or more of our facilities or our customers’ facilities could cause us to shut

down production facilities supplying these products, which could have a material adverse effect on our business, results of operations,

and financial condition.

Our ability to operate our company effectively could be impaired if we fail to attract and retain executive officers and other key

personnel

Our ability to operate our business and implement our strategies effectively depends, in part, on the efforts of our executive officers and

other key employees. In addition, our future success will depend on, among other factors, our ability to attract, develop, and retain other

qualified personnel, particularly engineers and other employees with software and technical expertise. The loss of the services of any of

our executive officers or other key employees or the failure to attract, develop, or retain other qualified personnel could have a material

adverse effect on our business.

Restructuring, efficiency, and strategic initiatives and capacity alignments are complex and difficult and at any time additional

restructuring steps may be necessary, possibly on short notice and at significant cost

Our restructuring, efficiency, and strategic initiatives and capacity alignments include efforts to adjust our manufacturing capacity, direct

and indirect labor workforce, and cost structure to meet current and projected operational and market requirements, including plant

closures, transfer of sourcing to best cost countries, consolidation of our supplier base, and standardization of products to reduce our

overhead costs and consolidate our operational centers. The successful implementation of our restructuring activities and capacity

alignments will involve sourcing, logistics, technology, and employment arrangements. Because these restructuring, efficiency, and

strategic initiatives and capacity alignments can be complex, there may be difficulties or delays in the implementation of any such

initiatives and capacity alignments or they may not be immediately effective, resulting in an adverse material impact on our performance.

In addition, there is a risk that inflation, high-turnover rates, and increased competition may reduce the efficiencies now available in best-

cost countries to levels that no longer allow for cost-beneficial restructuring opportunities. Therefore, there can be no assurances that any

future restructurings or capacity alignments will be completed as planned or achieve the desired results. See Note 11, Restructuring, to

the Consolidated Financial Statements in this Annual Report.

A prolonged recession and/or a downturn in our industry could result in us having insufficient funds to continue our operations

and external financing may not be available to us or available only on materially different terms than what has historically been

available

Our ability to generate cash from our operations is highly dependent on automotive sales and LVP, the global economy, and the

economies of our important markets. If LVP were to remain on low levels for an extended period of time, we would experience a

significantly negative cash flow. Similarly, if cash losses for customer defaults rise sharply, we would experience a negative cash flow.

Such negative cash flow could result in our having insufficient funds to continue our operations unless we can procure external financing,

which may not be possible. Our access to debt, securitization, or derivative markets around the world at competitive rates or in sufficient

amounts could be affected by credit rating downgrades, market volatility, market disruption, regulatory requirements, or other factors. Our

ability to obtain unsecured funding at a reasonable cost is dependent on our credit ratings or our perceived creditworthiness. Our current

15

credit rating could be lowered as a result of us experiencing significant negative cash flows, increasing our indebtedness and leverage,

or a dire financial outlook, which may affect our ability to procure financing. We may also for the same, or other reasons, find it difficult to

secure new long-term credit facilities, at reasonable terms, when our principal credit facility expires in 2027. Further, even our existing

unutilized credit facilities may not be available to us as agreed, or only at additional cost, if participating banks are unable to raise the

necessary funds, where, for instance, financial markets are not functioning as expected or one or more banks in our principal credit facility

syndicate were to default. As a result, we cannot assure you that we will continue to have sufficient liquidity to meet our operating needs.

In the event that we do not have sufficient external financing, we may be required to seek additional capital, sell assets, reduce or cut

back our operating activities or otherwise alter our business strategy. Information concerning our credit facilities and other financings are

included in Item 7 in this Annual Report in the section headed “Treasury Activities” and in Note 13, Debt and Credit Agreements, to the

Consolidated Financial Statements in this Annual Report.

Our indebtedness may harm our financial condition and results of operations

As of December 31, 2023, we have outstanding debt of $1.9 billion. We may incur additional debt for a variety of reasons. Although our

significant credit facilities and debt agreements do not have any financial covenants, our level of indebtedness will have several important

effects on our future operations, including, without limitation: a portion of our cash flows from operations will be dedicated to the payment

of any interest or could be used for amortization required with respect to outstanding indebtedness; increases in our outstanding

indebtedness and leverage will increase our vulnerability to adverse changes in general economic and industry conditions, as well as to

competitive pressure; depending on the levels of our outstanding debt, our ability to obtain additional financing for working capital,

acquisitions, capital expenditures, general corporate and other purposes may be limited; and potential future tightening of the availability

of capital both from financial institutions and the debt markets may have an adverse effect on our ability to access additional capital.

Governmental restrictions may impact our business adversely

Some of our customers are (or may be) owned by a governmental entity, receive various forms of governmental aid or support or are

subject to governmental influence in other forms, which may impact us as a supplier to these customers. As a result, they may be required

to partner with local entities or procure components from local suppliers to achieve a specific local content or be subject to other

restrictions regarding localized content or ownership. The nature and form of any such restrictions or protections, whatever their basis, is

very difficult to predict as is their potential impact. However, they are likely to be based on political rather than economical or operational

considerations and may materially impact our business.

Impairment charges relating to our assets, goodwill and other intangible assets could adversely affect our financial performance

We periodically review the carrying value of our assets, goodwill and other intangible assets for impairment indicators. If one or more of

our customers’ facilities cease production or decrease their production volumes, the assets we carry related to our facilities serving such

customers may decrease in value because we may no longer be able to utilize or realize them as intended. Where such decreases are

significant, such impairments may have a material adverse impact on our financial results. We monitor the various factors that impact the

valuation of our goodwill and other intangible assets, including expected future cash flow levels, global economic conditions, market price

for our stock, and trends with our customers. Impairment of goodwill and other identifiable intangible assets may result from, among other

things, deterioration in our performance and especially the cash flow performance of these goodwill assets, adverse market conditions

and adverse changes in applicable laws or regulations. If there are changes in these circumstances or the other variables associated with

the estimates, judgments and assumptions relating to the valuation of goodwill, when assessing the valuation of our goodwill items, we

may determine that it is appropriate to write down a portion of our goodwill or intangible assets and record related non-cash impairment

charges. In the event that we determine that we are required to write-down a portion of our goodwill items and other intangible assets

and thereby record related non-cash impairment charges, our financial condition and operating results would be adversely affected. For

additional information, see Part II, Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations -

Significant Accounting Policies and Critical Accounting Estimates – Goodwill and Intangibles”.

We face risks related to our defined benefit pension plans and employee benefit plans, including the need for additional funding

as well as higher costs and liabilities

Our defined benefit pension plans and employee benefit plans may require additional funding or give rise to higher related costs and

liabilities which, in some circumstances, could reach material amounts and negatively affect our operating results. We are required to

make certain year-end assumptions regarding our pension plans. Our pension obligations are dependent on several factors, including

factors outside our control such as changes in interest rates, the market performance of the diversified investments underlying the pension

plans, actuarial data and adjustments and an increase in the minimum funding requirements or other regulatory changes governing the

plans. Adverse equity market conditions and volatility in the credit market may have an unfavorable impact on the value of our pension

assets and our future estimated pension liabilities. Internal factors such as an adjustment to the level of benefits provided under the plans

may also lead to an increase in our pension liability. If these or other internal and external risks were to occur, alone or in combination,

our required contributions to the plans and the costs and net liabilities associated with the plans could increase substantially and have a

material effect on our business. Information concerning our benefit plans is included in Note 18, Retirement Plans, of the Consolidated

Financial Statements in this Annual Report.

We may not be able to, or we may decide not to, pay dividends or repurchase shares at a level anticipated by our shareholders,

which could reduce shareholder returns

The extent to which we pay dividends on our common stock and repurchase our common stock in the future is at the discretion of our

Board of Directors and depends upon a number of factors, including our earnings, financial condition, cash and capital needs,

indebtedness and leverage, and general economic or business conditions. No assurance can be given that we will be able to or will

choose to pay any dividends or repurchase any shares in the foreseeable future.

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Cybersecurity incidents or other damage to our technology infrastructure could disrupt business operations, result in the loss

of critical and confidential information, and adversely impact our reputation and operating results

We rely extensively on information technology (“IT”) networks and systems, our global data centers and services provided over the

internet to process, transmit and store electronic information, and to manage or support a variety of business processes or activities

across our facilities worldwide. In addition, a greater number of our employees are working remotely which may increase cybersecurity

vulnerabilities and risk to our IT networks and systems. The secure operation of our IT networks and systems and the proper processing

and maintenance of this information are critical to our business operations. We have been, and likely will continue to be, subject to cyber-

attacks. Although we seek to deploy comprehensive security measures to prevent, detect, address and mitigate these threats, there has

been an increased level of activity, and an associated level of sophistication, in cyber-attacks against large multinational companies. The

ever-evolving threats mean we and our third-party service providers and vendors must continually evaluate and adapt our respective

systems and processes and overall security environment, as well as those of any companies we acquire. There is no guarantee that

these measures will be fully implemented, complied with, or effective in safeguarding against all data security breaches, system

compromises or misuses of data. Our security measures may be breached due to human or technological error, employee malfeasance,

system malfunctions or attacks from uncoordinated individuals or sophisticated and targeted measures known as advanced persistent

threats, directed at the Company, its products, its customers, its third-party service providers, and/or other entities with whom we do

business. Because techniques used to obtain unauthorized access or to sabotage systems change frequently and generally are not

recognized until they are launched against a target, we may be unable to anticipate these techniques or to implement adequate

preventative measures. Disruptions and attacks on our IT systems or the systems of third parties storing our data or employee

malfeasance or human or technological error could result in the misappropriation, loss, destruction or corruption of our critical data and

confidential or proprietary information, personal information of our employees, the leakage of our or our customers’ confidential

information, improper use of our systems and networks, production downtimes and both internal and external supply shortages, which

could have a material adverse effect on our results of operations. It may also result in the theft of intellectual property or other

misappropriation of assets, or otherwise compromise our confidential or proprietary information and materially disrupt our operations. The

potential consequences of a material cybersecurity incident include reputational damage, damaged customer relationships, loss of

revenue, lower order intake in the future, theft of intellectual property, litigation with third parties, diminution in the value of our investment

in research, development and engineering, diversion of the attention of management away from the operation of our business and

increased cybersecurity protection and remediation costs, legal claims and liability, regulatory scrutiny, sanctions, fines or penalties (which

may not be covered by our insurance policies), negative publicity, release of sensitive and/or confidential information, increases in

operating expenses, or lost revenues which in turn could adversely affect our competitiveness and results of operations. To the extent

that any disruption or security breach results in a misappropriation, loss, destruction or corruption of our customer’s information, it could

affect our relationships with our customers, create significant expense for us to investigate and remediate damage, lead to claims against

the Company and ultimately harm our business, strategy, result of operations, or financial condition. In addition, we may be required to

incur significant costs to protect against damage caused by these disruptions or security breaches in the future. In addition, as the

regulatory environment related to information security, data collection and use, and privacy becomes increasingly rigorous, with new and

constantly changing requirements applicable to our business, compliance with those requirements could result in additional costs.

Furthermore, our technology systems are vulnerable to damage or interruption from natural disasters, power loss and telecommunication

failures. We continuously seek to maintain a robust program of information security and controls, however, any future significant

compromise or breach of our data security, whether external or internal, or misuse of customer, associate, supplier or Company data,

could result in significant costs, lost sales, fines, lawsuits, and damage to our reputation.

Third parties that maintain certain of our confidential and proprietary information could experience a cybersecurity incident

We rely on third parties to provide or maintain some of our IT systems, data centers and related services and do not exercise direct

control over these systems. Despite the implementation of security measures at third party locations, these IT systems, data centers and

cloud services are also vulnerable to security breaches or other disruptions. Additionally, we and certain of our third-party vendors, collect

and store personal information in connection with human resources operations and other aspects of our business. While we obtain

assurances that any third parties we provide data to will protect this information and, where we believe appropriate, monitor the protections

employed by these third parties, there is a risk the confidentiality of data held by us or by third parties may be compromised and expose

us to liability for such breach.

Global climate change could negatively affect our business

Increased public awareness and concern regarding global climate change will likely result in more regional and/or national requirements

to reduce or mitigate the effects of greenhouse gas emissions. In addition, our shareholders and customers also expect us to reduce our

greenhouse gas emissions. There continues to be a lack of consistent climate legislation, which creates economic and regulatory

uncertainty. Any future regulations aimed at mitigating climate change may negatively impact the prices of raw materials and energy as

well as the demand for certain of our customer’s products which could in turn impact demand for our products and impact our results of

operations. The costs of compliance and any changes to our operations mandated by new or amended laws, may be significant. We may

also face unexpected delays in obtaining permits and approvals required by such laws in connection with our manufacturing facilities,

which would hinder our operation of these facilities. Furthermore, any violations of these laws may result in substantial fines and penalties,

remediation costs, third party damages, or a suspension or cessation of our operations. We also face physical and transition risks from

climate change. The manifestations of climate change, such as extreme weather conditions or more frequent extreme weather events,

including wildfires, flooding, water stress and extreme heat, could disrupt our operations, damage our facilities, disrupt our supply chain,

including our customers or suppliers, impact the availability and cost of materials needed for manufacturing or increase insurance and

other operating costs. As a result, severe weather or a natural disaster that results in a prolonged disruption to our operations, or the

operations of our customers or suppliers, could have a material adverse effect on our

operating results, cash flows or financial condition.

Our goals, targets and ambitions related to sustainability and emissions reduction, and our public statements and disclosures

regarding them, expose us to numerous risks

We have developed, and will continue to develop and set, goals, targets, ambitions and other objectives related to sustainability matters,

including our net-zero emission targets both for ourselves and our supply chain. Some of these are based on our internal scenario

analysis, which may not prove to be accurate and carries inherent uncertainties. Statements related to these goals, targets, ambitions

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and objectives reflect our current plans and do not constitute a guarantee that they will be achieved. Our efforts to research, establish,

accomplish, and accurately report on these goals, targets, and objectives expose us to numerous operational, reputational, financial,

legal, and other risks. Additionally, greenhouse gas emissions, particular emissions that come from individuals and entities up and down

the value chain (otherwise known as Scope 3 emissions), are very difficult to estimate and our estimates may be materially different than

actual emissions. Additionally, accepted methodologies or regulatory requirements for estimating emissions, particularly Scope 3

emissions, continue to evolve. The manner in which we estimate and disclose Scope 3 emissions may differ from other companies and

may be different than future regulatory requirements, and currently, we do not include downstream Scope 3 emissions in our targets and

ambitions. If future governmental regulations require us to modify the basis of our Scope 3 emissions disclosure, our historically disclosed

Scope 3 emissions may change materially. Our ability to achieve any stated goal, target, ambition or objective, including with respect to

emissions reduction, is subject to numerous factors and conditions, some of which are outside of our control. For example, we have

announced that we are collaborating with Polestar to develop a climate neutral car. Such an endeavor requires the innovation and

collaboration with a number of partners and is subject to certain inherent risks, including the timetable in which it is achieved. We may

also have to purchase carbon offsets in order to meet our targets and objectives, which may not be available or may no longer be

considered acceptable to use to meet such targets.

Our business may face increased scrutiny from investors and other stakeholders related to our sustainability activities, including the goals,

targets, and objectives that we announce, and our methodologies and timelines for pursuing them. If our sustainability practices do not

meet investor or other stakeholder expectations and standards, which continue to evolve, our reputation, our ability to attract or retain

employees, and our attractiveness as an investment or business partner could be negatively affected. Similarly, our failure or perceived

failure to pursue or fulfill our sustainability-focused goals, targets, ambitions and objectives, to comply with ethical, environmental, or other

standards, regulations, or expectations, or to satisfy various reporting standards with respect to these matters, within the timelines we

announce, or at all, could adversely affect our business or reputation, as well as expose us to government enforcement actions and

private litigation.

RISKS RELATED TO INTERNATIONAL OPERATIONS

Our business is exposed to risks inherent in international operations

We currently conduct operations in various countries and jurisdictions, including locating certain of our manufacturing and distribution

facilities internationally, which subjects us to the legal, political, regulatory and social requirements and economic conditions in these

jurisdictions. Some of these countries are considered growth markets and emerging markets. International sales and operations,

especially in growth markets, subject us to certain risks inherent in doing business abroad, including: exposure to local economic

conditions; unexpected changes in laws, regulations, trade, or monetary or fiscal policy, including interest rates, foreign currency

exchange rates, and changes in inflation rates; foreign tax consequences; inability to collect, or delays in collecting, value-added taxes

and/or other receivables associated with remittances and other payments by subsidiaries; exposure to local political turmoil and

challenging labor conditions; changes in general economic and political conditions in countries where we operate, particularly in emerging

markets; expropriation and nationalization; enforcing legal agreements or collecting receivables through foreign legal systems; wage

inflation; currency controls, including lack of liquidity in foreign currency due to governmental restrictions, trade protection policies and

currency controls, which may create difficulty in repatriating profits or making other remittances; compliance with the requirements of an

increasing body of applicable anti-bribery laws; reduced intellectual property protection in various markets; investment restrictions or

requirements; and the imposition of product tariffs and the burden of complying with a wide variety of international and U.S. export laws.

The Company is subject to taxation in the U.S. and numerous foreign jurisdictions. The Organization for Economic Co-operation and

Development (“OECD”) continues its base erosion and profit shifting (“BEPS”) project begun in 2015 with new proposals for a global

minimum tax, further development of a coordinated set of rules for taxation and the allocation of taxing rights between jurisdictions. These

proposals, if adopted by countries in which we operate, could result in changes to tax policies, including transfer pricing policies, that

could ultimately impact our tax liabilities. On December 12, 2022, the European Union member states agreed to implement the OECD’s

Pillar 2 global corporate minimum tax at a rate of 15% on companies with revenues of at least $790 million, which went into effect in 2024.

The Pillar 2 rules are also in effect in the United Kingdom, Switzerland, and South Korea, among others. Similarly, the United States

passed the Inflation Reduction Act of 2022, which also imposes, among other things, a 15% corporate minimum tax for taxable years

beginning after December 31, 2022, on certain U.S. based companies that have average revenues over a three-year period of at least

$1 billion.

Other countries including Canada and Australia are also actively considering changes to their tax laws to adopt certain parts

of the OECD’s proposals. The timing or impact of these proposals and recommendations is unclear at this point.

Changes in tax laws or policies by the U.S. or foreign jurisdictions could result in a higher effective tax rate on our worldwide earnings,

and any such change could have a material adverse effect on our business prospects, cash flows, operating results and financial

condition. Our international operations also depend upon favorable trade relations between the countries where we manufacture and sell

products and those foreign countries in which our customers and suppliers have operations. Changes in national policy, other

governmental action related to tariffs or international trade agreements, changes in social, political regulatory, and economic conditions

or in laws and policies governing foreign trade, manufacturing, development and investment in the territories and countries where the

Company currently manufactures and sells products, and any resulting negative sentiments towards the Company as a result of such

changes could depress economic activity and restrict our access to suppliers or customers and have a material adverse effect on our

cash flows, operating results and financial condition. Increasing our manufacturing footprint in the growth markets and our business

relationships with automotive manufacturers in these markets are particularly important elements of our strategy. As a result, our exposure

to the risks described above may be greater in the future, and our exposure to risks associated with developing countries, such as the

risk of political upheaval and reliability of local infrastructure, may increase.

Our foreign operations may subject us to risks relating to laws governing international relations

Due to our global operations, we are subject to many laws governing international relations (including, but not limited to, the Foreign

Corrupt Practices Act, and other anti-bribery regulations in foreign jurisdictions where we do business), which prohibit improper payments

to government officials and restrict where and how we can do business, what information or products we can supply to certain countries

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and what information we can provide to authorities in governmental authorities. We also export components and products that are subject

to certain trade-related U.S. laws, including the U.S. Export Administration Act and various economic sanctions programs administered

by the U.S. Treasury’s Office of Foreign Assets Control. Although we have procedures and policies in place that should mitigate the risk

of violating these laws, there is no guarantee that they will be sufficiently effective. If and when we acquire new businesses, we may not

be able to ensure that the pre-existing controls and procedures meant to prevent violations of these laws were effective, and violations

may occur if we are unable to timely implement corrective and effective controls and procedures when integrating newly acquired

businesses. Any allegations of noncompliance with these laws could harm our reputation, divert management attention and result in

significant expenses, and could therefore materially harm our business prospects, operating results and financial condition.

Our business in Asia is subject to aggressive competition and is sensitive to economic, market, and political conditions

We operate in the automotive supply market throughout Asia including the highly competitive markets in China, South Korea, and India.

In each of these markets we face competition from both international and smaller domestic manufacturers. Due to the significance of the

Asian markets for our profit and growth, we are exposed to risks in China, South Korea, and India. We anticipate that additional

competitors, both international and domestic, may seek to enter the Chinese, South Korean, and/or Indian markets resulting in increased

competition. Increased competition may result in lower sales volumes, price reductions, reduced margins and our inability to gain or hold

market share. There have been periods of increased market volatility and moderation in the levels of economic growth in China, which

resulted in periods of lower automotive production growth rates in China than those previously experienced. Our business in Asia is

sensitive to economic and market conditions that drive automotive sales volumes in China, South Korea, and India and may be impacted

if there are reductions in vehicle demand in those markets. There are also trade and political tensions between China and other countries

in the western world. If we are unable to maintain our position in the Asian markets, the pace of growth slows, or vehicle sales in these

markets decrease, our business prospects, operating results and financial condition could be materially adversely affected.

Our business in Europe is sensitive to economic and market conditions

We operate in the automotive supply market throughout Europe

and are increasingly subject to the risks arising from adverse changes

in the European economy. A significant deterioration in economic conditions, increased volatility, further declines in the European credit,

equity, and foreign currency markets or geopolitical disruptions, including the war in Ukraine, could have negative impacts on our business

operations in Europe and may lead to delays in or cancellations of customer orders. We also face competition from both international and

smaller domestic manufacturers who may seek to enter the European markets resulting in increased competition. Increased competition

may result in lower sales volumes, price reductions, reduced margins, and our inability to gain or hold market share.

Global integration may result in additional risks

Because of our efforts to manage costs by integrating our operations globally, we face the additional risk that, should any of the other

risks discussed herein materialize, the negative effects could be more pronounced. For example, while supply delays of a component

have typically only affected a few customer vehicle models, such a delay could now affect several vehicle models of several customers

in several geographic areas. Similarly, any recall or warranty issue we face due to a product defect or failure is now more likely to involve

a larger number of units in several geographic areas.

Our business faces exchange rate risks

As a result of our global presence, a significant portion of our revenues and expenses are denominated in currencies other than the U.S.

dollar. We are therefore subject to foreign currency risks and foreign exchange exposure. Such risks and exposures include: transaction

exposure, which arises because the cost of a product originates in one currency and the product is sold in another currency; revaluation

effects, which arise from valuation of assets denominated in other currencies than the reporting currency of each unit; translation exposure

in the income statement, which arises when the income statements of non-U.S. subsidiaries are translated into U.S. dollars; translation

exposure in the balance sheet, which arises when the balance sheets of non-U.S. subsidiaries are translated into U.S. dollars; and

changes in the reported U.S. dollar amounts of cash flows. We cannot predict exchange rate volatility or the extent of its impact on our

future financial results. We typically denominate foreign transactions in foreign currencies to achieve a natural hedge. However, a natural

hedge cannot be achieved for all our currency flows; therefore, a net transaction exposure remains within the group. The net exposure

can be significant and creates a transaction exposure risk for the Company. The Company does not hedge translation exposure. However,

we do engage in foreign exchange rate hedging from time to time related to foreign currency transactions. For additional information, see

Part II, Item 7A. Quantitative and Qualitative Disclosures about Market Risk - Currency risks.

RISKS RELATED TO ACQUISITIONS

We face risks in connection with acquisitions, joint ventures, partnerships, and other strategic transactions

Our growth has been enhanced through strategic transactions, including acquisitions of businesses, products and technologies,

partnerships, strategic alliances, and joint development agreements that we believe will complement our business. We regularly evaluate

acquisition opportunities, frequently engage in acquisition discussions, conduct due diligence activities in connection with possible

acquisitions, and, where appropriate, engage in acquisition negotiations. We may not be able to successfully identify suitable acquisition

and joint venture candidates or complete transactions on acceptable terms, integrate acquired operations into our existing operations or

expand into new markets. Our failure to identify suitable strategic transactions may restrict our ability to grow our business. These strategic

transactions also involve numerous additional risks to us and our investors, including: risks related to retaining acquired management

and employees; difficulties in integrating acquired technologies, products, operations, services and personnel with our existing

businesses; diversion of our management’s attention from other business concerns; assumption of contingent liabilities; potential adverse

financial impacts, including from the amortization of expenses related to intangible assets and

from potential impairment of goodwill;

incurrence of indebtedness; and potential damage to existing customer relationships or lack of customer acceptance or inability to attract

new customers as a result of these transactions. In the future, we may pursue acquisitions of businesses or products that are

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complementary to our business but for which we have historically had little or no direct experience. These transactions can involve

significant challenges and risks as well as significant time and resources that may divert management’s attention from other business

activities. If we fail to adequately manage these risks, the acquisitions and other strategic transactions may not result in revenue growth,

operational synergies or service or technology enhancements, which could adversely affect our financial condition.

RISKS RELATED TO INTELLECTUAL PROPERTY

If our patents are declared invalid or our technology infringes on the proprietary rights of others, our ability to compete may be

impaired

We have developed a considerable amount of proprietary technology related to automotive safety systems and rely on a number of

patents to protect such technology. Our intellectual property plays an important role in maintaining our competitive position in a number

of the markets we serve. At present, we hold more than 6,500 patents and patent applications covering a large number of innovations

and product ideas, mainly in the fields of seatbelt and airbag technologies. In addition to our in-house research and development efforts,

we seek to acquire rights to new intellectual property through corporate acquisitions, asset acquisitions, licensing and joint venture

arrangements. Our patents and licenses expire on various dates during the period from 2024 to 2043. We do not expect the expiration of

any single patent or license to have a material adverse effect on our business, operating results and financial condition. Developments

or assertions by or against us relating to intellectual property rights could negatively impact our business. We primarily protect our

innovations with patents and vigorously protect and defend our patents, trademarks and know-how against infringement and unauthorized

use. If we are not able to protect our intellectual property and our proprietary rights and technology, we could lose those rights and incur

substantial costs policing and defending those rights. We also generate license revenue from these patents, which we may lose if we do

not adequately protect our intellectual property and proprietary rights. Our means of protecting our intellectual property, proprietary rights

and technology may not be adequate, and our competitors may independently develop technologies that are similar or superior to our

proprietary technologies, duplicate our technologies, or design around the patents we own or license. In addition, the laws of some foreign

countries do not protect our proprietary rights to as great an extent as the laws of the U.S. and we may encounter significant problems in

protecting and defending our intellectual property rights in certain foreign jurisdictions. This could make it difficult for us to stop the

infringement of our patents or misappropriation of our other intellectual property rights. Proceedings to enforce our patent rights in foreign

jurisdictions could result in substantial costs and divert our efforts and attention from other aspects of our business. Accordingly, our

efforts to protect our intellectual property rights in such countries may be inadequate.

We may not be able to protect our proprietary technology and intellectual property rights, which could result in the loss of our

rights or increased costs

Although we believe that our products and technology do not infringe the proprietary rights of others, third parties may assert infringement

claims against us in the future. Additionally, we license proprietary technology, from third parties, that is covered by patents, and we

cannot be certain that any such patents will not be challenged, invalidated, or circumvented. Such licenses may also be non-exclusive,

meaning our competition may also be able to access such technology. Further, we expect to continue to expand our products and services

and expand into new businesses, including through developing new products, acquisitions, joint ventures and joint development

agreements, which could increase our exposure to patent and other intellectual property claims from competitors and other parties. If

claims alleging patent, copyright or trademark infringement are brought against us and are successfully prosecuted against us, they could

result in substantial costs. If a successful claim is made against us and we fail to develop non-infringing technology, our business,

operating results and financial condition could be materially adversely affected. In addition, certain of our products utilize components

that are developed by third parties and licensed to us. If claims alleging patent, copyright or trademark infringement are brought against

such licensors and successfully prosecuted, they could result in substantial costs, and we may not be able to replace the functions

provided by these licensors. Alternate sources for the technology currently licensed to us may not be available in a timely manner, may

not provide the same functions as currently provided or may be more expensive than products currently used. We may develop proprietary

information through our in-house research and development efforts, consulting arrangements or research collaborations with other entities

or organizations. We may seek to protect this proprietary information by entering into confidentiality agreements or consulting, services

or employment agreements that contain non-disclosure and non-use provisions with our employees, consultants, scientific advisors and

other third parties. However, we may fail to enter into the necessary agreements, and even if entered into, these agreements may be

breached or may otherwise fail to prevent disclosure, third-party infringement or misappropriation of our proprietary information.

We may not be able to respond quickly enough to changes in technology and technological risks and to develop our intellectual

property into commercially viable products

Changes in legislative, regulatory, or industry requirements or in competitive technologies may render certain of our products obsolete or

less attractive to our customers. We currently license certain proprietary technology to third parties and, if such technology becomes

obsolete or less attractive, those licensees could terminate our license agreements, which could adversely affect our results of operations.

Our ability to anticipate changes in technology and regulatory standards and to successfully develop and introduce new and enhanced

products on a timely basis will be a significant factor in our ability to remain competitive. We cannot provide assurance that we will be

able to achieve the technological advances that may be necessary for us to remain competitive or that certain of our products will not

become obsolete. We are also subject to the risks generally associated with new product introductions and applications, including lack of

market acceptance, delays in product development and failure of products to operate properly. As part of our business strategy, we may

from time to time seek to acquire businesses or assets that provide us with additional intellectual property. We may experience problems

integrating acquired technologies into our existing technologies and products, and such acquired intellectual property may be subject to

known or contingent liabilities such as infringement claims.

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Some of our products and technologies may use “open source” software, which may restrict how we use or distribute our

products or require that we release the source code of certain products subject to those licenses

Some of our products and technologies may incorporate software licensed under so-called “open source” licenses. In addition to risks

related to license requirements, usage of open source software can lead to greater risks than use of third-party commercial software, as

open source licensors generally do not provide warranties or controls on origin of the software. Additionally, open source licenses typically

require that source code subject to the license be made available to the public and that any modifications or derivative works to open

source software continue to be licensed under open source licenses. These open source licenses typically mandate that proprietary

software, when combined in specific ways with open source software, become subject to the open source license. If we combine our

proprietary software in such ways with open source software, we could be required to release the source code of our proprietary software.

We take steps to ensure that our proprietary software is not combined with, and does not incorporate, open source software in ways that

would require our proprietary software to be subject to an open source license. However, few courts have interpreted open source

licenses; therefore, the way these licenses may be interpreted and enforced is subject to some uncertainty.

RISKS RELATED TO GOVERNMENT REGULATIONS AND TAXES

Our business may be adversely affected by laws or regulations, including environmental, occupational health and safety, and

other governmental regulations

We are subject to various federal, state, local and foreign laws and regulations, including those related to the requirements of

environmental, occupational health and safety, financial, and other matters. We cannot predict the substance or impact of pending or

future legislation or regulations, or the application thereof. The introduction of new laws or regulations or changes in existing laws or

regulations, or the interpretations thereof, could increase the costs of doing business for us or our customers or suppliers or restrict our

actions and adversely affect our business prospects, operating results, cash flows or financial condition. Our operations are subject to

environmental and safety laws and regulations governing, among other things, emissions to air, discharges to waters and the generation,

handling, storage, transportation, treatment and disposal of waste and other materials. The operation of automotive parts manufacturing

facilities entails risks in these areas, and we cannot assure that we will not incur material costs or liabilities as a result. Additionally,

environmental laws, regulations, and permits and the enforcement thereof change frequently and have tended to become increasingly

stringent over time, which may necessitate substantial capital expenditures or operating costs or may require changes of production

processes. Although we have no known pending material environmental issues, there is no assurance that we will not be adversely

impacted by any environmental costs, liabilities, or claims in the future either under present laws and regulations or those that may be

adopted or imposed in the future. Our costs, liabilities, and obligations relating to environmental matters may have a material adverse

effect on our business, operating results, cash flows, or financial condition. Our facilities in the U.S. are subject to regulation by the

Occupational Safety and Health Administration (“OSHA”), which regulates the protection of the health and safety of workers. In addition,

the OSHA hazard communication standard requires that we maintain information about hazardous materials used or produced in our

operations and that we provide this information to employees, state and local governmental authorities and residents. We are also subject

to occupational safety regulations in other countries. Our failure to comply with government occupational safety regulations, including

OSHA requirements, or general industry standards relating to employee health and safety, keep adequate records or monitor occupational

exposure to regulated substances could expose us to liability, enforcement, and fines and penalties, and could have a material adverse

effect on our business, operating results, cash flows, or financial condition. Although we employ safety procedures in the design and

operation of our facilities, there is a risk that an accident or injury to one of our employees could occur in one of our facilities. Any accident

or injury to our employees could result in litigation, manufacturing delays and harm to our reputation, which could negatively affect our

business, operating results, and financial condition.

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Our business may be adversely affected by changes in automotive safety regulations or concerns that drive further regulation

of the automobile safety market

Government vehicle safety regulations are a key driver in our business. Historically, these regulations have imposed ever more stringent

safety regulations for vehicles. Safety regulations have a positive impact on driver awareness and acceptance of automotive safety

products and technology. These more stringent safety regulations often require vehicles to have more safety content per vehicle and

more advanced safety products, which has thus been a driver of growth in our business. However, these regulations are subject to change

based on a number of factors that are not within our control, including new scientific or medical data, adverse publicity regarding the

industry recalls and safety risks of airbags or seatbelts (for instance, to children and small adults), domestic and foreign political

developments or considerations, and litigation relating to our products and our competitors’ products. Changes in government regulations

in response to these and other considerations could have a severe impact on our business. Although we believe that over time safety will

continue to be a regulatory priority, if government priorities shift and we are unable to adapt to changing regulations, our business may

suffer material adverse effects. The regulatory obligation of complying with safety regulations could increase as federal and local

regulators impose more stringent compliance and reporting requirements in response to product recalls and safety issues in our industry.

We are subject to existing stringent requirements under the National Traffic and Motor Vehicle Safety Act of 1966 (the “Vehicle Safety

Act”), including a duty to report, subject to strict timing requirements, safety defects with our products. The Vehicle Safety Act imposes

potentially significant civil penalties for violations including the failure to comply with such reporting actions. We are also subject to the

existing U.S. Transportation Recall Enhancement, Accountability and Documentation (TREAD) Act, which requires equipment

manufacturers, such as Autoliv, to comply with “Early Warning” requirements by reporting certain information to the National Highway

Traffic Safety Administration (“NHTSA”) such as: information related to defects or reports of injury related to our products. TREAD imposes

criminal liability for violating such requirements if a defect subsequently causes death or bodily injury. In addition, the Vehicle Safety Act

authorizes NHTSA to require a manufacturer to recall and repair vehicles that contain safety defects or fail to comply with U.S. federal

motor vehicle safety standards. Sales into foreign countries may be subject to similar regulations. Due to the record recall of airbag

inflators of one of our competitors, NHTSA has become more active in requesting information from suppliers and vehicle manufactures

regarding potential product defects.

Negative or unexpected tax developments could adversely affect our effective tax rate, operating results and financial condition

Changes in, or changes in the application of, U.S. or foreign tax laws, regulations or accounting principles with respect to matters such

as tax base, tax rates, transfer pricing, dividends and restrictions on certain forms of tax relief or limitations on favorable tax treatment

could affect the calculation of our income taxes and other tax liabilities, our effective tax rate, and the

carrying value of our deferred tax

assets. Our annual tax rate is based on our income and the tax laws in the jurisdictions in which we operate. Because of our global

operations we face uncertainties and judgments in the application of complex tax regulations in a multitude of jurisdictions. Significant

judgment and estimation are required in determining our effective tax rate and in evaluating our tax positions, in many cases where the

ultimate tax determination is uncertain. Although we believe that our tax estimates are reasonable, the final determination of our tax

liability may be different from what is reflected in our historical income tax provisions and accruals. We are regularly examined by tax

authorities around the world and in a number of jurisdictions, we are currently under examination, which inherently creates uncertainty.

Although we periodically assess the likelihood of adverse outcomes, negative or unexpected results from one or more of such reviews

and audits, including any related interest or penalties imposed by governmental authorities, could increase our effective tax rate and

adversely impact our operating results, cash flows or financial condition. The effective tax rates used for interim reporting are based on

our projected full-year geographic earnings mix and take into account projected tax costs on intercompany dividends from lower tier

subsidiaries. Changes in currency exchange rates, earnings mix among taxing jurisdictions, or the ability of our subsidiaries to pay

dividends could impact our reported effective tax rates, or cause fluctuations in the tax rate from quarter to quarter. Certain anti-trust

judgments or settlements may not be tax deductible, which could have a material negative impact to our annual tax rate. A number of

other factors may also increase our effective tax rate, which could have an adverse impact on our profitability and operating results. Due

to our numerous foreign operations, our tax rate may be impacted by our global mix of earnings if our pre-tax income is lower than

anticipated in countries with lower statutory tax rates and/or is higher than anticipated in countries with higher statutory tax rates. Based

on U.S. regulatory rules, we do not record current or deferred tax liabilities on permanent investments in our foreign subsidiaries. See

Note 5, Income Taxes, to the Consolidated Financial Statements in this Annual Report.

We may not be able to fully realize our deferred tax assets

We currently carry deferred tax assets, net of valuation allowances, resulting from deductible temporary differences and tax loss carry-

forwards, both of which will reduce taxable income in the future. However, deferred tax assets may only be realized against taxable

income. The amount of our deferred tax assets could be reduced, from time to time, due to adverse changes in our operations or in

estimates of future taxable income from operations during the carry-forward period as a result of a deterioration in market conditions or

other circumstances. Any such reduction would adversely affect our income in the period of the adjustment. Additional information on our

deferred tax assets is included in Note 5, Income Taxes, to the Consolidated Financial Statements in this Annual Report.

Item 1B. Unresolved Staff Comments

Not applicable.

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Item 1C. Cybersecurity

Autoliv maintains a cybersecurity program designed to identify, assess, manage, mitigate, and respond to cybersecurity threats as an

integrated part of the Company’s overall operations. The objective is to provide protection against cybersecurity threats to our employees,

operations, data, and products.

Cybersecurity risk management and strategy

Cybersecurity risk management for the Company is undertaken both through dedicated cybersecurity risk management processes and

within the Company’s overall Enterprise Risk Management program, which is overseen by the Audit and Risk Committee of the Company’s

Board of Directors.

Autoliv has established an Enterprise Risk Management framework aligned to the ISO 31000:2019 to ensure that the context, principles,

and processes for risk management are embedded and integrated with the operations of the company. All risks across the Autoliv risk

universe, including cybersecurity, are assessed with bottom-up risk assessments and subsequently are aggregated and reported to the

Audit and Risk Committee of the Company’s Board of Directors.

Autoliv utilizes the National Institute of Standards and Technology (“NIST”) Cybersecurity Framework in combination with other

corresponding and partially mandated frameworks to guide cybersecurity risk management. This approach includes the identification,

assessment, response, and management of risks arising from cybersecurity threats that may result in material adverse effects on the

confidentiality, integrity, and availability of our business, data and information systems. The Company contracts with third parties to assess

Autoliv’s cybersecurity program relative to its peers, utilizing the NIST framework as a baseline. Furthermore, Autoliv is pursuing, under

TISAX (Trusted Information Security Assessment Exchange), an assessment and exchange mechanism for information security in the

automotive industry, as well as compliance with road vehicle cybersecurity requirements as applicable to the supply chain under ISO

21434.

Frequent testing/auditing activities, bottom-up cybersecurity risk assessments, vulnerability scanning, monitoring of external threat

intelligence and supplier risk sources, and 24/7 incident monitoring are executed by the cybersecurity function to inform our understanding

of the cybersecurity risk landscape, including solutions from third-party service providers, and what areas of enhancement to prioritize.

Further input is gained from regular maturity assessments executed by third parties as well as TISAX assessments executed by external

audit bodies.

Autoliv combines expertise from our internal cybersecurity function with additional specialist capacities from external consultants and

partners as may be from time to time. Separately, because we understand the risks associated with engaging third party vendors, such

as service providers, consultants and partners, in our cybersecurity risk management processes, we conduct security assessments pre-

engagement and monitor their work to mitigate any identified risks.

Autoliv has not experienced any cybersecurity incidents that have materially affected or are reasonably likely to materially affect the

registrant. Despite our efforts, there can be no assurance that our cybersecurity risk management processes and measures described

will be fully implemented, complied with or effective in protecting our systems and information. We face risks from cybersecurity threats

that, if realized, are reasonably likely to materially affect our business strategy, result of operations or financial condition. For a full

discussion of these cybersecurity risks, please see our Risk Factors in Item 1A.

Board and management governance

Management's Role

The Chief Information Security Officer (CISO) is responsible for overseeing the Company’s cybersecurity practices. Our CISO joined

Autoliv in 2015. He has 29 years of information technology experience, including six years as CISO. The CISO reports directly to the CFO

but, in line with the corporate governance model, the CISO’s activities are formally governed through a management board, the

“Digitalization and IT Management Board” (“DITM Board”) comprised of the Chief Information Officer (CIO) and certain members of

Autoliv’s Executive Management Team (“EMT”) representing engineering, supply chain management, operations and manufacturing,

quality and project management, finance, information technology, and divisional teams. The DITM Board meets at least quarterly with

cybersecurity as a standing agenda item.

In addition to the standing DITM Board meetings, the CISO, when needs arise, meets with the full EMT typically at least semi-annually to

report on, or discuss, specific cybersecurity-related topics.

The Cybersecurity function in Autoliv reports to the CISO. The cybersecurity function includes team members in all of the Company’s

divisions including technical security architects and incident response team members. The core team is supported by the broader

organization with security coordinators in each plant and tech center and additional functional security experts as deemed relevant, such

as in supply chain management and engineering. The function has the responsibility to operate day-to-day activities (e.g., testing, incident

monitoring and response, vulnerability scanning and awareness training) as well as to drive prioritized improvements (as identified through

the risk management processes), together with other relevant Autoliv functions and stakeholders.

The security operations center (“SOC”),

part of the Cybersecurity function, monitors Autoliv for cyber incidents 24/7. A documented incident response process and numerous

documented playbooks provide the SOC guidance on how to respond for each type of incident, including categorization and principles

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for escalation. Incidents are escalated in the organization according to defined criteria to engage a level of authority that is deemed

appropriate, such as the Corporate Crisis Management Team if necessary.

Board of Directors Oversight

Our Board, in coordination with the Audit and Risk Committee, oversees the Company’s Enterprise Risk Management process, including

the management of risks arising from cybersecurity threats. Our Board has delegated the primary responsibility to oversee cybersecurity

matters to the Audit and Risk Committee. Both the Board and the Audit and Risk Committee periodically review the measures we have

implemented to identify and mitigate cybersecurity risks.

The Audit and Risk Committee receives information from the CISO and other members of management on at least a quarterly basis which

is supplemented by a more extensive briefing from the CISO and management on at least a semi-annual basis on cybersecurity matters,

including updates on cybersecurity training programs and the results of external assessments, as applicable. The CISO provides at least

an annual briefing to the Board of Directors on these same topics.

The routine reporting to the Audit and Risk Committee and the Board includes as appropriate the highlights from the full spectrum of work

done within the Company’s cybersecurity program. The briefings by the CISO to the Audit and Risk Committee and Board also include

the review of certifications and cybersecurity maturity assessments by management and third parties.

24

Item 2. Properties

Autoliv’s principal executive offices are located at Klarabergsviadukten 70, Section B7, SE-111 64, Stockholm, Sweden. Autoliv’s various

businesses operate in a number of production facilities and offices. Autoliv believes that its properties are adequately maintained and

suitable for their intended use and that the Company’s production facilities have adequate capacity for the Company’s current and

foreseeable needs. All of Autoliv’s production facilities and offices are owned or leased by operating (either subsidiary or joint venture)

companies.

AUTOLIV MANUFACTURING FACILITIES

Country/Company

Location of Facility

Items produced at Facility

Owned/Leased

Brazil

Autoliv do Brasil Ltda.

Taubaté

Seatbelts, airbags, steering

wheels and seatbelt webbing

Owned

Nova Goiana

Seatbelts and steering wheels

Leased

Canada

Autoliv Canada, Inc.

Tilbury

Airbag cushions

Owned

VOA Canada, Inc.

Collingwood

Seatbelt webbing

Owned

China

Autoliv (Baoding) Vehicle Safety Systems Co., Ltd

Baoding

Airbags

Leased

Autoliv (Changchun) Vehicle Safety Systems Co., Ltd.

Changchun

Airbags and seatbelts

Owned

Autoliv (China) Steering Wheel Co., Ltd.

Fengxian/Shanghai

Steering wheels

Owned

Autoliv (Guangzhou) Vehicle Safety Systems Co., Ltd.

Guangzhou

Airbags and seatbelts

Owned

Autoliv (Nanjing) Vehicle Safety Systems Co., Ltd.

Nanjing

Seatbelts

Owned

Autoliv Shenda (Nanjing) Automotive Components Co., Ltd.

Nanjing

Seatbelt webbing

Owned

Autoliv (Shanghai) Vehicle Safety Systems Co., Ltd.

Shanghai

Airbags

Owned

Autoliv Shenda (Tai Cang) Automotive Safety Systems Co.,

Ltd.

Shanghai

Seatbelt webbing

Owned

Autoliv (Jiangsu) Automotive Safety Components Co., Ltd.

Jintan

Propellant, Airbag initiators and

Airbag inflators

Owned

Autoliv (China) Automotive Safety Systems Co., Ltd.

Nantong

Airbag cushions

Owned

Mei-An Autoliv Co., Ltd.

Taipei

Seatbelts and airbags

Leased

Estonia

AS Norma

Tallinn

Seatbelts and belt components

Owned

France

Autoliv France SNC

Gournay-en-Bray

Airbags

Owned

Autoliv Isodelta SAS

Chiré-en-Montreuil

Steering wheels and covers

Owned

Livbag SAS

Pont-de-Buis

Airbag inflators

Owned

N.C.S. Pyrotechnie et Technologies SAS

Survilliers

Airbag initiators and seatbelt

micro gas generators

Owned

Hungary

Autoliv Kft.

Sopronkövesd

Seatbelts

Owned

India

Autoliv India Private Ltd.

Bangalore

Seatbelts, airbags

Owned

Mysore

Seatbelt webbing and Airbag

Cushions

Owned

Badli

Airbags and steering wheels

Leased

Pune

Airbag and Airbag cushions

Leased

Chennai

Airbag inflators

Owned

Indonesia

P.T. Autoliv Indonesia

Jakarta

Seatbelts, airbags and steering

wheels

Owned

Japan

Autoliv Japan Ltd.

Chubu

Airbags and steering wheels

Owned

Hiroshima

Airbags

Owned

Taketoyo

Airbag inflators

Leased

Tsukuba

Airbags, seatbelts and steering

wheels

Owned

25

Malaysia

Autoliv-Hirotako Sdn Bhd

Kuala Lumpur

Seatbelts, airbags and steering

wheels

Owned

Mexico

Autoliv Mexico East S.A. de C.V.

Matamoros

Steering wheels

Owned

Autoliv Mexico S.A. de C.V.

Lerma

Seatbelts

Owned

Autoliv Safety Technology de Mexico S.A. de C.V.

Tijuana

Seatbelts

Leased

Autoliv Steering Wheels Mexico S. de R.L. de C.V.

Querétaro

Airbag cushions

Leased

Autoliv Steering Wheels Mexico S. de R.L. de C.V.

Querétaro

Airbags

Leased

Autoliv Mexico S.A. de C.V.

Aguascalientes

Steering wheels

Owned

Philippines

Autoliv Cebu Safety Manufacturing, Inc.

Cebu

Steering wheels

Owned

Poland

Autoliv Poland Sp. zo.o.

Olawa

Airbag cushions

Owned

Jelcz-Laskowice

Airbags

Owned

Romania

Autoliv Romania S.R.L.

Brasov

Seatbelts, seatbelt webbing,

seatbelt components, airbag

inflators, steering wheels

Owned

Lugoj

Airbag cushions

Owned

Resita

Airbag cushions

Owned

Sfantu Georghe

Steering wheels

Owned

Onesti

Steering wheels

Leased

Rovinari

Seatbelts

Owned

South Africa

Autoliv Southern Africa (Pty) Ltd.

Krügersdorp

Seatbelts and airbags

Owned

South Korea

Autoliv Corporation

Hwasung

Airbags

Owned

Spain

Autoliv BKI S.A.U.

Valencia

Airbags

Owned

Sweden

Autoliv Sverige AB

Vårgårda

Airbag inflators

Owned

Thailand

Autoliv Thailand Ltd.

Chonburi

Seatbelts, Airbags and Steering

wheels

Owned

Chonburi

Seatbelt components

Leased

Tunisia

STE ASW3 Nadour

El Fahs