Siemens VDO to acquire Ballard Power Systems’ Electric Drive Business

Schwalbach, Dec 21, 2006 - Siemens VDO Automotive Corp. has signed an agreement to acquire Ballard Power Systems Inc.’s Electric Drive Business located in Dearborn, Mich. Ballard Power Systems Corp., a subsidiary of Ballard Power Systems Inc., develops and manufactures electric drive technology for fuel cell vehicles. Pending final approvals, the acquisition is projected to be completed in early 2007 and will include Ballard Power Systems Corp.’s research, development and manufacturing operation in Dearborn, impacting approximately 80 highly specialized personnel.

“This acquisition elevates Siemens VDO’s hybrid business to a new dimension, thereby securing a more competitive position for the company and its employees,” said Siemens VDO Group Vice President Dr. Klaus Egger. “By becoming part of Siemens VDO, a recognized world leader in automotive electronics, this acquisition will place us in a better position to capitalize on new business opportunities in the $14 billion (by 2015) global hybrid electric vehicle market.”

The Dearborn location will serve as the organizations’ North American Center of Expertise for the advancement of power electronics, motor design and systems for electrical drives for customer hybrid and fuel cell vehicle applications. “Together with our Alliance partners, DaimlerChrysler AG and Ford Motor Co., we look forward to working with Siemens VDO on next-generation fuel cell vehicle development programs,” said Ballard Power Systems Inc.’s President and CEO John Sheridan. According to Sheridan, Siemens VDO’s considerable electrical engineering expertise is an excellent fit with the Dearborn electric drive business.

“The agreement is representative of Siemens VDO’s strategy of growing our core competencies in areas, such as power electronics,” said Siemens VDO President and Chief Executive Officer – The Americas John Sanderson. “This will allow us to bring sharper focus to our core competency, ensuring we remain on the cutting edge of this business segment.”

Siemens VDO Automotive, a group of Siemens AG, is one of the world’s leading suppliers of electronics and mechatronics for the automotive industry. With its products, it enables individual mobility and the efficient transportation of goods by road in modern societies. As development partner of the automotive industry, the company manufactures automotive electronics and mechatronics for reducing emissions, enhancing safety and driving comfort, and keeping drivers informed and in touch with the outside world. Siemens VDO generated sales of over EUR 10 billion in the 2006 business year (30.9.2006).

Reference number: SV 200612.003 e

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Dr. Maria Lahaye-Geusen

Siemens AG

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