HC Shin Presentation

3M Industrial & Transportation Business

H. C. Shin
Executive Vice President
December 12, 2007

The Leading Provider of
Solutions Vital
Industrial
Customers’ Success
to our

© 3M 2007. All Rights Reserved. 2008 3M Outlook Meeting

Diverse Products/Technology Platforms, 8 Divisions, 3M’s Core
Industrial Adhesives & Tapes Automotive Aftermarket
Taping and Bonding solutions in every industry Solutions that help repair & maintain auto appearance

Abrasive Systems Automotive
Helping auto manufacturers add value and reduce cost
Systems to modify and finish surfaces

2


Diverse Products/Technology Platforms, 8 Divisions, 3M’s Core
CUNO Aerospace & Aircraft Maintenance
Filtration EBO
Filtration solutions for home, commercial and industrial locations OEM, maintenance and repair solutions for aircraft

Personal Care Energy & Advanced Materials
3M materials solutions for disposable personal care industry Bringing 3M technology to solve energy problems and improving
materials & processes

Advanced
Materials

High Performance
Polymers, Ceramics,
Chemicals, Glass

Renewable Energy EBO Oil & Gas EBO
3


Serving Diverse Global Markets

Building Contractors Appliance &
Electronics
Automotive Aftermarket Furnishings

Aerospace Maintenance & Repair
Oil & Gas
Food & Beverage

Automotive OEM Paper & Packaging
Construction
4


Oil and Gas Market Center– Bringing all 3M Solutions
Termination,
Splicing
Products

Fluoroelastomer
For Gaskets, Rings

Glass Bubble
Worker
Low Density Cement
Safety Solutions
CUNO Liquid Filter Bag

3M Epoxy
Coating
Novec Fire
Protection
Fluid
5


3M is the Brand of Choice (2006 Burke End Customers Survey)

Tapes Category Purchase Consideration
100%

74%
80%

60%

40%
29%
Adhesives Category Purchase Consideration
21% 21%
13%
20%

100%
0%
83%
3M Top 3 Comp 1 Comp 2 Comp 3
80%
Competitor
Average
60%

40%
30% 29%
27%
22%
20%

0%
3M Top 3 Comp 1 Comp 2 Comp 3
Competitor
Average

6


Delivering Solid Sales Across a Balanced Global Footprint

Sales 2006 Sales by Geography
($ millions)

$6,640

US
$6,047
37%
+8.2%
$5,621
$5,396
$5,146 APAC
$4,988 LAC
24%
11%
’04-’07Est Year CAGR = 8.4%
Global IPI Growth = 3.6% Europe
28%

2003 2004 2005 2006 9 Months 9 Months
'06 '07

>$ 2 Billion sales increase in 4 years
7


Continuous Improvement in Operating Margin Through
Operational Excellence Discipline
Cost of Goods Sold as % of Sales
Operating Income
57.2%
($ millions)
$1,357 55.7%
$1,210 $1,150 54.9%
$1,037 $1,039 54.5%

$825
2003 2004 2005 2006

’04-’07Est Year CAGR = 13.4%
SG&A as % of Sales
16.0% 18.4% 20.0% 20.4% 20.8% 21.3%
OI% 25.1%

24.1%
2003 2004 2005 2006 9 Months 9 Months
23.7%
'06 '07 23.4%

>$700M increase in OI over 4 years
>500 bps improvement to margin in 4 years 2003 2004 2005 2006

Note: Excludes special items in all periods
8


Our Strategy Execution Playbook…Growth Inspired by Our
Customers, Balanced with Operational Excellence

Growth Operational Excellence
Protect and Adjacent
Grow the Core Build Out

3. Solve Low
1. Factory Cost 2. Control Price
3. New Growth
1. New Technology 2. New Products Turns Inventory
Reduction Leakage
Ventures

5. Localized, Simplified 4. Service & Quality 5. Sourcing 6. Lean Six Sigma
4. M&A 6. Go to Market
Supply Chains Revolution

9

Operational Excellence Playbook Generates >$400M Annually
Strong Productivity Improvement Hopper
$175
($ millions)
3 Year Average Annual Savings $

$103
$80
$67

Lean Six Sigma Sourcing Pricing Actions Headcount
Productivity

Operational Excellence
3. Solve Low
1. Factory Cost 2. Control Price
Turns Inventory
Reduction Leakage

4. Service & Quality
10 5. Sourcing 6. Lean Six Sigma
Revolution


Lean Six Sigma Initiative Yielding $5M in Cost Savings at
Greenville Box Sealing Tape Plant
Film Making Productivity Tape Converting Productivity
2003 2004 2005 2006 2007
2005 2006 2007
Productivity

1

1

1 6 11 16 21 26 31 36 41 46 51
1 4 7 10 13 16 19 22 25 28 31 34
Month
Months

• Changeover Wheel • Runtime/Rate Improvements
$1.2M $3.8M
• Runtime & Yield Improvements • Changeover reductions
savings savings
• Speed Increases • Operator Task balancing
• In-sourced more film without additional labor

11
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SG&A Productivity Continues to Increase
Estimated # of Employees and Sales per Employee
Estimated # of SG&A Employees WW Sales/ SG&A Employee ($ thousands)
’04-’07 Productivity CAGR = 7%
10000 $900
$843
9750 $850
$816
9500
$800
$750
9250
$750
9000 $700
$700
8750
8486 Estimated # of Employees
$629
8500 $650
Sales/Employee
8138
8250 $600
8063
8032
7998
8000
$550
7750
$500
7500
$450
7250

7000 $400
2003 2004 2005 2006 2007

12
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Global Trends Present Opportunities that Drive our Strategy

Manufacturing Geo
Migration

Changing
New Materials
Automotive Industry

Channel in
Energy Crunch
Transformation

Aircraft Boom Water in Danger

13


Emerging Economies will exceed $1.1B in 2007
Representing >15% of Global Sales with Growth >25%
Significant BRICP Sales Growth…
$609
$562
($ millions)
+24%
YOY Change % $491 +20%
BRICP
+28%
$383
• Brazil
+28%
$300
• Russia
• India
• China
• Poland

2003 2004 2005 2006 9 Months 07

- Sales, marketing, technical execution, feet on the street
- Localization of manufacturing and R&D
- Supply Chain simplification
- Global Best Practice sharing
14


Untangling Supporting Global Growth with
while
Supply Chains Localized Manufacturing
Wroclaw, Poland
Xin Qiao, China
South Dakota
Guangzhou, China

Mexico Naju, S. Korea

Brazil
Pune, India

15

Vast International Penetration Opportunity Still Exists
- Auto Aftermarket Division

11M new drivers added each year 27M Vehicles (64% < 4 years old)
8.5M added per year

China

40% involved in 1 collision per year 90% of collisions repaired

Volume Shops 18,000 17,125
Accident Rate 16% 40%
Repair Rate 65% 90%
Total # Vehicle Repaired 17.5 M 10.2 M
Sales Per Repaired Vehicle $26.05 $1.30
16


Emerging Economies will exceed $1.1B in 2007
Representing >15% of Global Sales with Growth >25%
Significant BRICP Sales Growth…
$609
$562
($ millions) +24%
YOY Change % $491 +20%
BRICP
+28%
$383
• Brazil
+28%
$300
• Russia
• India
• China
• Poland

2003 2004 2005 2006 9 Months 07

New Frontier Countries
• Middle East
• Central East Europe
…and More Growth to Come in Emerging Economies
• South East Asia
• Emerging Latin America
17

Growth Portfolio Investment Map…Core as #1 Priority While Developing
Adjacencies to Expand our Footprint
Adhesives &
Tapes
Abrasives
Paint Systems

New Industrial
Platforms

Car Care

Liquid
Filtration

Core
New
Aerospace &
Automotive
Platforms

I&TB
Today Energy

Adjacent
18
< 1 year 1-3 years > 3 years

= New Technology
Adhesives &
Tapes
Abrasives
Paint Systems

New Industrial
Platforms

Car Care

Liquid
Filtration

Core
New
Aerospace &
Automotive
Platforms

I&TB
Today Energy

Adjacent
19

= New Technology
Adhesives &
Tapes
Abrasives = New Products
Paint Systems

New Industrial
Platforms

Car Care

Liquid
Filtration

Core
New
Aerospace &
Automotive
Platforms

I&TB
Today Energy

Adjacent
20

= New Technology
Adhesives &
Tapes
Paint Systems
= New Growth Ventures
New Industrial
Platforms

Car Care

Liquid
Filtration

Core
New
Aerospace &
Automotive
Platforms

I&TB
Today Energy

Adjacent
21

= New Technology
Adhesives &
Tapes
Paint Systems
= New Growth Ventures
New Industrial
= M&A Closed Deals
Platforms

Car Care

x4 x4 Liquid
Filtration

Core
New
x2 Aerospace &
Automotive
Platforms

I&TB
Today Energy

Adjacent
22


Breakthrough New Product – Paint Preparation Systems

• Paint mixing
Customer
• Solvent use inside paint room
Pain
• Cumbersome clean-up
Points
• Productivity issue

Paint Preparation Systems

3M
Solution

1M paint
$1.0B US
$1,000/Gun/Year
x =
guns used
Conversion opportunity Market Opportunity
in the US
23


Breakthrough New Products
Next Generation Tapes and Structural Adhesives Technologies

Gen 4 Acrylic Tape
Low Temperature Bond Tape
•Works with next generation
paints & tough to bond to •Breakthrough tape construction to
surfaces work in adverse weather conditions

VHB Structural Tapes
•Façade panel bonding
•High temperature
•High UV
Composite Bonding Film •High wind shear
•Boeing 787 platform applications
•Various other composite parts bonding
24


Water Filtration New Products—CUNO + 3M Technology
CUNO leveraging 3M technology and markets to provide unique
solutions enabling superior filtration for key industries

Marine & RV
specialty filtration

Nanoshield
A SMART hollow fiber
filter that is compatible
with aggressive fluids

25


Renewable Energy (Solar) Emerging Business Opportunity
Solar Industry 3M Technology Unique & Differentiated
Pain Points Toolbox Solutions

Capturing Mirror Films
Light Clear Adhesives
Sunlight Management
Scotchsheildtm
Barrier Film
+ =
Environmental Fluoropolymer Microreplicated IR Rejection Films
Durability Films
Films

Novel
Metallized Coatings
Barrier Films
Thermal
Fresnel Lens Film
Films
Management

Coatings Structural Tapes

26


2006 – 2007, Ten Complementary Acquisitions
General Industrial Diamond Diamond Production Standard Abrasives
Unifam
4. A&A 4. A&A 4. A&A
4. A&A
3M Industrial & Transportation Business 3M Industrial & Transportation Business
Unifam - Q3 2007 Business Standard&Abrasives - Q4 2007
General Industrial Diamond - Q4 2006
4. A&A 4. A&A 4. A&A
4. A&A
Diamond &Production Inc - Q1 2007
3M Industrial Transportation Business 3M Industrial Transportation Business
3M Industrial & Transportation 3M Industrial & Transportation Business

Abrasives -Acquisition in Poland
Unifam Q3 2007 Standard Abrasives - Q4 2007 2007 Estimates
Superabrasives, Bonded Abrasives 2006
General Industrial Diamond - Q4
Superabrasives, Diamond Production Inc - Q1 2007 Sales: $15.22 MM
Abrasives Acquisition in Poland Superabrasives, Bonded Abrasives
Superabrasives, EBITDA: $ 2.85MM (19%) Sales: $54.9 MM
2007 Estimates
Sales: $15.22 MM
Sales Growth: 2.85MM (19%)
EBITDA: $ 8% EBITDA: $8.9 MM (16%)
Sales: $54.9 MM
Sales Growth: 8% Sales CAGR:$8.9 MM (16%)
EBITDA: 11% (04 =>07)
Sales CAGR: 11% (04 =>07)

Resin Bond
Metal Bond
Diamond Wheels
Resin Bond
Diamond Wheels
Metal Bond
Diamond Wheels
And Tools
Diamond Wheels
And Tools
24 28 33
26
© 3M 2007. All Rights Reserved. © 3M 2007. All Rights Reserved. © 3M 2007. All Rights Reserved.
© 3M 2007. All Rights Reserved.
24 28 33
26
© 3M 2007. All Rights Reserved. © 3M 2007. All Rights Reserved. © 3M 2007. All Rights Reserved.

North Star Chemicals
Rite-Lok PolyMask VentureTape
4. A&A 4. A&A 4. A&A 4. A&A
3M Industrial & Transportation Business 3M Industrial & Transportation Business 3M Industrial & Transportation Business 3M Industrial & Transportation Business

Venture Tape - Q3 2007
Rite3MLok - Q1 2007Business North Star Chemicals - Q4 2006
4. A&A 4. A&A 4. A&A 4. A&A
Industrial & Transportation 3M Industrial & Transportation Business 3M Industrial & Transportation Business 3M Industrial & Transportation Business

Venture Tape - Q3 2007
Rite Lok - Q1 2007 PolyMask Corporation --- Q1,2007
North Star Chemicals - Q4 2006
What does this mean for 3M?

PolyMask Corporation --- Q1,2007
Aerosol Canister Delivery Systems
Gaps Filled
Anaerobic, Structural, Cyanoacrylate Woodworking
Gaps Filled
Adhesives
Anaerobic, Structural, Cyanoacrylate Building and Construction
Woodworking
New UV Adhesives product offering
Adhesives
Manufacturedand Construction
Building Housing/RVs
Sales Synergies
Marine Adhesives Housing/RVs
Manufactured
Industrial distribution
Sales Synergies
HVAC
Marine Adhesives
A 3 Company
OEM and MRO market segments
Industrial distribution
HVAC
A 3 Company
Product Portfolio
Product Portfolio
Structural Adhesives
(Epoxy, methacrylate)
•Bond to virtually all surfaces
Cyanoacrylate Adhesives
•Long-term performance in demanding
•General purpose - metal bonding,
environments
plastics & rubber Adhesives
Cyanoacrylate
•Flexibility
Full line of Protection Tapes for various industrial
Ultra-Violet (UV) Curing
environments
Anaerobic Adhesives
plastics & rubber Adhesives
•Flexibility
•High-performance, single
•Fast controllable cure(UV) Curing
Ultra-Violet at room
and transportation market segments
component engineering
Anaerobic Adhesives temperature which provide
Adhesives
adhesives, that cure in the
instant, & high strength for most
absence of•High-performance, single
air and in the presence •Fast controllable cure at room
glass, metal, & plastic
ofcomponent engineering
metal parts temperature which provide
instant, & high strength for most
29 27 30 32
absence of air and in the presence
of metal parts
© 3M 2007. All Rights Reserved. © 3M 2007. All Rights Reserved. © 3M 2007. All Rights Reserved. © 3M 2007. All Rights Reserved.
29 27 30 32
© 3M 2007. All Rights Reserved. © 3M 2007. All Rights Reserved. © 3M 2007. All Rights Reserved. © 3M 2007. All Rights Reserved.

Accuspray Bondo
4. A&A
4. A&A 3M Industrial & Transportation Business
4. A&A
4. A&A 3M Industrial & Transportation Business
Bondo Corporation - Q3 2007
Accuspray Transportation Business Technology - Q1 2007
Applications
3M Industrial &

Bondo Corporation - Q3 2007
Accuspray Applications Technology - Q1 2007
Proprietary Spray guns for automotive and Industrial applications.
Proprietary Spray guns for automotive and Industrial applications.

27 25
31
25
31



Complementary Acquisitions - Strengthening Tapes & Adhesives
4. A&A 4. A&A
4. A&A 4. A&A
Rite Lok - - Q1 2007
Rite Lok Q1 2007 North Star Chemicals - - Q4 2006
North Star Chemicals Q4 2006
Gaps Filled
Gaps Filled
Adhesives
Building and Construction
Adhesives
Building and Construction
Manufactured Housing/RVs
Sales Synergies Manufactured Housing/RVs
Marine Adhesives
Sales Synergies
Industrial distribution Marine Adhesives
Industrial distribution HVAC
OEM and MRO market segments HVAC

Product Portfolio
Product Portfolio
environments
plastics & rubber •Long-term performance in demanding
environments
•Flexibility
plastics & rubber
Anaerobic Adhesives •Flexibility Adhesives
Anaerobic Adhesives
•High-performance, single Adhesives
•Fast controllable cure at room
component engineering
•High-performance, single temperature which provide room
•Fast controllable cure at
component engineering instant, & high strength for most
temperature which provide
adhesives, that cure in the glass, & high & plastic for most
metal, strength
instant,
of metal parts
29 27
of metal parts
29 27
© 3M 2007. All Rights Reserved. © 3M 2007. All Rights Reserved.

4. A&A 4. A&A
4. A&A 4. A&A
Venture Tape - - Q3 2007
Venture Tape Q3 2007 PolyMask Corporation --- Q1,2007
PolyMask Corporation --- Q1,2007

A 3 Company y
A 3 Compan

32 30
28 32 30



Complementary Acquisitions - Strengthening the Abrasives Portfolio
4. A&A
3M Industrial & Transportation Business 4. A&A
4. A&A
3M Industrial & Transportation Business 4. A&A
Unifam - - Q3 2007
Unifam Q3 2007
General Industrial Diamond - - Q4 2006
General Industrial Diamond Q4 2006
Abrasives Acquisition inin Poland
Abrasives Acquisition Poland Superabrasives, Bonded Abrasives
Superabrasives, , Bonded Abrasives
Superabrasives,
Superabrasives

Resin Bond
Resin Bond Metal Bond
Diamond Wheels Metal Bond
Diamond Wheels Diamond Wheels
Diamond Wheels
And Tools
And Tools
24
26
24 © 3M 2007. All Rights Reserved. 26 © 3M 2007. All Rights Reserved.

4. A&A 4. A&A
4. A&A 4. A&A
Standard Abrasives - - Q4 2007
Standard Abrasives Q4 2007
Diamond Production Inc - - Q1 2007
Diamond Production Inc Q1 2007
2007 Estimates
Sales: $15.22 MM
2007 Estimates
EBITDA: $ $15.22 MM
Sales: 2.85MM (19%)
Sales: $54.9 MM
EBITDA: $ 2.85MM (19%) Sales: $54.9 MM
Sales Growth: 8% EBITDA: $8.9 MM (16%)
Sales Growth: 8% EBITDA: $8.9 MM (16%)
Sales CAGR: 11% (04 =>07)
Sales CAGR: 11% (04 =>07)

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