© Wärtsilä INTERNALCONFIDENTIAL

Growth through continuous innovations

8.5.2018

Hannu Mäntymaa

Director, R&D and Engineering

Wärtsilä Marine Solutions

14 May 2018 Smart Power Solutions centre concept1

© Wärtsilä INTERNALCONFIDENTIAL Corporate presentation 20172

Our business areas

THIS IS WÄRTSILÄ

ENERGY SOLUTIONS

MARINE SOLUTIONS

SERVICES

14 May 2018

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• Strong emphasis on product and solution innovation, particularly in the areas of efficiency improvement, fuel flexibility, total cost of ownership, and the reduction of environmental impact

• Long-term co-operation with research institutes and partners

• R&D investments in 2017 EUR 141 million, representing 2.9%of net sales

• In 2017 Wärtsilä made 42 patents for new inventions

In order to secure our

leading position in

sustainable innovation,

we must continuously look

into new ways of

developing our business.

Wärtsilä’s digital

transformation is important

in this context.

Corporate presentation 20173

Focus on research and development

THIS IS WÄRTSILÄ

14 May 2018

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Production and services globally

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Services network

Production facilities (fully owned)

Production facilities (joint ventures)

14 May 2018

18800 professionals in 70 countries and 200 locations

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A Comprehensive product portfolio

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BALLAST WATER MGMT

PUMPS & VALVES SHIP DESIGN

NAVIGATION

THRUSTERS

SEALS, BEARINGS & STERN TUBES

GAS SYSTEMS

PROPULSORS & GEARS

EXHAUST GAS CLEANINGAUTOMATION

SOLAR

14 May 2018

LIFECYCLE SOLUTIONS

INCL.

WÄRTSILÄ

GENIUS

SERVICES

ENERGY STORAGE

POWER ELECTRIC SYSTEMS

WASTE, OIL & FRESH WATER MGMT

INERT GAS SYSTEMS

ENGINES & GENERATING SETS

© Wärtsilä INTERNAL 14 May 2018 Corporate presentation 20176

THIS IS WÄRTSILÄ

Bold digital transformation intoWärtsilä-as-a-Service

Strong

partnerships

Collaborative

smart

ecosystem

approach

AI, data analytics,

open platforms,

blockchain

New business

models

Creating maximum value

for customers

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Wärtsilä Smart Marine Vision

© Wärtsilä

MEGATRENDS AND LONG-TERM MARKET DRIVERS

Urbanisation, increase

in population

Aging of

population /

growing

middle class

population

Climate

change

Advanced

technology

developments

Geopolitical

factors and

scarce

resources

Economic

power shift

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Overcapacity Fuel efficiencyWaiting time

in terminals

THREE PRINCIPAL SOURCES OF WASTE

© Wärtsilä INTERNAL 14.5.2018 SMART MARINE ECOSYSTEM10

OUR MARINE STRATEGY

Existing businessProducts, solutions, services

New strategy enables answering to new customer needs and builds growth.

Customer needs

+ Digital offering

+ New business

© Wärtsilä INTERNAL

Marine engine award

© Wärtsilä INTERNAL

Wärtsilä Hybrid

The first integrated

hybrid power system

in marine industry

WÄRTSILÄ HY

5/14/2018 Alternative fuels seminar @ TU Delft / P. Wägar

© Wärtsilä INTERNAL 11 April 201813

Wärtsilä HY

Port of LuleåContract signing in November 2017

Vessel built at Gondan Shipbuilders (Spain)

90 tbp harbour tug100 tbp on boost mode

Ice breaking operations

Wärtsilä HY

AVL Large Engine TechDays - Mikael Wideskog - Wärtsilä

Main Engine (ME)

Shaft Generator-Motor (SG-M)

Through PTO/PTI or inline

Including clutches

DC Power Electronics

Variable Speed

Energy Storage

System (ESS)

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AGREEMENT TO OPTIMISE LIFECYCLE EFFICIENCY

A 1% improvement of an

annual billion-dollar fuel bill

represents a massive ten

million dollars in savings.

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COLLABORATION & PARTNERSHIP

Gulfmark Offshore support vessel

in North Sea successfully remote

control operated from San Diego

in August 2017.

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CONTINUOUS DEVELOPMENT & TESTING OF NEW SMART TECHNOLOGIES

World’s first autodocking installation

succesfully tested in Norway in January 2018

Automatic wireless induction charging system

succesfully tested with Hybrid vessel in Norway in

Septembver 2017

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The opportunities

presented by smart

technology will foster a

new era of collaboration

and knowledge-sharing

with suppliers, partners

and customers.

New products, services and solutions

Growth

Value creation

Efficiency

Sustainablesocieties

At Wärtsilä our

purpose is to

enable sustainable

societies through

smart technology

SHAPING THE INDUSTRY FOR AND WITH OUR CUSTOMERS

© Wärtsilä INTERNAL

The purposeEngine Research Initiative (ERI) is a research ecosystem where we together develop sustainable energy solutions based on engines and their applications

4.4.2018 BF v318

Environmentally

sustainable

Energy Efficiency &

Total Cost of

Ownership

Reliable

Fuel & Operational

Flexibility

UNIQUE CO-OPERATION PROGRAM WITH UNIVERSITIES - ENGINE RESEARCH INITIATIVE - ERI

© Wärtsilä INTERNAL 7.11.2017 ERI signing event November 2017 / M Wideskog8

From the left: Åbo Akademi's Rector Mikko Hupa, Aalto University's Vice President Tuija Pulkkinen, Wärtsilä’s

Executive Vice President, Corporate Relations and Legal Affairs Kari Hietanen, Vaasa University's Rector Jari

Kuusisto and Tampere University of Technology's Dean Pauli Kuosmanen

Wärtsilä Corporation, News, 8 November 2017 at 10 a.m. EET

Wärtsilä and Finnish universities to cooperate in unique Engine Research Initiative

The technology group Wärtsilä has signed a Memorandum of Understanding (MoU) with four leading Finnish

universities to collaborate on developing world-class research into sustainable future applications for internal combustion engines.

This type of ecosystem approach represents a unique cooperation between industry and academia, and is

something that has never before been seen in Finland. Together, making use of our own individual competences

and areas of expertise, we shall endeavour to develop sustainable energy solutions based on the use of combustion engines, to the benefit of all concerned.

© Wärtsilä INTERNAL 23.4.2018 VAMK ympäristötekniikan koulutus19

ENERGY CLUSTER & INTENS NETWORK

Integrated hybrid

Control developmentComponent/Vessel

/Plant emulation

Gen.

Engine

Hyb. Drive

Batteries

Grid

Model

Energy management

And Performance

Hardware In-the-Loop / Rapid Prototyping control environment

Control

VEBIC

© Wärtsilä INTERNAL 23.4.2018 VAMK ympäristötekniikan koulutus20

EDGE

Advanced sensing

- Fuel quality, vibration, leakage etc.

Demonstrators

- Data collection, analysis & sending

Advanced sensing

- Fuel quality, vibration, leakage etc.

Data preparation

- Compressing & mapping data

Smart diagnostics

- Adaptive diagnostics

Advanced sensing

- Fuel quality, vibration, leakage etc.

Data preparation

- Compressing & mapping data

Smart diagnostics

- Adaptive diagnostics

Research project participant

Research project participant

Research project participantResearch project participant

Research project participant

© Wärtsilä INTERNAL21

Investment in innovation is the key success factor for long term success

A lot good work is

done and on-going

but it is not enough

to secure long term

competitiveness…

We need more…

SUMMARY

14.5.2018 SMART MARINE ECOSYSTEM

➢ Investments in education

of future competences

(Digital, Energy,

Mechanical, Business,

Marketing…)

➢Co-operation and speed

➢R&D investments

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THANK YOU!

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EDUCATION

R&D INVESTMENTS

CO-OPERATION

SPEED