Introduction To Eaton’s

Aerospace Operations

Craig Arnold
May 4, 2006

© 2005 Eaton Corporation. All rights reserved.

Forward Looking Statements
The information provided at our conference today will include forward-
looking statements relating the breakdown of our product offerings,
revenues from new business awards and our projected growth.
Those statements should be used with caution. They are subject to
various risks and uncertainties, many of which are outside the
Company’s control. Factors that could cause actual results to differ
materially from those in the forward-looking statements are set forth
in our 2005 Form 10K, which was filed with the Commission on
March 10, 2006. We do not assume any obligation to update these
forward-looking statements.

1
Objectives and Agenda
1. Overview the Fluid Power Group Craig Arnold – President
Fluid Power Group
2. Aerospace Industry trends/market drivers
Brad Morton – President
Aerospace
3. Differentiators for the Aerospace business
• A well-balanced portfolio
• With Component Excellence Rick Busch - VP/GM
• That delivers Integrated Systems Aerospace Fluid Power
• On the right platforms with more content

4. Overview on components and systems David Squires – Division

• Hydraulic Systems GM Fuel Systems
• Airframe Fuel Systems
• Air Management and Propulsion
Andy Weeks – VP/GM Fluid
Conveyance

5. Questions

2
Fluid Power Group Overview
…Organizational Chart

Fluid Power Group

Craig Arnold
President

Aerospace
Hydraulics Brad Morton Fluid Connectors Filtration
President

Fluid Power Fluid Conveyance

Rick Busch Andy Weeks
Division GM Division GM

Fuel Power
Sensing And Control
David Squires
Division GM

Actuation Systems

3
Fluid Power Overview
Hydraulics 50%
z On/Off highway and stationary
z #1 steering and motors
z #1 Distribution Network in NA
Aerospace 35%
z Commercial and defense
z #1 fluid conveyance
z #1 hydraulic pumps
Fluid Connectors 12%
z Global A/C and PS connectors
z #1 air-conditioning worldwide
z Global mfg footprint
Filtration 3%
z Industrial filtration systems
z #1 bag filtration
z New growth platform

4
Fluid Power Overview
…Markets

Military Commercial Regional Marine

Agriculture Construction Machine Tools Primary Metals

Performance Automotive Civil Industrial Process

5
Fluid Power Overview
…System Solutions and Component Leadership

• Filters
• Sensors

• Pumps

• Hoses
• Tubes

Systems

• Valves
• Cylinders • Steering
• Motors

Supporting many different end markets

6
 Fluid Power Overview
…Strategic Imperatives

Globalization
Globalization

Customer//Channel
Customer Channel SystemSolutions/
System Solutions/
Leverage
Leverage Componentleadership
Component leadership

TechnologyOptimization
Technology Optimization Product Expansion

CostLeadership
Cost Leadership

7
Fluid Power Overview
….Key Messages From The Aerospace Team

Aerospace Is A Growing Long Cycle Industry

Eaton Aerospace’s business is…….

z A well-balanced portfolio
„ Market and product balance minimizes cyclical impacts
z A provider of components excellence
„ Components drives core value and aftermarket growth
z A capable and valued systems integration
„ Optimizing systems with critical components
z A leader on the right platforms
„ With more content than ever

8
 Aerospace Markets, Industry Trends
And Portfolio Balance

Brad Morton
Vice President and President Aerospace Operations

© 2005 Eaton Corporation. All rights reserved.

 Eaton Aerospace
…Where Do We Play Today
Market Segments Global Mix Asia
Military Rest Of World
Commercial 1% 5%
OEM OEM
24% 36% Europe
25%

Military
Aftermarket North
18% Commercial America
Aftermarket 69%
22%
2006 Revenue
Platform Segments
$1.3 B
Ground System Segments
Other Air
Defense Other 4%
6% Large Management
Rotorcraft 4% Hydraulics
12% Transport 13% 36%
38% Fuel
11%
Military
Fighter
15%
Propulsion
Military Regional 9%
Actuation & Electrical
Transport General Business Transport
Aviation Controls Power
6% Jet 7% 8%
4% 14% 12%

Source: Eaton Aerospace 10

 Aerospace – Industry Trends
…Commercial Aircraft Markets
Large Commercial Aircraft Deliveries
700 ƒƒ Aircraft deliveries show long
600
500
term growth with 10 yr.cycle
400 ƒƒ Steady airline passenger
Units

300
200 growth at 5% CAGR
100
0 ƒƒ Key Shifts Underway
1970
1972
1974
1976
1978
1980
1982
1984
1986
1988
1990
1992
1994
1996
1998
2000
2002
2004
ƒƒ Continuing
Continuing Strong
Strong Demand
Demand
Revenue Seat Miles (RPM)* in
in Asia-Pacific
RPM -Billions of Seat Miles

Asia-Pacific
800
ƒƒ Restructuring
Restructuring ofof the
the Airlines
Airlines
600
ƒƒ Fuel
Fuel Price
Price Increases
Increases Driving
Driving
400
Record
Record OEM
OEM Order
Order Rates
Rates
200
ƒƒ Deters
Deters Use
Use Of
Of Older
Older A/C
A/C
0
70
72
74
76
78
80
82
84
86
88
90
92
94
96
98
00
02
04
19
19
19
19
19
19
19
19
19
19
19
19
19
19
19
20
20
20

* North American Operators’ System (Domestic and International)

Steady Demand Growth

Source: Eaton Analysis, ATA 11
Aerospace – Industry Trends
…Commercial Aftermarket Products and Services

ƒƒ Fleet Continues to Grow

Worldwide Passenger Fleet
ƒƒ New
New Builds
Builds Outpace
Outpace
20000 Age 20 Retirements
Active Retirements

A v erage A ge
15000 15 ƒƒ Fleet Refresh With Newer
A irc raft

10000 10
Parked
More Efficient Aircraft
5000 5
0 0
ƒƒ Profitability Pressures Drive
1999 2000 2001 2002 2003 2004 2005 2006 Load Factors to Record Levels
ƒƒ Airlines Outsourcing Total
Aircraft Maintenance
Capacity, Demand and Utilization
80
Capacity - ASM 80%
78%
Fleet Expansion Will
Miles (Billions)

70 76%
Efficiency - LF 74% Load Factor
60
72% Accelerate As Efficiency
50 70%
40 68% Ceiling Is Approached
Demand - RPM 12 Month Rolling Average 66%
30 64%
99

00

01

02

03

04

05

06
19

20

20

20

20

20

20

20

Source: ATA, ACAS, Eaton Analysis 12

Aerospace – Industry Trends
…Military Aircraft Markets
50,000
Military Total Market
45,000
40,000
Rotorcraft ƒƒ Fewer New Platforms Introduced
35,000 A400M
But At A Higher Per A/C Cost
Market $M

30,000
Mil. Transports
25,000
F-22
ƒƒ Fighter Fleet - F-35 and
20,000
Eurofighter
15,000
F-35 Eurofighter Replacing Aging
10,000 Military Fighters
5,000 Fighters
0
ƒƒ Transport Fleet - A400M & C17
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Add Capacity and Flexibility
UAV Total Market ƒƒ Growth of UAV & Rotorcraft
3,000
2,750 Markets
2,500 LIGHT UAVs
2,250
2,000
Market $M

1,750 Significant Opportunity

1,500
1,250 Within Sub-Segments
1,000
HEAVY UAVs
750
500
250
0
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Source: Forecast International; Teal,DoD Budget, Eaton Analysis.
13
 Aerospace – Industry Trends
…Military Aftermarket Products and Services

$1,200 US, Asia & Europe Defense Budgets

ƒƒ Aging
Aging Fleet
Fleet Requires
Requires an
an Increasing
Increasing
$1,100 Rate = 2.4%
Average Growth
$1,000 Percentage
Percentage of of Defense
Defense Budget
Budget for
for
$900 Maintenance
Maintenance
Fiscal Year Budget ($B)

$800
ƒƒ Increased
Increased Mission
Mission Tempo
Tempo Drives
Drives
$700
$600 Required
Required MRO
MRO Services
Services
$500 ƒƒ Upgrade
Upgrade Campaigns
Campaigns Underway
Underway
$400
$300 ƒƒ Increased
Increased Emphasis
Emphasis on on Performance
Performance
US Europe Asia
$200 Based
Based Logistics
Logistics for
for Spares/Fleet
Spares/Fleet
$100 Availability/Mission
Availability/Mission Readiness
Readiness
$0
08
04

05

06

07

09

10

11

12

13
20
20

20

20

20

20

20

20

20

20

Aging Fleet with Modifications,

Upgrade and Maintenance
Opportunities

Source: Teal,DoD Budget, Eaton Analysis.

14
A Balanced Portfolio
…The OEM Supply Chain
Aircraft Manufacturer

Tier One
System
Suppliers

Tier Two
Sub-System
Suppliers

Distributors

Eaton Delivers
Proprietary Component
Suppliers
Systems, Sub-Systems
and Components

Build To Print Supply Base

15
A Balanced Portfolio
…The OEM Supply Chain
Aircraft Manufacturer

Tier One
System
Suppliers
Tier One

Tier Two
Sub-System
Suppliers
Tier Two

Distributors Aircraft
Distributors Manufacturers
Tier 2 9%
59%
Proprietary 12%

Component
Suppliers
Proprietary Components Tier 1
20%

Build To Print Supply Base

16
A Balanced Portfolio
…The Aftermarket Supply Chain
Airlines, Owner Operator

Total Aircraft
Maintenance
Companies (MRO)

Component
Repair Facilities

Eaton Delivers
Distributors Component Repairs
& Spare Parts To Airlines,
Maintenance Companies
Proprietary Component
Suppliers And Distributors

Build To Print Supply Base

17
A Balanced Portfolio
…The Aftermarket Supply Chain
Airline, Owner Operators

Total Aircraft
Maintenance
Companies (MRO)

Tier Two
Sub-System
MRO Distribution Airlines MRO
Suppliers
Repairs/Overhauls

Distributors

Airlines Distribution
Proprietary
Component
SpareSuppliers
Components

Build To Print Supply Base

18
 Balance Across the Markets
…Counter-Cyclical Business Trends Smooth Cycle
Fixed Wing Deliveries
700
600
ƒƒ Aerospace
Aerospace Industry
Industry On
On A
A 10
10
Commercial
500 Year
Year Cycle
Cycle
Units

400
300 ƒƒ Commercial
Commercial and and Military
Military
200
100
Military Deliveries
Deliveries Are
Are Generally
Generally
0 Counter-Cyclical
Counter-Cyclical
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005
Commercial Aftermarket
ƒƒ Aftermarket
Aftermarket Trends
Trends AreAre Less
Less
RPM - Billions of Seat Miles

800
700 Variable
Variable
600
500 ƒƒ Commercial
Commercial Aftermarket
Aftermarket
400
300 Driven
Driven byby Utilization
Utilization
200
100
ƒƒ Military
Military Aftermarket
Aftermarket aa Function
Function
0 of
of Operations
Operations & & Maintenance
Maintenance
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

Miltary Aftermarket
Budget
Budget
250
2005 USD (Billions)

200
Operations and Maintenance Budget
150 Balance in Our Market Segments
100
Softens Cyclical Impact
50

0
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

Source: Eaton Analysis 19

 Balance Across The Markets
…Aerospace New Platform Development Cycle
Program Sub System First A/C
Launch Award Flight Certification

Aircraft Concept Aircraft Design Freeze Detailed Design Product Build & Aircraft Flight Production
& Technology and Suppliers & Development Qualification Testing Ramp up
Assessment Selection
Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 & 7

Proposal Development &

System Architecture
Trade Studies &
Component Design Detailed Design,
Product
Build & Test Qualification Reports &
Flight Test Support
OEM Production Sales
Initial Airline Provisioning

Limited Platforms And Long

Development Cycle
20
 Balance Across The Markets
…Facilitates Investment Through The Cycle
Market Segments
Military Commercial
OEM OEM
24% 36%

Military Customer Need

Aftermarket
18% Commercial z 7 Year Aircraft Development Process Requires
Aftermarket Investments Through The Cycle
22%

Balance Facilitates A Long Term Mindset

Platform Segments z Military Counter Cyclical To Commercial
Ground
Other z Aftermarket Counter Cyclical To OEM
Defense
6% Large
Rotocraft 4%
12% Transport z Balance Across Segments Softens The Cycle
38%
Military
Fighter
15%
Military Regional
Transport General Business Transport
6% Aviation Jet 7% 8%
4%

Generating Solid Financials Through The Cycle

Source: Eaton Aerospace 21
 Balance Across The Aircraft Power Systems
…Expanded Customer Value And Access
System Segments
Controls Hydraulics
Customer Needs
78% 5% z OEM’s Shifting Focus To Assembly and Test
Electrical
Power 17% 1998 „ Reduction Of Supply Base
z Full Service Suppliers Within Subsystems
z Design Team Membership, Flexible and
Responsive Through Development

Air Other
Hydraulics
Balance Provides Access
Mgmt. 13% 4%
Fuel, 11%
36% z Full Portfolio of Products and Design Services
2006 z Engaged in Architecture and Specification
Development
Propulsion Actuation &
Electrical z Building a Power Systems Specialist Reputation
Power
9% Controls 12%
14%

Portfolio Broadens Customer Access

During Critical Development Stages
Of The Program
22
A Balanced Portfolio
…..Broadening the Business While Enhancing Value

z Customer balance provides multiple access points to

secure major program content
z Market Segment balance facilitates new program
investments through the cycle
z Product Portfolio across broad Aircraft Power Systems
provides customer access during critical stages of the
development cycle

A Significant Force For Aerospace

On-Board Power Systems

23
 Components Excellence
The Foundation Of Profitable Growth

Andy Weeks
Vice President and General Manager
Aerospace Fluid Conveyance Division

© 2005 Eaton Corporation. All rights reserved.

 The Aerospace Value Proposition
…Component Excellence At The Foundation
Aircraft Accept
Responsibility Design & Validated
Development Flight Trials System
Activities Integrated with
Airplane
Airframe Systems
System Reqmts. Spec
Aircraft
Architecture
&
System
Integrate &
Integration
Engineering
Functional Test System
Activities
Partition
Airframe/
Subsystem Sub-System Reqmts. Spec

Integrate & System

Sub-System Test Sub
System
Modelling
Engineering Systems Integration
Activities

Component Reqmts.
Subsystem Spec

Performance Design
Stress, FEA, CFD Components
Test Component
Components
Detail Drawings & Plans Excellence
Component Manufacture
Components

7 Year Platform Development Period

25
Component Excellence
…Serving Our Customer Through Technical Innovation
5000 PSI Hydraulic Power
Customer
Customer Needs
Needs Results
Results

ƒƒ Reduced
Reduced System
System Weight
Weight ƒƒ 2000
2000 lbs.
lbs. Reduction
Reduction on
on A380
A380
ƒƒ Higher
Higher Power
Power Density
Density ƒƒ Power
Power Density
Density Increased
Increased 25%
25%
ƒƒ Increased
Increased Maintainability
Maintainability and
and ƒƒ Reliability
Reliability Increased
Increased by
by 3X
3X
Reliability
Reliability ƒƒ Optimized
Optimized Conveyance
Conveyance Layout
Layout
ƒƒ The
The only
only 5000
5000 psi
psi certified
certified hose
hose

Setting a New Standard for Hydraulic Systems

26
Component Excellence
…Serving Our Customers Through Technical Innovation
Integrated Cockpit Panels
Customer
Customer Needs
Needs Results
Results

ƒƒ Installation
Installation Complexity
Complexity Reduction
Reduction ƒƒ Increases
Increases Installation
Installation Quality
Quality

ƒƒ Reduction
Reduction in
in Multiple
Multiple Panel
Panel ƒƒ Reduces
Reduces Installation
Installation Time
Time (30%)
(30%)
Installation
Installation Time
Time ƒƒ Reduces
Reduces Total
Total Unit
Unit Cost
Cost
ƒƒ Acquisition
Acquisition Cost
Cost Reduction
Reduction

27
Component Excellence
…Serving Our Customers Through Technical Innovation
Ultra-Mate Couplings
Customer
Customer Needs
Needs Results
Results
ƒƒ Ease
Ease in
in Coupling
Coupling Mating
Mating ƒƒ No
No Tools
Tools Required
Required for
for Coupling
Coupling
ƒƒ Avoid
Avoid Intermediate
Intermediate Connections
Connections ƒƒ Intermediate
Intermediate Connections
Connections
ƒƒ Mechanism
Mechanism for
for Determining
Determining Avoided
Avoided Completely
Completely
Engagement
Engagement In
In Blind
Blind Environment
Environment ƒƒ Mechanism
Mechanism Added
Added For
For “Feel”
“Feel”
Connection
Connection Confirmation
Confirmation

•Connect Simplicity
•Positive And Secure Connection
•Facilitates “Blind” Installation
28
Component Excellence
…Serving Our Customers Through Technical Innovation
Fly-By-Wire Flap
Customer
Customer Needs
Needs Results
Results
ƒƒ Complex
Complex High
High Performance
Performance Wing
Wing ƒƒ Facilitates
Facilitates Complex
Complex Wing
Wing Through
Through
Shape
Shape Will
Will Not
Not Accommodate
Accommodate Small
Small Package
Package Size
Size
Traditional
Traditional Mechanical
Mechanical Design
Design ƒƒ Saves
Saves Weight
Weight by by 20%
20% -- 30%
30%
ƒƒ Weight
Weight Reduction
Reduction ƒƒ Increases
Increases Reliability
Reliability Through
Through
ƒƒ Increased
Increased Reliability
Reliability Reduced
Reduced Part
Part Count
Count and
and Increased
Increased
ƒƒ Lower
Lower Life-Cycle
Life-Cycle Cost
Cost Health
Health Monitoring
Monitoring
ƒƒ Reduced
Reduced Maintenance
Maintenance ƒƒ Decreases
Decreases Life-Cycle
Life-Cycle Cost
Cost Through
Through
Reliability
Reliability Increase
Increase
ƒƒ Reduces
Reduces Maintenance
Maintenance –– Plug
Plug and
and Play
Play

Providing Weight Savings and Simplicity

29
 Component Excellence
…Targeting Airline Problems With Component Solutions
Size of the Fleet
Platform Lifecycle

ro

35
Av

7-
0
1

D8

73
BA 8
7

D1

E
7
Decreasing Fleet to Field Exit

32

00
0
Increasing Fleet to Maximum Fielded

76

75

D9
M

F1
FD

M
A300
747 -400
A310
717
747 1-300
A320/21

A318/19
Upgrade Target Zone 737-1-200

737 NG
Years 10-20
A 20 year old design
A340 727
DC8
A330
777 DC9
CRJ 700/900 DC10
EMB RJ 170/190
707
787
A380 L1011

Entry Into Years in Service 30 – 40 Years

Service
Leveraging Our Component
Excellence for the Aftermarket
Source: Aerostrategy, Acas 30
 Component Excellence
…Targeting Eaton Legacy With Component Upgrades
MD-80/DC-9 Product Upgrade

Situation
z Active Fleet of 1,482 MD 80, MD 90
and DC 9 Aircraft
z Mid 70’s Pump Design (5K Hrs. Life)
z High Removal Rate
Solution
z Upgrade Pump With Latest
Technologies
Results
z Improved Reliability by a Factor of
Four Offering over 20,000 Hrs Life
z Market Opportunity $30M
1975 Vintage Eaton Pump 2005 Vintage Eaton Pump

Renewing Revenue And

Profit Stream Mid Life

Source: Aerostrategy, Acas 31

 Component Excellence
…Airlines Driven By Component Life Cycle Costs
Legacy Of High Product Reliability
„ 5 Year Airline Win Rate Of 75% Airline Fleet Retrofit
„ Strong Brands Known for High Reliability Situation
z Competitor Equipped 386 Aircraft Fleet
z High Removals and Operational Costs
Airline Reliability Comparison
Solution
B777 EDP z Retrofit Fleet With Eaton
z 1500 pumps for 737, 757, 767 And 777
B757/767 ACMP z Long Term Service Contracts
Results
B757/767 EDP z Product Placement on Future Aircraft
z Contract Value $20M+ Over 15 Year
B737-NG EDP z Win-Win For Airline and Eaton
Competitor
B737-CL EDP Eaton
Life Cycle Cost
B737 ACMP Advantage Winning At
0 20,000 40,000 60,000 80,000 100,000 120,000 140,000 160,000
The Airlines
Mean Time Between Failures (hrs)
32
 Component Excellence
…Aging Military Hardware Deployed Worldwide
US Fleet Aging Rapidly
1990 2005

Ground Combat ~ 6 yrs ~14 yrs

Vehicles

Marine Combat ~ 5 yrs ~ 15 yrs

Average Age

Vehicles

AF Fighters ~ 10 yrs ~ 18 yrs

Navy Aircraft ~ 11 yrs ~ 14 yrs

Significant Allied Forces Fleet
AF Bombers ~ 21 yrs ~ 30 yrs

AF Tankers ~ 27 yrs ~ 42 yrs Europe Platform Asia

Combat Ships ~ 16 yrs ~ 16 yrs 83 UH-60 285
Marine Helos ~ 17 yrs ~ 24 yrs 129 CH-47 130
Source: Forecast Int’l. 18150 M-113 6209
198 F-18C/D 79
0 F-15 213
326 UH-1H 250
- IDF 129

$100+ M Opportunity For Component Upgrades

33
Component Excellence
…Global Support And Opportunity Mining

Field Support

Field Support
Titchfield
Lufthansa Technik
Bedhampton
Grand Rapids Warwick
SR Technics
Field Support Field Support
Beltsville TOKIMEC
Coignieres
Air France
Industries
Los Angeles
Toccoa GAMECO

Jackson
GAMECO HAECO
Field Support
Field Support Field Support
Emirates
JorAMCo

Batam

SIA Engineering Qantas

Eaton Repair

Field Support

MRO Partner

34
Components Excellence
…..A Foundation For Profitable Growth
z Serving our customers through technical innovations
z Enhancing Airline profitability with component upgrades
„ Large Eaton legacy base for “easy” upgrades
„ Using Reliability advantage to capture share
z Military component upgrades to refresh technology on
aging platforms
z Global support team mining for opportunities

Component Excellence Assures

Sustainability Of Margins As We
Expand Scope and Systems Capability

35
 A Valued Integrator
Optimizing Systems With Critical Components

Rick Busch
Vice President and General Manager
Aerospace Fluid Power Division

© 2005 Eaton Corporation. All rights reserved.

 The Aerospace Value Proposition
…Component Excellence At The Foundation
Aircraft Accept
Responsibility Design & Validated
Development Flight Trials System
Activities Integrated with
Airplane
Airframe Systems
System Reqmts. Spec
Aircraft
Architecture
&
System
Integrate &
Integration
Engineering
Functional Test System
Activities
Partition
Airframe/
Subsystem Sub-System Reqmts. Spec

Integrate & System

Sub-System Test Sub
System
Modelling
Engineering Systems Integration
Activities

Component Reqmts.
Subsystem Spec

Performance Design
Stress, FEA, CFD Components
Test Component
Components
Detail Drawings & Plans Excellence
Component Manufacture
Components

7 Year Platform Development Period

37
 A Valued Integrator
…Major Systems: Hydraulics
Power
Power Generation
Generation Fluid
Fluid Conveyance
Conveyance
Other
Engine Hoses,
Hoses, Tube
Tube Fitting
Fitting
Engine Driven
Driven Pump,
Pump, Electrical
zz
Air
zz Electrical
Pump, Systems,
Systems, Coupling,
Coupling,
Mgmt. Pump, Power Transfer Unit,
Power Transfer Unit,
Hydraulic
Hydraulic Driven
Driven Generator,
Generator, Swivels,
Swivels, Clamps
Clamps
Hydraulics
Hydraulic
Hydraulic Power
Power Package
Package
Fuel

Propulsion
Actuation &
EPS
Controls

System Discriminators
z 5000 PSI Technology
z 5000 psi Certified Distribution
Distribution
Commercial Hose zz Manifolds,
Manifolds, Protection
Protection Valves,
Valves,
z Largest Portfolio of Control
Control Valves,
Valves, Filter
Filter Module,
Module,
Hydraulic Generation Pressure
Pressure Sensing,
Sensing, Reservoir,
Reservoir,
and Distribution Accumulators
Accumulators
z Hydraulic System
Architecture Expertise

System Enterprise Built on Component Excellence

38
 A Valued Integrator
…Major Systems: Electrical Power System
Electrical
Electrical Generation
Generation
Other zz DC Generator
DC Generator
Air
Mgmt.
zz Hydraulic
Hydraulic Driven
Driven Generator
Generator
zz Generator
Generator Control
Control Unit
Unit
Hydraulics
Fuel

Propulsion
Actuation &
Controls

EPS

Electrical
Electrical Distribution
Distribution
zz Contactors
Contactors
System Discriminators zz Circuit
Circuit Breakers
Breakers
z Leading Supplier for zz Power Relays
Power Relays
Emergency Power zz Electrical
Electrical Distribution
Distribution Panels
Panels
Generation
z Integrated Overhead Electrical
Electrical Control
Control
Control Panel Power Cockpit
zz Cockpit Switches
Switches
z Integrated Power zz Overhead
Overhead Cockpit
Cockpit Panels
Panels
Distribution Panel

System Enterprise Built on Component Excellence 39

 A Valued Integrator
…Major Systems: Actuation & Controls
Utility
Utility Actuation
Actuation
Other
Air zz Cargo
Cargo Door,
Door, Passenger
Passenger Door,
Door,
Mgmt. Weapons Bay Door
Weapons Bay Door
Hydraulics Flight
Flight Controls
Controls
Fuel zz Stabilizer
Stabilizer Trim,
Trim, Flap/Slat
Flap/Slat Systems,
Systems,
Spoilers,
Spoilers, Speed
Speed Brake,
Brake, Hydraulic
Hydraulic
Motors
Motors
Propulsion

EPS
Actuation &
Controls

System Discriminators
z Highest Power DC
Landing
Landing Gear
Gear Systems
Systems
Brushless Actuator
zz Nose
Nose Wheel
Wheel Steering,
Steering, Braking,
Braking,
z Precision Nose Gear Pilot
Pilot Controls
Controls
Parking Brake
Parking Brake
Steering Systems zz Landing
Landing Gear
Gear Lever
Lever
zz Throttle
Throttle
z Developing Integrated Flap
zz Flap Lever
Lever
Fly By Wire Flap
System

System Enterprise Built on Component Excellence

40
 A Valued Integrator
…Major Systems: Propulsion
Other External
External Systems
Systems Engine
Air Engine Build
Build Up
Up
Mgmt. zz Debris
Debris Monitoring
Monitoring zz High
High Pressure Ducting
Pressure Ducting
zz Lube
Lube Systems
Systems zz Tubing
Tubing
Hydraulics
zz Engine
Engine Fluid
Fluid Accessories
Accessories zz Bellows
Bellows
Fuel
zz High
High Pressure Fuel
Pressure Fuel Pumps
Pumps

Propulsion Actuation & EPS

Controls
Engine
Engine Components
Components
zz Dynamic
Dynamic Seals
Seals
zz Static
Static Seals
Seals

System Discriminators
z Market Leader For Metallic Dynamic
Seals
z Fluid Debris Sensing and Chip
Separation
z Integrated Lubrication Systems
z Fluid Conveyance EBU Integration

System Enterprise Built on Component Excellence

41
 A Valued Integrator
…Major Systems: Fuel
Other
Air Airframe
Airframe Fuel
Fuel Systems
Systems
Mgmt. zz Transfer Pump
Transfer Pump
zz Boost
Boost Pump
Pump
Hydraulics Fuel
Fuel Inerting
Inerting System
System zz Jettison
Jettison pump
pump
Fuel zz Venting
Venting zz Fuel
Fuel manifolds
manifolds
zz Valves
Valves
Propulsion zz Level
Level sensing
sensing
Actuation & EPS
Controls

System Discriminators
z Broadest Fuel Pump
Portfolio
z Complete Fuel Fuel
Fuel Conveyance
Conveyance
Conveyance Solutions zz Tube
Tube Fitting
Fitting
z Component Leader For zz Couplings
Couplings
Engine
Engine Fuel
Fuel Pumps
Pumps zz Flanges
Flanges
Inerting Vents
zz Ducts
Ducts

System Enterprise Built on Component Excellence

42
 A Valued Integrator
…Major Systems: Air Management
Air Other
Mgmt.

Hydraulics
Fuel

Propulsion

Actuation & EPS

Controls

System Discriminators Air

Air Conveyance
Conveyance
z Full Range of Air zz ECS
ECS tubes
tubes and
and ducts
ducts
zz High
High Pressure
Pressure Ducts
Ducts
Ducting Sealing and
zz High
High Temperature
Temperature
Clamping Products zz Composite
Composite // Plastic
Plastic Ducting
Ducting
z Unique Position To zz Non
Non Return
Return Valve
Valve
Integrate Air Distribution zz Couplings
Couplings and
and Connectors
Connectors
System Across Aircraft zz Flanges
Flanges and
and Seals
Seals
zz Bellows
Bellows

System Enterprise Built on Component Excellence

43
A Valued Integrator
…..The JSF / F35 Hydraulic Systems Story
z Multi-role, multi-service, multi-national
z Lethal and Affordable Service
F-35A F-35B F-35C

Conventional Takeoff & Short Takeoff/Vertical Landing Carrier Variant

Landing (CTOL -- USAF) (STOVL -- USMC and UK) (CV -- USN)

44
JSF / F-35 - High Production Rates, FMS Potential

450

400

350

300
Number of Aircraft

250 F -15 F -16

200
A-6
150
A-10

100
JSF
A-7 F/A-18
F/A- F -22
50

F -14 AV-8B
AV- F/A-18E/F
F/A-

1975 1980 1985 1990 1995 2000 2005 2010 2015 2020 2025

45
A New Level Of Customer Intimacy
z Eaton Responsibilities
„ Design and Development Of Components
Ê Hydraulic Pressure Generation
Ê Valves and Controls
Ê Pressure Storage
Ê Utility Actuation
Ê Complete Fluid Distribution Through Center Fuselage and Wing
Ê Vertical Takeoff Lift Fan Lubrication System
Ê Nose Gear Steering System
Ê Engine Lubrication System
„ Systems Responsibilities
Ê Configuration Control Of Hydraulic and Fluid Distribution
Ê Weight And Reliability Management
Ê Participation On Lockheed Integrated Design Team

46
 The Eaton Responsibility
…Hydraulic Power And Fluid Distribution Systems

Conventional Take-Off
& Landing Aircraft

47
 The Eaton Responsibility
…Hydraulic Power And Fluid Distribution Systems

Conventional Take-Off
& Landing Aircraft

48
 The Eaton Responsibility
…Hydraulic Power And Fluid Distribution Systems

Conventional Take-Off
& Landing Aircraft

49
The Eaton Responsibility
…Hydraulic Power And Fluid Distribution Systems
Ground
Maintenance
Pumps Eaton Content
Approximately $ 350M
Annual Revenue At Full Production

Reservoirs

Filter Modules

Engine Driven Accumulators

Pumps

50
 Value Proposition
…….. Systems Optimization

z Customer Need….Optimized System

„ Minimum Weight For Aircraft Performance
„ Optimized Space Utilization
„ Designed For High Volume Assembly
„ Designed For Reliability and Service
„ Maximize Commonality
„ Minimize Total System Cost
Basic Wing Optimized Wing
z Every Change Addresses Customer Need Distribution System Distribution System
„ System Approach Provides Customer
Justified And Sponsored Trade Studies
„ Scope Managed And Value Of Each Option
Linked To Performance and Weight,
Validated By The Customer

Optimized Fluid
Delivery System
51
Value Proposition
…….. Systems Optimization
Wing FDS Program Evolution
Wing FDS Program Evolution
50 2000
50 2000

40 1600
40 1600

Value of Contract
Value of Contract

Part Count
30 1200

Part Count
30 1200

20 800
20 800

10 400
10 400
Program Value ($M)
Program
Bill Value
of Material ($M)
(Count)
0 Bill of Material (Count) 0

August '02 Initial

2009
0 0

Renegotiation

June '05 New

AugustComplete

November '04

RFQ

2009
'02 Initial

Renegotiation
Contract

'05 New
Layout Complete

'04
August '03

SDD RFQ
August Award

Contract
'03

November

JuneSDD
Award

Layout
z When Weight Threatened The Program… Eaton Was There…
„Structural Changes Drove Significant Scope Change
„Eaton Solutions Focused On Systems Weight Optimization
„Eaton Captured Share From Competition

52
Value Proposition
……..Success Of The Customer Network
z Weight To Thrust Ratio….A Critical Aspect For All Armed Services
„ Eaton directly responsible for a 84 lb. aircraft weight reduction
„ Played a key role for an addition reduction of 800 + lbs.
z Ease Of Maintenance…..Key To Life Cycle Cost Estimates
„ Product support personnel engaged in equipment layout and access
z Actively Engaging Congressional Representatives For Support
z International Partnerships Key To Foreign Military Aircraft Sales

Partnership Is Multi-faceted….Win Win At Every Step

53
 Value Creation For JSF
z Benefits To Lockheed
„ Over 60 Eaton Engineers Working Inside Lockheed
„ Significant Systems Level Weight Savings And Performance
Improvements
„ Kitting Concepts Aligned With Volume Production
„ Significant Content Established In Partnering Nations

• Eaton Benefit Since Initial Proposal To Lockheed

• Customer Intimacy And Joint Reliance
• Parts Count Up 400 %
• Development Engineering Customer Funding Up 300%
• Annual Revenue at Full Production Rates Up From $146M to $358M
• Operating Margin Up Nearly 30 % From Original Award

Eaton and The Customer Winning Together

54
55
A Valued Integrator
…… Optimizing Systems Via Component Expertise
z Portfolio Facilitates Systems Strategy For On Board Power Systems
z Component Expertise Allows True Systems Optimization
z Customer Intimacy Elevated With Each Systems Award
„ Co-Location with Fully Linked Component Engineering Teams
„ Optimized System Solutions Builds Airframe Level Partnership
z Adding Value Through The Complete Product Life Cycle
z Systems Integration Role Expands Content And Customer Value

Building Customer Value

And Intimacy

56
 A Leader On Growth Programs
More Content Than Ever

Brad Morton
Vice President and President Aerospace Operations

© 2005 Eaton Corporation. All rights reserved.

Leading Position On Growth Platforms
…Airbus A380
Hydraulic Fuel

Reservoir 8.5L – 120 PSI Flex Union Joints

Accumulator 8.2L – 5000 PSI Fuel Flex Unions
HPMFA 9L – 5000 PSI Fuel Systems Pumps
HPMFA 6L – 5000 PSI Fire Shut Off Valve
Engine Driven Pump
AC Motor Pump Actuation and Controls
Ground Service Panel
Accumulator 5000 PSI
Hoses
Slats Motors
Rynglok Fittings
Composite Shafts (Flap Slat)
Check Valves
Shroud Drain Hose
Self Sealing Adapter Electrical
HPMFA 2.15 L - 5000 PSI MCPU
A380 Program Highlights Reservoir 20L MSU
Flex Joints
• 159 firm orders Heat Exchanger Air Management
Nose LDG Dressing
• 16 customers Landing Gear Dressing Air Distribution Equipment
• First Flight: April 05
Other Propulsion
• First Delivery: Nov 06
Water Systems Trent 900 EBU
Water Systems NRV Option HTTP Ducting
Composite Structural Rods Chip Detector

Represents $ 90 M Revenues Per Year at Full Production

58
 Leading Position On Growth Platforms
….Embraer Phenom 100 (VLJ)
Hydraulic Actuation & Controls
Hydraulic Power Pack Landing Gear Lever
Reservoir Landing Gear Control Valve
Positive Displacement Gear Pump Throttle
28 VDC Electric Motor
Hydraulic Accumulator
Pressure Gauge
Flap System
Charging Valve
Manifold Electro-mechanical Actuators
Outlet check valve Flap Selector Lever
Pressure Transducer Position Sensors
Pressure Switch
Accumulator Dump Valve
Outlet and Return Filters
Filter Bypass valve Electrical
Reservoir Bleed and Relief Valve
Ground Service Quick Disconnects Light plates
Differential Pressure Indicators Rotary/toggle switches
Push button switches
Phenom 100 Program Highlights Potentiometers

Power Distribution Boxes

• 1,300 aircraft program (increasing)
Circuit breakers
• First Flight: 1 Q 07 Relays
• First Delivery: 2 Q 08 Contactors
Fuses
Connectors

Represents $ 11 M Revenues Per Year at Full Production

59
 Leading Position On Growth Platforms
….Lockheed F-35
Actuation and Controls Hydraulic

Actuator Door Gun Port Hydraulic Check Valve

In flight refueling receptacle Directional Control Valve
Electromechanical Actuator Hydraulic Reservoir
Actuation Door 3-Bearing Nozzle Hydraulic Accumulator
Actuator Door Upper Lift Fan Aileron Valve
Emergency Control Upper Lift Arresting Gear ACTUATOR,
Fan Door Shutoff Firewall Valve
Vent Reservoir Actuator Return In-Line Transducer
Actuator Mission Systems Door Filter Module
Actuator Door – Infrared Counter Brake System Valve
Measure Engine Driven Valve
Actuator - Spoiler Electric Motor Pump
Counter Measure Door Actuator Electric Motor Pump Assembly
Electromechanical Controller Valve
Landing Gear Actuator Heat Exchanger
Door Nose Landing Gear Hydraulic Hoses and Fitting
F-35 Program Highlights Controller Hydraulic Conveyance Tubes
Door-Main Landing Gear
Actuator Fuel
• 2593 US/UK aircraft program
• First Flight: Fall 06
Refuel Probe
• First Delivery: 5 Aircraft in 07
Refuel Receptacle
Fuel Conveyance

Represents $ 358 M Revenue Per Year at Full Production

60
Leading Position On Growth Platforms
…Sikorsky UH-60 M
Hydraulic Actuation and Controls

Manifold Assembly Tail Wheel Lock Actuator

Hydraulic Accumulator Tail Rotor Index Actuator
Valve Assembly Pedal Adjust Actuator
Transfer Module Rescue Hoist Control
Valves Cockpit Displays
Hoses, Frangible Valves, QD, Fire Control Switch
Hoses, QD, Couplings Pressure Switches
Hydraulic Winch Motor
Hydraulic Starter Fuel
Sys 3 Hydraulic Pump
Sys 1 & 2 Hyd Pump Module Couplings
AC Ground Checkout Pump Fuel vent assembly
Heat Exchanger Tube Configurations
Brake Transfer Valve Flanges & Flexible Couplings
UH-60M Program Highlights Master Brake Cylinder Seals
APU Start Valve
• 1500 + aircraft program Electrical
• First Flight: 2005 Propulsion
• Full Rate Production: 2007 Electrical Switches
Chip Detectors and Collectors Remote Control Circuit
Chip Zappers Breakers
Sight Plugs and Gauges Electrical Relays
Fluid Reservoir Components

Represents $ 18.5 M Revenue Per Year at Full Production

61
 Leading Position On Growth Platforms
…Boeing 787
Hydraulic Fuel

Hydraulic Motor Actuated Ball Valves

Ram Air Turbine Hydraulic Drain Valves
Pump Check Valves
Hydraulic Fitting Flame Arrestors & Vent Scoop
Hydraulic Coupling Engine Feed Pumps
Landing Gear Swivel and Bleed Override Pump
Valves APU Pump
Jet Pumps
Propulsion Actuated Ball Valves
Jettison Valve
Flex Tube Assemblies Baffle Rip Check Valve
Ducts / Gimbal Assemblies Refuel Adaptors
Flex Tube Assemblies
Breather Duct Actuation & Control
Pressure Sense Lines
Coupling Assemblies Passenger Door Systems
B 787 Program Highlights Oil Debris Particle Separator Emergency Passenger Door
Filter Module Actuator
• 1750+ aircraft program QDM Sensor Flight Lock Actuator
Signal Conditioning Module
• First Flight: Mid 07
Sensors Air Management
• First Delivery: Mid 08 Electronic Module
Engine Lube System ECS Ducting Metal and Plastic

Represents $75 M Revenues Per Year at Full Production

62
 Leading Position On Growth Platforms
…Lockheed F-22A
Hydraulic Propulsion

Hydraulic Pumps Chip Collector

Hydraulic Pressure Switch Chip Detector
Hydraulic Pressure Oil Debris Separator
Transducers Valves
Drain Valve Switch Gages
Reservoir Pickup Tube Breathers
Check Valve Indicator Oil Level
Float Switch Flange Venturi Adaptor
Hydraulic Maintenance Insulation Blanket Clamp
Switching Valve
Hydraulic Isolation Valve Actuation and Controls
Hydraulic Pressure Regulator
Weapons Bay Door Drive Motor
Electrical Weapons Bay Door Control
Gun Drive Motor
Emergency Power Generation Landing Gear Valves
F-22A Program Highlights Hermetic Relays Nose Wheel Steering Control
Actuators
Fuel Dynamic Load Damper
• 183 aircraft program Rudder Shuttle Valve
• Currently in Service Fuel Transfer Motor Landing Gear Emergency Valve
ADAS Actuator

Represents $ 15.2M Revenue Per Year at Full Production

63
Leading Position On Growth Platforms
…Boeing/Bell V-22
Propulsion Hydraulic

Gear box sight gauge Engine driven pumps

Generator sight gauge Drive motors
Mid wing Prismalite Cargo door DC motor pump
Oil Debris Separators Winch and hoist control module
Gear box inlet screens Hydraulic brake master cylinder
Chip detectors and collectors Pressure reducer and relief valve
Gear box optic sensor Wing stow system isolation valve
Gear box breather/dryer Utility system isolation valve
Gear box cartridge Park, lock/transfer module
Compressor breather Ramp control valve
Generator check valves Rotor brake valve
Generator float switches Remote switching valve
APLI float switch Local switching isolation valve
Gear box drain valve Hydraulic hoses and swivels
Full flow chip collector Rynglok® fittings

V-22 Program Highlights Fuel Actuation & Controls

Refuel/de-fuel valve Illuminated switches

• Production Increased from 215 Over pressure manifold Fire pull handle
to 410 aircraft Fuel hoses Rotor positioning motors
Wing stowage/rotation motor
• Currently in Service Air Management

Inlet particle separators

Represents $16 M Revenue Per Year Full Production 64

Leading Position On Growth Platforms
…Eurofighter
Air Management Fuel
50 mm Bellows Sealed Gimbal Joint Shut Off Valves
63 mm Gimbal & Pressure Joint Cross Feed Valve
75 mm Gimbal & Pressure Joint Defuel Isolate Valve
Anti-mist / Demist non return valve Fuel/Air Couplings
Cabin Ground Test Connection Fuel System Non-Return Valves
ECS Shutoff Valve
Gravity Filler Caps and Adaptors
Emergency Ram Air Valve
Flexible Couplings
IFR Probe Nozzle
Inlet Non Return Valve IFRP Fuel Drain Valve
Light Weight Gimbal IFRP Lock Slide & Swivel Joint
Pressure Balance Joint MSOGS Drain Valve
Actuated Three Way Valve Refuel / Defuel Valve
Air Non Return Valves Tank Interconnect Valve
Avionic & Fan Shutoff Valve Compartment Relief Valve
High Pressure Gimbal Fuel and Air Connection
Clamps & Flanges Fuel Flow Proportioner
Transfer Pumps and Valves
Eurofighter Program Highlights Propulsion Thermal Relief Valve
Chip Detectors and Collectors
Air No Fuel Valve
• Tranche I and II –385 aircraft Vent Valve Assemblies
• Tranche III -236 aircraft Hydraulic Flexible Ducts
• Export - 200 plus Actuation & Controls
Self Sealing Couplings
• Entry into Service 2003 (UK), 2004 Slide and Swivel Joints
Germany Lead Edge Slat Motors
Radar Cooling Pump Cockpit Display Switches
Relief Valve

Represents $ 10 M Revenue Per Year at Full Production 65

 Leading Position On Growth Platforms
…Hawker Horizon
Hydraulic Electrical

Teflon Hose Assemblies Low Power Transfer

GSE Coupling Contractor
Complex Tube Assemblies High Power DC Contactor
Aircraft Band Clamps High Power DC Transfer
Hydraulic Reservoir Contactor
Hydraulic Filter Module Power Interconnect Contactor
Pressure Maintaining Valve Three Phase 30KVA
Priority Valve Generator Contractor
Emergency Rudder System Power Transfer Unit
Electric Motor-Driven Pump
Emergency Generator Motor
Air Management
Engine Driven Pump
ECS Ducting System
Hawker Horizon Program Highlights Fuel Rotomolded Ducting
V-Bands
Fire sleeved Fuel Assemblies Flanges
• 241 aircraft program
• First Flight 2005
• Entry into Service 2006

Represents $ 8.9M Revenue Per Year at Full Production

66
Leading Position On Growth Platforms
…X-47 UAV
Hydraulic Actuation and Controls

Hydraulic Pump Pressure Regulator Relief Valve

Reservoir Engine Throttle Actuator
Reservoir Mounting Assembly APU Door Actuator
Axial Swage Elbow
Axial Swage Seal Elbow
Propulsion
Axial Swage Tee
Axial Swage Union
Liquid Cooling Pressure Sensor
Axial Swage Seal Adapter

Electrical Fuel

Transducers Fuel Duct

X-47 UAV Program Highlights

• Total Production To Be Determined

• Estimated Entry into Service 2012

Potentially $ 6.0 M Revenue Per Year at Full Production

67
 Leading Position On Growth Platforms
…Choosing Our Target And Filling The Pipeline
Program Sub System First A/C
Launch Award Flight Certification

Aircraft Concept Aircraft Design Freeze Detailed Design Product Build & Aircraft Flight Production
& Technology and Suppliers & Development Qualification Testing Ramp up
Assessment Selection
Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 & 7

B737 RS P 100 A380 Eurofighter

A350
B787 V22
F 35
C 17
X 47 B
Horizon
ARJ 21
ARJ 21 F-22

Pipeline Assures Significant

Growth For The Long Term

68
 Leading Position On Growth Platforms
…With Steadily Increasing Content
Eaton Ship Set Content
Large Transports Military Fighters Rotorcraft Military Business UAV
Transports Jet

$900
Per A/C Platform Content $
Thousands

$800
$700
$600
$500
$400
$300
$200
$100
$-

Hawker Horizon
A320 Families

Global Hawk
Eurofighter

X 47 Proto
B737 NG
A330-200

UH 60 M

A400 M

Citation
EH101

C130
A380

B787

P100
B767

F16
F18

F22
F35

S92

V22

Systems Approach Paying Dividends Of Content Growth

69
 Leading Position On Growth Platforms
…Growth Over End Market Assured
Aerospace Projected Revenue Growth
z Strong Position on All New 2.02 Market Outgrowth
Platforms Entering Service From New Platforms
2
in Next Ten Years Growth At 5.5%
Market Rate
1.82
z Product Placement %
9.6

Billion $
2
Ensures Commercial-
AGR
Military Balance 1.62 C
z Successful Positioning to 2

Outgrow Our End Market 1.41

z Future Growth Assured 1

1.21
2006 2007 2008 2009 2010 2011
1

6
Investments by Eaton in Strategic Platforms
Have Secured a Strong Revenue Position
For the Long Term
70
A leader on growth platforms
…with more content than ever!

3.0B
3

2.1B 2.0B Market

2
1.5B Eaton

0
Hydraulic Electric Fuel Air
Systems Systems Systems Systems

But, significant growth opportunities remain

within our served markets
71
Fluid Power Overview
….Key Messages From The Aerospace Team

Aerospace Is A Growing Long Cycle Industry

Eaton Aerospace’s business is…….

z A well-balanced portfolio
„ Market and product balance minimizes cyclical impacts
z A provider of components excellence
„ Components drives core value and aftermarket growth
z A capable and valued systems integration
„ Optimizing systems with critical components
z A leader on the right platforms
„ With more content than ever

72
Eaton Aerospace
…… Systems Capability Breakouts
z Breakout #1
„ Group A - Hydraulic Systems
„ Group B – Airframe Fuel Systems
„ Group C – Air Management and Propulsion
z Breakout #2
„ Group B - Hydraulic Systems
„ Group C – Airframe Fuel Systems
„ Group A – Air Management and Propulsion
z Breakout #3
„ Group C - Hydraulic Systems
„ Group A – Airframe Fuel Systems
„ Group B – Air Management and Propulsion

73