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<SEC-DOCUMENT>0001047469-05-008383.txt : 20050331
<SEC-HEADER>0001047469-05-008383.hdr.sgml : 20050331
<ACCEPTANCE-DATETIME>20050331080902
ACCESSION NUMBER:		0001047469-05-008383
CONFORMED SUBMISSION TYPE:	40-F
PUBLIC DOCUMENT COUNT:		8
CONFORMED PERIOD OF REPORT:	20050330
FILED AS OF DATE:		20050331
DATE AS OF CHANGE:		20050331

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			MAGNA INTERNATIONAL INC
		CENTRAL INDEX KEY:			0000749098
		STANDARD INDUSTRIAL CLASSIFICATION:	MOTOR VEHICLE PARTS & ACCESSORIES [3714]
		IRS NUMBER:				000000000
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		40-F
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-11444
		FILM NUMBER:		05716334

	BUSINESS ADDRESS:	
		STREET 1:		337 MAGNA DRIVE
		STREET 2:		N/A
		CITY:			AURORA, ONTARIO, CAN
		STATE:			A6
		ZIP:			L4G 7K1
		BUSINESS PHONE:		9057262462

	MAIL ADDRESS:	
		STREET 1:		337 MAGNA DRIVE
		STREET 2:		N/A
		CITY:			AURORA, ONTARIO, CAN
		STATE:			A6
		ZIP:			L4G 7K1
</SEC-HEADER>
<DOCUMENT>
<TYPE>40-F
<SEQUENCE>1
<FILENAME>a2154594z40-f.htm
<DESCRIPTION>FORM 40-F
<TEXT>
<HTML>
<HEAD>
</HEAD>
<BODY BGCOLOR="#FFFFFF" LINK=BLUE  VLINK=PURPLE>
<BR>
<FONT SIZE=3 ><A HREF="#05TOR1382_1">QuickLinks</A></FONT>
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<P ALIGN="CENTER"><FONT SIZE=2><B>U.S.&nbsp;Securities and Exchange Commission<BR>
Washington,&nbsp;D.C. 20549<BR>
<BR>
FORM 40-F</B></FONT></P>

<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2><FONT FACE="WINGDINGS">&#111;</FONT></FONT></DT><DD><FONT SIZE=2>REGISTRATION
STATEMENT PURSUANT TO SECTION 12&nbsp;OF THE SECURITIES EXCHANGE ACT OF&nbsp;1934 </FONT></DD></DL>
<P ALIGN="CENTER"><FONT SIZE=2>OR </FONT></P>

<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2><FONT FACE="WINGDINGS">&#253;</FONT></FONT></DT><DD><FONT SIZE=2>ANNUAL
REPORT PURSUANT TO SECTION 13(a)&nbsp;or 15(d)&nbsp;of THE SECURITIES EXCHANGE ACT OF&nbsp;1934 </FONT></DD></DL>
<BR>

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<TR VALIGN="BOTTOM">
<TD WIDTH="49%" VALIGN="TOP"><FONT SIZE=2>For the fiscal year ended </FONT><FONT SIZE=2><B><U>December&nbsp;31, 2004</U></B></FONT></TD>
<TD WIDTH="2%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="49%" ALIGN="RIGHT" VALIGN="TOP"><FONT SIZE=2>Commission File Number </FONT><FONT SIZE=2><B><U>0-13942</U></B></FONT></TD>
</TR>
</TABLE>
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<TABLE WIDTH="100%" BORDER=0 CELLSPACING=0 CELLPADDING=0>
<TR VALIGN="TOP">
<TD WIDTH="1%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="98%" ALIGN="CENTER"><FONT SIZE=2><B><BR>
Magna International&nbsp;Inc.</B></FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="1%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="98%" ALIGN="CENTER"><HR NOSHADE></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="1%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="98%" ALIGN="CENTER"><FONT SIZE=1>(Exact name of Registrant as specified in its charter)</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="1%" ALIGN="RIGHT"><FONT SIZE=1>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TD>
<TD WIDTH="98%" ALIGN="CENTER"><FONT SIZE=2><B><BR>
Not Applicable</B></FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="1%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="98%" ALIGN="CENTER"><HR NOSHADE></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="1%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="98%" ALIGN="CENTER"><FONT SIZE=1>(Translation of Registrant's name into English (if&nbsp;applicable)</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="1%" ALIGN="RIGHT"><FONT SIZE=1>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TD>
<TD WIDTH="98%" ALIGN="CENTER"><FONT SIZE=2><B><BR>
Province of Ontario, Canada</B></FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="1%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="98%" ALIGN="CENTER"><HR NOSHADE></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="1%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="98%" ALIGN="CENTER"><FONT SIZE=1>(Province of other jurisdiction of incorporation or organization)</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="1%" ALIGN="RIGHT"><FONT SIZE=1>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TD>
<TD WIDTH="98%" ALIGN="CENTER"><FONT SIZE=2><B><BR>
3714</B></FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="1%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="98%" ALIGN="CENTER"><HR NOSHADE></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="1%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="98%" ALIGN="CENTER"><FONT SIZE=1>(Primary Standard Industrial Classification Code number (if&nbsp;applicable)</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="1%" ALIGN="RIGHT"><FONT SIZE=1>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TD>
<TD WIDTH="98%" ALIGN="CENTER"><FONT SIZE=2><B><BR>
Not Applicable</B></FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="1%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="98%" ALIGN="CENTER"><HR NOSHADE></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="1%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="98%" ALIGN="CENTER"><FONT SIZE=1>(I.R.S. Employer Identification Number (if&nbsp;applicable)</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="1%" ALIGN="RIGHT"><FONT SIZE=1>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TD>
<TD WIDTH="98%" ALIGN="CENTER"><FONT SIZE=2><B><BR>
337&nbsp;Magna Drive, Aurora, Ontario, Canada L4G&nbsp;7K1 (905)&nbsp;726-2462</B></FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="1%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="98%" ALIGN="CENTER"><HR NOSHADE></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="1%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="98%" ALIGN="CENTER"><FONT SIZE=1>(Address and telephone number of Registrant's principal executive offices)</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="1%" ALIGN="RIGHT"><FONT SIZE=1>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TD>
<TD WIDTH="98%" ALIGN="CENTER"><FONT SIZE=2><B><BR>
CT Corporation System, 1633&nbsp;Broadway, New&nbsp;York, New&nbsp;York 10019 (212)&nbsp;664-1666</B></FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="1%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="98%" ALIGN="CENTER"><HR NOSHADE></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="1%" ALIGN="RIGHT"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="98%" ALIGN="CENTER"><FONT SIZE=1>(Name, address (including zip code) and telephone number (including area code)<BR>
of agent for service in the United&nbsp;States)</FONT></TD>
</TR>
</TABLE>
<!-- end of user-specified TAGGED TABLE -->


<P><FONT SIZE=2>Securities
registered or to be registered pursuant to Section&nbsp;12(b)&nbsp;of the Act. </FONT></P>

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<TABLE WIDTH="100%" BORDER=0 CELLSPACING=0 CELLPADDING=0>
<TR VALIGN="TOP">
<TD WIDTH="49%" ALIGN="CENTER"><FONT SIZE=2>Title of each class</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="49%" ALIGN="CENTER"><FONT SIZE=2>Name of each exchange on which registered</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="49%" ALIGN="CENTER"><BR><FONT SIZE=2><B>Class&nbsp;A Subordinate Voting Shares</B></FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><B><BR>&nbsp;</B></FONT></TD>
<TD WIDTH="49%" ALIGN="CENTER"><FONT SIZE=2><B><BR>
New&nbsp;York Stock Exchange</B></FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="49%" ALIGN="CENTER"><HR NOSHADE></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="49%" ALIGN="CENTER"><HR NOSHADE></TD>
</TR>
</TABLE>
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<P><FONT SIZE=2>Securities
registered or to be registered pursuant to Section&nbsp;12(g)&nbsp;of the Act. </FONT><FONT SIZE=2><B>None</B></FONT></P>

<P><FONT SIZE=2>Securities
for which there is a reporting obligation pursuant to Section&nbsp;15(d)&nbsp;of the Act. </FONT><FONT SIZE=2><B>None</B></FONT></P>

<P><FONT SIZE=2>For
annual reports, indicate by check mark the information filed with this Form: </FONT></P>

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<TABLE WIDTH="100%" BORDER=0 CELLSPACING=0 CELLPADDING=0>
<TR VALIGN="TOP">
<TD WIDTH="49%"><FONT SIZE=2> <FONT FACE="WINGDINGS">&#253;</FONT> Annual Information Form</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="49%"><FONT SIZE=2><FONT FACE="WINGDINGS">&#111;</FONT> Audited Annual Financial Statements</FONT></TD>
</TR>
</TABLE>
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<P><FONT SIZE=2>Indicate
the number of outstanding shares of each of the issuer's classes of capital or common stock as of the close of the period covered by the annual report </FONT></P>

<P><FONT SIZE=2><B>95,850,377&nbsp;Class&nbsp;A Subordinate Voting Shares  </B></FONT></P>

<P><FONT SIZE=2><B>1,093,983&nbsp;Class&nbsp;B Shares  </B></FONT></P>

<P><FONT SIZE=2>Indicate by check mark whether the Registrant by filing the information contained in this Form is also hereby furnishing the information to the Commission pursuant to
Rule&nbsp;12g3-2(b)&nbsp;under the Securities and Exchange Act of 1934 (the&nbsp;"Exchange Act"). If "Yes" is marked, indicate the filing number assigned to the Registrant in
connection with such Rule.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Yes&nbsp;&nbsp;<FONT FACE="WINGDINGS">&#111;</FONT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;No&nbsp;&nbsp;&nbsp;&nbsp;<FONT FACE="WINGDINGS">&#253;</FONT> </FONT></P>

<P><FONT SIZE=2>Indicate by check mark whether the Registrant (1)&nbsp;has filed all reports required to be filed by Section&nbsp;12 or&nbsp;15(d)&nbsp;of the Exchange Act during the
preceding 12&nbsp;months (or&nbsp;for such shorter period that the Registrant was required to file such reports) and (2)&nbsp;has been subject to such filing requirements for the past
90&nbsp;days.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Yes&nbsp;&nbsp;<FONT FACE="WINGDINGS">&#253;</FONT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;No&nbsp;&nbsp;&nbsp;&nbsp;<FONT FACE="WINGDINGS">&#111;</FONT> </FONT></P>

<HR NOSHADE>
<P style='page-break-before:always'></p>
<!-- ZEQ.=1,SEQ=1,EFW="2154594",CP="MAGNA INTERNATIONAL",DN="1",CHK=332240,FOLIO='blank',FILE='DISK005:[05TOR2.05TOR1382]BA1382A.;5',USER='RMCIVOR',CD='30-MAR-2005;10:34' -->

<P><FONT SIZE=2><B>1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ANNUAL INFORMATION FORM  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Registrant's Annual Information Form for the year ended December&nbsp;31, 2004 required under Canadian law is attached hereto as Exhibit&nbsp;1
(the&nbsp;"Annual Information Form"). </FONT></P>

<P><FONT SIZE=2><B>2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;AUDITED ANNUAL FINANCIAL STATEMENTS AND MANAGEMENT'S DISCUSSION AND ANALYSIS  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Registrant's Annual Report to Shareholders for the year ended December&nbsp;31, 2004 (the&nbsp;"Annual Shareholders' Report") was previously filed with
the U.S.&nbsp;Securities and Exchange Commission (the&nbsp;"Commission") as Exhibit&nbsp;99 to&nbsp;the Registrant's Report on Form&nbsp;6-K dated March&nbsp;30, 2005. For the
Registrant's consolidated audited annual financial statements, including the report of the independent chartered accountants with respect thereto, see pages&nbsp;37 to&nbsp;75 and page&nbsp;36,
respectively, of the Annual Shareholders' Report. See note&nbsp;30 to&nbsp;the Registrant's consolidated audited annual financial statements, on pages&nbsp;70 to&nbsp;74 of the Annual
Shareholders' Report, reconciling the important differences between Canadian and United&nbsp;States generally accepted accounting principles. For the Registrant's Management's Discussion and
Analysis of Results of Operations and Financial Position, see pages&nbsp;12 to&nbsp;35 of the Annual Shareholders' Report. </FONT></P>

<P><FONT SIZE=2><B>3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WEBSITE INFORMATION  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Notwithstanding any reference to the Registrant's website on the World Wide Web in the Annual Information Form or in the documents attached or incorporated as
exhibits hereto, the information contained in the Registrant's website, or any other site on the World Wide Web referred to in the Registrant's website, is not a part of this annual report on
Form&nbsp;40-F and, therefore, is not filed with the Commission. </FONT></P>


<P><FONT SIZE=2><B>4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;FORWARD-LOOKING STATEMENTS  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Registrant has made in the documents filed as part of this annual report on Form&nbsp;40-F, and&nbsp;from time to time may otherwise make
"forward-looking statements", within the meaning of Section&nbsp;21E of the U.S.&nbsp;Securities Exchange Act of 1934 (the&nbsp;"Exchange Act") and Section&nbsp;27A of the
U.S.&nbsp;Securities Act of 1933, and related assumptions concerning its operations, economic performance and financial matters. Actual results or events could differ materially from those set forth
in, or implied by, the forward-looking statements and the related assumptions due to a variety of factors. Reference is made to the section entitled "Forward-Looking Statements" on page&nbsp;2 of
the Annual Information Form for a discussion of such factors. </FONT></P>

<P><FONT SIZE=2><B>5.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;DISCLOSURE CONTROLS AND PROCEDURES  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Registrant's Chairman and Interim Chief Executive Officer and its Executive Vice-President and Chief Financial Officer are responsible for
establishing and maintaining the Registrant's disclosure controls and procedures as such term is defined under Rules&nbsp;13a-15(e)&nbsp;and&nbsp;15d-15(e)&nbsp;of the
Exchange Act. These officers have designed the Registrant's disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under their supervision, to ensure that
material information relating to the Registrant, including its consolidated subsidiaries, is made known to them by others within those entities, particularly during the period in which this annual
report on Form&nbsp;40-F was being prepared. The Registrant's Chairman and Interim Chief Executive Officer and its Executive Vice-President and Chief Financial Officer have
evaluated the effectiveness of the Registrant's disclosure controls and procedures as of December&nbsp;31, 2004. Based on this evaluation, these officers are satisfied as to the effectiveness of the
Registrant's disclosure controls and procedures in ensuring that material information relating to the Registrant, including its consolidated subsidiaries, is made known to them by others in those
entities in a timely manner. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;There
have been no changes to the Registrant's internal control over financial reporting that occurred during the period covered by the annual report that has materially affected, or is
reasonably likely to materially affect, the Registrant's internal control over financial reporting. </FONT></P>

<HR NOSHADE>
<P style='page-break-before:always'></p>
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<P><FONT SIZE=2><B>6.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;AUDIT COMMITTEE MEMBERS AND AUDIT COMMITTEE FINANCIAL EXPERT  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Registrant has a separately designated standing audit committee of its Board of Directors (the&nbsp;"Audit Committee"), which is comprised of the following
members of the Registrant's Board of Directors: Donald Resnick (Chairman), William H. Fike and Royden R. Richardson. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Registrant's Board of Directors has determined that Mr.&nbsp;Resnick, the Chairman of the Audit Committee, is an "audit committee financial expert" and that each member of the
Audit Committee, including Mr.&nbsp;Resnick, is "independent" and
"financially literate", as such terms are defined in the listing standards of the New&nbsp;York Stock Exchange and Exchange Act Rule&nbsp;10A-3. </FONT></P>

<P><FONT SIZE=2><B>7.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;CODE OF ETHICS  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Registrant has adopted a code of ethics that applies to all of its employees, including its Chairman and Interim Chief Executive Officer, its Executive
Vice-President and Chief Financial Officer, its Controller and other persons performing similar functions. The text of such code of ethics is contained in the Registrant's Code of Conduct
and Ethics, which is posted on the Registrant's website at www.magna.com. </FONT></P>

<P><FONT SIZE=2><B>8.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;PRINCIPAL ACCOUNTANT FEES AND SERVICES  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The aggregate fees billed for each of the last two fiscal years for professional services rendered by Ernst&nbsp;&amp; Young&nbsp;LLP, the Registrant's principal
accountant (the&nbsp;"Auditor"), are as follows: </FONT></P>

<!-- User-specified TAGGED TABLE -->
<DIV ALIGN="CENTER"><TABLE WIDTH="70%" BORDER=0 CELLSPACING=0 CELLPADDING=0>
<TR VALIGN="BOTTOM">
<TH WIDTH="72%" ALIGN="LEFT"><FONT SIZE=2>&nbsp;</FONT><BR></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ALIGN="CENTER"><FONT SIZE=1><B>Fiscal 2004</B></FONT><HR NOSHADE></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ALIGN="CENTER"><FONT SIZE=1><B>Fiscal 2003</B></FONT><HR NOSHADE></TH>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="72%"><FONT SIZE=2>Audit Fees</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2>6,061,500</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2>5,724,500</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="72%"><FONT SIZE=2>Audit-Related Fees</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2>467,500</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2>491,700</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="72%"><FONT SIZE=2>Tax Fees</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2>1,758,000</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2>3,576,900</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="72%"><FONT SIZE=2>All Other Fees</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2>nil</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="10%" ALIGN="RIGHT"><FONT SIZE=2>19,300</FONT></TD>
</TR>
</TABLE></DIV>
<!-- end of user-specified TAGGED TABLE -->


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
services comprising the Audit Fees category for these two fiscal years were performed by the Auditor to comply with generally accepted auditing standards ("GAAS"). Fees included in
this category may include an appropriate allocation of fees for tax services or accounting consultations, to the extent such services were necessary to comply with GAAS. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
services comprising the Audit-Related Fees category for these two fiscal years consisted of certain assurance and related services, namely employee benefit plan audits. This category
would also include due diligence relating to acquisition and divestitures, accounting consultations and audits in connection with acquisitions and divestitures, internal control reviews, attest
services that are not required by statute or regulation, and consultations concerning financial accounting and reporting standards. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
services comprising the Tax Fees category for these two fiscal years consisted of Canadian, U.S., European and Mexican tax compliance, advisory and research services. Tax services
would generally include tax compliance, tax planning and tax advice. This category includes fees paid in respect of services performed by the Auditor's tax professionals, excluding services required
to comply with GAAS, which are included in the Audit Fees category. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
services comprising the All Other Fees category for these two fiscal years consisted of translation services. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Audit Committee has a process for pre-approving all services provided by, and related fees to be paid to, the Auditor. This process includes reviewing, on a quarterly
basis, the details and associated costs of the services expected to be provided. Audit Committee approval is required for any services that have not been previously approved by the Audit Committee.
The Audit Committee considers whether such services are consistent with the Commission's rules on auditor independence. The Audit Committee also considers whether the Auditor is best positioned to
provide the most effective and efficient service, for reasons such as its familiarity with the Registrant's business, people, culture, accounting systems, risk profile, and whether the services
enhance the Registrant's ability to manage or control risks and improve audit quality. The Audit Committee has delegated authority to its Chairman to pre-approve permitted
non-audit services that have not previously been approved, provided that such approval is in writing and signed by the Chairman. The Chairman will report to the Audit Committee on all such
pre-approvals granted under such authority at the next regularly scheduled Audit Committee meeting. None of the services provided by the Auditor in 2004 were treated as exempt from
pre-approval pursuant to the de minimis provision of paragraph&nbsp;(c)(7)(i)(C)&nbsp;of Rule&nbsp;2-01&nbsp;of Regulation&nbsp;S-X. </FONT></P>

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<P><FONT SIZE=2><B>9.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;OFF-BALANCE SHEET ARRANGEMENTS AND TABULAR DISCLOSURE OF CONTRACTUAL OBLIGATIONS  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For disclosure of the Registrant's off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on the
Registrant's financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to investors, see
pages&nbsp;27 and&nbsp;28 of the Annual Shareholders' Report, under the section entitled "Contractual Obligations and Off-Balance Sheet Financing". </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For
the tabular disclosure regarding the Registrant's known contractual obligations, with amounts aggregated by the type of contractual obligation, see pages&nbsp;27 and&nbsp;28 of
the Annual Shareholders' Report, under the section entitled "Contractual Obligations and Off-Balance Sheet Financing". </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><B>UNDERTAKING AND CONSENT TO SERVICE OF PROCESS  </B></FONT></P>


<P><FONT SIZE=2><B>A.&nbsp;&nbsp;&nbsp;&nbsp;Undertaking  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Registrant undertakes to make available, in person or by telephone, representatives to respond to inquiries made by the Commission staff, and to furnish promptly,
when requested to do so by the Commission staff, information relating to: the securities registered pursuant to Form&nbsp;40-F; the securities in relation to which the obligation to file
an annual report on Form&nbsp;40-F arises; or transactions in said securities. </FONT></P>

<P><FONT SIZE=2><B>B.&nbsp;&nbsp;&nbsp;&nbsp;Consent to Service of Process  </B></FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A Form&nbsp;F-X signed by the Registrant and its agent for service of process was previously filed with the Commission. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="ba1382_signatures"> </A>
<A NAME="toc_ba1382_1"> </A>
<BR></FONT><FONT SIZE=2><B>SIGNATURES    <BR>    </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pursuant to the requirements of the Exchange Act, the Registrant certifies that it meets all of the requirements for filing on Form&nbsp;40-F
and&nbsp;has duly caused this annual report to be signed on its behalf by the undersigned, thereunto duly authorized. </FONT></P>

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<TD WIDTH="21%"><FONT SIZE=2>Registrant:</FONT></TD>
<TD COLSPAN=2 ALIGN="CENTER"><FONT SIZE=2>MAGNA INTERNATIONAL&nbsp;INC.</FONT></TD>
</TR>
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<TD WIDTH="21%"><FONT SIZE=2>&nbsp;</FONT></TD>
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<TD WIDTH="52%"><HR NOSHADE></TD>
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By (Signature and Title):</FONT></TD>
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&nbsp;</FONT></TD>
<TD WIDTH="52%" VALIGN="TOP"><FONT SIZE=2><BR>
/s/&nbsp;&nbsp;</FONT><FONT SIZE=2>J. BRIAN COLBURN</FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
</TR>
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<TD WIDTH="21%"><FONT SIZE=2>&nbsp;</FONT></TD>
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<TD WIDTH="21%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="27%" ALIGN="CENTER"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="52%"><FONT SIZE=2>J. Brian Colburn<BR>
Executive Vice-President, Special Projects and Secretary</FONT></TD>
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<TD WIDTH="21%"><FONT SIZE=2><BR>
Date:</FONT></TD>
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&nbsp;</FONT></TD>
<TD WIDTH="52%"><FONT SIZE=2><BR>
March&nbsp;30, 2005</FONT></TD>
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<TD WIDTH="27%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="52%"><FONT SIZE=2>&nbsp;</FONT></TD>
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<A NAME="toc_ba1382_2"> </A>
<BR></FONT><FONT SIZE=2><B>EXHIBIT  INDEX<BR> </B></FONT></P>

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<TD WIDTH="16%"><FONT SIZE=2>Exhibit&nbsp;1</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="82%"><FONT SIZE=2>Annual Information Form of the Registrant dated March&nbsp;29, 2005.</FONT></TD>
</TR>
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<TD WIDTH="16%"><BR><FONT SIZE=2> Exhibit&nbsp;2</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="82%"><FONT SIZE=2><BR>
Registrant's Annual Report to Shareholders for the Year Ended December&nbsp;31, 2004, which contains the Registrant's audited financial statements as at and for the three-year period ended December&nbsp;31, 2004 and Management's Discussion and
Analysis of Results of Operations and Financial Position (incorporated by reference to Exhibit&nbsp;99 to&nbsp;Registrant's Report on Form&nbsp;6-K dated March&nbsp;30, 2005).</FONT></TD>
</TR>
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<TD WIDTH="16%"><BR><FONT SIZE=2> Exhibit&nbsp;3</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="82%"><FONT SIZE=2><BR>
Consent of Ernst&nbsp;&amp; Young&nbsp;LLP.</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="16%"><BR><FONT SIZE=2> Exhibit&nbsp;99.1</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="82%"><FONT SIZE=2><BR>
Certificate of Principal Executive Officer Pursuant to Exchange Act Rules&nbsp;13a-14(a)&nbsp;and&nbsp;15d-14(a),&nbsp;as Adopted Pursuant to Section&nbsp;302 of the Sarbanes-Oxley Act of 2002.</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="16%"><BR><FONT SIZE=2> Exhibit&nbsp;99.2</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="82%"><FONT SIZE=2><BR>
Certificate of Principal Financial Officer Pursuant to Exchange Act Rules&nbsp;13a-14(a)&nbsp;and&nbsp;15d-14(a),&nbsp;as Adopted Pursuant to Section&nbsp;302 of the Sarbanes-Oxley Act of 2002.</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="16%"><BR><FONT SIZE=2> Exhibit&nbsp;99.3</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="82%"><FONT SIZE=2><BR>
Certificate of Principal Executive Officer Pursuant to 18&nbsp;U.S.C. Section&nbsp;1350, as Adopted pursuant to Section&nbsp;906 of the Sarbanes-Oxley Act of 2002.</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="16%"><BR><FONT SIZE=2> Exhibit&nbsp;99.4</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="82%"><FONT SIZE=2><BR>
Certificate of Principal Financial Officer Pursuant to 18&nbsp;U.S.C. Section&nbsp;1350, as Adopted pursuant to Section&nbsp;906 of the Sarbanes-Oxley Act of 2002.</FONT></TD>
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<BR>
<P><br><A NAME="05TOR1382_1">QuickLinks</A><br></P><!-- TOC_BEGIN -->
<FONT SIZE=2><A HREF="#toc_ba1382_1">SIGNATURES</A></FONT><BR>
<FONT SIZE=2><A HREF="#toc_ba1382_2">EXHIBIT INDEX</A></FONT><BR>
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<DESCRIPTION>EXHIBIT 1
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<FONT SIZE=3 ><A HREF="#05TOR1382_2">QuickLinks</A></FONT>
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<P ALIGN="RIGHT"><FONT SIZE=2><B>Exhibit 1  </B></FONT></P>

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<P ALIGN="CENTER"><FONT SIZE=2><B>
<IMG SRC="g760100.jpg" ALT="LOGO" WIDTH="327" HEIGHT="72">
  </B></FONT></P>

<P ALIGN="CENTER"><FONT SIZE=5><B>Magna International&nbsp;Inc.  </B></FONT></P>

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<P ALIGN="CENTER"><FONT SIZE=3><B>Annual Information Form  </B></FONT></P>

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<P ALIGN="CENTER"><FONT SIZE=2><B>March&nbsp;29, 2005  </B></FONT></P>

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NAME="page_bg1382_1_1"> </A> </FONT></P>

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<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="bg1382_magna_international_inc._annua__mag02622"> </A>
<A NAME="bg1382_table_#160;of_#160;contents"> </A>
<A NAME="toc_bg1382_1"> </A>
<BR></FONT><FONT SIZE=2><B>MAGNA INTERNATIONAL&nbsp;INC.<BR>  <BR>    ANNUAL INFORMATION FORM<BR>  <BR>    TABLE OF CONTENTS    <BR>    </B></FONT></P>

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<TH WIDTH="9%" ALIGN="LEFT"><FONT SIZE=2>&nbsp;</FONT><BR></TH>
<TH WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TH>
<TH WIDTH="82%" ALIGN="LEFT"><FONT SIZE=2>&nbsp;</FONT><BR></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH WIDTH="4%" ALIGN="CENTER"><FONT SIZE=1><B>Page</B></FONT><HR NOSHADE></TH>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD COLSPAN=3><FONT SIZE=2> FORWARD-LOOKING STATEMENTS</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>2</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="9%"><FONT SIZE=2>ITEM 1.</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="82%"><FONT SIZE=2>CORPORATE STRUCTURE</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>3</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="9%"><FONT SIZE=2>ITEM 2.</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="82%"><FONT SIZE=2>GENERAL DEVELOPMENT OF THE BUSINESS</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>3</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="9%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="82%"><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;OVERVIEW</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>3</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="9%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="82%"><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;RECENT TRENDS IN THE AUTOMOTIVE INDUSTRY</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>5</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="9%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="82%"><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;OUR BUSINESS STRATEGY</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>9</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="9%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="82%"><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;OPERATING STRUCTURE AND PRINCIPLES</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>10</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="9%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="82%"><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;RECENT DEVELOPMENTS IN OUR BUSINESS</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>13</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="9%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="82%"><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;SPIN-OFF OF MI DEVELOPMENTS&nbsp;INC. AND MAGNA ENTERTAINMENT CORP.</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>16</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="9%"><FONT SIZE=2>ITEM 3.</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="82%"><FONT SIZE=2>DESCRIPTION OF THE BUSINESS</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>17</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="9%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="82%"><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;AUTOMOTIVE SYSTEMS GROUPS</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>17</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="9%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="82%"><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;CORPORATE AND OTHER</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>26</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="9%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="82%"><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;RESEARCH AND DEVELOPMENT</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>27</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="9%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="82%"><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;MANUFACTURING AND ENGINEERING</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>27</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="9%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="82%"><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;HUMAN RESOURCES</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>28</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="9%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="82%"><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;COMPETITION</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>30</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="9%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="82%"><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;SALES AND MARKETING</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>30</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="9%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="82%"><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ENVIRONMENTAL MATTERS</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>31</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="9%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="82%"><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;INTELLECTUAL PROPERTY</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>32</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="9%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="82%"><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;RISK FACTORS</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>33</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="9%"><FONT SIZE=2>ITEM 4.</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="82%"><FONT SIZE=2>DIVIDENDS</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>40</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="9%"><FONT SIZE=2>ITEM 5.</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="82%"><FONT SIZE=2>MANAGEMENT'S DISCUSSION AND ANALYSIS</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>41</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="9%"><FONT SIZE=2>ITEM 6.</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="82%"><FONT SIZE=2>DESCRIPTION OF CAPITAL STRUCTURE</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>41</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="9%"><FONT SIZE=2>ITEM 7.</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="82%"><FONT SIZE=2>MARKET FOR SECURITIES</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>43</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="9%"><FONT SIZE=2>ITEM 8.</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="82%"><FONT SIZE=2>DIRECTORS AND OFFICERS</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>45</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="9%"><FONT SIZE=2>ITEM 9.</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="82%"><FONT SIZE=2>CORPORATE CONSTITUTION</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>48</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="9%"><FONT SIZE=2>ITEM 10.</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="82%"><FONT SIZE=2>LEGAL PROCEEDINGS</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>50</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="9%"><FONT SIZE=2>ITEM 11.</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="82%"><FONT SIZE=2>INTEREST OF MANAGEMENT AND OTHERS IN MATERIAL TRANSACTIONS</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>52</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="9%"><FONT SIZE=2>ITEM 12.</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="82%"><FONT SIZE=2>TRANSFER AGENT AND REGISTRAR</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>52</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="9%"><FONT SIZE=2>ITEM 13.</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="82%"><FONT SIZE=2>AUDIT COMMITTEE</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>53</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="9%"><FONT SIZE=2>ITEM 14.</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="82%"><FONT SIZE=2>ADDITIONAL INFORMATION</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>53</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD COLSPAN=3><FONT SIZE=2> SCHEDULE A&nbsp;&#151;&nbsp;PRINCIPAL SUBSIDIARIES</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>54</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD COLSPAN=3><FONT SIZE=2> SCHEDULE B&nbsp;&#151;&nbsp;AUDIT COMMITTEE CHARTER/MANDATE</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%" ALIGN="RIGHT"><FONT SIZE=2>56</FONT></TD>
</TR>
</TABLE>
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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
this Annual Information Form, when we use the terms "we", "us", "our", "Company" and "Magna", we are referring to Magna International&nbsp;Inc. and its subsidiaries and jointly
controlled entities, unless the context otherwise requires. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All
references in this Annual Information Form to calendar years are references to our years ending after December&nbsp;31, 1998 and all references to fiscal years are references to
years ending on July&nbsp;31 of the year named. All references to "$" or "dollars" are references to U.S.&nbsp;dollars, unless otherwise specified. "EBIT" is defined as operating income as
presented on our consolidated financial statements before interest income or expense. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>1</FONT></P>

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<BR></FONT><FONT SIZE=2><B>FORWARD-LOOKING STATEMENTS    <BR>    </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The contents of this Annual Information Form contain statements that, to the extent they are not recitations of historical fact, constitute "forward-looking
statements", within the meaning of applicable securities legislation. Forward-looking statements may include financial and other projections, as well as statements regarding our future plans,
objectives or economic performance, or the assumptions underlying any of the foregoing. We use words such as "may", "would", "could", "will", "likely", "expect", "anticipate", "believe", "intend",
"plan", "forecast", "project", "estimate" and similar expressions to identify forward-looking statements. Any such forward-looking statements are based on assumptions and analyses made by us in light
of our experience and our perception of historical trends, current conditions and expected future developments, as well as other factors we believe are appropriate in the circumstances. However,
whether actual results and developments will conform to our expectations and predictions is subject to a number of risks, assumptions and uncertainties. These risks, assumptions and uncertainties
include, but are not limited to: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>pressure
from our customers to reduce our prices; </FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
availability of and increased prices for key commodities; </FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>global
economic conditions causing decreases in production volumes; </FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>increased
product warranty and recall costs and increased product liability risks; </FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
impact of financially distressed automotive components sub-suppliers; </FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>our
dependence on certain customers and vehicle programs; </FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>our
dependence on outsourcing by automobile manufacturers; </FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>pressure
from our customers to absorb certain fixed costs; </FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>rapid
technological and regulatory changes; </FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>increased
crude oil and energy prices; </FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>doing
business in foreign countries; </FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>fluctuations
in relative currency values; </FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>unionization
activity at our facilities; </FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
threat of work stoppages and other labour disputes; </FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
highly competitive nature of the auto parts supply market; </FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>program
cancellations and delays in launching new programs; </FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>delays
in constructing new facilities; </FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>changes
in governmental regulations; </FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
impact of environmental regulations; and </FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>our
relationship with our controlling shareholder. </FONT></DD></DL>
</UL>
<BR>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
evaluating any forward-looking statements in this Annual Information Form, you should specifically consider the various factors, including those contained under the heading "ITEM 3.
DESCRIPTION OF THE BUSINESS&nbsp;&#151;&nbsp;RISK FACTORS" below, which could cause actual events or results to differ materially from those indicated by our forward-looking
statements. Unless otherwise required by applicable securities laws, we do not intend, nor do we undertake any obligation, to update or revise any forward-looking statements contained in this Annual
Information Form to reflect subsequent information, events or circumstances or otherwise. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>2</FONT></P>

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<P><FONT SIZE=2><A
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<A NAME="toc_de1382_1"> </A>
<BR></FONT><FONT SIZE=2><B>ITEM 1.&nbsp;&nbsp;&nbsp;&nbsp;CORPORATE STRUCTURE    <BR>    </B></FONT></P>

<P><FONT SIZE=2><B>Issuer  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We were incorporated under the laws of the Province of Ontario, Canada on November&nbsp;16, 1961. Our charter documents currently consist of restated articles
of incorporation dated July&nbsp;25, 2001, which were issued pursuant to the </FONT><FONT SIZE=2><I>Business Corporations Act</I></FONT><FONT SIZE=2> (Ontario). </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our
registered and head office is at 337&nbsp;Magna Drive, Aurora, Ontario L4G&nbsp;7K1. </FONT></P>


<P><FONT SIZE=2><B>Subsidiaries  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A list of our principal subsidiaries and their respective jurisdictions of incorporation as of January&nbsp;1, 2005 is set forth on Schedule&nbsp;A. Our legal
structure (including that of our subsidiaries) is not necessarily indicative of our operational structure. </FONT></P>

<P><FONT SIZE=2><A
NAME="de1382_item_2._general_development_of_the_business"> </A>
<A NAME="toc_de1382_2"> </A>
<BR></FONT><FONT SIZE=2><B>ITEM 2.&nbsp;&nbsp;&nbsp;&nbsp;GENERAL DEVELOPMENT OF THE BUSINESS    <BR>    </B></FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><B>OVERVIEW  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our operations are conducted through our global automotive systems groups, as well as corporate and other ancillary operations. Until August&nbsp;29, 2003, we
had non-automotive operations, which were conducted through Magna Entertainment Corp. </FONT></P>

<P><FONT SIZE=2><B>Automotive Operations  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We are the most diversified automotive components supplier in the world. We design, develop and manufacture automotive components, assemblies, modules and
systems, and engineer and assemble complete vehicles. Our products and services are sold primarily to manufacturers of cars and light trucks in North America, Europe, Asia and South America. As at
December&nbsp;31, 2004, we employed over 81,000&nbsp;people and operated 223&nbsp;manufacturing facilities, as well as 56&nbsp;product development and engineering facilities, in
22&nbsp;countries. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our
manufacturing, product development and engineering facilities are organized as autonomous operating divisions. Each division is currently under one of seven automotive systems
groups, three of which Decoma International&nbsp;Inc. ("Decoma"), Intier Automotive&nbsp;Inc. ("Intier") and Tesma International&nbsp;Inc. ("Tesma") were, throughout 2004, publicly traded
companies in which we had a controlling interest through voting securities. In October&nbsp;2004, we announced our proposal to take each of Decoma, Intier and Tesma private. During the first quarter
of 2005, we completed the acquisition of all the outstanding Class&nbsp;A Subordinate Voting Shares of Decoma and Tesma. As a result, Tesma became a wholly-owned subsidiary of Magna and, as part of
the privatization of Decoma, Decoma was amalgamated into Magna. Currently, six out of our seven automotive groups are wholly-owned. The privatization of Intier remains subject to shareholder and court
approval. The shareholders of Intier are scheduled to meet on March&nbsp;30, 2005 to vote on our privatization proposal. See "OPERATING STRUCTURE AND
PRINCIPLES&nbsp;&#151;&nbsp;Privatizations" below. </FONT></P>

<P><FONT SIZE=2><B><I>Automotive Systems Groups  </I></B></FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2><I>Decoma International&nbsp;&#151;&nbsp;</I></FONT><FONT SIZE=2>Decoma designs, engineers and manufactures a variety of
automotive exterior components and systems, including fascias (bumper systems), front and rear end modules, plastic body panels, exterior trim components and systems, sealing and greenhouse systems,
and lighting components. Decoma operates 47&nbsp;manufacturing facilities and nine engineering and product development facilities, including two multi-group facilities, in North America, Europe and
Asia.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2><I>Intier Automotive&nbsp;Inc.&nbsp;&#151;&nbsp;</I></FONT><FONT SIZE=2>Intier is a global full service supplier and integrator
of automotive interior and closure components, systems and modules, including cockpit, sidewall, overhead and complete seating systems, seat hardware and mechanisms, floor and acoustic systems,
seating systems, cargo management systems, latching systems, glass moving systems, wiper systems, power sliding doors and liftgates, mid-door and door module technologies, and
electro-mechanical systems. Intier operates 74&nbsp;manufacturing facilities, including one joint venture facility with Magna Steyr, and 15&nbsp;product development, engineering and testing
centres, including one joint venture facility with Magna Steyr and one multi-group facility, in North America, Europe, South America and Asia. </FONT></DD></DL>
</UL>
<P ALIGN="CENTER"><FONT SIZE=2>3</FONT></P>

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<UL>
</UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2><I>Tesma International&nbsp;&#151;&nbsp;</I></FONT><FONT SIZE=2>Tesma designs, engineers, tests and manufactures powertrain
(engine, transmission and fuel) components, assemblies, modules and systems for cars and light trucks. Tesma operates 28&nbsp;manufacturing facilities in North America, Europe, Asia and South
America, as well as five tooling, design and research and development centers.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2><I>Magna Steyr&nbsp;&#151;&nbsp;</I></FONT><FONT SIZE=2>Magna Steyr is the automotive industry's leading independent assembler of
low-volume derivative, specialty and other vehicles for automobile manufacturers. Magna Steyr also provides complete vehicle design, engineering, validation and testing services. Magna
Steyr operates two assembly and two manufacturing facilities, including one joint venture facility with Intier, and eleven engineering and testing facilities, including one joint venture facility with
Intier and one multi-group facility, in Europe, North America and Asia.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2><I>Magna Drivetrain&nbsp;&#151;&nbsp;</I></FONT><FONT SIZE=2>Magna Drivetrain, which was formed in early 2004, is one of the
world's most advanced developers and suppliers of complete drivetrain technologies, four-wheel and all-wheel drive systems, including transfer cases, power take-off
units, axle drives, manual transaxles, traction control devices and all-wheel drive couplings, mass balancing systems and chassis modules. Magna Drivetrain operates eight manufacturing
facilities and three engineering and testing facilities in Europe and North America. Magna Drivetrain's operations significantly expanded in September&nbsp;2004 with the completion of the
acquisition of the worldwide operations of DaimlerChrysler's wholly-owned subsidiary, New&nbsp;Venture Gear,&nbsp;Inc.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2><I>Magna Donnelly</I></FONT><FONT SIZE=2>&nbsp;&#151;&nbsp;Magna Donnelly manufactures exterior and interior mirrors, interior
lighting and engineered glass systems, electro-mechanical systems and advanced electronics. Magna Donnelly operates 25&nbsp;manufacturing facilities and three engineering and testing facilities in
North America, Europe and Asia.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2><I>Cosma International&nbsp;&#151;&nbsp;</I></FONT><FONT SIZE=2>Cosma manufactures a comprehensive range of stamped, hydroformed
and welded metal body systems, components, modules, assemblies, including complete body-in-white assemblies, chassis systems and complete suspension modules. Cosma operates
33&nbsp;manufacturing facilities and nine engineering and testing facilities in North America, Europe and Asia. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2><B><I>Customers  </I></B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In North America, our primary customers are the "big three" North American automobile manufacturers and their North American operating divisions and subsidiaries,
which are General Motors (including Subaru, Isuzu and Suzuki), Ford (including Mazda) and DaimlerChrysler. Our North American customers also include certain North American subsidiaries of
foreign-based automobile manufacturers, such as Honda, Renault-Nissan, Toyota, BMW, Volkswagen and Mitsubishi. Our North American consolidated production sales accounted for approximately 48% and 55%
of our consolidated sales for each of 2004 and 2003, respectively. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
Europe, our customers include most of the automobile manufacturers, such as BMW (including MINI and Rolls Royce), DaimlerChrysler (including SMART), Volkswagen (including Audi, Skoda,
SEAT and Bentley), General Motors and its European affiliates (including Opel and Saab), Ford and its European affiliates (including Jaguar, Volvo and Land Rover), Renault-Nissan, MG Rover Group,
Fiat, Porsche, PSA Peugeot Citro&euml;n, Toyota, Honda and Mitsubishi. Our European consolidated production and vehicle assembly sales accounted for approximately 45% and 35% of our
consolidated sales for 2004 and 2003, respectively. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Worldwide
sales to DaimlerChrysler, General Motors, BMW and Ford represented approximately 23%, 22%, 20% and 16%, respectively, of our consolidated sales in 2004. See "ITEM 3.
DESCRIPTION OF THE BUSINESS" below. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>4</FONT></P>

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<P><FONT SIZE=2><B>Non-Automotive Operations  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Until August&nbsp;29, 2003, we had non-automotive operations, which were conducted through Magna Entertainment Corp. Magna Entertainment is North
America's number one owner and operator of thoroughbred racetracks, based on revenues, and one of the world's leading suppliers, via simulcasting, of live racing content to the growing inter-track,
off-track and account wagering markets. We transferred our controlling equity interest in Magna Entertainment to MI Developments&nbsp;Inc. in connection with the reorganization and
subsequent spin-off of MI Developments. Since the spin-off transaction, we no longer have any significant non-automotive operations. See "SPIN-OFF OF MI
DEVELOPMENTS&nbsp;INC. AND MAGNA ENTERTAINMENT CORP." and "OPERATING STRUCTURE AND PRINCIPLES&nbsp;&#151;&nbsp;Reorganizations" below. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><B>RECENT TRENDS IN THE AUTOMOTIVE INDUSTRY  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A number of trends have had a significant impact on the global automotive industry in recent years, including: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>increased
pressure by automobile manufacturers on automotive components suppliers to reduce their prices and bear additional costs;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>increased
prices for key commodities used in our parts production;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>globalization
and consolidation of the automotive industry, including both automobile manufacturers and automotive components suppliers;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
evolving role of independent automotive components suppliers and their progression up the "value chain";
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>increased
outsourcing and modularization of vehicle production;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>increased
prevalence of lower volume "niche" vehicles built off high-volume global vehicle platforms;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>growth
of Asian-based automobile manufacturers in North America and Europe; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>growth
of automotive production in emerging markets. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2><B>Increased Pressure on Automotive Components Suppliers to Reduce Prices and Bear Additional Costs  </B></FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Automobile manufacturers have sought ways in which to reduce their cost of producing vehicles as competition for market share among them has become more intense.
In addition to seeking cost efficiencies in their own production, marketing and administrative structures, automobile manufacturers have placed significant pressure on automotive components suppliers
to reduce the price of the components, assemblies, modules and systems. This price pressure has come in different forms, including through: long-term agreements containing
pre-determined price reductions for each year of a vehicle production program; price reduction demands, in addition to those contained in any long-term agreement; pressure to
absorb more design and engineering costs previously paid for by the automobile manufacturer and to recover these costs through amortization in the piece price of the particular components designed or
engineered by the supplier; pressure to assume or offset increases in prices of key commodities, including steel; and pressure to own and/or capitalize tooling and recover these costs through
amortization in the piece price of the components produced by this tooling. In many cases, suppliers bear the risk of not being able to fully recover the design, engineering and tooling costs if the
particular vehicle production volumes are lower than anticipated. This price pressure has intensified, due to the competitive environment of the automotive industry in North America and Europe. In
addition, automobile manufacturers are increasingly requesting that their suppliers bear the cost of the repair and replacement of defective products which are either covered under the automobile
manufacturers' warranty and/or are the subject of a recall and which were improperly designed, manufactured or assembled by their suppliers. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>5</FONT></P>

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<P><FONT SIZE=2><B>Increased Prices for Key Commodities Used in Our Parts Production  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In 2004, we experienced significant price increases for key commodities used in our parts production, particularly steel. We expect such prices to remain at
elevated levels in 2005. Steel price increases have been primarily the result of increased demand for steel in China and a shortage of steel-making ingredients, such as scrap steel, iron ore and coke
coal. Approximately half of our steel is acquired through re-sale programs operated by the automobile manufacturers and does not involve us in pricing exposure. The remainder is acquired
through spot, short-term and long-term contracts. Surcharges on existing prices have been imposed on us by our steel suppliers and other suppliers of steel parts, with the
threat of withheld deliveries by such suppliers if the surcharges are not paid. We have pricing agreements with some of our suppliers that reduce our exposure to steel pricing increases and
surcharges. However, certain suppliers have challenged these agreements and, to the extent that they are successfully disputed, terminated or otherwise not honoured by our suppliers, our exposure to
steel price increases and surcharges may increase. </FONT></P>


<P><FONT SIZE=2><B>Consolidation and Globalization of the Automotive Industry  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The automotive industry has undergone significant consolidation and globalization of automobile manufacturers. This can be attributed to several factors,
including: increased pressure on automobile manufacturers to reduce costs and achieve greater economies of scale; the expansion of free trade zones between major trading partners in North America,
Europe and elsewhere; the accelerated growth of emerging markets in Asia, particularly China and India, and also in Korea, Malaysia and Thailand; and the development of free market economies in
Eastern Europe and the recent expansion of the European Union into Eastern Europe. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Some
examples of the consolidation of automobile manufacturers include: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
merger of Daimler-Benz and Chrysler;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
acquisition by Ford of Jaguar, Volvo, Land Rover and Aston Martin, and a significant equity interest in Mazda;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
acquisition by General Motors of Saab and equity interests in Fuji Heavy Industries&nbsp;Inc. (the&nbsp;maker of Subaru vehicles), Isuzu and a company that owns and
operates certain assets of the former Daewoo Motor Company, and the development of a relationship between General Motors and Suzuki;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
acquisition by Renault of a significant equity interest in Nissan and the acquisition by Nissan of an equity interest in Renault;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
acquisition by Volkswagen of SEAT, Skoda, Bentley, Lamborghini and Bugatti;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
acquisition by BMW of the MINI and the Rolls Royce brands;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
acquisition by Hyundai of Kia Motors and its affiliate Asia Motors; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
acquisition of Ssangyong Motors by Shaghai Automotive Industry Corp. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;However,
there have been recent examples of automobile manufacturers acting contrary to the consolidation trend, such as General Motors' decision not to exercise its put option in
respect of Fiat and DaimlerChrysler's decision to withdraw from a bailout plan in respect of Mitsubishi Motors. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
cost pressures that have caused this consolidation have also stimulated the development by automobile manufacturers of global vehicle platforms. In order to achieve economies of
scale on a global basis, automobile manufacturers, together with their global affiliates and partners, have developed vehicles based on common platforms that share many components, including
powertrain variations, but have distinct styling and different branding, and are produced in different parts of the world. The development of these "world cars" results in significantly reduced
design, development and engineering costs and maximizes automobile manufacturers' purchasing power with respect to key commodities and the components required in vehicle production. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>6</FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;An
example of the globalization of the automotive industry has been the expansion of automobile manufacturers into China, principally through joint ventures with Chinese partners, to
service the growing needs of the local market. For example, the Chinese government has established local manufacturing content requirements for automobile manufacturers, which are expected to increase
component production and assembly in China for the local market. In addition, certain major automobile manufacturers have announced plans to significantly increase their automobile production capacity
in China over the next few years to meet the projected growth in local demand. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
globalization and consolidation of the automobile industry, together with the adoption of just-in-time manufacturing processes and delivery techniques, have
also fostered the globalization of automotive components suppliers. In order to be responsive to the needs of their customers, primary or "Tier&nbsp;1" suppliers to automobile manufacturers are
required to have the financial strength, technical capabilities and geographic reach required to support the design, engineering, manufacturing, sales and program support needs of automobile
manufacturers in most of the countries in which they operate. In addition, as automobile manufacturers have adopted just-in-time manufacturing processes and delivery
techniques, Tier&nbsp;1 suppliers have been increasingly required to locate their facilities close to their customers' manufacturing plants in various parts of the world. </FONT></P>


<P><FONT SIZE=2><B>Evolving Role of Independent Automotive Components Suppliers  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Historically, automotive components suppliers had a relatively limited role in the vehicle development process. Development of a vehicle from concept to
production often took seven to eight years, with automobile manufacturers designing and engineering the vehicle as a whole, as well as many of the specific components required to make the vehicle.
Automobile manufacturers also performed a significant portion of the quality control testing and component sub-assembly required. The role of their suppliers was limited to manufacturing
components in accordance with the design and engineering specifications supplied by automobile manufacturers, which often purchased the same parts from different suppliers, including affiliated
component suppliers. The components delivered to the automobile manufacturers often formed part of significant inventories stored by the automobile manufacturers. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Currently,
Tier&nbsp;1 suppliers are increasingly engaged in more value-added activities, which more closely resemble the activities that were traditionally performed by automobile
manufacturers. Tier&nbsp;1 suppliers are increasingly involved at early stages in the design, engineering and development of components, systems and modules and have assumed increased responsibility
for sub-assembly work, systems integration, quality control testing and component, system and module validation. In order to continue to move up the "value chain", Tier&nbsp;1 suppliers
have had to make significant investments in their engineering capabilities and expertise. Such investments include fixed assets, highly skilled employees and technology. In some cases, suppliers have
assumed responsibility for designing, engineering, developing and assembling significant portions of vehicles, including modules and systems and in certain cases even complete vehicles. This trend
toward increased engineering at the Tier&nbsp;1 supplier level provides those Tier&nbsp;1 suppliers that have such capabilities with increased opportunities to provide increasingly larger, more
complex modules (with increased content and features) to the automobile manufacturers. </FONT></P>

<P><FONT SIZE=2><B>Increased Outsourcing and Modularization of Vehicle Production  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In recent years, automobile manufacturers have increased their outsourcing of components, assemblies, modules and systems. The primary factors driving this
outsourcing have been the need by automobile manufacturers to reduce costs, minimize the time required to bring a new vehicle to market, capitalize on the technical and engineering expertise of
Tier&nbsp;1 suppliers and minimize capital expenditures. Additional factors affecting the decision to outsource include the degree of unutilized capacity in automobile manufacturers' facilities,
restrictions in collective bargaining agreements and the impact of outsourcing on labour relations. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
significant cost and competitive pressures faced by automobile manufacturers combined with the expansion in the capabilities of their suppliers and the trend toward outsourcing has
increasingly resulted in automobile manufacturers outsourcing production of larger assemblies and portions or "modules" of vehicles to their Tier&nbsp;1 suppliers. This modularization of production
enables automobile manufacturers to achieve significant cost savings, by taking advantage of their suppliers' lower variable costs, and has simplified the vehicle assembly process and reduced the
automobile manufacturers' fixed cost investments. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>7</FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
order to properly manage the production of outsourced modules, Tier&nbsp;1 suppliers have had to expand their capabilities and expertise. For example, module suppliers require
program management expertise in order to manage large numbers of sub-suppliers that had previously been managed by automobile manufacturers, as well as extensive logistics capabilities to
coordinate just-in-time deliveries from these sub-suppliers and just in time deliveries to automobile manufacturers. Tier&nbsp;1 suppliers have also had to
develop a broader technical understanding of systems beyond their own products, as well as an understanding of the process of integrating various automotive systems in order to ensure the proper fit,
finish and functioning of the modules supplied by them. As Tier&nbsp;1 suppliers have successfully managed the challenges posed by modularization, automobile manufacturers have begun sourcing
increasingly larger, more complex modules (with increased content and features) as well as management or integration of complete systems to their most capable suppliers. </FONT></P>


<P><FONT SIZE=2><B>Increased Prevalence of Lower Volume "Niche" Vehicles  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;To remain competitive, automobile manufacturers continue to broaden the range of vehicles they offer, to differentiate their products from those of their
competitors, to expand the number of market segments in which they compete, to extend the life of their existing vehicle platforms, to respond to lifestyle trends and to meet the tastes of consumers.
This has caused automobile manufacturers to increase their reliance on lower volume, derivative or "niche" vehicles. Niche vehicles are new vehicle models that are built based on existing vehicle
platforms, and usually consist of convertibles, sports cars and all-wheel drive and four-wheel drive sport utility or cross-over vehicles. Automobile manufacturers
are also "refreshing" more of their existing models during the program life and developing model variants with factory-installed performance and styling packages. This trend toward niche vehicles
provides those Tier&nbsp;1 suppliers that have capabilities resembling those of automobile manufacturers with increased opportunities to provide complete vehicle engineering and assembly services. </FONT></P>

<P><FONT SIZE=2><B>Growth of Asian-Based Automobile Manufacturers in North America and Europe  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;North American subsidiaries of Asian-based automobile manufacturers (primarily Japanese and Korean) have increased their production to approximately 28% of
aggregate North American car and light truck production in 2004, which is up from approximately 26% in 2003. These automobile manufacturers are expected to increase their North American production
volumes, which will be achieved through the expansion of existing assembly facilities and the construction of new assembly facilities. A number of factors, including the improving quality and cost
effectiveness of North American automotive suppliers, currency fluctuations, the loosening of the traditional Japanese "keiretsu" supplier relationships and the North American Free Trade Agreement,
are expected to cause foreign-based automobile manufacturers to rely on increased outsourcing to increase the North American content of their vehicles. Accordingly, these automobile manufacturers
represent significant growth potential for North American automotive components suppliers. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
addition, Asian-based automobile manufacturers have recently increased their manufacturing capacity in Europe both through joint ventures with local partners and new facilities. These
automobile manufacturers are expected to continue to increase their European production. The increased strength of the euro and the establishment of a common market throughout the European Union has
assisted their growth in Europe. Accordingly, these automobile manufacturers represent significant growth potential for European automotive components suppliers, in relation to the investments in
Europe and their need for local high quality suppliers. </FONT></P>

<P><FONT SIZE=2><B>Growth of Automotive Production in Emerging Markets  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We believe that the growth of emerging markets in Asia and Central and Eastern Europe will provide opportunities for expansion for automotive components
suppliers. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;China
has experienced significant automotive industry growth in recent years. Although certain economic policies of the Chinese government tempered automotive growth during 2004, we
expect considerable growth in automotive sales and vehicle production in the coming years. During this period, we also expect that China will experience consolidation among both automobile
manufacturers and Tier&nbsp;I suppliers, as both the automobile manufacturers and their supply base increase production capacity in the country and competition intensifies. Automotive production in
Korea remains strong, and we expect this market to experience considerable growth in the future. Thailand, Malaysia and India, while smaller automotive markets in absolute terms, have also emerged as
markets of growing automotive sales and production. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>8</FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Now
that the expansion associated with new EU member states has stabilized, we believe that continued automotive industry growth will occur in the low cost regions of Central and Eastern
Europe. Automobile manufacturers continue to add assembly capacity in Central and Eastern Europe in order to build a strong low-cost export base, as well as to capitalize on the region's
developing sales market. Automotive components suppliers have followed, and will likely continue to follow, the automobile manufacturers into these regions. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
believe that automobile manufacturers and Tier&nbsp;1 suppliers that expand successfully into these emerging markets and provide a high quality product, while protecting
intellectual property rights, could experience significant growth. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><B>OUR BUSINESS STRATEGY  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;To capitalize on the recent trends in the automotive industry, our business strategy is to achieve and maintain a leading global position with all major
automobile manufacturers in North America, South America, Europe and Asia, as a full service supplier of metal body and structural systems, interior and exterior modules, mirrors and electronics,
powertrain and drivetrain components and systems, with vehicle engineering and assembly, program management and systems integration capabilities. The most significant elements of this business
strategy are described below. </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2><I>We seek to capitalize on our existing customer relationships and expand relationships with our customers in order to increase our content per
vehicle</I></FONT><FONT SIZE=2>. We currently possess a major market share in each product area in which we compete and maintain strong relationships with most major automobile manufacturers in North
America, South America and Europe and, to a lesser extent, in China, Japan and Korea. As a result of these relationships, we have increased the dollar value of our content per vehicle in North America
from approximately $126 in fiscal 1993 to approximately $629 in 2004, which represents a compound annual growth rate of approximately 15%, and in Europe from approximately $6 in fiscal 1993 to
approximately $556 in 2004, which represents a compound annual growth rate of approximately 48%. We are pursuing new programs and "takeover" business from our customers, including foreign-based
automobile manufacturers with facilities in North America, South America, Europe and Asia, to further increase our market penetration and content per vehicle in these markets.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2><I>We intend to capitalize on our total vehicle competence in order to enhance our competitive advantage</I></FONT><FONT SIZE=2>. We have the expertise
to work with our customers from concept to completion, from the design and engineering of a complete vehicle and its systems through to its final assembly. Magna Steyr is a leading supplier of
advanced, total vehicle engineering and is the world's largest independent assembler of complete vehicles. In addition, our other automotive systems groups produce components, modules and systems for
many of the key areas of the entire vehicle. As a result, we are the most diversified global automotive components supplier in the world, having the broadest and deepest product range among the global
automobile components suppliers.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2><I>We intend to leverage our proven expertise in coordinating the design, engineering, manufacture, integration and assembly of modules in order to
further benefit from the trend towards increased outsourcing of larger modules.</I></FONT><FONT SIZE=2> Our automotive systems groups are among the industry leaders in the engineering, development and
production of a number of different types of modules, including front- and rear-end modules, door modules, complete integrated interiors, seating systems, mirror systems, engine-cover
modules, all-wheel drive modules and complete body-in-white assemblies. We intend to continue coordinating our product design, engineering, manufacturing and
testing resources, and further refining our logistics, supply chain management, program management and systems integration skills, in order to enable us to supply a larger number of increasingly
complex modules. We also plan to capitalize on cross-group cooperation on modules in order to maximize our content in each module we supply and on our position as the most diversified components
supplier in the automotive industry. We believe that our privatization proposals will assist us in this regard (see&nbsp;"OPERATING STRUCTURE AND
PRINCIPLES&nbsp;&#151;&nbsp;Privatizations" below). </FONT></DD></DL>
</UL>
<P ALIGN="CENTER"><FONT SIZE=2>9</FONT></P>

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<UL>
<UL>
</UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2><I>We plan to maintain a strong balance sheet and exploit our relative financial strength in order to pursue opportunities for new vehicle programs, as
well as to acquire new technologies and strategic assets.</I></FONT><FONT SIZE=2> We maintain a strong balance sheet, with relatively low debt and significant cash reserves, as well as strong cash
flow. Our financial strength provides comfort to our customers regarding our ability to support major vehicle programs, which enhances our ability to pursue such programs, as well as "takeover"
business from our competitors. We also intend to take advantage of our financial resources to acquire new technologies and strategic assets that complement our current portfolio of automotive
technologies or expand our product breadth, provided that any such acquisition furthers our overall business strategy and enhances our long-term earnings growth.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2><I>We intend to maintain a strong focus on technology-driven growth.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;We believe that one of the cornerstones of our
past success has been our commitment to research, development and technological innovation. This commitment is
enshrined in our Corporate Constitution, which requires us to allocate annually a minimum of 7% of our pre-tax profits (as&nbsp;defined in the Corporate Constitution) to research and
development. Our focus on utilizing new technologies and processes in the development of a wide range of proprietary products has significantly contributed to our strong financial performance over the
last number of years. We intend to remain focused on technology-driven growth and our commitment to research, development and technology innovation in order to maintain our leading position in a
number of product categories and remain in a position to offer our customers a competitive advantage through our technology.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2><I>We plan to continue to invest in technical skills training as well as training for our managers and employees.</I></FONT><FONT SIZE=2> We believe
that the most successful companies are those which are most successful in attracting, retaining and motivating skilled and entrepreneurial employees and management. We believe that we have one of the
most skilled labour pools in the industry, particularly tool and die makers, as well as automotive technicians and engineers. We intend to continue expanding this pool of skilled employees and
managers as a source of significant competitive advantage, by providing extensive training through apprenticeships, technical training centers and management training centers.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2><I>We intend to continue promoting our entrepreneurial culture.</I></FONT><FONT SIZE=2>&nbsp;&nbsp;We have developed an entrepreneurial culture based
on certain key principles such as functional decentralization, which we believe increases flexibility, customer responsiveness and productivity, as well as profit-based compensation programs, which
more directly align the interests of our employees and shareholders. We believe that our operating principles and culture have formed one of the cornerstones of our past success and we intend to
continue promoting them to help achieve continued success in the future. </FONT></DD></DL>
</UL>
<P ALIGN="CENTER"><FONT SIZE=2><B>OPERATING STRUCTURE AND PRINCIPLES  </B></FONT></P>

<P><FONT SIZE=2><B>Decentralization  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We follow a corporate policy of functional and operational decentralization, which we believe increases flexibility, customer responsiveness and productivity. Our
operating structure contains three levels of management&nbsp;&#151;&nbsp;divisional management, automotive systems group management and executive management. Our manufacturing
and assembly operations are conducted through divisions, each of which is an autonomous operating unit and profit center under the authority of a general manager. The general manager of each division
has the discretion to determine rates of pay, hours of work, sources of supply and contracts to be performed, within the framework of our Corporate Constitution and our Employee Charter. All of our
divisions are organized along global product lines under one of the seven automotive systems groups. The management of each of our automotive systems groups is responsible for coordinating product
development, finance and marketing, as well as maximizing manufacturing efficiencies in the divisions comprising the group. Each of our automotive systems groups interfaces with its customers and
provides assistance and advice to its respective divisions. Our executive management coordinates advanced systems development and manufacturing, allocates capital, ensures customer and employee
satisfaction, succession planning and interfaces with the investment community. Our executive management is also responsible for our long-term strategic planning and future growth, as well
as monitoring the performance of the management of each of the automotive systems groups. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>10</FONT></P>

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<P><FONT SIZE=2><B>Spinco Policy  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In 1982, our shareholders approved our "spinco" policy of developing our automotive systems groups into self-sufficient public companies. The
objective of this Spinco policy, which was in furtherance of our commitment to decentralization, was to establish one or more automotive systems groups as separate public corporations, or "spincos",
over a period of time, while we remained as a major shareholder. Guidelines to implement our Spinco policy were approved by our shareholders in December&nbsp;1987. Under these guidelines, each
spinco was to have a corporate constitution and share structure similar to ours and be comprised of independent operating units supported by the spinco's operations, marketing and financial management
resources and executive management. Our role was to provide operations, technical, marketing and financial management and other services from time to time to each spinco for an agreed upon affiliation
fee. Historically, our Spinco policy provided us with numerous benefits, including increased decentralization and autonomy, improved operating flexibility, motivation of senior management and greater
accountability and public scrutiny. However, changing industry conditions, such as opportunities to meet our customers' needs for larger modules that include two or more of our current product groups,
necessitated re-examining our "spinco" policy which resulted in our recent proposals to privatize our three public automotive systems groups (see&nbsp;"Privatizations" below). Although
we will no longer be pursuing further spin-offs, our fundamental "decentralized" operating philosophy and culture have not changed. We remain committed to a philosophy of decentralized,
entrepreneurial and autonomous groups. </FONT></P>

<P><FONT SIZE=2><B>Reorganizations  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In recent years, we completed a series of corporate reorganizations intended to organize our automotive business into automotive systems groups structured along
global product lines, to align our non-automotive operations under Magna Entertainment and to place substantially all of our automotive real estate under MI Developments. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For
example, in February&nbsp;2001, we reorganized our automotive operations into five global automotive systems groups and we completed the spin-off of Intier shortly
thereafter. Following the completion of the acquisition of Donnelly Corporation in October&nbsp;2002, we completed a reorganization of our existing and acquired mirrors operations in order to create
a sixth automotive systems group, Magna Donnelly. In early 2004, we established a seventh automotive systems group, Magna Drivetrain, based on the powertrain operations of Magna Steyr and then
expanded the group with the purchase of the business of New&nbsp;Venture Gear,&nbsp;Inc. from DaimlerChrysler in September&nbsp;2004. See "RECENT DEVELOPMENTS IN OUR
BUSINESS&nbsp;&#151;&nbsp;Acquisitions and Divestitures" below. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Between
1998 and 2003, we transferred substantially all of our automotive real estate assets to MI Developments. Further to a commitment made to our shareholders in calendar 1998, all of
our non-automotive assets (including non-automotive real estate) were transferred to Magna Entertainment. In March&nbsp;2000, we completed the spin-off of
approximately 20% of the voting equity of Magna Entertainment by distributing to its shareholders by way of stock dividend an aggregate of 5,246,085&nbsp;shares of Magna Entertainment's
Class&nbsp;A Subordinate Voting Stock and 10,460,859&nbsp;exchangeable shares of MEC Holdings (Canada)&nbsp;Inc. In August&nbsp;2003, we divested all of our ownership interests in MI
Developments and Magna Entertainment in a spin-off transaction. See "SPIN-OFF OF MI DEVELOPMENTS&nbsp;INC. AND MAGNA ENTERTAINMENT CORP." below. </FONT></P>

<P><FONT SIZE=2><B>Privatizations  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In October&nbsp;2004, we made separate proposals to the respective boards of directors of each of our three public subsidiaries, Intier, Decoma and Tesma, in
each case to acquire all of the outstanding Class&nbsp;A Subordinate Voting Shares of each subsidiary not owned by us. The decision to make these proposals followed a review of our "spinco" policy
by, and recommendation of, a special committee of independent directors of our Board. We believe that the privatizations will enable us to respond much more quickly to customer needs for larger
modules that require a higher degree of systems engineering and integration. Each proposal, to be implemented by way of a court-approved plan of arrangement under Ontario law, was independent and not
conditional on completion of the other transactions. In addition to court approval, each transaction required the approval of shareholders of each subsidiary, including by way of a majority of the
votes cast by holders other than Magna and its affiliates and other insiders. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>11</FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
believe that the privatization of our public subsidiaries will enable us to more efficiently leverage our vast capabilities as the most diversified automotive components supplier in
the world. Specifically, we believe that the privatizations will allow us to: capitalize on the industry trend toward larger and more complex modules that cross traditional product lines; better
position us as a sole supplier to the Japanese and Korean automobile manufacturers, who prefer dealing with a single corporate entity; benefit from greater economies of scale; better align and
streamline product capabilities that currently reside in two or more of our operating groups; and avoid duplicate investments in research and development and infrastructure by more than one operating
group. We also believe that by re-positioning our groups, we will be better able to design and engineer sophisticated cross-product modules. </FONT></P>

<P><FONT SIZE=2><B><I>Tesma  </I></B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On October&nbsp;25, 2004, we announced our intention to privatize Tesma pursuant to a plan of arrangement. Subsequently, on December&nbsp;23, 2004, we jointly
announced with Tesma that we had entered into a definitive agreement pursuant to which we would acquire all the outstanding Class&nbsp;A Subordinate Voting Shares of Tesma not owned by us. On
February&nbsp;1, 2005, Tesma shareholders approved the resolution relating to the plan of arrangement involving Tesma. Court approval of the plan of arrangement was granted on February&nbsp;3,
2005 and the arrangement took effect on February&nbsp;6, 2005. As a result, Tesma's Class&nbsp;A Subordinate Voting Shares ceased trading on the TSX and NASDAQ on and after February&nbsp;4,
2005. Tesma ceased to be a reporting issuer in each province and territory of Canada shortly thereafter. Following completion of the privatization of Tesma effective February&nbsp;6, 2005, Tesma
became a wholly-owned subsidiary of Magna. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
consideration of our acquisition of all of the issued and outstanding Class&nbsp;A Subordinate Voting Shares of Tesma not already owned by us, we issued
6,687,709&nbsp;Class&nbsp;A Subordinate Voting Shares in exchange for Tesma's Class&nbsp;A Subordinate Voting Shares and paid approximately Cdn$127,695,000 to Tesma shareholders who made cash
elections and for fractional shares. For purposes of the cash elections, the volume-weighted average trading price of our Class&nbsp;A Subordinate Voting Shares on the Toronto Stock Exchange over
the five trading days ended February&nbsp;4, 2005 was Cdn$94.4709 per share, resulting in a payment of Cdn$41.5672 per share for Tesma shareholders who made cash elections. Otherwise, Tesma
shareholders received 0.44&nbsp;of a Magna Class&nbsp;A Subordinate Voting Share for each Tesma Class&nbsp;A Subordinate Voting Share under the arrangement. </FONT></P>

<P><FONT SIZE=2><B><I>Decoma  </I></B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On October&nbsp;25, 2004, we announced our intention to privatize Decoma pursuant to a plan of arrangement. Subsequently, on January&nbsp;13, 2005, we jointly
announced with Decoma that we had entered into a definitive agreement pursuant to which we would acquire all the outstanding Class&nbsp;A Subordinate Voting Shares of Decoma not owned by us. On
February&nbsp;28, 2005, Decoma shareholders approved the resolution relating to the plan of arrangement involving Decoma. Court approval of the plan of arrangement was granted on March&nbsp;2,
2005 and the arrangement took effect on March&nbsp;6, 2005. As a result, Decoma's Class&nbsp;A Subordinate Voting Shares ceased trading on the TSX and NASDAQ on and after March&nbsp;4, 2005.
Decoma ceased to be a reporting issuer in each province and territory of Canada shortly thereafter. As part of the privatization of Decoma, Decoma was amalgamated into Magna. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
consideration of our acquisition of all of the issued and outstanding Class&nbsp;A Subordinate Voting Shares of Decoma not already owned by us, we issued
2,854,400&nbsp;Class&nbsp;A Subordinate Voting Shares in exchange for Decoma's Class&nbsp;A Subordinate Voting Shares and paid approximately Cdn$37,175,800 to Decoma shareholders who made cash
elections and for fractional shares. For purposes of the cash elections, the volume-weighted average trading price of our Class&nbsp;A Subordinate Voting Shares on the Toronto Stock Exchange over
the five trading days ended March&nbsp;4, 2005 was Cdn$88.2856 per share, resulting in a payment of Cdn$12.8279 per share for Decoma shareholders who made cash elections. Otherwise, Decoma
shareholders received 0.1453&nbsp;of a Magna Class&nbsp;A Subordinate Voting Share for each Decoma Class&nbsp;A Subordinate Voting Share under the arrangement. </FONT></P>


<P><FONT SIZE=2><B><I>Intier  </I></B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On February&nbsp;9, 2005, we entered into a definitive arrangement agreement that would allow Intier shareholders to vote on whether we would acquire all of the
outstanding Class&nbsp;A Subordinate Voting Shares of Intier not already owned by us by way of a court-approved plan of arrangement. Under the terms of the proposed arrangement, shareholders of
Intier would receive 0.41&nbsp;of a Class&nbsp;A Subordinate Voting Share of Magna for each Class&nbsp;A Subordinate Voting Share of Intier or, at the election of any shareholder, cash based on
the volume-weighted average trading price of our Class&nbsp;A Subordinate Voting Shares over the five trading days ending on the last trading day immediately preceding the effective date of the plan
of arrangement. The aggregate cash payable to all electing Intier shareholders in the proposed transaction would be capped at Cdn$125&nbsp;million. If shareholders of Intier elect to receive cash in
excess of Cdn$125&nbsp;million in the aggregate, the total cash available will be prorated among those shareholders electing to receive cash and the balance of their consideration will be satisfied
through our Class&nbsp;A Subordinate Voting Shares. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>12</FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A
management information circular/proxy statement was mailed to Intier shareholders on or about March&nbsp;7, 2005. Intier has set a record date of February&nbsp;24, 2005 for
shareholders entitled to receive notice of the special shareholders' meeting. The vote on our privatization proposal will take place at Intier's special shareholders' meeting on March&nbsp;30, 2005.
If approved, the proposed arrangement will become effective on April&nbsp;3, 2005. The arrangement will require approval of two-thirds of the votes cast by holders of Intier
Class&nbsp;A Subordinate Voting Shares, as well as a written resolution of all holders of Intier Class&nbsp;B Shares, voting separately as a class, and a written resolution of all holders of
Intier Convertible Preferred Shares, voting separately as a class. We (together with our affiliates) currently hold all of the outstanding Intier Class&nbsp;B Shares and Intier Convertible Preferred
Shares and have agreed that we will vote, or cause to be voted, all such Intier Shares in favour of the arrangement. The arrangement also requires the approval of a simple majority of the votes cast
by the minority shareholders of Intier Class&nbsp;A Subordinate Voting Shares. Magna, parties related to Magna and certain interested parties may not vote their Intier Class&nbsp;A Subordinate
Voting Shares for the purposes of the "majority of the minority" requirement. The arrangement will also be subject to court approval. </FONT></P>

<P><FONT SIZE=2><B>Operating Principles  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We are committed to a number of operating principles, including employee equity participation and profit sharing, incentive-based management compensation and an
employee charter. See "ITEM 3. DESCRIPTION OF THE BUSINESS&nbsp;&#151;&nbsp;HUMAN RESOURCES" below. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><B>RECENT DEVELOPMENTS IN OUR BUSINESS  </B></FONT></P>

<P><FONT SIZE=2><B>Creation of Global Automotive Systems Groups  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In order to respond to the globalization of the automotive industry and diversify our customer and product base, we developed and implemented a European expansion
strategy beginning in fiscal 1994. To assist in implementing this strategy, Frank Stronach, who is currently our Chairman and Interim Chief Executive Officer, moved to Europe during fiscal 1994 and
agreed through Stronach&nbsp;&amp;&nbsp;Co., a Swiss partnership in which Mr.&nbsp;Stronach is the general partner, to provide business development and consulting services to our European and other
affiliates and to develop and coordinate global strategies, identify and evaluate potential acquisitions, business alliances and technologies, develop and recruit technical management for deployment
throughout our worldwide operations, implement our successful operating principles outside North America, enhance our good relations with foreign automobile manufacturers and governments and further
develop our international presence. Stronach&nbsp;&amp;&nbsp;Co., and more recently Mr.&nbsp;Stronach directly, continue to provide business development and consulting services to our European and
other affiliates. As a result of these initiatives, we significantly expanded our operations outside of North America between fiscal 1994 and calendar 1999 by acquiring 51&nbsp;manufacturing
facilities in Europe. This European expansion has enabled us to replicate our North American product offerings in Europe and has resulted in the increase of our European consolidated production and
assembly sales from $79&nbsp;million in fiscal 1993 to approximately $9.2&nbsp;billion, or 45% of total consolidated sales, in 2004. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
February&nbsp;2001, we initiated a reorganization with the aim of consolidating our operations and aligning our automotive products under one of five global automotive systems
groups focused on providing large vehicle modules and systems in each key vehicle area. These groups included the then public automotive systems groups, Decoma and Tesma, and the wholly-owned
automotive systems groups, Magna Steyr, Cosma and an interior systems group. Our interior systems group was created at that time by reorganizing our former Atoma Closure Systems, Magna Seating Systems
and Magna Interior Systems groups into a single group, which is now known as Intier Automotive&nbsp;Inc. At the same time, our Board of Directors, acting on the basis of a report and recommendations
of a special committee of members of our Board of Directors, approved the spin-off of our interior systems group. In August&nbsp;2001, we completed the spin-off of Intier by
way of an initial public offering of 5,476,191&nbsp;of its Class&nbsp;A Subordinate Voting Shares. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>13</FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
October&nbsp;2002, we added a sixth automotive systems group, Magna Donnelly, by combining our existing mirrors operations with those added through the acquisition of Donnelly
Corporation. Magna Drivetrain was established in early 2004 as Magna's seventh automotive group. </FONT></P>

<P><FONT SIZE=2><B>New&nbsp;Products and Technologies  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We believe that a significant portion of our internally generated product growth in recent years has been due to our design and engineering capabilities and
product innovation, which generally results in complex and highly engineered products which generate better returns than commodity-type products. This product innovation has resulted in
the introduction of a number of significant automotive products and technologies in recent years, including: </FONT></P>

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<TABLE WIDTH="100%" BORDER=0 CELLSPACING=0 CELLPADDING=0>
<TR VALIGN="BOTTOM">
<TH WIDTH="24%" ALIGN="LEFT"><FONT SIZE=1><B>Automotive Systems Group </B></FONT><HR NOSHADE></TH>
<TH COLSPAN=3 ALIGN="LEFT"><FONT SIZE=1><B>Recent Product and Technology Innovations </B></FONT><HR NOSHADE></TH>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="24%"><FONT SIZE=2>Decoma International</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2>&#149;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="71%"><FONT SIZE=2>lightweight and technologically advanced running boards</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="24%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2>&#149;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="71%"><FONT SIZE=2>composite tonneau covers</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="24%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2>&#149;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="71%"><FONT SIZE=2>front-end modules</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="24%"><BR><FONT SIZE=2> Intier Automotive&nbsp;Inc.</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2><BR>
&#149;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="71%"><FONT SIZE=2><BR>
reversible seating systems</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="24%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2>&#149;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="71%"><FONT SIZE=2>door modules integrating door hardware and interior trim</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="24%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2>&#149;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="71%"><FONT SIZE=2>Fold and Tumble&#153; seating mechanisms</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="24%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2>&#149;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="71%"><FONT SIZE=2>Tailgate Swing Up&#153; seat</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="24%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2>&#149;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="71%"><FONT SIZE=2>pedestrian protection system</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="24%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2>&#149;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="71%"><FONT SIZE=2>obstacle detection system for windows and doors</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="24%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2>&#149;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="71%"><FONT SIZE=2>integrated centre stack technology</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="24%"><BR><FONT SIZE=2> Tesma International</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2><BR>
&#149;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="71%"><FONT SIZE=2><BR>
electric oil pumps</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="24%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2>&#149;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="71%"><FONT SIZE=2>vane oil pumps for engine applications</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="24%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2>&#149;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="71%"><FONT SIZE=2>electric water pumps</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="24%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2>&#149;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="71%"><FONT SIZE=2>"high speed" balance shaft driven oil pumps</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="24%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2>&#149;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="71%"><FONT SIZE=2>continuously variable intake manifolds</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="24%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2>&#149;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="71%"><FONT SIZE=2>camshaft torque cancellation sprockets</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="24%"><BR><FONT SIZE=2> Magna Steyr</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2><BR>
&#149;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="71%"><FONT SIZE=2><BR>
Dynamic Compound Axle for sport utility vehicles, vans and pick-up trucks</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="24%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2>&#149;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="71%"><FONT SIZE=2>liquid hydrogen fuel storage system, developed in conjunction with BMW</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="24%"><BR><FONT SIZE=2> Magna Drivetrain</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2><BR>
&#149;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="71%"><FONT SIZE=2><BR>
Integrated Transfer Case (ITC), incorporating permanent all-wheel drive with a constant torque distribution</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="24%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2>&#149;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="71%"><FONT SIZE=2>Active Torque Control (ATC) transfer case incorporating variable torque distribution to the front axle with a rigid one to the rear axle</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="24%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2>&#149;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="71%"><FONT SIZE=2>active torque management devices for longitudinal and transversal all-wheel and four-wheel drive applications</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="24%"><BR><FONT SIZE=2> Magna Donnelly</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2><BR>
&#149;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="71%"><FONT SIZE=2><BR>
exterior and interior electrochromic mirrors with SPM&#153; technology and third surface reflector technology</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="24%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2>&#149;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="71%"><FONT SIZE=2>modular added-feature mirrors</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="24%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2>&#149;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="71%"><FONT SIZE=2>Display-On-Demand&#153; technology</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="24%"><BR><FONT SIZE=2> Cosma International</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2><BR>
&#149;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="71%"><FONT SIZE=2><BR>
resistance brazed spot welding</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="24%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2>&#149;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="71%"><FONT SIZE=2>hot forming</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="24%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2>&#149;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="71%"><FONT SIZE=2>remote laser welding</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="24%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2>&#149;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="71%"><FONT SIZE=2>advanced high-strength steels</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="24%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2>&#149;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="71%"><FONT SIZE=2>hydroforming processes</FONT></TD>
</TR>
</TABLE>
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<P ALIGN="CENTER"><FONT SIZE=2>14</FONT></P>

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<P><FONT SIZE=2>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;See "ITEM 3. DESCRIPTION OF THE BUSINESS" below. </FONT></P>

<P><FONT SIZE=2><B>Acquisitions and Divestitures  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In August&nbsp;2003, we distributed to our shareholders 100% of MI Developments, which owns substantially all of our automotive real estate and all of our
former controlling equity interest in Magna Entertainment. See "SPIN-OFF OF MI DEVELOPMENTS&nbsp;INC. AND MAGNA ENTERTAINMENT CORP." below. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On
September&nbsp;29, 2004, we completed the acquisition of the worldwide operations of DaimlerChrysler Corporation's wholly-owned subsidiary, New&nbsp;Venture Gear,&nbsp;Inc. The
transaction involved the creation of a new joint venture, New&nbsp;Process Gear,&nbsp;Inc., initially owned 80% by us and 20% by DaimlerChrysler Corporation, to operate a manufacturing facility in
Syracuse, New&nbsp;York. We will acquire DaimlerChrysler's interest in New&nbsp;Process Gear in September&nbsp;2007. The transaction also involved the acquisition by us of certain other U.S. and
European assets of New&nbsp;Venture Gear, including a manufacturing facility in Roitzsch, Germany and a research and development centre and sales office in Troy, Michigan. The New&nbsp;Venture
Gear acquisition provides our Magna Drivetrain group with additional technological and manufacturing capacity and resources to take advantage of opportunities for sales growth in the drivetrain
market. (See&nbsp;"ITEM 3. DESCRIPTION OF THE BUSINESS&nbsp;&#151;&nbsp;AUTOMOTIVE SYSTEMS GROUPS&nbsp;&#151;&nbsp;Magna Drivetrain" below.) The total
purchase price for 100% of New&nbsp;Venture Gear's business was $428&nbsp;million, subject to post-closing adjustments. The purchase price was satisfied with a combination of
$348&nbsp;million in cash (net&nbsp;of cash acquired of $3&nbsp;million) and $80&nbsp;million in zero-coupon notes payable to DaimlerChrysler, which have a face value of
$95&nbsp;million and are due in December&nbsp;2008. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
January&nbsp;2004, Tesma completed the acquisition of Davis Industries,&nbsp;Inc., a powertrain components and assemblies supplier with three manufacturing plants in Indiana and
Tennessee and an engineering center in Michigan, for a purchase price of approximately $75&nbsp;million, consisting of $45&nbsp;million paid in cash and $30&nbsp;million of assumed debt. This
acquisition increased Tesma's manufacturing capabilities in the United&nbsp;States, including the south, providing Tesma with a closer presence to some of its non-traditional customers. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;During
2004, we also completed several smaller acquisitions, including a number of manufacturing facilities and engineering centres. The total consideration for the above noted
acquisitions amounted to approximately $102&nbsp;million, consisting of $69&nbsp;million paid in cash and $33&nbsp;million of assumed debt. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
the future, we will continue to consider acquisitions of new technologies and strategic assets that complement our current portfolio of automotive technologies or expand our product
breadth, provided that any such acquisition furthers our overall business strategy and potentially enhances our long-term earnings growth. In addition, we will consider acquisitions that
will potentially diversify our customer base, provide us with installed capacity at an economical rate or involve the purchase of key assets at a discounted price. We will also continue to consider
joint ventures with other suppliers in order to increase our business opportunities in various regions and enhance our relationships with certain automobile manufacturers. We analyze all potential
acquisitions and joint ventures using discounted cash flow criteria in an effort to maximize shareholder returns and generate earnings growth. However, we expect that we will continue to expand
primarily through greenfield operations. </FONT></P>

<P><FONT SIZE=2><B>Financing and Securities Transactions  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In August&nbsp;2003, the Toronto Stock Exchange and the New&nbsp;York Stock Exchange accepted notices of our intention to purchase for cancellation and/or for
the purposes of our long-term retention (restricted share) program, up to 3,000,000&nbsp;of our Class&nbsp;A Subordinate Voting Shares, representing less than 5% of our issued and
outstanding Class&nbsp;A Subordinate Voting Shares, pursuant to a normal course issuer bid. Our normal course issuer bid, which was subject to a maximum aggregate expenditure of $200&nbsp;million,
commenced on August&nbsp;12, 2003, following the expiry of our prior normal course issuer bid on August&nbsp;11, 2003, and expired on August&nbsp;11, 2004. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>15</FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
connection with the New&nbsp;Venture Gear acquisition completed in September&nbsp;2004 (see&nbsp;"Acquisitions and Divestitures" above), we issued five series of unsecured
zero-coupon notes on September&nbsp;29, 2004 with an aggregate issue price of Cdn$365&nbsp;million ($287&nbsp;million on issue date) and an aggregate amount due at maturity of
Cdn$415&nbsp;million. The notes, which mature on various dates to December&nbsp;2008, were sold in Canada on an underwritten private placement basis. The first series of notes, having an amount
due at maturity of Cdn$55&nbsp;million and a maturity date of January&nbsp;5, 2005, have been repaid. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;During
September&nbsp;2004, we redeemed all of our outstanding 8.65% Series&nbsp;A Preferred Securities and 8.875% Series&nbsp;B Cumulative Quarterly Income Preferred Securities
for $300&nbsp;million in cash. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On
February&nbsp;6, 2005, we issued 6,687,709&nbsp;Class&nbsp;A Subordinate Voting Shares in exchange for Tesma's Class&nbsp;A Subordinate Voting Shares as part of our
privatization of Tesma. See "OPERATING STRUCTURE AND PRINCIPLES&nbsp;&#151;&nbsp;Privatizations" above. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On
March&nbsp;6, 2005, we issued 2,854,400&nbsp;Class&nbsp;A Subordinate Voting Shares in exchange for Decoma's Class&nbsp;A Subordinate Voting Shares as part of our
privatization of Decoma. See "OPERATING STRUCTURE AND PRINCIPLES&nbsp;&#151;&nbsp;Privatizations" above. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
part of the privatization of Decoma, we assumed Decoma's obligations in respect of its 6.5% Convertible Debentures in the principal amount outstanding of $99,998,000 and maturing on
March&nbsp;31, 2010. Accordingly, Decoma's Convertible Debentures are convertible in whole or in part into our Class&nbsp;A Subordinate Voting Shares at a rate of Cdn$91.19 for each of our
Class&nbsp;A Subordinate Voting Shares. As a result, each Cdn$1,000 principal amount of Decoma Convertible Debentures is convertible into approximately 10.9661&nbsp;of our Class&nbsp;A
Subordinate Voting Shares. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><B>SPIN-OFF OF MI DEVELOPMENTS&nbsp;INC. AND MAGNA ENTERTAINMENT CORP.  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In July&nbsp;2003, we announced that, subject to our shareholders' approval, we proposed to spin-off to our shareholders 100% of MI
Developments&nbsp;Inc., which would operate as a new publicly-traded company and would own substantially all of our automotive real estate and all of our controlling equity interest in Magna
Entertainment Corp. The spin-off transaction was expected to enhance our shareholder value by: unlocking the unrecognized value of our real estate business and non-automotive
assets through a distribution directly to our shareholders; increasing our return on assets through a separation of the lower-return assets of MI Developments and Magna Entertainment from our
automotive assets; and allowing our share valuation to be more reflective of the valuations attributed to other companies in the automotive industry. The spin-off transaction was
recommended by a special committee of independent directors of, and approved by, our Board of Directors, and was subsequently approved by the holders of our Class&nbsp;A Subordinate Voting Shares
and Class&nbsp;B Shares, with each class voting separately, at a meeting held on August&nbsp;19, 2003. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
transaction was effected as a return of capital to our shareholders by way of a distribution of all of the outstanding shares of MI Developments on September&nbsp;2, 2003, on the
basis of one Class&nbsp;A Subordinate Voting Share of MI Developments for every two of our Class&nbsp;A Subordinate Voting Shares, and one Class&nbsp;B Share of MI Developments for every two of
our Class&nbsp;B Shares, in each case to our shareholders of record as of the close of business on August&nbsp;29, 2003. Also on August&nbsp;29, 2003, we completed a reorganization of our
controlling equity interest in Magna Entertainment and as a result, it became held solely by MI Developments. Previously, in March&nbsp;2000, we completed the spin-off of approximately
20% of the voting equity of Magna Entertainment by distributing to our shareholders by way of stock dividend an aggregate of 5,246,085&nbsp;shares of Magna Entertainment's Class&nbsp;A Subordinate
Voting Stock and 10,460,859&nbsp;exchangeable shares of MEC Holdings (Canada)&nbsp;Inc. As a result of these transactions, we no longer have any ownership interest in either of MI Developments or
Magna Entertainment. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
continue to occupy and use the automotive real estate owned by MI Developments, pursuant to long-term leases. All of our automotive systems groups and each of their
divisions operate as autonomous profit centres, as did MI Developments when it was owned by us. We have also in the past engaged in real estate development activities directly with competitors of MI
Developments. Accordingly, we believe that the terms of our leases with MI Development are on arm's length commercial terms. Any material lease, construction or other arrangements with MI Developments
are reviewed and approved by our Corporate Governance and Compensation Committee in advance of any commitments by us or any of our subsidiaries. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>16</FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
a result of the spin-off transaction, our financial results for 2003 have been restated to reflect the financial results of Magna Entertainment as discontinued operations.
However, because we continue to occupy the automotive real estate under long-term leases with MI Developments, the operations of MI Developments' real estate business are disclosed as
continuing operations in our financial statements until August&nbsp;29, 2003. </FONT></P>

<P><FONT SIZE=2><A
NAME="dg1382_item_3._description_of_the_business"> </A>
<A NAME="toc_dg1382_1"> </A>
<BR></FONT><FONT SIZE=2><B>ITEM 3.&nbsp;&nbsp;&nbsp;&nbsp;DESCRIPTION OF THE BUSINESS    <BR>    </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our operations are conducted through manufacturing, engineering and product development facilities that are organized as autonomous operating divisions. At the
start of 2004, we had six automotive systems groups. In early 2004, we created Magna Drivetrain, our seventh automotive systems group. Throughout 2004, three of our automotive systems groups (Decoma,
Intier and Tesma) were publicly traded companies in which we had a controlling interest through voting securities. In October&nbsp;2004, we announced our proposal to take private each of Decoma,
Intier and Tesma. During the first quarter of 2005, we completed the acquisition of all the outstanding Class&nbsp;A Subordinate Voting Shares of Decoma and Tesma. As a result, Tesma became a
wholly-owned subsidiary of Magna and, as part of the privatization of Decoma, Decoma was amalgamated into Magna. The Decoma group is now referred to as Decoma International. Currently, six out of our
seven automotive groups are organized among our wholly-owned subsidiaries. The privatization of Intier remains subject to shareholder and court approval. The shareholders of Intier are scheduled to
meet on March&nbsp;30, 2005 to vote on our privatization proposal. See "ITEM 2. GENERAL DEVELOPMENT OF THE BUSINESS&nbsp;&#151;&nbsp;OPERATING STRUCTURE AND
PRINCIPLES&nbsp;&#151;&nbsp;Privatizations" above. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our
corporate and other operations, which is a separate reportable segment, consist of operations that support or are ancillary to our automotive operations and, until August&nbsp;29,
2003, included our automotive real estate operations. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><B>AUTOMOTIVE SYSTEMS GROUPS  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We currently have seven automotive systems groups. With the exception of Intier Automotive&nbsp;Inc., which as of the date hereof is a publicly traded company
in which we have a controlling interest through voting securities, each of our operating groups is wholly-owned and organized as follows: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Decoma
International;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Intier
Automotive&nbsp;Inc.;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Tesma
International;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Magna
Steyr;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Magna
Drivetrain;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Magna
Donnelly; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Cosma
International. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2><B>Decoma International  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Decoma is a leading global manufacturer and Tier&nbsp;1 supplier of automotive exterior components and systems for cars and light trucks. As at
December&nbsp;31, 2004, Decoma employed approximately 16,000&nbsp;people in 47&nbsp;manufacturing facilities and nine engineering and product development facilities, including two multi-group
facilities, in Canada, the United&nbsp;States,
Mexico, Germany, Belgium, Poland, England, Japan, France, Austria and the Czech Republic. In 2004, Decoma's sales were approximately $2.759&nbsp;billion (compared with $2.426&nbsp;billion in
2003), representing approximately 13% of our consolidated sales, and EBIT was approximately $79&nbsp;million. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>17</FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;During
2004, Decoma's Class&nbsp;A Subordinate Voting Shares were publicly traded on the Toronto Stock Exchange under the trading symbol "DEC.SV.A", and were listed and quoted on the
NASDAQ National Market under the trading symbol "DECA". Following a vote of the shareholders of Decoma, the privatization of Decoma became effective as of March&nbsp;6, 2005 (see&nbsp;"ITEM 2.
GENERAL DEVELOPMENT OF THE BUSINESS&nbsp;&#151;&nbsp;OPERATING STRUCTURE AND PRINCIPLES&nbsp;&#151;&nbsp;Privatizations" above). </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Decoma's
main product segments are: </FONT></P>

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<TR VALIGN="TOP">
<TD WIDTH="49%"><FONT SIZE=2>&#149;&nbsp;&nbsp;&nbsp;&nbsp;fascias (bumper systems);</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="49%"><FONT SIZE=2>&#149;&nbsp;&nbsp;&nbsp;&nbsp;front and rear end modules;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="49%"><BR><FONT SIZE=2> &#149;&nbsp;&nbsp;&nbsp;&nbsp;plastic body panels;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="49%"><FONT SIZE=2><BR>
&#149;&nbsp;&nbsp;&nbsp;&nbsp;exterior trim components and systems;</FONT></TD>
</TR>
<TR VALIGN="BOTTOM">
<TD WIDTH="49%" VALIGN="TOP"><BR><FONT SIZE=2> &#149;&nbsp;&nbsp;&nbsp;&nbsp;sealing and greenhouse systems; and</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="49%" VALIGN="TOP"><FONT SIZE=2><BR>
&#149;&nbsp;&nbsp;&nbsp;&nbsp;lighting components.</FONT></TD>
</TR>
</TABLE>
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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Within
these product segments, Decoma possesses a full range of manufacturing and tooling capabilities. Decoma uses molding technologies such as structural reaction injection, reaction
injection, injection, compression and thermoset molding. Decoma's metal forming processes include metal stamping, roll forming, tube forming and stretch bending, while its extrusion processes include
co-extrusion as well as thermoset and thermoplastic extrusion. Decoma also employs a number of finishing processes, including painting, hardcoating, chrome plating and anodizing. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
addition to its principal manufacturing operations, Decoma designs, engineers, manufactures, assembles and installs spoilers, rocker panels, splash guards and air dams. In this
product area, Decoma also performs in-line vehicle system assembly work (consisting of installation of cladding, rocker panels, spoilers, wheel flares, running boards, exhaust tips,
striping decals, light bars, tonneau covers, fascias, body side moldings, hood deflectors and grilles) primarily for General Motors and DaimlerChrysler specialty vehicle production programs. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Decoma
has a diversified customer base that spans the major automotive markets of North America and Europe. In North America, Decoma's primary customers are the various North American
operating divisions and subsidiaries of Ford, General Motors, DaimlerChrysler, Honda, Renault-Nissan and Toyota. In Europe, Decoma's customers include the European operating divisions and subsidiaries
of DaimlerChrysler, Volkswagen, Ford (including Land Rover), General Motors, BMW, Volvo Truck, Renault, MAN Truck, PSA Peugeot-Citro&euml;n, Toyota and Honda. Decoma's largest production
programs in 2004 include: </FONT></P>

<P><FONT SIZE=2><I>North America  </I></FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Ford
Explorer;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>General
Motors Impala;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>DaimlerChrysler
Magnum and 300/300C;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>DaimlerChrysler
Stratus, Sebring and Sebring Convertible; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Ford
Crown Victoria and Grand Marquis. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2><I>Europe  </I></FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Volkswagen
Transit Van;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Volkswagen
Golf;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>DaimlerChrysler
Mercedes C-Class;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Opel
Epsilon; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Volkswagen
City Car. </FONT></DD></DL>
</UL>
<P ALIGN="CENTER"><FONT SIZE=2>18</FONT></P>

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</UL>
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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Prior
to the privatization of Decoma, Decoma owned a minority interest the Modular Automotive Systems, L.L.C. joint venture. As a result of the privatization of Decoma, including the
amalgamation of Decoma into Magna, we now own a 40% equity interest in Modular Automotive Systems, while Hollingsworth Logistics Group, L.L.C. and a related company own the remaining 60% equity
interest and maintain management control of it. Modular Automotive Systems is a Michigan-based minority controlled sequencing and sub-assembly operation that is certified as a minority
business enterprise under the certification guidelines of the Michigan Minority Business Development Council. Modular Automotive Systems provides sequencing and sub-assembly services to a
number of automobile manufacturers on a minority credit basis. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Decoma's
operations have grown significantly in recent years through several acquisitions. In September&nbsp;2001, Decoma purchased the automotive lighting business of Autosystems
Manufacturing, which added a new product group to Decoma's overall exterior product mix and enhanced Decoma's overall module capability. Decoma's automotive lighting business was further enhanced by
the acquisition of Federal-Mogul Corporation's original equipment automotive lighting business in April&nbsp;2003, consisting of a manufacturing facility in Matamoros, Mexico, a distribution centre
in Brownsville, Texas, an assembly operation in Toledo, Ohio and certain of the engineering operations, contracts and equipment at Hampton, Virginia. Decoma also acquired the shares of HDO
Galvano-und Oberfl&auml;chentechnik&nbsp;GmbH, which operated a chroming line adjacent to Decoma's Idoplas facility in Germany, in late 2003. </FONT></P>


<P><FONT SIZE=2><B>Intier Automotive&nbsp;Inc.  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Intier is a global full-service supplier of automotive interior and closure components, systems and modules for cars and trucks. As at
December&nbsp;31, 2004, Intier employed approximately 24,100&nbsp;people at 74&nbsp;manufacturing facilities, including one joint venture facility with Magna Steyr, and 15&nbsp;product
development, engineering and testing centers, including one joint venture facility with Magna Steyr and one multi-group facility, in Canada, the United&nbsp;States, Mexico, Brazil, Germany, Austria,
England, France, Spain, Italy, Poland, the Czech Republic, Turkey, China and Japan. Intier's Class&nbsp;A Subordinate Voting Shares are listed and posted for trading on the Toronto Stock Exchange
under the trading symbol "IAI.SV.A" and are listed and quoted for trading on the Nasdaq National Market under the trading symbol "IAIA". In 2004, Intier's sales were approximately
$5.487&nbsp;billion (compared with $4.654&nbsp;billion in 2003), representing approximately 27% of our consolidated sales, and EBIT was approximately $231&nbsp;million. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
proposed privatization of Intier remains subject to shareholder and court approval. The shareholders of Intier are scheduled to meet on March&nbsp;30, 2005 to vote on our
privatization proposal. See "ITEM 2. GENERAL DEVELOPMENT OF THE BUSINESS&nbsp;&#151;&nbsp;OPERATING STRUCTURE AND
PRINCIPLES&nbsp;&#151;&nbsp;Privatizations" above. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Intier's
main products are: </FONT></P>

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<TR VALIGN="TOP">
<TD WIDTH="49%"><FONT SIZE=2>&#149;&nbsp;&nbsp;&nbsp;&nbsp;complete cockpit systems;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="49%"><FONT SIZE=2>&#149;&nbsp;&nbsp;&nbsp;&nbsp;latching systems;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="49%"><BR><FONT SIZE=2> &#149;&nbsp;&nbsp;&nbsp;&nbsp;sidewall and trim systems;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="49%"><FONT SIZE=2><BR>
&#149;&nbsp;&nbsp;&nbsp;&nbsp;window systems;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="49%"><BR><FONT SIZE=2> &#149;&nbsp;&nbsp;&nbsp;&nbsp;overhead systems;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="49%"><FONT SIZE=2><BR>
&#149;&nbsp;&nbsp;&nbsp;&nbsp;door modules;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="49%"><BR><FONT SIZE=2> &#149;&nbsp;&nbsp;&nbsp;&nbsp;complete seating systems;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="49%"><FONT SIZE=2><BR>
&#149;&nbsp;&nbsp;&nbsp;&nbsp;liftgate, tailgate and mid-door modules;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="49%"><BR><FONT SIZE=2> &#149;&nbsp;&nbsp;&nbsp;&nbsp;seating hardware systems;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="49%"><FONT SIZE=2><BR>
&#149;&nbsp;&nbsp;&nbsp;&nbsp;modular roof systems;</FONT></TD>
</TR>
<TR VALIGN="BOTTOM">
<TD WIDTH="49%" VALIGN="TOP"><BR><FONT SIZE=2> &#149;&nbsp;&nbsp;&nbsp;&nbsp;floor carpet and complete vehicle acoustic systems;</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="49%" VALIGN="TOP"><FONT SIZE=2><BR>
&#149;&nbsp;&nbsp;&nbsp;&nbsp;power closures systems;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="49%"><BR><FONT SIZE=2> &#149;&nbsp;&nbsp;&nbsp;&nbsp;cargo management systems;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="49%"><FONT SIZE=2><BR>
&#149;&nbsp;&nbsp;&nbsp;&nbsp;electrical/electronic systems and components; and</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="49%"><BR><FONT SIZE=2> &#149;&nbsp;&nbsp;&nbsp;&nbsp;complete interior integration.</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="49%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
</TR>
</TABLE>
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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Intier
employs a number of different technologies in its operations. For example, seating and seating components are manufactured using both traditional "cut&nbsp;&amp; sew" technology and
Intier's patented Mold-In-Place&#153; technology. Manufacturing methods for cockpit and sidewall systems include low pressure and injection molding, compression of
molding, vacuum forming, slush molding and spray urethane. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Intier's
primary customers include DaimlerChrysler, Ford and General Motors and their respective operating divisions and subsidiaries. Intier also supplies products to a number of other
automobile manufacturers, including BMW, Volkswagen, Fiat, Renault-Nissan, Honda and Toyota. Examples of some of the programs launched by Intier in 2004 include: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>second
and third row stow-in-floor seating system for the DaimlerChrysler minivan;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>complete
seating system for the Mercury Mariner in North America;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>complete
seating system for the Chevrolet Cobalt and the Pontiac Pursuit;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>complete
seating system, headliner and instrument panel for the Chevrolet Equinox;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>door
panels, interior trim, carpet and cargo management system for the Mercedes-Benz A-Class;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>door
panels, instrument panel and overhead system and interior integration for the Cadillac STS; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>door
panels for the BMW 1-series. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
a result of the wide range of interior components, modules and systems that Intier produces, combined with its engineering and program management capabilities, Intier was selected by
General Motors to manage, design and produce the complete seats, instrument panels and overhead system for the Chevrolet Equinox which commenced production in 2004. In 2003, Intier launched the
integration of the complete interior (including seats) of the Cadillac SRX and in 2004 launched the integration of the interior (excluding seats) for the Cadillac STS. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Intier
participates in a number of joint ventures created to facilitate its entry into new markets and the exchange of technical know-how and other intellectual property and
to expand its product and engineering expertise as well as its customer base. Intier owned a 50% interest in each of the following joint ventures, with the exception of InterLink Automotive L.L.C. in
which Intier owned a 60% interest, as of December&nbsp;31, 2004: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
Bloomington-Normal Seating Company joint venture with Namba Press Works&nbsp;Co.&nbsp;Ltd., which manufactures complete seating systems in Illinois for a
Mitsubishi/DaimlerChrysler joint venture;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
Shanghai Lomason Automotive Seating Company joint venture with Shanghai Jiao Yun&nbsp;Co.&nbsp;Ltd., which manufactures seat frames, metal stampings and complete
aftermarket seats in China;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Gra-Mag
Truck Interior Systems, L.L.C., a joint venture with Grammar AG, which supplies seating systems to the North American medium and heavy-duty
truck market;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
Magna Kansei joint venture in the United&nbsp;Kingdom with Calsonic International Europe, which supplies Nissan U.K., BMW, Land Rover and General Motors with
instrument panels, consoles and glove boxes using injection molding technology;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
Advanced Car Technology Systems (ACTS) joint venture with Magna Steyr in Germany, which provides component, system and full vehicle testing and simulation services to
Intier, Magna Steyr and third parties;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
Uniport joint venture in France with Magna Steyr, which supplies complete door and tailgate modules for the DaimlerChrysler Smart Car;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>InterLink
Automotive L.L.C., a Michigan joint venture with Llink Technologies L.L.C., which was created for the development, sales and marketing of sun visor and related
products; and </FONT></DD></DL>
</UL>
<P ALIGN="CENTER"><FONT SIZE=2>20</FONT></P>

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<UL>
</UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
Namba-Intier&nbsp;K.K. joint venture in Japan with Namba Press Works&nbsp;Co.&nbsp;Ltd., which was formed as a sales and engineering office in Japan to focus on
seating systems. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
addition, we have a 32% equity interest in Camaco L.L.C, which is a registered minority supplier of seat frames with operations located in Columbus, Nebraska and Marianna, Arkansas
and a sales and engineering office in Novi, Michigan and which supplies seat frames to Intier and several of its competitors. Intier has the option to purchase from us, and we have the right to
require Intier to purchase our equity interest in Camaco L.L.C., for a nominal purchase price. Intier also has a 45% interest in Dakkota L.L.C., a joint venture with Rush Group L.L.C.
(a&nbsp;certified minority supplier). Dakkota is responsible for providing sequencing, logistics management and assembly services with respect to several programs (including the Cadillac CTS, SRX
and STS) under which Intier is manufacturing and supplying certain interior products. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;During
the first quarter of 2004, Intier sold its Lohr, Germany seating systems facility and during the third quarter of 2004, Intier sold its New&nbsp;Eastwood, England seating
systems facility. </FONT></P>

<P><FONT SIZE=2><B>Tesma International  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Tesma designs, engineers, tests and manufactures powertrain (engine, transmission and fuel) components, assemblies, modules and systems for cars and light trucks.
As at December&nbsp;31, 2004, Tesma employed approximately 5,800&nbsp;people in 28&nbsp;manufacturing facilities located in Canada, the United&nbsp;States, Germany, Austria, Italy, South
Korea, China and Brazil, and five tooling, design and research and development centres. In 2004, Tesma's sales were approximately $1.377&nbsp;billion (compared with $1.102&nbsp;billion in 2003),
representing approximately 7% of our consolidated sales, and EBIT was approximately $111&nbsp;million. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;During
2004, Tesma's Class&nbsp;A Subordinate Voting Shares were publicly traded on the Toronto Stock Exchange under the trading symbol "TSM.SV.A", and were listed and quoted on the
NASDAQ National Market under the trading symbol "TSMA". Following a vote of the shareholders of Tesma, the privatization of Tesma became effective as of February&nbsp;6, 2005 (see&nbsp;"ITEM 2.
GENERAL DEVELOPMENT OF THE BUSINESS&nbsp;&#151;&nbsp;OPERATING STRUCTURE AND PRINCIPLES&nbsp;&#151;&nbsp;Privatizations" above). </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Tesma
operates in three product technology groups, as follows: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2><I>Tesma Engine Technologies</I></FONT><FONT SIZE=2>&nbsp;&#151;&nbsp;including: engine front cover module assemblies; aluminum
die cast and precision machined oil pans, cam cover assemblies and rocker covers; engine oil and water pump systems; cooling system cross-over tubes, injection molded water outlet and
thermostat housing assemblies; accessory and timing belt drive tensioner products and systems and other highly engineered drive systems products (including overrunning alternator decoupler assemblies
and multi-function crankshaft pulley assemblies); steel, phenolic (plastic) and aluminum pulleys for virtually all engine applications (crankshafts, alternators, power steering pumps,
air-conditioning compressors and water pumps); engine balance shaft assemblies; variable camshaft phasing systems; and collapsible drive shaft assemblies.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2><I>Tesma Transmission Technologies</I></FONT><FONT SIZE=2>&nbsp;&#151;&nbsp;including:
die-formed/flow-formed/cast and machined transmission clutch housings and shaft assemblies; cam die-formed transmission shells; torque converter damper plate
assemblies; transmission oil pump assemblies; die-formed transmission oil pan assemblies; aluminum die cast and machined case extensions; flexplates (both one- and
two-piece designs); servo piston and accumulator assemblies; drive hubs and housings, pistons, damper plates, reaction and input shells, shift detent plates and other transmission
components; friction clutch pack assemblies; fineblanked products; transfer case output shafts and flanges; torque converter stator shafts; and various components (pistons, plungers and clutch
housings) for continuously variable transmission applications; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2><I>Tesma Fuel Technologies</I></FONT><FONT SIZE=2>&nbsp;&#151;&nbsp;including: traditional automotive caps (fuel, radiator,
coolant reservoir and oil); fuel filler inlet assemblies; vapour recovery valves/systems; vent, fill and spud tubes; thin-walled, stainless steel "cap-to-tank" fuel
filler modules (integrated refueling units consisting of the fuel cap, filler inlet and filler pipe or tube, plus in some applications, "on-board refueling vapour recovery" (ORVR) system
technology; and stainless steel fuel filler pipes, stainless steel fuel tank assemblies and fuel sender units. </FONT></DD></DL>
</UL>
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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Tesma
employs a wide variety of different manufacturing capabilities and processing technologies in its operations, many of which are used across multiple product groups. Tesma's current
capabilities include metal die-forming, flow-forming, stamping and spinning, synchronous roll-forming, die-spline rolling, precision-heavy stamping,
fineblanking, steel tube bending and end-forming, hydroforming, stainless steel plasma welding, aluminum die casting, gravity casting and precision machining, plastic injection molding,
including plastic welding, and automated assembly. Using these metal, aluminum and plastic processing technologies, Tesma is able to engineer and supply unique components, assemblies and modules that
offer performance, weight, cost and packaging advantages in each of its Engine, Transmission and Fuel Technologies product areas. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Although
Tesma is principally a supplier to automobile manufacturers in North America and Europe, it has a diversified worldwide customer base that spans each of the four major
automotive markets&nbsp;&#151;&nbsp;North America, Europe, Asia and South America. Tesma's primary customers in North America are General Motors, Ford and DaimlerChrysler,
including their respective operating divisions and subsidiaries, while its European customer base is quite diversified and includes virtually all significant automobile manufacturers with vehicle
assembly operations in Europe, the primary ones being Volkswagen, DaimlerChrysler and General Motors. Tesma also delivers its products to customers in China, Japan, South Korea, Taiwan, Singapore,
Indonesia, Thailand, Philippines, Australia, Brazil, Argentina, Venezuela and South Africa. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
substantial majority of Tesma's products is engine or transmission specific, and therefore may be installed or available as options over a variety of vehicle platforms. Examples of
some of Tesma's current "high content" North American engine and transmission programs (including a number of the more significant vehicle applications) include: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
General Motors L850/LE5&nbsp;engine program (Saturn Ion and Vue; Chevrolet Cavalier, Malibu and Cobalt; and Pontiac G6, Sunfire and Grand Am);
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
General Motors Gen III/IV engine program (Cadillac Escalade; Chevrolet Silverado, Suburban and Tahoe; and GMC Sierra and Yukon);
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
General Motors High Feature V6&nbsp;engine program (Cadillac CTS, SRX and STS; and Buick Rendezvous);
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
General Motors Line 4, 5&nbsp;and 6&nbsp;engine programs (Chevrolet Colorado and Trailblazer; GMC Canyon and Envoy; Buick Rainier; and Isuzu Ascender);
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
Ford Modular V8&nbsp;engine program (Ford Mustang, Crown Victoria, F-Series pick-up trucks, Explorer and Expedition; and Lincoln Navigator and
Aviator);
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
Ford Duratec engine program (Ford Escape, Taurus, Five Hundred and Mondeo; and Mazda 6&nbsp;and Tribute);
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
DaimlerChrysler 3.7L to 5.7L modular engine programs (Chrysler 300; Jeep Liberty and Grand Cherokee; and Dodge Durango, Magnum, Dakota and Ram pickup trucks);
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
Ford 5R110&nbsp;transmission program (Ford's heavier duty F-Series pickup trucks);
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
General Motors 4L60&nbsp;transmission program (General Motors' full-sized pickup truck and sport utility vehicle families); and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
Allison LT1000&nbsp;transmission program (General Motors' heavier duty pickup trucks and medium duty trucks). </FONT></DD></DL>
</UL>

<P><FONT SIZE=2><B>Magna Steyr  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Magna Steyr is the automotive industry's leading independent assembler of low-volume derivative, specialty and other vehicles for automobile
manufacturers. Magna Steyr also provides complete vehicle design, engineering, validation and testing services. As at December&nbsp;31, 2004, Magna Steyr employed approximately 9,100&nbsp;people
at two assembly and two manufacturing facilities, including one joint venture facility with Intier, and eleven engineering and testing facilities, including one joint venture facility with Intier and
one multi-group facility, located in Austria, Germany, France, Hungary, India and the United&nbsp;States. In 2004, Magna Steyr's sales (including Magna Drivetrain) were approximately
$6.172&nbsp;billion (compared with $2.719&nbsp;billion in 2003), representing approximately 30% of our consolidated sales, and EBIT was approximately $206&nbsp;million. Magna Steyr's financial
results are included with those of Magna Drivetrain in our "Magna Steyr" financial reporting segment. </FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Magna
Steyr's complete vehicle, systems and components engineering as well as its testing capabilities enable it to participate in the vehicle and systems concept and design process
through: involvement in advance development and the preparation of feasibility studies; the development phase, in which technical calculations and simulations are performed and full vehicle prototypes
are built; and the vehicle testing and production planning stage. In June&nbsp;2004, we acquired the engineering group of Duarte, which includes four locations in France. The acquisition strengthens
Magna Steyr's position in the European market as a leading engineering and development partner of the automobile manufacturers and is consistent with our strategy of increasing our exposure to the
French-based automobile manufacturers, being Duarte's primary customers. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Magna
Steyr's primary customers are automobile manufacturers located in Europe, although Magna Steyr supplies to certain automobile manufacturers in North America. Magna Steyr currently
assembles the following vehicles at its facility in Graz, Austria, with a combined volume of approximately 227,000&nbsp;vehicles in 2004, for sale to the global market for the following automotive
manufacturers: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>DaimlerChrysler:
the Mercedes-Benz G-Class, and E-Class&nbsp;4MATIC; 4x4&nbsp;systems for the Mercedes-Benz
C-Class, E-Class and S-Class; the Jeep Grand Cherokee; and the Chrysler Voyager;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Saab:
the 9<SUP>3</SUP> convertible, since the third quarter of 2003; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>BMW:
the X3&nbsp;sport activity vehicle, since the fourth quarter of 2003. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
2004, Magna Steyr was awarded an assembly contract for the Chrysler 300&nbsp;touring and sedan vehicles for distribution to all markets outside North America. This program is
scheduled to launch in Magna Steyr's Graz facility in 2005. Magna Steyr also operates a heavy stamping facility in Albersdorf, Austria that serves primarily as a feeder plant for the group's assembly
facility in Graz. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Magna
Steyr operates a joint venture with Intier in Hambach, France which produces complete door systems for the DaimlerChrysler SMART car, as well as the Advanced Car Technology Systems
(ACTS) joint venture which focuses on
total vehicle safety systems integration and supports Magna Steyr, Intier and third party suppliers in the development and testing of their respective systems and components. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
2002, Magna Steyr completed the acquisition from DaimlerChrysler of the Eurostar assembly facility, located adjacent to Magna Steyr's assembly facility in Graz, Austria. This
acquisition increased Magna Steyr's assembly capacity. </FONT></P>


<P><FONT SIZE=2><B>Magna Drivetrain  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Magna Drivetrain is a leading supplier and developer of drivetrain components, modules and systems, with a focus on all-wheel drive vehicles. As at
December&nbsp;31, 2004, Magna Drivetrain employed approximately 5,300&nbsp;people at eight manufacturing facilities and three engineering and testing facilities, which are located in the
United&nbsp;States, Mexico, Austria and Germany. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Magna
Drivetrain was established in early 2004 as Magna's seventh automotive group. Initially, its operations included the powertrain operations of Magna Steyr. Magna Drivetrain's
operations expanded in September&nbsp;2004 with the completion of the acquisition of the worldwide operations of DaimlerChrysler Corporation's wholly-owned subsidiary, New&nbsp;Venture
Gear,&nbsp;Inc. See "ITEM 2. GENERAL DEVELOMENT OF THE BUSINESS&nbsp;&#151;&nbsp;RECENT DEVELOPMENTS IN OUR BUSINESS&nbsp;&#151;&nbsp;Acquisitions and
Divestitures" above. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>23</FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Magna
Drivetrain's produces a wide variety of drivetrain products, including the following: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2><I>four-wheel and all-wheel drive systems:</I></FONT><FONT SIZE=2>&nbsp;&nbsp;
<BR><BR></FONT>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2><I>transfer cases&nbsp;&#151;&nbsp;</I></FONT><FONT SIZE=2>an assembly, primarily used in light trucks and sport utility
vehicles, that transfers power from the transmission of a rear-wheel drive vehicle to the front axle;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2><I>power take-off units&nbsp;&#151;&nbsp;</I></FONT><FONT SIZE=2>another type of assembly for four-wheel
drive systems that transfers power from the transmission of a front-wheel drive vehicle to the rear axle;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2><I>axle drives&nbsp;&#151;&nbsp;</I></FONT><FONT SIZE=2>drive units for front and rear axles;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2><I>torque management devices and all-wheel drive couplings&nbsp;&#151;&nbsp;</I></FONT><FONT SIZE=2>devices that
allow torque distribution between the main drive axle and the auxiliary drive axle; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2><I>manual transaxles&nbsp;&#151;&nbsp;</I></FONT><FONT SIZE=2>a driveline assembly for front-wheel drive vehicles into which a
manual transmission, gearbox, clutch, final drive and differential are combined into a single unit, and which connects to the engine and transmits torque through the driveshaft in various ratios to
wheels;
<BR><BR></FONT></DD></DL>
</DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2><I>mass balancing systems&nbsp;&#151;&nbsp;</I></FONT><FONT SIZE=2>systems to reduce engine noise and vibrations; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2><I>chassis modules&nbsp;&#151;&nbsp;</I></FONT><FONT SIZE=2>complete, pre-assembled suspended axle modules. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Magna
Drivetrain uses the following core skills and competencies in manufacturing its drivetrain components: aluminum die casting, soft and hard processing of gear wheels and shafts,
rotary swaging, hardening, laser welding, assembly and end-of-line testing and magnesium machining. Magna Drivetrain will also commence manufacturing hypoid bevel gear sets,
using special machining for these types of gears. A portion of Magna Drivetrain's operations include assembly of third party components into modules, on a "just-in-sequence"
basis. These assembly operations require the following competencies possessed by Magna Drivetrain: layout, process planning, supply chain management, global sourcing, logistics, assembly and
sequencing. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Magna
Drivetrain supplies products for several vehicle programs, including the following: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>transfer
cases for the BMW X5&nbsp;and X3;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>four-wheel
drive components for many DaimlerChrysler models, including the Mercedes-Benz S-Class, E-Class and
C-Class, the new Mercedes Benz M-Class/R-Class, the Mercedes-Benz G-Class, the Chrysler 300/300C/Dodge Magnum, and all of the Jeep and Dodge
sport utility vehicles and pick-up trucks;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>transfer
cases for the General Motors current model full-size pick-up trucks and full-size and mid-size sport utility
vehicles;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>rear
suspension module for the Buick Rendezvous;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>four-wheel
drive components for the Ford full-size heavier duty pick-up trucks, as well as for the Land Rover Freelander, Range Rover and
Discovery 3;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>transfer
cases for the Volkswagen Touareg and the Porsche Cayenne;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>all-wheel
drive components for several vehicle models of Volkswagen (including Audi, SEAT and Skoda); and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>manual
transaxles for the Dodge Neon. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Magna
Drivetrain has the contract to develop and produce new transfer cases for the General Motors next-generation full-size pick-up trucks and sport
utility vehicles. Magna Drivetrain has also been selected by General Motors to co-ordinate the engineering and development of a rear suspension module for a General Motors
next-generation mid-sized vehicle platform. In addition, Magna Drivetrain has contracts to develop and produce a new all-wheel drive system for future Volkswagen
models, as well as transfer cases for the DaimlerChrysler Jeep and Dodge vehicle models. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>24</FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Magna
Drivetrain's manufacturing facility in Syracuse, New&nbsp;York is operated by New&nbsp;Process Gear,&nbsp;Inc., which is a new joint venture created in connection with the
acquisition of the New&nbsp;Venture Gear business (see&nbsp;"ITEM 2. GENERAL DEVELOMENT OF THE BUSINESS&nbsp;&#151;&nbsp;RECENT DEVELOPMENTS IN OUR
BUSINESS&nbsp;&#151;&nbsp;Acquisitions and Divestitures" above). </FONT></P>

<P><FONT SIZE=2><B>Magna Donnelly  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Magna Donnelly is one of the automotive industry's leading suppliers of automotive mirror systems. It supplies automotive customers around the world with rear
vision systems (mirrors and cameras), modular window systems (engineered glass) and handle products. Magna Donnelly integrates sophisticated automotive electronics and communications technology in its
products. As at December&nbsp;31, 2004, Magna Donnelly employed approximately 7,400&nbsp;people at 25&nbsp;manufacturing facilities and three engineering and testing facilities with locations in
the United&nbsp;States, Austria, China, France, Germany, Ireland, Mexico, Spain, Sweden and Slovakia. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Magna
Donnelly's main product segments are: </FONT></P>

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<TR VALIGN="TOP">
<TD WIDTH="49%"><FONT SIZE=2>&#149;&nbsp;&nbsp;&nbsp;&nbsp;interior rearview mirror systems;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="49%"><FONT SIZE=2>&#149;&nbsp;&nbsp;&nbsp;&nbsp;door handle systems;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="49%"><BR><FONT SIZE=2> &#149;&nbsp;&nbsp;&nbsp;&nbsp;exterior rearview mirror systems;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="49%"><FONT SIZE=2><BR>
&#149;&nbsp;&nbsp;&nbsp;&nbsp;glass fabrication and coating;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="49%"><BR><FONT SIZE=2> &#149;&nbsp;&nbsp;&nbsp;&nbsp;advanced vision systems;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="49%"><FONT SIZE=2><BR>
&#149;&nbsp;&nbsp;&nbsp;&nbsp;automotive electronics; and</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="49%"><BR><FONT SIZE=2> &#149;&nbsp;&nbsp;&nbsp;&nbsp;modular windows.</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="49%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
</TR>
</TABLE>
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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
growth strategy of Magna Donnelly focuses on developing value-added features around core products including complete interior and exterior mirrors, modular encapsulated windows,
electrochromic mirrors and bonded hardware window systems. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Magna
Donnelly has a diverse customer base, which includes Ford (including Volvo), DaimlerChrysler, General Motors (including Saab), Honda, Volkswagen, BMW, Toyota, PSA
Peugeot-Citro&euml;n and Renault-Nissan. Some examples of Magna Donnelly's programs include: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Ford:
the Expedition/Navigator, F-Series trucks, Taurus/Sable cars, and the Volvo S80;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>DaimlerChrysler:
the Caravan/Voyager/Town&nbsp;&amp; Country minivans, the Chrysler Pacifica, the Jeep Grand Cherokee and the MercedesBenz C-Class and
E-Class;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>General
Motors: the Trailblazer/Bravada/Envoy and the Saab 9<SUP>5</SUP>;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Honda:
the Accord and Civic;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Volkswagen:
the Golf/Polo, Passat B6, Audi A4&nbsp;and the Porsche Cayenne;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>BMW:
the 3-series, 5-series, 7-series and Z4; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Renault-Nissan:
the Laguna. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Magna
Donnelly participates in one joint venture and operates two wholly-owned facilities in China, for the manufacture and sale of automotive products in the Asian markets. </FONT></P>

<P><FONT SIZE=2><B>Cosma International  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cosma manufactures a comprehensive range of stamped, hydroformed and welded metal body systems, components, modules, assemblies, including complete
body-in-white assemblies, chassis systems and complete suspension modules. As at December&nbsp;31, 2004, Cosma employed approximately 13,800&nbsp;people in
33&nbsp;manufacturing facilities and nine engineering and testing facilities located in Canada, the United&nbsp;States, Mexico, Germany, Austria, France, the Czech Republic and Japan. Cosma's
results are combined with Magna Donnelly's results under our "Other Automotive Operations" financial reporting segment. In 2004, the sales attributable to this segment were approximately
$5.024&nbsp;billion (compared with $4.591&nbsp;billion in 2003), representing approximately 24% of our consolidated sales, and EBIT was approximately $436&nbsp;million. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>25</FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cosma's
main product and service segments are: </FONT></P>

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<TD WIDTH="49%"><FONT SIZE=2>&#149;&nbsp;&nbsp;&nbsp;&nbsp;metalforming technologies;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="49%"><FONT SIZE=2>&#149;&nbsp;&nbsp;&nbsp;&nbsp;body stampings and assemblies;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="49%"><BR><FONT SIZE=2> &#149;&nbsp;&nbsp;&nbsp;&nbsp;structural stampings and assemblies;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="49%"><FONT SIZE=2><BR>
&#149;&nbsp;&nbsp;&nbsp;&nbsp;suspension modules;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="49%"><BR><FONT SIZE=2> &#149;&nbsp;&nbsp;&nbsp;&nbsp;complete body-in-white systems;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="49%"><FONT SIZE=2><BR>
&#149;&nbsp;&nbsp;&nbsp;&nbsp;energy management systems; and</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="49%"><BR><FONT SIZE=2> &#149;&nbsp;&nbsp;&nbsp;&nbsp;design and engineering.</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="49%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
</TR>
</TABLE>
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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cosma
has extensive engineering capabilities with respect to computer-aided design and computer-aided manufacturing, complete body and chassis engineering, failure effects analysis,
prototyping, concept vehicles and testing. Cosma's product engineering team creates original engineering drawings, feasibility studies, working prototypes and full-scale testing programs
to meet or establish customer specifications. Manufacturing and engineering personnel design and build the manufacturing systems, processes and equipment which link the designed product to high
quality, efficient production systems. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Technologies
employed by Cosma include a series of metal processing technologies, including conventional stamping and extrusion, roll-forming, hydroforming, hydropiercing,
tube to tube welding, hot forming and technically advanced laser welding processes, as well as finishing technologies such as e-coating, powder coating and wax coating. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cosma's
primary customers include General Motors, DaimlerChrysler, BMW, Ford, Volkswagen, Honda, Renault-Nissan and Toyota. For example, Cosma supplies: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>complete
frames for the Dodge Durango and General Motors full-size pick-up trucks and sport utility vehicles;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>exterior
Class&nbsp;A stamped body panels for the new Mercedes M-Class, the Chrysler 300/300C/Dodge Magnum, the Ford Freestar and the BMW Z4;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>major
underbody sub-assemblies for the new Ford Mustang and the Ford Freestar;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>suspension
subframes for the Chrysler Pacifica, the Pontiac Pursuit and the Volvo XC90; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>energy
management systems, such as bumper and door intrusion beams, for the Volkswagen Golf and the Honda Accord. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
addition, Cosma was recently awarded a contract to manufacture frames for the next-generation of Ford Explorer and Ford F-Series Super Duty pick-up
trucks. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cosma
has also historically operated various tooling facilities. During 2004, these facilities, which have approximately 700&nbsp;employees and engineer, design and build the tools,
dies and assembly equipment necessary for the production of our products, were organized into a separate business unit under the name Magna Technology and Tooling. We expect that this will allow us to
respond to trends and developments in the automotive industry more quickly and to serve our internal tooling needs and external customers more effectively. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><B>CORPORATE AND OTHER  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our corporate and other operations support, or are ancillary to, our automotive operations. Prior to August&nbsp;29, 2003, this included our real estate
operations. Substantially all of our automotive real estate is owned by MI Developments, all of the shares of which we distributed to our shareholders of record at the close of business on
August&nbsp;29, 2003. See "ITEM 2. GENERAL DEVELOPMENT OF THE BUSINESS&nbsp;&#151;&nbsp;SPIN-OFF OF MI DEVELOPMENTS&nbsp;INC. AND MAGNA ENTERTAINMENT CORP."
above. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>26</FONT></P>

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<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="page_di1382_1_27"> </A> </FONT> <FONT SIZE=2><B>RESEARCH AND DEVELOPMENT  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We have historically emphasized technology development and have a policy, embodied in our Corporate Constitution, to allocate a minimum of 7% of our
pre-tax profits (as&nbsp;defined in the Corporate Constitution) for each financial year to research and development during that financial year or the next succeeding financial year. See
"ITEM 9. CORPORATE CONSTITUTION&nbsp;&#151;&nbsp;Research and Development" below. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our
past development activities have resulted in a number of new and improved manufacturing processes and proprietary products, including those discussed above under "ITEM 2. GENERAL
DEVELOPMENT OF THE BUSINESS&nbsp;&#151;&nbsp;RECENT DEVELOPMENTS IN OUR BUSINESS&nbsp;&#151;&nbsp;New&nbsp;Products and Technologies" above. We expect
that our involvement in the development of manufacturing technology and product technology in cooperation with automobile manufacturers will increase as automobile manufacturers further involve
suppliers in the vehicle development process. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><B>MANUFACTURING AND ENGINEERING  </B></FONT></P>


<P><FONT SIZE=2><B>Facilities  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As at December&nbsp;31, 2004, we had 223&nbsp;manufacturing facilities, including 14&nbsp;joint venture facilities, of which 129&nbsp;are in North
America, 83&nbsp;are in Europe, eight are in Asia and three are in South America. These manufacturing facilities occupied approximately 39.1&nbsp;million square&nbsp;feet, of which approximately
56% was leased from MI Developments, 18% was owned by our automotive systems groups and the remaining 26% was leased from third parties. As at December&nbsp;31, 2004, our manufacturing facilities
ranged in size from approximately 6,000&nbsp;to over three million square&nbsp;feet of floor space. Most of them maintained an in-house tooling capability with a staff of experienced
tool and die makers. As production becomes more automated, the size and potential production capacity of our typical facility increases. We are operating many of our manufacturing facilities on a
multi-shift basis. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
at December&nbsp;31, 2004, we also operated 56&nbsp;product development and engineering facilities, including four joint venture facilities and two multi-group facilities, of
which 25&nbsp;are in North America, 27&nbsp;are in Europe and four are in Asia. Such
facilities occupy approximately 2.9&nbsp;million square&nbsp;feet, of which approximately 55% was leased from MI Developments, 19% was owned by our automotive systems groups and the remaining 26%
was leased from third parties. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Leases
typically have terms of five years or more with options to renew. </FONT></P>

<P><FONT SIZE=2><B>Key Commodities  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We purchase our key commodities to the extent possible from domestic suppliers in the jurisdictions in which we do business. Factors such as price, quality,
transportation costs, warehousing costs, availability of supply and timeliness of delivery have an impact on the decision to source from certain suppliers. In the past, we have purchased key
commodities offshore when shortages of materials, such as certain high quality grades of steel, have occurred. In 2004, we experienced significant price increases for key commodities used in our parts
production, particularly steel, and expect such prices to remain at elevated levels in 2005. Steel price increases have been primarily the result of increased demand for steel in China and a shortage
of steel-making ingredients, such as scrap steel, iron ore and coke coal. Approximately half of our steel is acquired through re-sale programs operated by the automobile manufacturers and
does not involve us in pricing exposure. The remainder is acquired through spot, short-term and long-term contracts. Surcharges on existing prices have been imposed on us by
our steel suppliers and other suppliers of steel parts, with the threat of withheld deliveries by such suppliers if the surcharges are not paid. We have pricing agreements with some of our suppliers
that reduce our exposure to steel pricing increases and surcharges. However, certain suppliers have challenged these agreements and, to the extent that they are successfully disputed, terminated or
otherwise not honoured by our suppliers, our exposure to steel price increases and surcharges may increase. To date, we have not experienced any significant difficulty in obtaining supplies of parts,
components or key commodities for our manufacturing operations, including steel and steel products. We do not carry inventories of either key commodities or finished products in excess of those
reasonably required to meet production and shipping schedules. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>27</FONT></P>

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<P ALIGN="CENTER"><FONT SIZE=2><B>HUMAN RESOURCES  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As at December&nbsp;31, 2004, we employed over 81,000&nbsp;people, including approximately 21,600&nbsp;in Canada, 28,900&nbsp;in Europe, 18,500&nbsp;in
the United&nbsp;States, 10,100&nbsp;in Mexico, 2,000&nbsp;in Asia and 500&nbsp;in South America. </FONT></P>

<P><FONT SIZE=2><B>Human Resource Principles  </B></FONT></P>


<P><FONT SIZE=2><B><I>Employee Equity Participation and Profit Sharing Program  </I></B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Since 1975, we have maintained an employee equity and profit participation program to foster participation in profits and share ownership by our eligible
employees. Our Corporate Constitution requires that 10% of our employee pre-tax profits before profit sharing (as&nbsp;defined in our Corporate Constitution) for a fiscal period be
allocated to (i)&nbsp;the employee equity participation and profit sharing plan, including similar plans for Intier, Decoma and Tesma, (ii)&nbsp;contributions to a company pension plan, or
(iii)&nbsp;a cash distribution to eligible employees of the respective companies. See "ITEM 9. CORPORATE CONSTITUTION&nbsp;&#151;&nbsp;Employee Equity Participation and Profit
Sharing Programs" below. </FONT></P>

<P><FONT SIZE=2><B><I>Management Incentive Compensation  </I></B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We believe that profit participation motivates members of management. Accordingly, our automotive management compensation structure consists of a base salary
(which in most instances is relatively low compared to automotive industry norms) and an incentive bonus based on profits. Our Corporate Constitution provides that aggregate incentive bonuses for
eligible members of our corporate management (as&nbsp;defined) in any fiscal year will not exceed 6% of our pre-tax profits before profit sharing (as&nbsp;defined in the Corporate
Constitution) for that financial year. See "ITEM 9. CORPORATE CONSTITUTION&nbsp;&#151;&nbsp;Incentive Bonuses; Management Base Salaries" below. </FONT></P>

<P><FONT SIZE=2><B><I>Employee's Charter  </I></B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We are committed to an operating philosophy based on fairness and concern for people. This philosophy is part of our "Fair Enterprise" culture in which employees
and management share in the responsibility to help ensure our success. Our Employee's Charter embodies this philosophy through the following principles: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2><I>Job Security&nbsp;&#151;&nbsp;</I></FONT><FONT SIZE=2>Being competitive by making a better product for a better price is the
best way to enhance job security. We are committed to working together with our employees to help protect their job security. To assist our employees, we will provide job counseling, training and
employee assistance programs to our employees.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2><I>A Safe and Healthful Workplace&nbsp;&#151;&nbsp;</I></FONT><FONT SIZE=2>We strive to provide our employees with a working
environment which is safe and healthful.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2><I>Fair Treatment&nbsp;&#151;&nbsp;</I></FONT><FONT SIZE=2>We offer equal opportunities based on an individual's qualifications
and performance, free from discrimination or favoritism.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2><I>Competitive Wages and Benefits&nbsp;&#151;&nbsp;</I></FONT><FONT SIZE=2>We will provide our employees with information which
will enable them to compare their total compensation, including total wages and total benefits with those earned by employees of our competitors, as well as with other plants in the communities in
which our plants are located.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2><I>Employee Equity and Profit Participation&nbsp;&#151;&nbsp;</I></FONT><FONT SIZE=2>We believe that every one of our employees
should share in our financial success.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2><I>Communication and Information&nbsp;&#151;&nbsp;</I></FONT><FONT SIZE=2>Through regular monthly meetings between management and
employees and through publications, we will provide our employees with information so that they will know what is going on in the company and in the industry. </FONT></DD></DL>
</UL>
<P ALIGN="CENTER"><FONT SIZE=2>28</FONT></P>

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<UL>
<UL>
</UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2><I>Employee Hotline&nbsp;&#151;&nbsp;</I></FONT><FONT SIZE=2>Should any of our employees have a problem, or feel the foregoing
principles are not being met, we encourage them to call the Hotline or use self-addressed Hotline envelopes to register their complaints. Employees do not have to give their names, but if
they do, it will be held in strict confidence. Hotline investigators who are independent from divisional management will answer an employee's call. The Hotline is committed to investigating and
resolving all concerns or complaints and must report the outcome to our global human resources department and, in certain cases, to our Audit Committee.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2><I>Employee Relations Advisory Board&nbsp;&#151;&nbsp;</I></FONT><FONT SIZE=2>The Employee Relations Advisory Board is a group of
people who have proven recognition and credibility relating to humanitarian and social issues. This Board will monitor, advise and ensure that we operate within the spirit of our Employee's Charter
and the principles of our Corporate Constitution. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2><B>Human Resource Policies  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In furtherance of our commitment to fairness, as demonstrated in our Employee's Charter, we have established Fairness Committees in most of our North American
manufacturing facilities which enable employees at such facilities to have many of their concerns resolved by a committee comprised of both management and employees. Most of our North American
manufacturing facilities also have an Employee Advocate who works with our employees and management to ensure that any problems that arise in the workplace are addressed quickly and in accordance with
our Employee's Charter, Corporate Constitution and operating principles. Employee Advocates can only be removed if more than 50% of the shop floor employees at the applicable division vote to remove
him or her through a periodic secret ballot. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
have established many employee communication programs, such as monthly divisional employee meetings, continuous improvement team meetings, an employee hotline and employee opinion
surveys to help ensure employee involvement and feedback. In addition, we maintain a 100&nbsp;acre recreational park within 20&nbsp;miles of most of our Toronto-area facilities for use
by our employees and their families. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
addition to the employee equity participation and profit sharing programs discussed above under "Human Resource Principles", we maintain a group retirement savings plan in Canada and
a 401(k)&nbsp;plan in the United&nbsp;States whereby we partially match employees' contributions made through payroll deductions. These plans complement the employee equity participation and
profit sharing programs and the pension plans, and are designed to assist employees in providing replacement income for retirement. Those employees who choose to participate in our pension plan are
not eligible to receive our matching payment on their group retirement savings plan or 401(k)&nbsp;contributions and receive a reduced allocation from the employee equity participation and profit
sharing program. The pension plans that commenced in January&nbsp;2001 for Canadian and U.S.&nbsp;employees were closed to new participants as of January&nbsp;1, 2005. </FONT></P>

<P><FONT SIZE=2><B>Labour Relations  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We believe that we maintain positive relations with our employees and, where applicable, with the unions representing the employees at certain of our automotive
divisions. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Employees
of Intier's Mississauga Seating division in Mississauga, Ontario, as well as employees of Intier's Integram Windsor and Innovatech seating divisions in Windsor, Ontario, are
covered by collective agreements with the National Automobile, Aerospace, Transportation and General Workers Union of Canada (CAW). Employees of Intier's Integram St. Louis, Excelsior Springs,
Lewisburg, Lordstown and Techcraft seating divisions and its Ontegra Brighton and Shreveport interiors divisions are represented in the United&nbsp;States by the International Union, United
Automobile Aerospace and Agricultural Workers of America (UAW). In addition, new collective agreements have been negotiated with the UAW at the New&nbsp;Process Gear facility in Syracuse,
New&nbsp;York which we acquired in 2004 from DaimlerChrysler. The forms of collective agreements negotiated with the CAW and the UAW recognize our unique operating philosophy, including our
Employee's Charter and fundamental principles. In particular, these agreements recognize the need for wages and benefits to be competitive with our competitors, rather than those paid by our
customers' vehicle assembly operations. One of the key features of these agreements is the "no strike&nbsp;&#151;&nbsp;no lock-out" language during the life of such
agreements. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>29</FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Employees
at a number of our divisions in Mexico are currently covered by collective bargaining agreements with various unions. These divisions are Cosma's Autotek (Puebla),
Formex/Pressmex (Saltillo), Estampados Magna and Sonora Forming Technologies divisions, Intier's Automotive Interiors de Mexico (Saltillo) division, Magna Drivetrain's division in Saltillo, Magna
Donnelly's division in Monterrey as well as Decoma's Decoplas division in Mexico City. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Various
unions represent employees at certain of Intier's interior systems and seating divisions, as well as certain of Decoma's divisions, in the United&nbsp;Kingdom. Certain of our
European employees are covered by national industry-wide agreements relating to compensation and employment conditions and are members of in-house employees' associations or
trade unions. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;From
time to time, various unions seek to represent groups of our employees and, as a result, we may become party to additional collective agreements in the future. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><B>COMPETITION  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We face numerous sources of competition in the markets in which we operate, including from automobile manufacturers, other outside automotive components suppliers
and numerous other suppliers in which one or more automobile manufacturers may have direct or indirect investments. We believe that there are a number of suppliers that can produce some of the
components, assemblies, modules and systems that our automotive systems groups currently produce. Some of our competitors have greater technical or marketing resources than we do and some of them are
dominant in markets in which we operate. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
basis on which automobile manufacturers select automotive components suppliers is determined by a number of factors, including price, quality, service, historical performance,
timeliness of delivery, proprietary technologies, scope of in-house capabilities, existing agreements, responsiveness to the customer, the supplier's overall relationship with the
automobile manufacturer, the degree of available and unutilized capacity or resources in the manufacturing facilities of the automobile manufacturer, collective bargaining agreement provisions, labour
relations issues, financial strength and other factors. The number of competitors that are solicited by automobile manufacturers to bid on any individual product has been reduced in many cases and we
expect further reductions as automobile manufacturers follow through on their stated intentions of dealing with fewer suppliers and awarding those suppliers longer-term contracts. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><B>SALES AND MARKETING  </B></FONT></P>

<P><FONT SIZE=2><B>Sales Offices  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We sell our products to automobile manufacturers located in Canada through sales offices located in southern Ontario, and to automobile manufacturers located in
Western Europe through sales offices located primarily in Austria, Germany, the United&nbsp;Kingdom, France, Italy and Spain. Sales to North American automobile manufacturers located in the
United&nbsp;States and Mexico, including foreign automobile manufacturers with operations in the United&nbsp;States, are coordinated through independent sales representatives in Michigan. We also
maintain sales offices in Japan to help coordinate sales to Japanese automobile manufacturers and their North American operations, as well as in South Korea and Brazil. In 2003, we opened an
engineering office in Japan and a purchasing office in Shanghai, China. In 2004, we significantly expanded our offices in Japan and added dedicated sales, engineering and program management offices in
China and South Korea. We also established a sales and engineering office in Shanghai, China in early 2005. These offices will facilitate our planned geographic expansion into these growth markets. We
believe that we can significantly increase our sales of components and systems to Japanese automobile manufacturers in the coming years by continuing to enhance our relationship with Japanese
automobile manufacturers in Japan and around the world. The various internal operating divisions and subsidiaries of the automobile manufacturers normally initiate many of their own purchasing
decisions and, accordingly, each automobile manufacturer effectively constitutes different customers, although this is changing as automobile manufacturers are increasingly sourcing global platforms. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>30</FONT></P>

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<P><FONT SIZE=2><B>Purchase Orders  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our sales are generated through customer requests to quote on particular products, including parts, components and assemblies, and the tools and dies to produce
parts. Purchase orders for our products are typically for one or more models, and typically extend over the life of each model, which is generally four to seven years. However, purchase orders issued
by our automobile manufacturer customers typically do not require them to purchase any minimum number of our products. Releases under such purchase orders, which authorize us to supply specific
quantities of products, are issued for planning, raw material and production purposes typically over a one to four month period in advance of anticipated delivery dates. The actual number of products
that we supply under purchase orders in any given year is dependent upon the number of vehicles produced by the automobile manufacturers of the specific models in which those products are
incorporated. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;It
has been our experience that once we receive purchase orders for products for a particular vehicle model or program, we will usually continue to supply those products until the end of
that model or program. However, automobile manufacturers could cease sourcing their production requirements from us for a number of reasons, including if we refuse to accept demands for price
reductions or other concessions. We have also obtained new business on a "takeover" basis from our customers and our competitors. This occurs where parts for certain programs are already in production
at the automobile manufacturers' facilities or at our competitors' facilities and, for various reasons, those parts are "re-sourced" to us for production at our facilities. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><B>ENVIRONMENTAL MATTERS  </B></FONT></P>

<P><FONT SIZE=2><B>Health, Safety and Environmental Policy  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We are subject to a wide range of environmental laws and regulations relating to air emissions, soil and ground water quality, wastewater discharge, waste
management and storage of hazardous substances. We aim to be an industry leader in environmental compliance with the intention to prevent pollution by reducing the impact of our operations on the
environment and through technological innovation and process efficiencies. In furtherance of this aim, we recently amended our Health, Safety and Environmental Policy, pursuant to which we are
committed to: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>complying
with, and exceeding where possible, all applicable health, safety and environmental laws, regulations and standards in all of our operations and conforming to our
internal standards based on generally accepted environmental practices and established industry codes of practice;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>regularly
evaluating and monitoring past and present business activities impacting upon health, safety and environmental matters;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>improving
upon the efficient use of natural resources, including energy, to minimizing waste streams and emissions, and to implementing effective recycling in manufacturing
operations through the use of locally set continuous improvement targets;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>utilizing
innovative design and engineering to reduce the environmental impact of our products during vehicle operation and at end of life;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>ensuring
that a systematic review program is implemented and monitored at all times for each of our operations, with the goal of continual improvement in health, safety and
environmental matters; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>ensuring
that adequate reports on health, safety and environmental matters are presented to our Board of Directors on an annual basis, at a minimum. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A
Health and Safety and Environmental Committee of our Board of Directors assists in overseeing our management's handling of health, safety and environmental issues and annually reviews
our Health, Safety and Environmental Policy. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>31</FONT></P>

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<P><FONT SIZE=2><B>Environmental Compliance  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As part of our commitment to environmental compliance, we also intend to achieve company-wide compliance with ISO&nbsp;14001 standards. As of
December&nbsp;31, 2004, 150&nbsp;of our manufacturing facilities were ISO&nbsp;14001 certified. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
operate a number of manufacturing facilities that use environmentally sensitive processes and hazardous materials. We believe that all of these operations meet, in all material
respects, applicable governmental standards for waste handling and emissions. Notwithstanding this compliance, we have in the past and may in the future experience complaints regarding some of our
manufacturing facilities from neighbouring parties. In the past, such complaints have been addressed by open dialogue with relevant stakeholders and, where appropriate, manufacturing process
adjustments. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
are also subject to environmental laws requiring investigation and clean-up of environmental contamination. From time to time our operations and properties become the
subject of inquiries or investigations of environmental regulators. We are in various stages of investigation or clean-up at our manufacturing facilities where contamination has been
alleged. These stages include performing periodic soil and groundwater sampling, determining the most appropriate corrective action approach for remediating the contamination and obtaining regulatory
approval of such approach, performing the remediation itself and monitoring the status of our remediation. Estimating environmental clean-up liabilities is complex and heavily dependent on
the nature and extent of historical information and physical data about the contaminated site, the complexity of the contamination, the uncertainty of which remedy to apply and the outcome of
discussions with regulatory authorities relating to the contamination. To date, the costs incurred in complying with environmental laws and regulations, including the costs of clean-up and
remediation, have not had a material adverse effect on our operations or financial condition. However, changes in these government laws and regulations are ongoing and may make environmental
compliance, such as emissions control and waste disposal, increasingly expensive. We cannot predict future costs that may be incurred to meet environmental obligations. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
are subject to environmental laws and regulations both as tenant and owner of our properties. Substantially all of our automotive real estate is leased from MI Developments. Our
leases with MI Developments generally provide that we, as tenant, must maintain the leased properties in accordance with all applicable laws, including environmental laws. We are also responsible for
removing all hazardous and toxic substances when and as required by applicable laws and, in any event, prior to the termination of our occupation of the leased properties. This applies whether or not
the contamination occurred prior to our use of the leased properties, unless it was not caused or exacerbated by our use. Our leases generally also contain indemnities in favour of MI Developments
with respect to environmental matters, and those indemnities expire after a specified period of time following the termination of the leases. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><B>INTELLECTUAL PROPERTY  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We own and use numerous patents and patent applications in connection with our operations. We are also licensed to use patents or technology owned by others. From
time to time claims of patent infringement are made by or against us. None of the claims against us has had, and we believe that none of the current claims will have, a material adverse effect upon
us. While in the aggregate our patents and licenses are considered important in the operation of our business, we do not consider them of such importance that their expiry would materially affect our
business. </FONT></P>

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<P ALIGN="CENTER"><FONT SIZE=2><B>RISK FACTORS  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The industry in which we compete and the business we conduct are subject to a number of risk, and uncertainties. These risks and uncertainties, together with
certain assumptions, also underlie the forward-looking statements made in this Annual Information Form. In order to fully understand these risks, uncertainties and assumptions, you should carefully
consider the following risk factors in addition to other information included in this Annual Information Form. </FONT></P>

<P><FONT SIZE=2><B>Risks Relating to the Automotive Industry  </B></FONT></P>

<P><FONT SIZE=2><B><I>Changes in global economic conditions could reduce vehicle production volumes, which could have a material adverse effect on our operations, our financial condition or our
profitability.</I></B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our
operations are directly impacted by the levels of global automotive production. The global automotive industry is cyclical and sensitive to changes in certain economic conditions,
such as interest rates, consumer demand, oil and energy prices and international conflicts. Automotive sales and production can also be affected by labour relations issues, regulatory requirements,
trade agreements and other factors. The volume of automotive production in North America, Europe and the rest of the world has fluctuated, sometimes significantly, from year to year, and such
fluctuations give rise to fluctuations in the demand for our products and services. The rate of global economic growth, particularly in the United&nbsp;States and parts of Europe, slowed in 2001,
partially due to the events of September&nbsp;11, 2001 and the ensuing war against terrorism, the U.S.&nbsp;&#151;&nbsp;led coalition's war against Iraq, the impact of a
series of corporate accounting scandals in the United&nbsp;States and a number of other geopolitical and economic factors. Some of these factors continue to have an effect on these economic
conditions. Although low interest rates and incentives offered by automobile manufacturers for the last few years have maintained or increased consumer demand for vehicles in some countries, economic
uncertainty remains in North America, Europe, Asia and the rest of the world. In North America, the industry is characterized by significant overcapacity, fierce competition and significant pension
and healthcare liabilities for the domestic automobile manufacturers. North American automobile manufacturers have recently announced production cuts for certain platforms in which we have significant
content. In Europe, the market structure is relatively fragmented with significant overcapacity. A decline in consumer demand for vehicles, as a result of a loss of confidence in the economy, fears of
war, political instability or terror attacks, interest rate increases, a reduction in vehicle incentive programs by automobile manufacturers or any other geopolitical, economic or other factors, could
prompt automobile manufacturers to cut production volumes. A significant decline in production volumes in any of our principal markets could have a material adverse effect on our operations, our
financial condition or our profitability. </FONT></P>

<P><FONT SIZE=2><B><I>Availability of key commodities or increased prices for key commodities could have a material adverse effect on our operations, our financial condition or our
profitability.</I></B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
generally purchase our key commodities, such as steel, from suppliers located in the jurisdictions in which we have manufacturing operations. We generally do not carry inventories of
key commodities in excess of those required to meet production and shipping schedules. To date, we have not experienced any significant difficulty in obtaining supplies of key commodities. However,
the inability to obtain key commodities in the quantities required by our operations could disrupt the supply of our products to our customers and could have an adverse effect on our operations. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
2004, we experienced significant price increases for key commodities used in our parts production, particularly steel, and expect such prices to remain at elevated levels in 2005.
Steel price increases have been primarily the result of increased demand for steel in China and a shortage of steel-making ingredients, such as scrap steel, iron ore and coke coal. Approximately half
of our steel is acquired through re-sale programs operated by the automobile manufacturers and does not involve us in pricing exposure. The remainder is acquired through spot,
short-term and long-term contracts. Surcharges on existing prices have been imposed on us by our steel suppliers and other suppliers of steel parts, with the threat of withheld
deliveries by such suppliers if the surcharges are not paid. We have pricing agreements with some of our suppliers that reduce our exposure to steel pricing increases and surcharges. However, certain
suppliers have challenged these agreements and, to the extent that they are successfully disputed, terminated or otherwise not honoured by our suppliers, our exposure to steel price increases and
surcharges may increase. To the extent we are unable to pass on to our customers the additional costs associated with increased steel prices, such additional costs could have a material adverse effect
on our financial condition or our profitability. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>33</FONT></P>

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<P><FONT SIZE=2><B><I>We face increasing price reduction pressures from our customers, which could have a material adverse effect on our financial condition or our
profitability.</I></B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
have entered into, and will continue to enter into, long-term supply arrangements with automobile manufacturers which provide for, among other things, price concessions
over the supply term. To date, these concessions have been partially offset by cost reductions arising principally from product and process improvements and price reductions from our suppliers.
However, the competitive automotive industry environment in North America, Europe and Asia has caused these pricing pressures to intensify. A number of our customers have demanded, and will continue
to demand, additional price concessions and retroactive price reductions. We may not continue to be successful in offsetting price concessions through improved operating efficiencies, reduced
expenditures or reduced prices from our suppliers. Such concessions could have a material adverse effect on our financial condition or our profitability, to the extent that these price reductions are
not offset through cost reductions or improved operating efficiencies. </FONT></P>

<P><FONT SIZE=2><B><I>Our customers increasingly require us to absorb more fixed costs in our unit pricing, which could have a material adverse effect on our financial condition or our
profitability.</I></B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
are under increasing pressure to absorb more costs related to product design, engineering and tooling as well as other items previously paid for directly by automobile manufacturers.
In particular, some automobile manufacturers have requested that we pay for design, engineering and tooling costs that are incurred up to the start of production and recover these costs through
amortization in the piece price of the applicable component. Our current contracts do not generally include any guaranteed minimum purchase requirements. Contract volumes for new vehicle programs are
based on our customers' estimates of their own future production levels by vehicle body type. However, actual production volumes may vary significantly from these estimates, due to lower than expected
consumer demand, delays in product launches and other factors, often without any compensation from our customers. We do not typically rely solely on our customers' estimates of production volumes, but
evaluate their estimates based on our own assessment of future production levels by vehicle body type. For programs currently under production, we are typically not in a position to request price
changes when volumes differ significantly from production estimates used during the quotation stage. If estimated production volumes are not achieved, the design, engineering and tooling costs
incurred by us may not be fully recovered. Similarly, future pricing pressure or volume reductions by our customers could also reduce the amount of amortized costs otherwise recoverable in the unit
price of our products. Although these factors have not been material to date, they could have a material adverse effect on our financial condition or our profitability. </FONT></P>

<P><FONT SIZE=2><B><I>We are increasingly requested to assume greater product warranty and recall costs and are subject to product liability claims, which could have a material adverse effect on our
financial condition or our profitability.</I></B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Automobile
manufacturers are increasingly requesting that each of their suppliers bear the costs of the repair and replacement of defective products which are either covered under their
warranty or are the subject of a product recall by
them. If our products are, or are alleged to be, defective, we may be required to participate in a recall of those products, particularly if the actual or alleged defect relates to vehicle safety. As
we become more integrally involved in the development process and assume more of the vehicle system design, integration and assembly, our automobile manufacturer customers could demand greater
contribution by us towards product warranty and recall costs. The obligation to repair or replace products supplied by us or a requirement to participate in a product recall could have a material
adverse effect on our financial condition or our profitability. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
certain circumstances, we are at risk for warranty costs, including product liability and recall costs. Warranty provisions are established based on our estimate of the amounts
necessary to settle existing claims on product defect issues. Product liability provisions are established based on our best estimate of the amounts necessary to settle existing claims on product
defect issues. Recall costs are costs incurred when our automobile manufacturer customers decide, either voluntarily or involuntarily, to recall a product due to a known or suspected performance
issue. Costs typically include the cost of the product being replaced, the cost of the recall and labour to remove and replace the defective part. When a decision to recall a product has been made or
is probable, our estimated cost of the recall is recorded as a charge to net earnings in that period. In making this estimate, judgment is required as to the number of units that may be returned as a
result of the recall, the total cost of the recall campaign, the ultimate negotiated sharing of the cost between us and the customer and, in some cases, the extent to which our supplier(s)&nbsp;will
share in the recall cost. Due to the nature of the costs, we make our best estimate of the expected future costs; however, the ultimate amount of such costs could be materially different. To date, we
have not experienced significant warranty or recall costs. However, we continue to experience increased customer pressure to assume greater warranty responsibility. Currently, we only account for
existing or probable claims; however, the obligation to repair or replace such products could have a material adverse effect on our financial condition or our profitability. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>34</FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
are also subject to the risk of exposure to product liability claims in the event that the failure or alleged failure of our products results in bodily injury and/or property damage.
We could experience material product liability losses in the future and could incur significant costs to defend such claims. We currently have product liability coverage under our insurance policies,
subject to certain limits. This coverage will continue until August&nbsp;2005, subject to renewal on an annual basis. In addition, some of our European subsidiaries maintain product recall
insurance, which is required by law in certain jurisdictions. We cannot guarantee that our insurance coverage will be adequate for any liabilities we may incur. Furthermore, we cannot guarantee that
our coverage will continue to be available at premiums and on other terms acceptable to us. A successful claim brought against us in excess of our available insurance coverage could have a material
adverse effect on our financial condition or our profitability. </FONT></P>

<P><FONT SIZE=2><B><I>The financial distress of a critical automotive components sub-supplier could have an adverse effect on our operations, our financial condition or our
profitability.</I></B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
rely on a number of sub-suppliers to supply us with a wide range of components required in connection with our business. Economic conditions, intense pricing pressures and
a number of other factors have left many automotive components suppliers in financial distress. The continued financial distress or the insolvency or bankruptcy of a major automotive components
sub-supplier could disrupt the supply of components to us by these suppliers, possibly resulting in a temporary disruption in the supply of products by us to our automobile manufacturer
customers. Any prolonged disruption in the supply of critical components by our sub-suppliers, the inability to resource production of a critical component from a financially distressed
automotive components sub-supplier, or any temporary shut-down of one of our production lines or the production lines of our customers, could have an adverse effect on our
operations, our financial condition or our profitability. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Where
we act as a module supplier, integrator or vehicle assembler, we are typically responsible for ensuring the quality of the components supplied to us by automotive components
sub-suppliers. In some cases, these sub-suppliers are selected by our automobile manufacturer customers. We take steps to ensure that sub-suppliers remain liable
for any product warranty claims, product liability claims or other costs arising from product recalls relating to the components supplied by them. However, we may be liable to our customers if these
sub-suppliers become insolvent or are otherwise unable to assume full responsibility for the product warranty claim, product liability claim or product recall cost, which could have an
adverse effect on our operations, our financial condition or our profitability. </FONT></P>

<P><FONT SIZE=2><B><I>A material reduction in outsourcing by automobile manufacturers could have a material adverse effect on our financial condition or our profitability.</I></B></FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
are dependent on outsourcing by our automobile manufacturer customers. The extent of this outsourcing is dependent on a number of factors, including: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
cost, quality and timeliness of external production relative to in-house production by automobile manufacturers;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>relative
technological capability;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
degree of unutilized capacity at automobile manufacturers' facilities;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>collective
bargaining agreements between labour unions and automobile manufacturers; and </FONT></DD></DL>
</UL>
<P ALIGN="CENTER"><FONT SIZE=2>35</FONT></P>

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<UL>
<UL>
</UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>relations
between labour unions and automobile manufacturers. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A
material reduction in outsourcing by automobile manufacturers could have a material adverse effect on our financial condition or our profitability. </FONT></P>


<P><FONT SIZE=2><B><I>Technological and regulatory changes could have an adverse effect on our operations, our financial condition or our profitability.</I></B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Changes
in competitive technologies or regulatory or industry requirements may render some of our products obsolete. Our ability to anticipate changes in technology and regulatory or
industry requirements and to develop and introduce new and enhanced products successfully on a timely basis will be a significant factor in our ability to grow and remain competitive. We may not be
able to anticipate or achieve the technological advances necessary to comply with regulatory or industry requirements in a manner that allows us to remain competitive and to prevent our products from
becoming 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. Any of these changes could have an adverse effect on our operations, our financial condition or our profitability. </FONT></P>

<P><FONT SIZE=2><B><I>Increased crude oil and energy prices could reduce global demand for automobiles and increase our costs, which could have an adverse effect on our
profitability.</I></B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Material
increases in the price of crude oil have, historically, been a contributing factor to the reduction in the global demand for automobiles. A significant increase in the price of
crude oil could further reduce global demand for automobiles and shift customer demand away from larger cars and light trucks (including sport utility vehicles) in which we have relatively higher
content, which could have an adverse effect on our profitability. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Oil-based
products are also critical elements in various components utilized by us and our suppliers, including resins, colorants and polymers. Material increases in the
price of crude oil, natural gas or in energy would likely increase the cost of manufacturing or supplying some of our products. To the extent that we are not able to pass these increased costs along
to our automobile manufacturer customers, such price increases could have an adverse effect on our profitability. </FONT></P>

<P><FONT SIZE=2><B>Risks Relating to Our Business  </B></FONT></P>

<P><FONT SIZE=2><B><I>A reduction in production volumes of specific vehicles or products by our customers could have an adverse effect on our financial condition or our
profitability.</I></B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Although
we supply parts to most of the leading automobile manufacturers, the majority of our sales are to three automobile manufacturers. Our worldwide sales to DaimlerChrysler, General
Motors, BMW and Ford represented approximately 23%, 22%, 20% and 16%, respectively, of our total consolidated sales in 2004. Moreover, while we supply parts for a wide variety of vehicles produced in
North America and Europe, we do not supply parts for all vehicles produced, nor is the number or value of parts evenly distributed among the vehicles for which we do supply parts. Our dependence on a
small number of vehicle platforms has been reduced since 2002, but remains significant. In 2004, the top five vehicle platforms for which we supply products generated approximately 24% of our total
production sales. Parts supplied for General Motors' full-size pick-up trucks and sport utility vehicles and the DaimlerChrysler minivan constituted approximately 10% and 6%,
respectively, of our total production sales for that period. Further, the recently announced production cuts by North American automobile manufacturers combined with increased production and market
share in North America by Japanese automobile manufacturers, which tend to use less outsourcing, could result in a decrease in our average dollar content per vehicle. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;There
has been an industry trend toward more "brand hopping" among consumers with consumers' vehicle preferences changing quickly and dramatically in some instances. Shifts in market
share among vehicles, in particular from those vehicles in which we have relatively higher content to those vehicles in which we have relatively lower content, could have an adverse effect on our
profitability. The contracts we have entered into with many of our automobile manufacturer customers are to supply their requirements for all the vehicles they produce in a particular model, rather
than a set quantity of parts. These contracts range from one year to the life of a model, usually several years, and do not require our customers to purchase a minimum number of parts. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>36</FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
addition, the early termination, loss, renegotiation of the terms or delay in the implementation of any significant production contract with any of our automobile manufacturer
customers could have an adverse effect on our financial condition or our profitability. Any changes in the anticipated production volume of our products, particularly those supplied for General
Motors' full-size pick-up trucks and sport utility vehicles and the DaimlerChrysler minivan as a result of any of the above factors could have an adverse effect on our
financial condition or our profitability. </FONT></P>

<P><FONT SIZE=2><B><I>Our substantial international operations make us vulnerable to risks associated with doing business in foreign countries, which could have an adverse effect on our operations,
our financial condition or our profitability.</I></B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
have manufacturing and distribution facilities in many foreign countries, including countries in Asia, Eastern and Western Europe and Central and South America. International
operations are subject to certain risks inherent in doing business abroad, including: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>exposure
to local economic conditions; </FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>expropriation
and nationalization; </FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>withholding
and other taxes on remittances and other payments by subsidiaries; </FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>investment
restrictions or requirements; </FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>export
and import restrictions; </FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>increases
in working capital requirements related to long supply chains; and </FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>difficulties
in protecting intellectual property rights. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Expanding
our business in the markets mentioned above and our business relationships with automotive manufacturers in those regions are important elements of our strategy. In addition,
our strategy includes expanding our manufacturing operations in lower-cost regions. As a result, our exposure to the risks described above may be greater in the future. The likelihood of
such occurrences and their potential effect on us vary from country to country and are unpredictable. However, any such occurrences could have an adverse effect on our operations, our financial
condition or our profitability. </FONT></P>

<P><FONT SIZE=2><B><I>Fluctuations in relative currency values could have an adverse effect our profitability.</I></B></FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Although
our financial results are reported in U.S.&nbsp;dollars, a significant portion of our sales and operating costs are realized in Canadian dollars, euros, the British pound and
other currencies. Our profitability is affected by movements of the U.S.&nbsp;dollar against the Canadian dollar, the British pound, the euro or other currencies in which we generate our revenues.
As a result of hedging programs employed by us, foreign exchange transactions are not fully impacted by the recent movements in exchange rates. We record foreign currency transactions at the hedged
rate where applicable. Despite these measures, significant long-term fluctuations in relative currency values, such as a significant change in the relative values of the
U.S.&nbsp;dollar, Canadian dollar, euro or the British pound, could have an adverse effect on our profitability. In addition, during times of a strengthening Canadian dollar, our international sales
and earnings could be reduced, resulting in an adverse effect on our profitability. </FONT></P>

<P><FONT SIZE=2><B><I>Unionization activities at some of our facilities could increase our costs, which could have an adverse effect on our financial condition or our
profitability.</I></B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
CAW and UAW have conducted organizing drives at certain of our divisions. As a result, we have concluded, or are currently concluding, collective agreements covering employees at
each of the facilities identified above under "HUMAN RESOURCES&nbsp;&#151;&nbsp;Labour Relations". The collective agreements negotiated with the CAW and UAW recognize our unique
operating philosophy, including our Employee's Charter and fundamental principles. In addition, the CAW and the UAW have in the past attempted to persuade some of our automobile manufacturer customers
to encourage their automotive components suppliers to assume a neutral position with respect to unionization at their plants. We are unable to predict whether we will reach satisfactory collective
bargaining agreements with these unions, or whether our employees at other divisions elect union representation in the future. These and other unionization activities at some of our facilities may
increase our costs, which could have an adverse effect on our financial condition or our profitability. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>37</FONT></P>

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<P><FONT SIZE=2><B><I>Work stoppages and other labour relations matters could have an adverse effect on our operations, our financial condition or our profitability.</I></B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
our hourly workforce becomes more unionized in the future, we may be subject to work stoppages and may be affected by other labour disputes. To date, we have not experienced any work
stoppages at our facilities, nor have we experienced any disputes with unions that have had a material effect on our operations. However, future disputes with labour unions may not be resolved without
significant work stoppages, which could have an adverse effect on our operations, our financial condition or our profitability. </FONT></P>

<P><FONT SIZE=2><B><I>We may not be able to compete successfully in the highly competitive automotive components supply industry, which could have an adverse effect on our operations, our financial
condition or our profitability.</I></B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
automotive parts supply market is highly competitive, and competition has become even more intense in recent years. We face competition from a number of sources, including: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>our
automobile manufacturer customers and their related parts manufacturing organizations;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>existing
and new automotive components suppliers; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>manufacturers
of product alternatives. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Some
of our competitors have substantially greater market share than us and are dominant in some of the markets in which we operate. Their market share and dominance may give them
advantages over us in the competition for new or existing business from our automobile manufacturer customers. We may not be able to compete successfully with our existing competitors or with any new
competitors in the highly competitive automotive components supply industry, which could have an adverse effect on our operations, our financial condition or our profitability. </FONT></P>

<P><FONT SIZE=2><B><I>Cancellations of vehicle programs or delays in launching new vehicle programs by our customers could have an adverse effect on our operations, our financial condition or our
profitability.</I></B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
incur engineering, design, tooling and other capital costs in advance of commencing production of parts to be supplied for our automobile manufacturers customers' new vehicle
programs. For example, we typically build new facilities to accommodate the requirements for significant new programs for which we have been awarded the business. Production volumes for our products
to be supplied for these new programs are based on our customers' estimates of their future production levels, and our supply contracts typically are only for the supply of customers' actual
requirements, not for a minimum or specified quantity of products. Our customers' actual production levels for new vehicle programs may vary significantly from their estimates, or such programs may be
cancelled, or their launch may be delayed. To the extent that our estimated production volumes are not attained, due to cancellations of vehicle programs or delays in launching new vehicle programs,
our production economies expected at the time of quotation may not be realized. Consequently, our capital costs incurred in connection with such programs may not be fully recovered, which could have
an adverse effect on our operations, our financial condition or our profitability. </FONT></P>

<P><FONT SIZE=2><B><I>Delays in the construction of new facilities could have an adverse effect on our financial condition or our profitability.</I></B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;From
time to time, we expand our production capacity through the construction of new manufacturing facilities. New facilities are also typically required to facilitate the introduction
of new manufacturing processes or technologies, and to relocate our manufacturing operations to remain close to the principal customers of these operations, in situations where they have relocated
their facilities. The construction of new facilities involves a number of areas of operational and financial risks. For example, we may experience construction delays associated with poor weather,
labour disruptions, cost overruns, shortages of construction materials and delays associated with the installation, testing and start-up of new production equipment or manufacturing
processes. Delays by us in completing our new facilities could negatively affect our customer relationships, as well as expose us to reimbursement claims by our automobile manufacturer customers for
their costs arising out of such delays. Any of these factors could have an adverse effect on our financial condition or our profitability. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>38</FONT></P>

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<P><FONT SIZE=2><B><I>Changes in laws and governmental regulations could have an adverse effect on our operations, our financial condition or our profitability.</I></B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A
significant change in the current regulatory environment in which we carry on business could have an adverse effect on our operations, our financial condition or our profitability. In
particular, our operations or financial condition or our profitability could be adversely affected by significant changes in the tariffs and duties imposed on our products, particularly significant
changes to the North American Free Trade Agreement. </FONT></P>

<P><FONT SIZE=2><B><I>Environmental laws and regulations could have an adverse effect on our operations, our financial condition or our profitability.</I></B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
are subject to a wide range of environmental laws and regulations relating to air emissions, wastewater discharge, waste management and storage of hazardous substances. We are also
subject to environmental laws requiring investigation and clean-up of environmental contamination and are in various stages of investigation and clean-up at our manufacturing
facilities where contamination has been alleged. Estimating environmental clean-up liabilities is complex and heavily dependent on the nature and extent of historical information and
physical data relating to the contaminated site, the complexity of the contamination, the uncertainty of which remedy to apply and the outcome of discussions with regulatory authorities relating to
the contamination. In addition, these environmental laws and regulations are complex, change frequently and have tended to become more stringent and expensive over time. Therefore, we may not have
been, and in the future may not be, in complete compliance with all such laws and regulations, and we may incur material costs or liabilities as a result of such laws and regulations significantly in
excess of amounts we have reserved. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
are subject to environmental laws and regulations both as tenant and owner of our properties. Our leases with MI&nbsp;Developments generally provide that we, as tenant, must comply
with environmental laws. We are also responsible for removing all hazardous and toxic substances, when and as required by applicable laws and, in any event, prior to the termination of our occupation
of the leased properties, which applies whether or not the contamination occurred prior to our use of the leased properties, unless it was not caused or exacerbated by our use. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;To
the extent that we incur liabilities or costs in excess of the amounts we have reserved in order to comply with environmental laws and regulations, such liabilities or costs could
have an adverse effect on our operations, our financial condition or our profitability. </FONT></P>

<P><FONT SIZE=2><B>Risks Related to Our Controlling Shareholder  </B></FONT></P>

<P><FONT SIZE=2><B><I>We are controlled by the Stronach Trust.  </I></B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our business and affairs are controlled by the Stronach Trust, which beneficially owns approximately 66.4% of our outstanding Class&nbsp;B Shares. Those shares
represent approximately 0.7% of our total outstanding shares and approximately 55.7% of the aggregate voting power of our outstanding shares. In addition, Frank Stronach, who is our Chairman and
Interim Chief Executive Officer, controls approximately 16.2% of the votes carried by our outstanding shares through his voting control of certain of our employee compensatory plans.
Mr.&nbsp;Stronach, Ms.&nbsp;Belinda Stronach, who was our President and Chief Executive Officer until January&nbsp;2004, and two other members of their family are the trustees of the Stronach
Trust, and are also members of the class of potential beneficiaries of the Stronach Trust. Accordingly, Mr.&nbsp;Stronach may be deemed to beneficially own the shares owned by the Stronach Trust,
although he disclaims beneficial ownership. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Subject
to applicable law and the restrictions in our Corporate Constitution, the Stronach Trust is able to elect all of our directors and control us. In addition, the Stronach Trust
may, as a practical matter, be able to cause us to effect corporate transactions without the consent of our other shareholders. The Stronach Trust is also able to cause or prevent a change in our
control. Under present law, any offer to purchase our Class&nbsp;B Shares, whether by way of a public offer or private transaction and regardless of the offered price, would not necessarily result
in an offer to purchase our Class&nbsp;A Subordinate Voting Shares. Accordingly, holders of our Class&nbsp;A Subordinate Voting Shares do not have a right to participate if a takeover bid is made
for our Class&nbsp;B Shares. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>39</FONT></P>

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<P><FONT SIZE=2><B><I>Our controlling shareholder and Mr.&nbsp;Stronach have interests in MI&nbsp;Developments and Magna Entertainment that could conflict with our
interests.</I></B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Stronach Trust beneficially owns, in addition to our Class&nbsp;B Shares as described above, Class&nbsp;B Shares of MI&nbsp;Developments representing approximately 56.5% of the
aggregate voting power of MI&nbsp;Developments. Mr.&nbsp;Stronach is also the Chairman of MI&nbsp;Developments. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A
significant portion of our leased facilities is owned by MI&nbsp;Developments. We pay rent and occupy these facilities pursuant to long-term leases. Most of these leases
were entered into while MI&nbsp;Developments was our wholly-owned subsidiary. Any material lease, construction or other arrangements with MI&nbsp;Developments are reviewed and approved by our
Corporate Governance and Compensation Committee in advance of any commitments by us or any of our subsidiaries. Although we believe that the existing leases are on arm's length commercial terms, there
can be no assurance that independent parties negotiating at arm's length would have arrived at the same terms. Since we are under common control with MI&nbsp;Developments, there is a risk that any
future decisions or actions taken by either of us regarding these leases (including with respect to renewals, amendments, disputes or enforcement proceedings) and any new leases and any new leases may
not be the same as if we operated on an arm's length basis. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
previously made a commitment to our shareholders that we would not, for a period of approximately seven years, without the prior consent of the holders of a majority of our
Class&nbsp;A Subordinate Voting Shares: (i)&nbsp;make any further debt or equity investment in, or otherwise give financial assistance to, Magna Entertainment or any of its subsidiaries; or
(ii)&nbsp;invest in any business or assets determined in good faith by our independent directors to be non-automotive-related and not ancillary or incidental to our automotive-related
business, other than through our historical investment in Magna Entertainment. This commitment is contained in a forbearance agreement between Magna Entertainment and Magna in which our shareholders
are express third party beneficiaries. The forbearance agreement will expire of May&nbsp;31, 2006. Since we are under common control with Magna Entertainment, there is a risk that any future
decisions or actions taken with respect to Magna Entertainment may not be the same as if we operated on an arm's length basis. However, any material transaction with Magna Entertainment would require
review and prior approval by the independent members of our Board. In addition, our Corporate Constitution, which forms part of our charter documents, prohibits us from making investments in certain
"unrelated businesses" where such an investment, together with the aggregate of all other investments in unrelated businesses on the date in question, exceeds 20% of our "available equity" at the end
of the financial quarter immediately preceding the date of investment (see&nbsp;"ITEM 9. CORPORATE CONSTITUTION&nbsp;&#151;&nbsp;Unrelated Investments" below). </FONT></P>

<P><FONT SIZE=2><A
NAME="dk1382_item_4._dividends"> </A>
<A NAME="toc_dk1382_1"> </A>
<BR></FONT><FONT SIZE=2><B>ITEM 4.&nbsp;&nbsp;&nbsp;&nbsp;DIVIDENDS    <BR>    </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Holders of our Class&nbsp;A Subordinate Voting Shares and Class&nbsp;B Shares are entitled to a pro rated amount of any cash dividends declared by our Board
of Directors on these shares. The following table sets forth the cash dividends we have paid on each of our Class&nbsp;A Subordinate Voting Shares and Class&nbsp;B Shares for the last three years: </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>40</FONT></P>

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<TABLE WIDTH="100%" BORDER=0 CELLSPACING=0 CELLPADDING=0>
<TR VALIGN="BOTTOM">
<TH WIDTH="45%" ALIGN="LEFT"><FONT SIZE=1><B>Fiscal Period </B></FONT><HR NOSHADE></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH WIDTH="19%" ALIGN="CENTER"><FONT SIZE=1><B>Payment Date</B></FONT><HR NOSHADE></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH WIDTH="19%" ALIGN="CENTER"><FONT SIZE=1><B>Record Date</B></FONT><HR NOSHADE></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ALIGN="CENTER"><FONT SIZE=1><B>Amount per Share</B></FONT><HR NOSHADE></TH>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="45%"><FONT SIZE=2>Calendar 2005 (to&nbsp;date)</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="19%"><FONT SIZE=2>March&nbsp;23, 2005</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="19%"><FONT SIZE=2>March&nbsp;11, 2005</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>0.38</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="45%"><FONT SIZE=2>Calendar 2004</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="19%"><FONT SIZE=2>December&nbsp;15, 2004</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="19%"><FONT SIZE=2>November&nbsp;30, 2004</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>0.38</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="45%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="19%"><FONT SIZE=2>September&nbsp;15, 2004</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="19%"><FONT SIZE=2>August&nbsp;31, 2004</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>0.38</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="45%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="19%"><FONT SIZE=2>June&nbsp;15, 2004</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="19%"><FONT SIZE=2>May&nbsp;28, 2004</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>0.38</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="45%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="19%"><FONT SIZE=2>March&nbsp;18, 2004</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="19%"><FONT SIZE=2>March&nbsp;9, 2004</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>0.34</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="45%"><BR><FONT SIZE=2> Calendar 2003</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="19%"><FONT SIZE=2><BR>
December&nbsp;15, 2003</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="19%"><FONT SIZE=2><BR>
November&nbsp;28, 2003</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>$</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2><BR>
0.34</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="45%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="19%"><FONT SIZE=2>September&nbsp;15, 2003</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="19%"><FONT SIZE=2>August&nbsp;29, 2003</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>0.34</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="45%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="19%"><FONT SIZE=2>June&nbsp;16, 2003</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="19%"><FONT SIZE=2>May&nbsp;30, 2003</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>0.34</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="45%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="19%"><FONT SIZE=2>March&nbsp;18, 2003</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="19%"><FONT SIZE=2>March&nbsp;7, 2003</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>0.34</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="45%"><BR><FONT SIZE=2> Calendar 2002</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="19%"><FONT SIZE=2><BR>
December&nbsp;16, 2002</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="19%"><FONT SIZE=2><BR>
November&nbsp;29, 2002</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>$</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2><BR>
0.34</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="45%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="19%"><FONT SIZE=2>September&nbsp;16, 2002</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="19%"><FONT SIZE=2>August&nbsp;30, 2002</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>0.34</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="45%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="19%"><FONT SIZE=2>June&nbsp;14, 2002</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="19%"><FONT SIZE=2>May&nbsp;31, 2002</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>0.34</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="45%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="19%"><FONT SIZE=2>March&nbsp;15, 2002</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="19%"><FONT SIZE=2>March&nbsp;1, 2002</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="9%" ALIGN="RIGHT"><FONT SIZE=2>0.34</FONT></TD>
</TR>
</TABLE>
<!-- end of user-specified TAGGED TABLE -->


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
started paying cash dividends on our Class&nbsp;A Subordinate Voting Shares and Class&nbsp;B Shares (or&nbsp;their predecessors) on a quarterly basis in 1967. We have declared
cash dividends in respect of each of the last 53&nbsp;fiscal quarters, up to and including the fourth quarter of calendar 2004. The payment of future dividends and the amount thereof will be
determined by our Board of Directors in accordance with our Corporate Constitution (see&nbsp;"ITEM 9. CORPORATE CONSTITUTION&nbsp;&#151;&nbsp;Dividends; Minimum Profit
Performance" below), taking into account earnings, cash flow, capital requirements, our financial condition and other relevant factors. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
fiscal 1994, we established a dividend reinvestment plan in which registered shareholders have the option to purchase additional Class&nbsp;A Subordinate Voting Shares by investing
the cash dividends paid on their shares. </FONT></P>

<P><FONT SIZE=2><A
NAME="dk1382_item_5._management_s_discussion_and_analysis"> </A>
<A NAME="toc_dk1382_2"> </A>
<BR></FONT><FONT SIZE=2><B>ITEM 5.&nbsp;&nbsp;&nbsp;&nbsp;MANAGEMENT'S DISCUSSION AND ANALYSIS    <BR>    </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Reference is made to the "Management's Discussion and Analysis of Results of Operations and Financial Position" contained on pages&nbsp;12 to&nbsp;35 of our
Annual Report to Shareholders for the year ended December&nbsp;31, 2004, which is incorporated by reference into this Annual Information Form. </FONT></P>

<P><FONT SIZE=2><A
NAME="dk1382_item_6._description_of_capital_structure"> </A>
<A NAME="toc_dk1382_3"> </A>
<BR></FONT><FONT SIZE=2><B>ITEM 6.&nbsp;&nbsp;&nbsp;&nbsp;DESCRIPTION OF CAPITAL STRUCTURE    <BR>    </B></FONT></P>

<P><FONT SIZE=2><B>Authorized Share Capital  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our authorized share capital consists of an unlimited number of Class&nbsp;A Subordinate Voting Shares, 1,412,341&nbsp;Class&nbsp;B Shares and
99,760,000&nbsp;Preference Shares, issuable in series, all with no par value. As of March&nbsp;21, 2005, a total of 105,537,754&nbsp;Class&nbsp;A Subordinate Voting Shares and
1,093,983&nbsp;Class&nbsp;B Shares were outstanding. The percentage of aggregate voting rights attached to our Class&nbsp;A Subordinate Voting Shares as of March&nbsp;21, 2005 was 16.2%. No
Preference Shares have been issued or are outstanding. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
following is a brief description of the significant attributes of our authorized share capital and is qualified in its entirety by reference to the detailed provisions in our charter
documents. See "ITEM 9.&nbsp;&#151;&nbsp;CORPORATE CONSTITUTION" below for additional terms and conditions relating to our authorized share capital. The attributes of our
Class&nbsp;A Subordinate Voting Shares, our Class&nbsp;B Shares and our Preference Shares are set out in our charter documents, which includes our Corporate Constitution. </FONT></P>

<P><FONT SIZE=2><B><I>Class&nbsp;A Subordinate Voting Shares  </I></B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The holders of our Class&nbsp;A Subordinate Voting Shares are entitled: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>to
one vote for each Class&nbsp;A Subordinate Voting Share held (together with the holders of our Class&nbsp;B Shares, which are entitled to vote at such meetings on the
basis of 500&nbsp;votes per Class&nbsp;B Share held) at all meetings of our shareholders, other than meetings of the holders of another class or series of shares; </FONT></DD></DL>
</UL>
<P ALIGN="CENTER"><FONT SIZE=2>41</FONT></P>

<HR NOSHADE>
<P style='page-break-before:always'></p>
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<A NAME="page_dk1382_1_42"> </A>
<UL>
<UL>
</UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>to
receive, on a pro&nbsp;rata basis with the holders of our Class&nbsp;B Shares, any dividends (except for stock dividends, as described below) that may be declared by
our Board of Directors, subject to the preferential rights attaching to shares ranking in priority to our Class&nbsp;A Subordinate Voting Shares and our Class&nbsp;B Shares; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>to
receive, after the payment of our liabilities and subject to the rights of the holders of our shares ranking in priority to our Class&nbsp;A Subordinate Voting Shares
and our Class&nbsp;B Shares, on a pro&nbsp;rata basis with the holders of our Class&nbsp;B Shares, all our property and net assets available for distribution in the event of our liquidation,
dissolution or winding-up, whether voluntary or involuntary, or any other distribution of our assets among our shareholders for the purpose of winding-up our affairs. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2><B><I>Class&nbsp;B Shares  </I></B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The holders of our Class&nbsp;B Shares are entitled to: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>500&nbsp;votes
for each Class&nbsp;B Share held (together with the holders of our Class&nbsp;A Subordinate Voting Shares, which are entitled to vote at such meetings
on the basis of one vote per share held) at all meetings of our shareholders, other than meetings of the holders of another class or series of shares;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>receive,
on a pro&nbsp;rata basis with the holders of our Class&nbsp;A Subordinate Voting Shares, any dividends (except for stock dividends, as described below) that may
be declared by our Board of Directors, subject to the preferential rights attaching to shares ranking in priority to our Class&nbsp;B Shares and our Class&nbsp;A Subordinate Voting Shares;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>receive,
after the payment of all our liabilities and subject to the rights of the holders of our shares ranking in priority to our Class&nbsp;B Shares and our
Class&nbsp;A Subordinate Voting Shares (including holders of our Preference Shares), on a pro&nbsp;rata basis with the holders of our Class&nbsp;A Subordinate Voting Shares, all our property and
net assets available for distribution in the event of our liquidation, dissolution or winding-up, whether voluntary or involuntary, or any other distribution of our assets among our
shareholders for the purpose of winding-up our affairs; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>convert
our Class&nbsp;B Shares into our Class&nbsp;A Subordinate Voting Shares, on a one-for-one basis. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2><B><I>Stock Dividends  </I></B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our Board of Directors may declare a simultaneous dividend payable on our Class&nbsp;A Subordinate Voting Shares in our Class&nbsp;A Subordinate Voting Shares
and payable on our Class&nbsp;B Shares in our Class&nbsp;A Subordinate Voting Shares or in our Class&nbsp;B Shares. No dividend payable in our Class&nbsp;B Shares may be declared on our
Class&nbsp;A Subordinate Voting Shares. </FONT></P>

<P><FONT SIZE=2><B><I>Preference Shares  </I></B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our Board of Directors may, without the approval of any of our shareholders, fix the number of shares in and determine the attributes of an individual series of
Preference Shares and issue shares of such series from time to time. The shares of each such series will be entitled to a preference over our Class&nbsp;A Subordinate Voting Shares and our
Class&nbsp;B Shares, but will rank equally with our Preference Shares of every other series with respect to the payment of dividends and in the distribution of all our property and net assets
available for distribution in the event of our liquidation, dissolution or winding-up, whether voluntary or involuntary, or any other distribution of our assets among our shareholders for
the purpose of winding-up our affairs. </FONT></P>

<P><FONT SIZE=2><B>Amendments to Share Provisions and Other Matters  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The provisions attaching to our Preference Shares, to a series of our Preference Shares, to our Class&nbsp;A Subordinate Voting Shares and to our Class&nbsp;B
Shares may not be deleted or varied without the approval of the holders of the class or series concerned. In addition, no shares of a class ranking prior to or on a parity with our Preference Shares,
our Class&nbsp;A Subordinate Voting Shares or our Class&nbsp;B Shares may be created without the approval of the holders of the class or each series of the class concerned. Any approval required
to be given must be given by the vote of two-thirds of those present or voting at a meeting of the holders of the class or series concerned duly called for that purpose in addition to any
other consent or approval required by law. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>42</FONT></P>

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<A NAME="page_dk1382_1_43"> </A>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Neither
our Class&nbsp;A Subordinate Voting Shares nor our Class&nbsp;B Shares may be subdivided, consolidated, reclassified or otherwise changed unless, contemporaneously therewith,
the other class of shares is subdivided, consolidated, reclassified or otherwise changed in the same proportion and in the same manner. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Under
present law, any offer to purchase our Class&nbsp;B Shares, whether by way of a public offer or private transaction and regardless of the offered price, would not necessarily
result in an offer to purchase our Class&nbsp;A Subordinate Voting Shares. </FONT><FONT SIZE=2><B>Accordingly, holders of our Class&nbsp;A Subordinate Voting Shares do not have a right to
participate if a takeover bid is made for our Class&nbsp;B Shares.</B></FONT></P>

<P><FONT SIZE=2><B>Preferred Securities  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In September&nbsp;1999, we issued two series of unsecured junior subordinated debentures: our 8.65% Series&nbsp;A Preferred Securities, which were denominated
in Canadian dollars; and our 8.875% Series&nbsp;B Preferred Securities, which were denominated in U.S.&nbsp;dollars. Both series of Preferred Securities were redeemed in September&nbsp;2004. See
"ITEM 2. GENERAL DEVELOPMENT OF THE BUSINESS&nbsp;&#151;&nbsp;RECENT DEVELOPMENTS IN OUR BUSINESS&nbsp;&#151;&nbsp;Financing and Securities Transactions"
above. </FONT></P>

<P><FONT SIZE=2><B>Ratings  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our senior debt, including the five series of unsecured zero-coupon notes we issued in connection with the acquisition of New&nbsp;Venture Gear
(see&nbsp;"ITEM 2. GENERAL DEVELOPMENT OF THE BUSINESS&nbsp;&#151;&nbsp;RECENT DEVELOPMENTS IN OUR BUSINESS&nbsp;&#151;&nbsp;Financing and Securities
Transactions" above), has been an "A" credit rating by Dominion Bond Rating Service. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Dominion
Bond Rating Service's rating of our senior debt is based on a bond and long-term debt rating scale that ranges from AAA to D, which represents the range from highest
to lowest quality of such bonds and long-term debt rated. Bonds and long-term debt rated in the "A" rating category are in the third highest category of the relevant scale and
are considered by Dominion Bond Rating Services to be of satisfactory
credit quality. "High" and "low" grades are used to indicate the relative standing of a credit within a particular rating category. The lack of one of these designations indicates a rating which is
essentially in the middle of the category. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Credit
ratings are intended to provide investors with an independent measure of the credit quality of debt and securities. The credit ratings accorded to our senior debt by the rating
agencies are not recommendations to purchase, hold or sell our debt or securities, inasmuch as such ratings do not comment as to market price or suitability for a particular investor. There is no
assurance that any rating will remain in effect for any given period of time or that any rating will not be revised or withdrawn entirely by a rating agency in the future. </FONT></P>

<P><FONT SIZE=2><A
NAME="dk1382_item_7._market_for_securities"> </A>
<A NAME="toc_dk1382_4"> </A>
<BR></FONT><FONT SIZE=2><B>ITEM 7.&nbsp;&nbsp;&nbsp;&nbsp;MARKET FOR SECURITIES    <BR>    </B></FONT></P>

<P><FONT SIZE=2><B>Class&nbsp;A Subordinate Voting Shares and Class&nbsp;B Shares  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Prior&nbsp;to November&nbsp;15, 2004, our Class&nbsp;A Subordinate Voting Shares and Class&nbsp;B Shares were listed and posted for trading on the Toronto
Stock Exchange under the trading symbols "MG.A" and "MG.B", respectively. Since November&nbsp;15, 2004, pursuant to the Toronto Stock Exchange's 2004 Symbol Extension Changes, our Class&nbsp;A
Subordinate Voting Shares and Class&nbsp;B Shares have been listed and posted for trading on the Toronto Stock Exchange under the symbols "MG.SV.A" and "MG.MV.B", respectively. Our Class&nbsp;A
Subordinate Voting Shares are listed and posted for trading on the New&nbsp;York Stock Exchange under the trading symbol "MGA". </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
high and low sale prices and volume of shares traded for each of our Class&nbsp;A Subordinate Voting Shares and our Class&nbsp;B Shares, as reported by the Toronto Stock
Exchange, for the months during the year ended December&nbsp;31, 2004 were as follows: </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>43</FONT></P>

<HR NOSHADE>
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<!-- User-specified TAGGED TABLE -->
<TABLE WIDTH="100%" BORDER=0 CELLSPACING=0 CELLPADDING=0>
<TR VALIGN="BOTTOM">
<TH WIDTH="48%" ALIGN="LEFT"><FONT SIZE=2>&nbsp;</FONT><BR></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=5 ALIGN="CENTER"><FONT SIZE=1><B>Class&nbsp;A Subordinate Voting Shares</B></FONT><HR NOSHADE></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=5 ALIGN="CENTER"><FONT SIZE=1><B>Class&nbsp;B Shares</B></FONT><HR NOSHADE></TH>
</TR>
<TR VALIGN="BOTTOM">
<TH WIDTH="48%" ALIGN="LEFT"><FONT SIZE=1><B>Month </B></FONT><HR NOSHADE></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH WIDTH="7%" ALIGN="CENTER"><FONT SIZE=1><B>High (Cdn.$)</B></FONT><HR NOSHADE></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH WIDTH="7%" ALIGN="CENTER"><FONT SIZE=1><B>Low (Cdn.$)</B></FONT><HR NOSHADE></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH WIDTH="7%" ALIGN="CENTER"><FONT SIZE=1><B>Volume (000's)</B></FONT><HR NOSHADE></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH WIDTH="7%" ALIGN="CENTER"><FONT SIZE=1><B>High (Cdn.$)</B></FONT><HR NOSHADE></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH WIDTH="7%" ALIGN="CENTER"><FONT SIZE=1><B>Low (Cdn.$)</B></FONT><HR NOSHADE></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH WIDTH="6%" ALIGN="CENTER"><FONT SIZE=1><B>Volume (000's)</B></FONT><HR NOSHADE></TH>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="48%"><FONT SIZE=2>January</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>110.20</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>102.13</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>5,442.7</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>106.00</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>103.50</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="6%" ALIGN="RIGHT"><FONT SIZE=2>2.1</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="48%"><FONT SIZE=2>February</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>109.00</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>103.30</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>3,046.6</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>108.00</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>105.25</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="6%" ALIGN="RIGHT"><FONT SIZE=2>0.4</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="48%"><FONT SIZE=2>March</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>107.60</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>98.02</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>4,086.0</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>109.00</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>101.00</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="6%" ALIGN="RIGHT"><FONT SIZE=2>0.9</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="48%"><FONT SIZE=2>April</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>114.00</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>104.34</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>4,352.3</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>113.08</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>108.00</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="6%" ALIGN="RIGHT"><FONT SIZE=2>1.7</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="48%"><FONT SIZE=2>May</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>109.90</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>103.07</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>3,233.0</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>112.00</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>104.79</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="6%" ALIGN="RIGHT"><FONT SIZE=2>0.7</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="48%"><FONT SIZE=2>June</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>115.79</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>107.22</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>2,958.6</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>112.50</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>110.00</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="6%" ALIGN="RIGHT"><FONT SIZE=2>0.7</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="48%"><FONT SIZE=2>July</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>113.80</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>105.23</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>2,983.2</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>108.00</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>108.00</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="6%" ALIGN="RIGHT"><FONT SIZE=2>1.1</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="48%"><FONT SIZE=2>August</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>107.49</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>97.22</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>2,728.5</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>102.86</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>99.61</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="6%" ALIGN="RIGHT"><FONT SIZE=2>1.0</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="48%"><FONT SIZE=2>September</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>99.50</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>90.48</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>4,335.9</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>99.00</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>99.00</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="6%" ALIGN="RIGHT"><FONT SIZE=2>0.4</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="48%"><FONT SIZE=2>October</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>96.88</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>82.40</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>7,921.1</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>90.00</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>90.00</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="6%" ALIGN="RIGHT"><FONT SIZE=2>0.8</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="48%"><FONT SIZE=2>November</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>96.64</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>85.96</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>5,444.8</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>95.00</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>90.00</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="6%" ALIGN="RIGHT"><FONT SIZE=2>1.3</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="48%"><FONT SIZE=2>December</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>101.09</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>94.05</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>4,123.6</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>106.00</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>106.00</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="6%" ALIGN="RIGHT"><FONT SIZE=2>0.2</FONT></TD>
</TR>
</TABLE>
<!-- end of user-specified TAGGED TABLE -->


<P><FONT SIZE=2><B>6.5% Convertible Debentures  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As part of the privatization of Decoma, we assumed Decoma's obligations in respect of its 6.5% Convertible Debentures in the principal amount outstanding of
$99,998,000 (see&nbsp;"ITEM 2. GENERAL DEVELOPMENT OF THE BUSINESS&nbsp;&#151;&nbsp;RECENT DEVELOPMENTS IN OUR BUSINESS&nbsp;&#151;&nbsp;Financing and
Securities Transactions" above). The 6.5% Convertible Debentures are listed and posted for trading on the Toronto Stock Exchange under the symbol "MG.DB" (formerly "DEC.DB"). </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
high and low sale prices and volume traded for the 6.5% Convertible Debentures, as reported by the Toronto Stock Exchange, for the months during the year ended December&nbsp;31,
2004 were as follows: </FONT></P>

<!-- User-specified TAGGED TABLE -->
<TABLE WIDTH="100%" BORDER=0 CELLSPACING=0 CELLPADDING=0>
<TR VALIGN="BOTTOM">
<TH WIDTH="73%" ALIGN="LEFT"><FONT SIZE=2>&nbsp;</FONT><BR></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=5 ALIGN="CENTER"><FONT SIZE=1><B>6.5% Convertible Debentures</B></FONT><HR NOSHADE></TH>
</TR>
<TR VALIGN="BOTTOM">
<TH WIDTH="73%" ALIGN="LEFT"><FONT SIZE=1><B>Month </B></FONT><HR NOSHADE></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH WIDTH="7%" ALIGN="CENTER"><FONT SIZE=1><B>High (Cdn.$)</B></FONT><HR NOSHADE></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH WIDTH="7%" ALIGN="CENTER"><FONT SIZE=1><B>Low (Cdn.$)</B></FONT><HR NOSHADE></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH WIDTH="7%" ALIGN="CENTER"><FONT SIZE=1><B>Volume (000's)</B></FONT><HR NOSHADE></TH>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="73%"><FONT SIZE=2>January</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>120.00</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>115.01</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>1.1</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="73%"><FONT SIZE=2>February</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>117.99</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>110.00</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>3.3</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="73%"><FONT SIZE=2>March</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>119.99</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>111.01</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>1.5</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="73%"><FONT SIZE=2>April</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>119.00</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>112.00</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>1.3</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="73%"><FONT SIZE=2>May</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>115.00</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>112.00</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>20.7</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="73%"><FONT SIZE=2>June</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>116.03</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>110.51</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>62.6</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="73%"><FONT SIZE=2>July</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>114.99</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>110.50</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>32.3</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="73%"><FONT SIZE=2>August</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>112.21</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>105.00</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>5.8</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="73%"><FONT SIZE=2>September</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>107.00</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>101.52</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>25.9</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="73%"><FONT SIZE=2>October</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>118.50</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>103.00</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>95.0</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="73%"><FONT SIZE=2>November</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>120.00</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>114.00</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>10.8</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="73%"><FONT SIZE=2>December</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>125.00</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>118.00</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="7%" ALIGN="RIGHT"><FONT SIZE=2>27.5</FONT></TD>
</TR>
</TABLE>
<!-- end of user-specified TAGGED TABLE -->

<P ALIGN="CENTER"><FONT SIZE=2>44</FONT></P>

<HR NOSHADE>
<P style='page-break-before:always'></p>
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<A NAME="page_dk1382_1_45"> </A>

<P><FONT SIZE=2><A
NAME="dk1382_item_8._directors_and_officers"> </A>
<A NAME="toc_dk1382_5"> </A>
<BR></FONT><FONT SIZE=2><B>ITEM 8.&nbsp;&nbsp;&nbsp;&nbsp;DIRECTORS AND OFFICERS    <BR>    </B></FONT></P>

<P><FONT SIZE=2><B>Directors  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our Board of Directors currently consists of the following members: </FONT></P>

<!-- User-specified TAGGED TABLE -->
<TABLE WIDTH="100%" BORDER=0 CELLSPACING=0 CELLPADDING=0>
<TR VALIGN="BOTTOM">
<TH WIDTH="38%" ALIGN="LEFT"><FONT SIZE=1><B>Name and Municipality of Residence </B></FONT><HR NOSHADE></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH WIDTH="20%" ALIGN="LEFT"><FONT SIZE=1><B>Director Since </B></FONT><HR NOSHADE></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH WIDTH="38%" ALIGN="LEFT"><FONT SIZE=1><B>Principal Occupation </B></FONT><HR NOSHADE></TH>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD WIDTH="38%" VALIGN="TOP"><FONT SIZE=2>WILLIAM H. FIKE<SUP>(1)</SUP><BR>
Ft. Myers, Florida</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP"><FONT SIZE=2>June&nbsp;5, 1995</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="38%" VALIGN="TOP"><FONT SIZE=2>Consultant and Corporate Director</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="38%"><FONT SIZE=2>MANFRED GINGL<BR>
Kettleby, Ontario</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="20%"><FONT SIZE=2>January&nbsp;14, 2002</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="38%"><FONT SIZE=2>Executive Vice-Chairman of the Company</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="38%"><FONT SIZE=2>MICHAEL D. HARRIS<SUP>(2)</SUP><BR>
Vaughn, Ontario</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="20%"><FONT SIZE=2>January&nbsp;8, 2003</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="38%"><FONT SIZE=2>Consultant and Senior Business Advisor,<BR>
Goodmans&nbsp;LLP (Barristers and Solicitors)</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="38%"><FONT SIZE=2>EDWARD C. LUMLEY<SUP>(2)</SUP><SUP>(3)(5)</SUP><BR>
South Lancaster, Ontario</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="20%"><FONT SIZE=2>December&nbsp;7, 1989</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="38%"><FONT SIZE=2>Vice-Chairman, BMO Nesbitt Burns<BR>
(Investment and Corporate Banking)</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD WIDTH="38%" VALIGN="TOP"><FONT SIZE=2>KLAUS MANGOLD<BR>
Stuttgart, Germany</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP"><FONT SIZE=2>February&nbsp;26, 2004</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="38%" VALIGN="TOP"><FONT SIZE=2>Corporate Director</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="38%"><FONT SIZE=2>KARLHEINZ MUHR<BR>
Greenwich, Connecticut</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="20%"><FONT SIZE=2>March&nbsp;8, 1999</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="38%"><FONT SIZE=2>Chairman, CSFB VOLARIS, Member of CSFB's Chairman's Board and Management Council and Managing Director, Credit Suisse First Boston<BR>
(Investment Banking)</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="38%"><FONT SIZE=2>GERHARD RANDA<BR>
Vienna, Austria</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="20%"><FONT SIZE=2>July&nbsp;19, 1995</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="38%"><FONT SIZE=2>Chairman of the Supervisory Board of Bank Austria&nbsp;&#151;&nbsp;Creditanstalt and Member of the Management Board of Directors of Bayerische Hypo Vereinsbank AG<BR>
(Investment and Corporate Banking)</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD WIDTH="38%" VALIGN="TOP"><FONT SIZE=2>DONALD RESNICK<SUP>(1)(4)</SUP><BR>
Toronto, Ontario</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP"><FONT SIZE=2>February&nbsp;25, 1982</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="38%" VALIGN="TOP"><FONT SIZE=2>Corporate Director</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="38%"><FONT SIZE=2>ROYDEN R. RICHARDSON<SUP>(1)(2)(4)</SUP><BR>
Schomberg, Ontario</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="20%"><FONT SIZE=2>October&nbsp;31, 1990</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="38%"><FONT SIZE=2>President, RBQ Limited, Managing Director, Fairlane Asset Management Limited, and Vice-Chairman and Director, Richardson Partners Financial Limited (Investments)</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="38%"><FONT SIZE=2>FRANK STRONACH<BR>
Oberwaltersdorf, Austria</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="20%"><FONT SIZE=2>December&nbsp;10, 1968</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="38%"><FONT SIZE=2>Partner, Stronach&nbsp;&amp;&nbsp;Co.<BR>
(Consultant)</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD WIDTH="38%" VALIGN="TOP"><FONT SIZE=2>FRANZ VRANITZKY<BR>
Vienna, Austria</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP"><FONT SIZE=2>June&nbsp;11, 1997</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="38%" VALIGN="TOP"><FONT SIZE=2>Corporate Director</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="38%"><FONT SIZE=2>SIEGFRIED WOLF<BR>
Weikersdorf, Austria</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="20%"><FONT SIZE=2>March&nbsp;9, 1999</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="38%"><FONT SIZE=2>Executive Vice-Chairman of the Company</FONT></TD>
</TR>
</TABLE>
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<HR NOSHADE ALIGN="LEFT" WIDTH="60">
<DL compact>
<DT style='margin-bottom:-9pt;'><FONT SIZE=1>(1)</FONT></DT><DD><FONT SIZE=1>Member
of the Audit Committee
<BR><BR></FONT></DD><DT style='margin-bottom:-9pt;'><FONT SIZE=1>(2)</FONT></DT><DD><FONT SIZE=1>Member
of the Corporate Governance and Compensation Committee
<BR><BR></FONT></DD><DT style='margin-bottom:-9pt;'><FONT SIZE=1>(3)</FONT></DT><DD><FONT SIZE=1>Lead
Director of the Board of Directors
<BR><BR></FONT></DD><DT style='margin-bottom:-9pt;'><FONT SIZE=1>(4)</FONT></DT><DD><FONT SIZE=1>Member
of the Environmental Committee
<BR><BR></FONT></DD><DT style='margin-bottom:-9pt;'><FONT SIZE=1>(5)</FONT></DT><DD><FONT SIZE=1>Mr.&nbsp;Lumley
served as a director of Air Canada when it filed for protection under the C</FONT><FONT SIZE=1><I>ompanies' Creditors Arrangement Act (CCAA)</I></FONT><FONT SIZE=1>
in April&nbsp;2003. Air Canada successfully emerged from the CCAA proceedings and was restructured pursuant to a plan of arrangement in September&nbsp;2004, though Mr.&nbsp;Lumley is no longer a
director of Air Canada. </FONT></DD></DL>
<P ALIGN="CENTER"><FONT SIZE=2>45</FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All of our directors were elected to their present terms of office by our shareholders at our Annual Meeting of Shareholders held on May&nbsp;6,
2004. The term of office for each director expires at the conclusion of the next annual meeting of our shareholders. At present, no executive committee of the Board of Directors has been constituted. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All
of the directors have held the principal occupations identified above (or&nbsp;another position with the same employer) for not less than five years, except as follows: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Mr.&nbsp;Fike
served as our Vice-Chairman and held other senior positions with us from August&nbsp;1994 to January&nbsp;1999, after which time he worked as
a consultant for us until January&nbsp;2000.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Mr.&nbsp;Harris
was the Premier of Ontario from June&nbsp;1995 until March&nbsp;2002 and has acted as a business consultant since that date and as a Senior Business
Advisor to Goodmans&nbsp;LLP since October&nbsp;2002.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Dr.&nbsp;Mangold
was a member of the Management Board of DaimlerChrysler AG until December&nbsp;2003 and has been a corporate director and consultant since then.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Mr.&nbsp;Randa
also served as the Chief Operating Officer of Bayerische Hypo Vereinsbank AG until March&nbsp;2005.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Mr.&nbsp;Richardson
has served as President, RBQ Limited since its formation in 1983. He has served as the Managing Director, Fairlane Asset Management Limited and as the
Vice-Chairman and Director, Richardson Partners Financial Limited since June&nbsp;2003.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Mr.&nbsp;Muhr
has served as Chairman, CSFB VOLARIS since June&nbsp;1999. He has been the Managing Director, Credit Suisse First Boston since June&nbsp;2003, prior to
which he was Chairman and Chief Executive Officer of Volaris Advisors. Prior to that, he was Managing Director at UBS AG from February&nbsp;1995 until June&nbsp;2000. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2><B>Officers  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our officers currently consist of the following persons: </FONT></P>

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<TR VALIGN="BOTTOM">
<TH WIDTH="33%" ALIGN="LEFT"><FONT SIZE=1><B>Name and Municipality of Residence </B></FONT><HR NOSHADE></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH WIDTH="65%" ALIGN="LEFT"><FONT SIZE=1><B>Principal Occupation </B></FONT><HR NOSHADE></TH>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="33%"><FONT SIZE=2>FRANK STRONACH<BR>
Oberwaltersdorf, Austria</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="65%"><FONT SIZE=2>Chairman of the Board (since November&nbsp;1971) and<BR>
Interim Chief Executive Officer (since January&nbsp;2004)</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD WIDTH="33%" VALIGN="TOP"><FONT SIZE=2>MANFRED GINGL<BR>
Kettleby, Ontario</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="65%" VALIGN="TOP"><FONT SIZE=2>Executive Vice-Chairman (since May&nbsp;2002)</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD WIDTH="33%" VALIGN="TOP"><FONT SIZE=2>SIEGFRIED WOLF<BR>
Weikersdorf, Austria</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="65%" VALIGN="TOP"><FONT SIZE=2>Executive Vice-Chairman (since May&nbsp;2002)</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD WIDTH="33%" VALIGN="TOP"><FONT SIZE=2>MARK T. HOGAN<BR>
Birmingham, Michigan</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="65%" VALIGN="TOP"><FONT SIZE=2>President (since August&nbsp;2004)</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="33%"><FONT SIZE=2>VINCENT J. GALIFI<BR>
Woodbridge, Ontario</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="65%"><FONT SIZE=2>Executive Vice-President (since September&nbsp;1996) and<BR>
Chief Financial Officer (since December&nbsp;1997)</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="33%"><FONT SIZE=2>J. BRIAN COLBURN<BR>
Toronto, Ontario</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="65%"><FONT SIZE=2>Executive Vice-President, Special Projects (since May&nbsp;1992) and<BR>
Secretary (since January&nbsp;1994)</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="33%"><FONT SIZE=2>PETER KOOB<BR>
Hausen, Germany</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="65%"><FONT SIZE=2>Executive Vice-President, Corporate Development (since May&nbsp;2002)</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="33%"><FONT SIZE=2>MARC NEEB<BR>
Gormley, Ontario</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="65%"><FONT SIZE=2>Executive Vice-President, Global Human Resources (since January&nbsp;2003)</FONT></TD>
</TR>
</TABLE>
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<TABLE WIDTH="100%" BORDER=0 CELLSPACING=0 CELLPADDING=0>
<TR VALIGN="BOTTOM">
<TH WIDTH="33%" ALIGN="LEFT"><FONT SIZE=1><B>Name and Municipality of Residence </B></FONT><HR NOSHADE></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH WIDTH="65%" ALIGN="LEFT"><FONT SIZE=1><B>Principal Occupation </B></FONT><HR NOSHADE></TH>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD WIDTH="33%" VALIGN="TOP"><FONT SIZE=2>JEFFREY O. PALMER<BR>
Burlington, Ontario</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="65%" VALIGN="TOP"><FONT SIZE=2>Executive Vice-President (since January&nbsp;2001)</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD WIDTH="33%" VALIGN="TOP"><FONT SIZE=2>TOMMY J. SKUDUTIS<BR>
King City, Ontario</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="65%" VALIGN="TOP"><FONT SIZE=2>Executive Vice-President, Operations (since May&nbsp;2001)</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="33%"><FONT SIZE=2>KEITH STEIN<BR>
Toronto, Ontario</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="65%"><FONT SIZE=2>Senior Vice-President, Corporate Affairs (since February&nbsp;2005) and Vice-President, Corporate Affairs (since March&nbsp;1999)</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD WIDTH="33%" VALIGN="TOP"><FONT SIZE=2>KEVIN GALLAGHER<BR>
Toronto, Ontario</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="65%" VALIGN="TOP"><FONT SIZE=2>Vice-President, Public Affairs (since November&nbsp;2004)</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD WIDTH="33%" VALIGN="TOP"><FONT SIZE=2>CAMERON W. HASTINGS<BR>
Pefferlaw, Ontario</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="65%" VALIGN="TOP"><FONT SIZE=2>Vice-President, Core Projects (since January&nbsp;2002)</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD WIDTH="33%" VALIGN="TOP"><FONT SIZE=2>JOSEPH M. LEFAVE<BR>
Vaughan, Ontario</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="65%" VALIGN="TOP"><FONT SIZE=2>Vice-President (since May&nbsp;2004)</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="33%"><FONT SIZE=2>PATRICK W. D. McCANN<BR>
Newmarket, Ontario</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="65%"><FONT SIZE=2>Vice-President (since January&nbsp;2005) and Controller (since May&nbsp;2002)</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD WIDTH="33%" VALIGN="TOP"><FONT SIZE=2>ROLAND B. NIMMO<BR>
Aurora, Ontario</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="65%" VALIGN="TOP"><FONT SIZE=2>Vice-President, Internal Audit (since September&nbsp;2002)</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="BOTTOM">
<TD WIDTH="33%" VALIGN="TOP"><FONT SIZE=2>STEPHEN I. RODGERS<BR>
Holland Landing, Ontario</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="65%" VALIGN="TOP"><FONT SIZE=2>Vice-President, Marketing (since August&nbsp;2003)</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="BOTTOM">
<TD WIDTH="33%" VALIGN="TOP"><FONT SIZE=2>LOUIS TONELLI<BR>
Aurora, Ontario</FONT></TD>
<TD WIDTH="2%" VALIGN="TOP"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="65%" VALIGN="TOP"><FONT SIZE=2>Vice-President, Investors Relations (since November&nbsp;2003)</FONT></TD>
</TR>
</TABLE>
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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;To
the extent that our officers have not held the offices identified above for the last five years, they have held the following offices or positions with us and/or have had the
following principal occupations, during the last five years: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Prior
to May&nbsp;2002, Mr.&nbsp;Gingl was our Vice-Chairman since January&nbsp;2002, and also from November&nbsp;1999 to July&nbsp;2000.
Mr.&nbsp;Gingl has also been the Chairman of Tesma since February&nbsp;2004 and President and Chief Executive Officer of Tesma since 1995.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Prior
to May&nbsp;2002, Mr.&nbsp;Wolf was our Vice-Chairman since February&nbsp;2002 and also from March&nbsp;1999 to February&nbsp;2001.
Mr.&nbsp;Wolf has also been the Chairman of the Supervisory Board of Magna Steyr since May&nbsp;2003 and, prior to that, was the President and Chief Executive Officer of Magna Steyr since
September&nbsp;2001. Mr.&nbsp;Wolf has also held executive and director positions in our European corporate operations, including serving as the Chairman of the Supervisory Board of Magna
International Europe since May&nbsp;2003.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Prior
to August&nbsp;2004, Mark Hogan was the Group Vice President of General Motors Advanced Vehicle Development since January&nbsp;2002. Prior to that,
Mr.&nbsp;Hogan was Group Vice President of General Motors and the President of </FONT><FONT SIZE=2><I>e</I></FONT><FONT SIZE=2>GM from August&nbsp;1998 to December&nbsp;2001.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Mr.&nbsp;Koob
has been the Vice-Chairman of the Supervisory Board of Magna Steyr since May&nbsp;2003 and, prior to that, served as an Executive
Vice-President of Magna Steyr since September&nbsp;2001. Mr.&nbsp;Koob has also held executive and director positions in our European corporate operations, including serving as a
member of the Supervisory Board of Magna International Europe since May&nbsp;2003.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Prior
to January&nbsp;2003, Mr.&nbsp;Neeb was our Vice-President, Global Human Resources since May&nbsp;2002. Prior to that, he was our
Vice-President, Human Resources from August&nbsp;2000 to May&nbsp;2002. He was our Director, Corporate Administration from November&nbsp;1999 to July&nbsp;2000.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Prior
to January&nbsp;2001, Mr.&nbsp;Palmer was a partner at the law firm of Davies, Ward&nbsp;&amp; Beck&nbsp;L.L.P. </FONT></DD></DL>
</UL>
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<UL>
<UL>
</UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Mr.&nbsp;Skudutis
was President of Cosma from March&nbsp;2001 to March&nbsp;2002. Prior to that, he was Vice-President, Operations of Cosma since
February&nbsp;1993. Mr.&nbsp;Skudutis was also Vice-President, Operations from January&nbsp;1993 to June&nbsp;2000.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Prior
to November&nbsp;2004, Mr.&nbsp;Gallagher was a partner at the law firm of Morrison Brown Sosnovitch&nbsp;L.L.P.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Prior
to January&nbsp;2002, Mr.&nbsp;Hastings was the Assistant General Manager of Cosma's Maple Stamping division since August&nbsp;1990.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Prior
to April&nbsp;2004, Mr.&nbsp;Lefave was the Executive Vice-President of Volkswagen Commercial Vehicles since June&nbsp;2000. Prior to that, he was
the Vice-President, Manufacturing of Volkswagen Commercial Vehicles from December&nbsp;1998 to May&nbsp;2000.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Prior
to January&nbsp;2005, Mr.&nbsp;McCann was our Controller since May&nbsp;2002. Prior to that, he was our Assistant Controller since August&nbsp;2000. Prior to
that, he was our Group Controller, Europe since April&nbsp;1999.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Prior
to September&nbsp;2002, Mr.&nbsp;Nimmo was a partner at the accounting firm Deloitte&nbsp;&amp; Touche&nbsp;L.L.P. since June&nbsp;2002. Prior to that, he was a
partner at the former accounting firm Arthur Andersen&nbsp;L.L.P. from November&nbsp;2000 to May&nbsp;2002. Prior to November&nbsp;2000, he was President of Nimmo Financial Corporation, a
consulting firm.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Prior
to August&nbsp;2003, Mr.&nbsp;Rodgers was the Senior Vice-President, Marketing of Intier Automotive&nbsp;Inc. since April&nbsp;2002. Prior to that,
he was the Senior Vice-President, Marketing and Planning of Intier Automotive Closures&nbsp;Inc. since July&nbsp;1997.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>Prior
to November&nbsp;2003, Mr.&nbsp;Tonelli was our Director of Investor Relations since November&nbsp;2000. Prior to that, he was our Senior Manager, Investor
Relations since February&nbsp;1999. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2><B>Beneficial Ownership of Securities  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As of March&nbsp;21, 2005, the number and percentage of securities of each class of our voting securities beneficially owned, directly or indirectly, or over
which control or direction was exercised by all of our directors and officers as a group (27&nbsp;persons), was 4,811,606 (approximately 4.6%) of our Class&nbsp;A Subordinate Voting Shares and
930,013 (approximately 85%) of our Class&nbsp;B Shares. </FONT></P>

<P><FONT SIZE=2><A
NAME="dk1382_item_9._corporate_constitution"> </A>
<A NAME="toc_dk1382_6"> </A>
<BR></FONT><FONT SIZE=2><B>ITEM 9.&nbsp;&nbsp;&nbsp;&nbsp;CORPORATE CONSTITUTION    <BR>    </B></FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our Corporate Constitution forms part of our charter documents. The Corporate Constitution defines the rights of our employees and investors to participate in our
profits and growth and imposes discipline on our management. The brief description of the principal features of our Corporate Constitution which follows is subject to the detailed provisions of the
Corporate Constitution as contained in our charter documents. The description which follows does not purport to be complete and is qualified in its entirety by reference to the detailed provisions of
the Corporate Constitution as contained in our charter documents. </FONT></P>


<P><FONT SIZE=2><B>Board of Directors  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our Corporate Constitution requires that a majority of the members of our Board of Directors be individuals who are not also our officers, employees or persons
related to our officers or employees. </FONT></P>

<P><FONT SIZE=2><B>Employee Equity Participation and Profit Sharing Programs  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our Corporate Constitution requires that 10% of our employee pre-tax profits before profit sharing (as&nbsp;defined in the Corporate Constitution)
for each financial year be allocated in that financial year or the immediately following financial year to: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
employee equity participation and profit sharing programs and any other profit sharing programs we have established for our employees; and </FONT></DD></DL>
</UL>
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<UL>
</UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>our
defined benefit pension plan (for&nbsp;participating employees). </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Employees
of Tesma, Decoma and Intier participate in parallel employee equity participation and profit sharing programs and thus are not currently eligible to participate in our
corporate level program. The structure of the programs is currently under review in connection with the privatization of Decoma and Tesma, as well as the proposed privatization of Intier. Senior
members of divisional, automotive systems group and executive management who are direct profit participators do not participate in these employee equity participation and profit sharing programs. </FONT></P>

<P><FONT SIZE=2><B>Dividends; Minimum Profit Performance  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our Corporate Constitution provides that unless otherwise approved by ordinary resolution of the holders of our Class&nbsp;A Subordinate Voting Shares and our
Class&nbsp;B Shares, voting as separate classes, the holders of our Class&nbsp;A Subordinate Voting Share and Class&nbsp;B Shares will be entitled to receive and we will pay, if, as and when
declared by our Board of Directors out of funds properly applicable to the payment of dividends, non-cumulative dividends in respect of each financial year so that the aggregate of the
dividends paid or payable in respect of such year is: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>equal
to at least 10% of our after-tax profits (as&nbsp;defined in the Corporate Constitution) after providing for dividends on preference shares, if any, for
such year; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>on
average, equal to at least 20% of our after-tax profits (as&nbsp;defined in the Corporate Constitution) after providing for dividends on preference shares,
if any, for such financial year and the two immediately preceding financial years. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
at any time our after-tax profits (as&nbsp;defined in the Corporate Constitution) are less than 4% of the average stated capital attributable to our Class&nbsp;A
Subordinate Voting Shares and Class&nbsp;B Shares at the beginning and at the end of the financial year in question, for two consecutive financial years or we fail to pay the required dividends
described above for a period of two consecutive financial years, the holders of our Class&nbsp;A Subordinate Voting Shares will, until the 4% return is achieved in a succeeding financial year and
all required dividends, if any, are paid, have the exclusive right, voting separately as a class, to nominate and elect two directors at the next meeting of our shareholders at which directors are to
be elected such right to increase the number of directors which may be elected to continue for each consecutive two-year period. If the 4% return is not achieved or a required dividend is
not paid for any two consecutive financial years following the initial two consecutive financial years, then the holders of our Class&nbsp;A Subordinate Voting Shares will, until the 4% return is
achieved for one financial year and all required dividends are paid, have the exclusive right, voting separately as a class, to nominate and elect two additional directors at the next meeting of
shareholders at which directors are to be elected. Once the right of holders of our Class&nbsp;A Subordinate Voting Shares to elect such directors terminates, the directors who had been so elected
will nonetheless serve until their successors are duly elected at the next meeting of our shareholders. </FONT></P>


<P><FONT SIZE=2><B>Changes in Share Capital  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Except as otherwise approved by the holders of at least a majority of each of our Class&nbsp;A Subordinate Voting Shares and Class&nbsp;B Shares, voting as
separate classes, our Corporate Constitution prohibits: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>an
increase in the maximum number of authorized shares of any class of our capital stock (other than our Class&nbsp;A Subordinate Voting Shares which may be issued in an
unlimited amount); and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
creation of any new class or series of capital stock having voting rights (other than on default in the payment of dividends) or having rights to participate in our
profits (other than securities convertible into existing classes of shares or a class or series of shares having fixed dividends or dividends determined without regard to profits). </FONT></DD></DL>
</UL>

<P><FONT SIZE=2><B>Unrelated Investments  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Unless approved by the holders of at least a majority of each of our Class&nbsp;A Subordinate Voting Shares and Class&nbsp;B Shares, voting as separate
classes, our Corporate Constitution prohibits us from making an investment (whether direct or indirect, by means of loans, guarantee, or otherwise) in any "unrelated business" where such an
investment, together with the aggregate of all other investments in unrelated businesses on the date in question, exceeds 20% of our "available equity" at the end of the financial quarter immediately
preceding the date of investment. For purposes of our Corporate Constitution, the term "unrelated business" means any business that: </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>49</FONT></P>

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<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>does
not relate to the design, manufacture, distribution or sale of motor vehicles or motor vehicle parts, components, assemblies or accessories;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>does
not utilize technology, manufacturing processes, equipment or skilled personnel in a manner similar to that utilized or under development by us; or
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>does
not involve the provision of products or services to our suppliers and customers, or the provisions of products or services similar to those provided by our suppliers
and customers from time to time. </FONT></DD></DL>
</UL>
<BR>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A
business will be deemed to cease to be an unrelated business for purposes of our Corporate Constitution if the net profits after tax of such business exceeds on average 5% of our
aggregate investment in such business for two out of any three consecutive years after the date of such investment. For purposes of our Corporate Constitution, the term "available equity" is defined
to mean our total shareholders' equity, less the stated capital of any non-participating preference shares. </FONT></P>

<P><FONT SIZE=2><B>Research and Development  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our Corporate Constitution requires a minimum of 7% of our pre-tax profits (as&nbsp;defined in the Corporate Constitution) for any financial year to
be allocated to research and development during that financial year or the immediately following financial year. </FONT></P>


<P><FONT SIZE=2><B>Social Objectives  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pursuant to our Corporate Constitution, a maximum of 2% of our pre-tax profits (as&nbsp;defined in the Corporate Constitution) for any financial
year may be allocated to the promotion of "social objectives" during the financial year or the immediately following financial year. For purposes of our Corporate Constitution, the term "social
objectives" means objectives which, in the sole opinion of our executive management, are of a political, patriotic, philanthropic, charitable, educational, scientific, artistic, social or other useful
nature to the communities in which we operate. </FONT></P>


<P><FONT SIZE=2><B>Incentive Bonuses; Management Base Salaries  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our Corporate Constitution provides that aggregate incentive bonuses (which may be paid in cash or in our shares) paid or payable to "corporate management" in
respect of any financial year will not exceed 6% of our pre-tax profits before profit sharing (as&nbsp;defined in the Corporate Constitution) for that financial year and that base
salaries payable to such management will be comparable to those in industry generally. For purposes of our Corporate Constitution, "corporate management" means our chief executive officer, chief
operating officer, chief marketing officer and chief administrative officer and any other employee designated by these persons from time to time to be included within "corporate management". Our
Executive Vice-Chairmen and certain of our Executive Vice-Presidents have been designated for these purposes. </FONT></P>

<P><FONT SIZE=2><A
NAME="dk1382_item_10._legal_proceedings"> </A>
<A NAME="toc_dk1382_7"> </A>
<BR></FONT><FONT SIZE=2><B>ITEM 10.&nbsp;&nbsp;&nbsp;&nbsp;LEGAL PROCEEDINGS    <BR>    </B></FONT></P>

<P><FONT SIZE=2><B>Centoco  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In November&nbsp;1997, we, and two of our subsidiaries, were sued in the Ontario Superior Court of Justice by KS Centoco&nbsp;Ltd., an Ontario-based steering
wheel manufacturer in which we have a 23% equity interest, and by Centoco Holdings Limited, the owner of the remaining 77% equity interest in KS Centoco&nbsp;Ltd. On March&nbsp;5, 1999, the
plaintiffs were granted leave to make substantial amendments to the original statement of claim in order to add several new defendants and claim additional remedies. The amended statement of claim
alleges, among other things: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>breach
of fiduciary duty by us and two of our subsidiaries; </FONT></DD></DL>
</UL>
<P ALIGN="CENTER"><FONT SIZE=2>50</FONT></P>

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<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>breach
by us of our binding letter of intent with KS Centoco, including our covenant not to have any interest, directly or indirectly, in any entity that carries on the
airbag business in North America, other than through MST Automotive&nbsp;Inc., a company to be 77% owned by Magna and 23% owned by Centoco Holdings;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
plaintiff's exclusive entitlement to certain airbag technologies in North America pursuant to an exclusive license agreement, together with an accounting of all revenues
and profits resulting from the alleged use by us, TRW&nbsp;Inc. and other unrelated third party automotive supplier defendants of such technology in North America; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>a
conspiracy by us, TRW and others to deprive KS Centoco of the benefits of such airbag technology in North America and to cause Centoco Holdings to sell to TRW its interest
in KS Centoco in conjunction with the sale by us to TRW of our interest in MST Automotive&nbsp;GmbH and TEMIC Bayern-Chemie Airbag&nbsp;GmbH. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
plaintiffs are seeking, among other things, damages of approximately Cdn$3.5&nbsp;billion. We have filed an amended statement of defence and counterclaim. Document production is
being completed and examinations for discovery have commenced. We intend to vigorously defend this case. At this time, notwithstanding the early stages of these legal proceedings and the difficulty in
predicting final outcomes, our management believes that the ultimate resolution of these claims will not have a material adverse effect on our consolidated financial position. </FONT></P>

<P><FONT SIZE=2><B>General Motors  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On February&nbsp;28, 2003, Intier was served, in conjunction with Siemens Automotive Corp., a.k.a Siemens VDO Automotive Corp., with a complaint issued in the
Macomb County Circuit Court of the State of Michigan by General Motors Corporation. The General Motors complaint alleges that Intier and Siemens are in breach of certain express and implied warranties
to General Motors and, as a result, General Motors is seeking reimbursement for costs and expenses incurred as a result of its replacement of tens of thousands of rear door electric motors in respect
of its model year 2000 full-size sport utility vehicles and trucks, including the Tahoe, Suburban, GMC Silverado and Chevrolet Avalanche. The rear door electric motors, which Intier was
directed to use by General Motors, are manufactured by Siemens and form part of a power rear door window regulator supplied by Intier to General Motors for those vehicles. Although the damages in the
complaint are unspecific, General Motors has previously claimed that the warranty and future recall costs could be up to $42&nbsp;million. Based on its investigations to date, Intier does not
believe that it has any
liability for this claim and that any liability it may become subject to, if it is established that the rear door motor is defective, will be recoverable from Siemens, although Intier cannot provide
any assurance that this will be the case. </FONT></P>

<P><FONT SIZE=2><B>C-MAC  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On June&nbsp;10, 2004, Intier was served with a statement of claim issued in the Ontario Superior Court of Justice by C-MAC Invotronics&nbsp;Inc.,
a subsidiary of Solectron Corporation. The plaintiff is a supplier of electro-mechanical and electronic automotive parts and components to Intier. The statement of claim alleges, among other things: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>improper
use by Intier of the plaintiff's confidential information and technology in order to design and manufacture certain automotive parts and components; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>breach
of contract related to a failure by Intier to fulfill certain preferred sourcing obligations arising under a strategic alliance agreement, as well as follow a certain
re-pricing mechanism set forth in a long-term supply agreement, in each case signed by the parties at the time of Intier's disposition of the Invotronics business division to
the plaintiff in September&nbsp;2000. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
plaintiff is seeking, among other things, compensatory damages in the amount of Cdn$150&nbsp;million and punitive damages in the amount of Cdn$10&nbsp;million and an accounting
of profits. On January&nbsp;7, 2005, Intier filed a Statement of Defence and Counterclaim for misrepresentation, breach of contract, conspiracy and interfering with economic interests. Final
affidavits of documents were due on February&nbsp;28, 2005. Despite the early stages of the litigation, Intier believes it has valid defenses to the plaintiff's claims and therefore intends to
defend this case vigorously. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>51</FONT></P>

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<P><FONT SIZE=2><B>Ford Class Actions  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We, and/or our subsidiaries Magna Donnelly and Intier, have been named with Ford Motor Company as defendants in class action proceedings in the Ontario Superior
Court of Justice, as well as state courts in North Carolina, Massachusetts and Florida, as a result of Magna Donnelly's role as a supplier to Ford of door handles and Intier's role as a supplier of
door latches, and in certain cases door latch assemblies, for the Ford F-150, F-250, Expedition, Lincoln Navigator and Blackwood vehicles produced by Ford between
November&nbsp;1995 and April&nbsp;2000. Class proceedings in other states are anticipated. In these proceedings, plaintiffs are seeking compensatory damages in an amount to cover the cost of
repairing the vehicles or replacing the door latches, punitive damages, attorneys' fees and interest. Each of the class actions have similar claims and allege that the door latch systems are defective
and do not comply with applicable motor vehicle safety legislation and that the defendants conspired to hide the alleged defects from the end use consumer. These class proceedings are in the early
stages and have not been certified by any court. We deny these allegations and intend to vigorously defend the lawsuits, including taking steps to consolidate the state class proceedings to federal
court wherever possible. Given the early stages of the proceedings, it is not possible to predict their outcome. </FONT></P>

<P><FONT SIZE=2><B>Other  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In the ordinary course of business activities, we may be contingently liable for litigation and claims with customers, suppliers and former employees. These
claims include our contingent liability for steel price increases in connection with certain supply agreements that are under dispute. In addition, we may be, or could become, liable to incur
environmental remediation costs to bring environmental contamination levels back within acceptable legal limits. On an ongoing basis, we assess the likelihood of any adverse judgments or outcomes to
these matters, as well as potential ranges of probable costs and losses. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A
determination of the provision required, if any, for these contingencies is made after analysis of each individual issue. The required provision may change in the future due to new
developments in each matter or changes in approach, such as a change in settlement strategy in dealing with these matters. Our management believes that adequate provisions are recorded in the accounts
required and when estimable. However, there can be no assurance that we will not incur additional expense. </FONT></P>


<P><FONT SIZE=2><A
NAME="dm1382_item_11._interest_of_managemen__ite02554"> </A>
<A NAME="toc_dm1382_1"> </A>
<BR></FONT><FONT SIZE=2><B>ITEM 11.&nbsp;&nbsp;&nbsp;&nbsp;INTEREST OF MANAGEMENT AND OTHERS IN MATERIAL TRANSACTIONS    <BR>    </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Reference is made to the section entitled "Interests of Management and Other Insiders in Certain Transactions" in our Management Information Circular/Proxy
Statement dated March&nbsp;29, 2005 for our annual meeting of shareholders to be held on May&nbsp;3, 2005, which is incorporated by reference into this Annual Information Form. </FONT></P>

<P><FONT SIZE=2><A
NAME="dm1382_item_12._transfer_agent_and_registrar"> </A>
<A NAME="toc_dm1382_2"> </A>
<BR></FONT><FONT SIZE=2><B>ITEM 12.&nbsp;&nbsp;&nbsp;&nbsp;TRANSFER AGENT AND REGISTRAR    <BR>    </B></FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The transfer agent and registrar for our Class&nbsp;A Subordinate Voting Shares and our Class&nbsp;B Shares is Computershare Trust Company of Canada, at its
principal offices in Toronto, Ontario. The co-transfer agent and co-registrar for our Class&nbsp;A Subordinate Voting Shares in the United&nbsp;States is Computershare
Trust Company,&nbsp;Inc., at its offices in Golden, Colorado. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>52</FONT></P>

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<P><FONT SIZE=2><A
NAME="dm1382_item_13._audit_committee"> </A>
<A NAME="toc_dm1382_3"> </A>
<BR></FONT><FONT SIZE=2><B>ITEM 13.&nbsp;&nbsp;&nbsp;&nbsp;AUDIT COMMITTEE    <BR>    </B></FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our Audit Committee is comprised of Messrs.&nbsp;William H. Fike, Donald Resnick (Chair) and Royden R. Richardson. A copy of our Audit Committee Charter/Mandate
is attached as Schedule&nbsp;B. Additional information about our Audit Committee is contained in the section entitled "Audit Committee and Audit Committee Report" in our Management Information
Circular/Proxy Statement dated March&nbsp;29, 2005 for our annual meeting of shareholders to be held on May&nbsp;3, 2005, which is incorporated by reference into this Annual Information Form. </FONT></P>

<P><FONT SIZE=2><A
NAME="dm1382_item_14._additional_information"> </A>
<A NAME="toc_dm1382_4"> </A>
<BR></FONT><FONT SIZE=2><B>ITEM 14.&nbsp;&nbsp;&nbsp;&nbsp;ADDITIONAL INFORMATION    <BR>    </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our Management Information Circular/Proxy Statement dated March&nbsp;29, 2005 contains the following additional information about us: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>our
directors' and executive officers' remuneration and indebtedness;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>our
voting securities and their principal holders;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>securities
authorized for issuance under our equity compensation plans;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>our
Audit Committee and its report;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>our
Corporate Governance and Compensation Committee and its report; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>our
statement of corporate governance practices. </FONT></DD></DL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Additional
financial information about us is provided in our consolidated financial statements as at and for the three-year period ended December&nbsp;31, 2004. These
documents and additional information about us may be found on SEDAR, at <U>www.sedar.com</U>. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Any
person may obtain copies of the following documents upon request from our Secretary, c/o Magna International&nbsp;Inc., 337&nbsp;Magna Drive, Aurora, Ontario, L4G&nbsp;7K1: </FONT></P>

<UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>(a)</FONT></DT><DD><FONT SIZE=2>when
our securities are in the course of a distribution pursuant to a short form prospectus or a preliminary short form prospectus has been filed in respect of a distribution of our
securities,
<BR><BR></FONT>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>(i)</FONT></DT><DD><FONT SIZE=2>one
copy of this Annual Information Form;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(ii)</FONT></DT><DD><FONT SIZE=2>one
copy of our Annual Report to Shareholders for the year ended December&nbsp;31, 2004, which contains the following items:
<BR><BR></FONT>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>the
"Management's Discussion and Analysis of Results of Operations and Financial Position", which is the only item incorporated by reference into this Annual Information
Form; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>&#149;</FONT></DT><DD><FONT SIZE=2>our
financial statements as at and for the three-year period ended December&nbsp;31, 2004;
<BR><BR></FONT></DD></DL>
</DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(iii)</FONT></DT><DD><FONT SIZE=2>one
copy of any of our interim financial statements subsequent to the financial statements for our most recently completed financial year;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(iv)</FONT></DT><DD><FONT SIZE=2>one
copy of our Management Information Circular/Proxy Statement dated March&nbsp;29, 2005; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(v)</FONT></DT><DD><FONT SIZE=2>one
copy of any other documents that are incorporated by reference into the preliminary short form prospectus or the short form prospectus and are not provided under
(i)&nbsp;to (iv)&nbsp;above; or
<BR><BR></FONT></DD></DL>
</DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(b)</FONT></DT><DD><FONT SIZE=2>at
any other time, one copy of any of the documents referred to in (a)(i)&nbsp;to (iv)&nbsp;above, provided that we may require payment of a reasonable charge for such copy if the
request is made by a person who is not one of our security holders. </FONT></DD></DL>
</UL>
<P ALIGN="CENTER"><FONT SIZE=2>53</FONT></P>

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<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="do1382_schedule_a_principal_subsidiaries"> </A>
<A NAME="toc_do1382_1"> </A>
<BR></FONT><FONT SIZE=2><B>SCHEDULE A<BR>  <BR>    PRINCIPAL SUBSIDIARIES    <BR>    </B></FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following is a list of our principal subsidiaries as at January&nbsp;1, 2005, which is the end of our 2004 taxation year, and their respective jurisdictions
of incorporation. However, we use the current corporate names of these subsidiaries. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Parent/subsidiary
relationships are identified by indentations. The list shows the percentages of the votes attached to all voting securities, and of each class of non-voting
securities, owned by us or over which control or direction is exercised by us. Percentages represent the total equity interest in a subsidiary, which is not necessarily indicative of percentage voting
control. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Subsidiaries
not shown each represent less than 10% of our total consolidated revenues and total consolidated assets (although not all subsidiaries shown necessarily each represent more
than 10% of our total consolidated assets and total consolidated sales) and, if considered in the aggregate as a single subsidiary, represent less than 20% of our total consolidated revenues and total
consolidated assets. </FONT></P>

<!-- User-specified TAGGED TABLE -->
<TABLE WIDTH="100%" BORDER=0 CELLSPACING=0 CELLPADDING=0>
<TR VALIGN="BOTTOM">
<TH COLSPAN=4 ALIGN="LEFT"><FONT SIZE=1><B>Subsidiary </B></FONT><HR NOSHADE></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH WIDTH="17%" ALIGN="CENTER"><FONT SIZE=1><B>Voting Securities</B></FONT><HR NOSHADE></TH>
<TH WIDTH="2%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH WIDTH="11%" ALIGN="CENTER"><FONT SIZE=1><B>Jurisdiction of Incorporation</B></FONT><HR NOSHADE></TH>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD COLSPAN=4><FONT SIZE=2>Cosma America Holdings&nbsp;Inc.</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="17%" ALIGN="CENTER"><FONT SIZE=2>100%</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="11%" ALIGN="CENTER"><FONT SIZE=2>Delaware</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD COLSPAN=4><FONT SIZE=2>Magna Structural Systems&nbsp;Inc.</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="17%" ALIGN="CENTER"><FONT SIZE=2>100%</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="11%" ALIGN="CENTER"><FONT SIZE=2>Ontario</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD COLSPAN=4><BR><FONT SIZE=2> Magna Steyr Investments&nbsp;S.A.</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="17%" ALIGN="CENTER"><FONT SIZE=2><BR>
100%</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="11%" ALIGN="CENTER"><FONT SIZE=2><BR>
Belgium</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD COLSPAN=3><FONT SIZE=2>Magna Steyr Metalforming AG</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="17%" ALIGN="CENTER"><FONT SIZE=2>100%</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="11%" ALIGN="CENTER"><FONT SIZE=2>Austria</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD COLSPAN=2><FONT SIZE=2>Magna Steyr AG&nbsp;&amp;&nbsp;Co. KG</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="17%" ALIGN="CENTER"><FONT SIZE=2>100%</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="11%" ALIGN="CENTER"><FONT SIZE=2>Austria</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="61%"><FONT SIZE=2>Magna Steyr Fahrzeugtechnik AG&nbsp;&amp;&nbsp;Co. KG</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="17%" ALIGN="CENTER"><FONT SIZE=2>100%</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="11%" ALIGN="CENTER"><FONT SIZE=2>Austria</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="61%"><FONT SIZE=2>Magna Drivetrain AG&nbsp;&amp;&nbsp;Co. KG</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="17%" ALIGN="CENTER"><FONT SIZE=2>100%</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="11%" ALIGN="CENTER"><FONT SIZE=2>Austria</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD COLSPAN=4><BR><FONT SIZE=2> Magna Drivetrain&nbsp;Inc.</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="17%" ALIGN="CENTER"><FONT SIZE=2><BR>
100%</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="11%" ALIGN="CENTER"><FONT SIZE=2><BR>
Ontario</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD COLSPAN=3><FONT SIZE=2>Magna Drivetrain Holdings (America),&nbsp;Inc.</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="17%" ALIGN="CENTER"><FONT SIZE=2>100%</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="11%" ALIGN="CENTER"><FONT SIZE=2>Delaware</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD COLSPAN=2><FONT SIZE=2>New&nbsp;Process Gear,&nbsp;Inc.</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="17%" ALIGN="CENTER"><FONT SIZE=2>100%</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="11%" ALIGN="CENTER"><FONT SIZE=2>Delaware</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD COLSPAN=2><FONT SIZE=2>Magna Drivetrain of America,&nbsp;Inc.</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="17%" ALIGN="CENTER"><FONT SIZE=2>100%</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="11%" ALIGN="CENTER"><FONT SIZE=2>Delaware</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD COLSPAN=4><BR><FONT SIZE=2> Magna Donnelly Corporation</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="17%" ALIGN="CENTER"><FONT SIZE=2><BR>
100%</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="11%" ALIGN="CENTER"><FONT SIZE=2><BR>
Michigan</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD COLSPAN=4><BR><FONT SIZE=2> Decoma International&nbsp;Inc.</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="17%" ALIGN="CENTER"><FONT SIZE=2><BR>
56.3% Class&nbsp;A<SUP>(1)</SUP><SUP>(2)(5)</SUP><BR>
100% Class&nbsp;B<SUP>(1)</SUP><SUP>(2)(5)</SUP></FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="11%" ALIGN="CENTER"><FONT SIZE=2><BR>
Ontario</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD COLSPAN=3><FONT SIZE=2>Decoma International Corp.</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="17%" ALIGN="CENTER"><FONT SIZE=2>100%</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="11%" ALIGN="CENTER"><FONT SIZE=2>Ontario</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD COLSPAN=2><FONT SIZE=2>Decoma U.S.&nbsp;Holdings&nbsp;Inc.</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="17%" ALIGN="CENTER"><FONT SIZE=2>100%</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="11%" ALIGN="CENTER"><FONT SIZE=2>Delaware</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD COLSPAN=2><FONT SIZE=2>Decoma Automotive Holding&nbsp;N.V.</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="17%" ALIGN="CENTER"><FONT SIZE=2>100%</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="11%" ALIGN="CENTER"><FONT SIZE=2>Belgium</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD COLSPAN=4><BR><FONT SIZE=2> Intier Automotive&nbsp;Inc.</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="17%" ALIGN="CENTER"><FONT SIZE=2><BR>
1.1% Class&nbsp;A<SUP>(1)</SUP><BR>
100% Class&nbsp;B<SUP>(1)</SUP><SUP>(3)</SUP></FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="11%" ALIGN="CENTER"><FONT SIZE=2><BR>
<BR>
Ontario</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD COLSPAN=3><FONT SIZE=2>Intier Automotive Closures&nbsp;Inc.</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="17%" ALIGN="CENTER"><FONT SIZE=2>100%</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="11%" ALIGN="CENTER"><FONT SIZE=2>Ontario</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD COLSPAN=3><FONT SIZE=2>Intier Automotive of America,&nbsp;Inc.</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="17%" ALIGN="CENTER"><FONT SIZE=2>100%</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="11%" ALIGN="CENTER"><FONT SIZE=2>Delaware</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD COLSPAN=2><FONT SIZE=2>Intier Automotive of America Holdings,&nbsp;Inc.</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="17%" ALIGN="CENTER"><FONT SIZE=2>100%</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="11%" ALIGN="CENTER"><FONT SIZE=2>Delaware</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="61%"><FONT SIZE=2>Intier Automotive Seating of America,&nbsp;Inc.</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="17%" ALIGN="CENTER"><FONT SIZE=2>100%</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="11%" ALIGN="CENTER"><FONT SIZE=2>Delaware</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD COLSPAN=2><FONT SIZE=2>Intier Automotive Interiors of America,&nbsp;Inc.</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="17%" ALIGN="CENTER"><FONT SIZE=2>100%</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="11%" ALIGN="CENTER"><FONT SIZE=2>Delaware</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD COLSPAN=3><FONT SIZE=2>Intier Investments&nbsp;S.A.</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="17%" ALIGN="CENTER"><FONT SIZE=2>100%</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="11%" ALIGN="CENTER"><FONT SIZE=2>Belgium</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD COLSPAN=4><BR><FONT SIZE=2> Tesma International&nbsp;Inc.</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="17%" ALIGN="CENTER"><FONT SIZE=2><BR>
0.2% Class&nbsp;A<SUP>(1)(6)</SUP><BR>
100% Class&nbsp;B<SUP>(1)</SUP><SUP>(4)</SUP></FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="11%" ALIGN="CENTER"><FONT SIZE=2><BR>
Ontario</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD COLSPAN=3><FONT SIZE=2>2014332&nbsp;Ontario&nbsp;Inc.</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="17%" ALIGN="CENTER"><FONT SIZE=2>100%</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="11%" ALIGN="CENTER"><FONT SIZE=2>Ontario</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=0>&nbsp;</FONT></TD>
<TD COLSPAN=2><FONT SIZE=2>Litens Automotive Partnership</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="17%" ALIGN="CENTER"><FONT SIZE=2>76.8%</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="11%" ALIGN="CENTER"><FONT SIZE=2>Ontario</FONT></TD>
</TR>
</TABLE>
<!-- end of user-specified TAGGED TABLE -->

<P ALIGN="CENTER"><FONT SIZE=2>54</FONT></P>

<HR NOSHADE>
<P style='page-break-before:always'></p>
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<A NAME="page_do1382_1_55"> </A>
<DL compact>
<DT style='margin-bottom:-9pt;'><FONT SIZE=1>(1)</FONT></DT><DD><FONT SIZE=1>"Class&nbsp;A"
means the Class&nbsp;A Subordinate Voting Shares of the named subsidiary, and "Class&nbsp;B" means the Class&nbsp;B Shares of the named subsidiary.
<BR><BR></FONT></DD><DT style='margin-bottom:-9pt;'><FONT SIZE=1>(2)</FONT></DT><DD><FONT SIZE=1>Includes
voting securities owned by 1265058&nbsp;Ontario&nbsp;Inc., which is a wholly-owned subsidiary of ours.
<BR><BR></FONT></DD><DT style='margin-bottom:-9pt;'><FONT SIZE=1>(3)</FONT></DT><DD><FONT SIZE=1>Includes
voting securities owned by 893898&nbsp;Ontario&nbsp;Inc., 989891&nbsp;Ontario&nbsp;Inc. and 2004189&nbsp;Ontario&nbsp;Inc., which are wholly-owned subsidiaries of
ours.
<BR><BR></FONT></DD><DT style='margin-bottom:-9pt;'><FONT SIZE=1>(4)</FONT></DT><DD><FONT SIZE=1>Includes
voting securities owned by 1128969&nbsp;Ontario&nbsp;Inc., which is a wholly-owned subsidiary of ours.
<BR><BR></FONT></DD><DT style='margin-bottom:-9pt;'><FONT SIZE=1>(5)</FONT></DT><DD><FONT SIZE=1>Effective
March&nbsp;6, 2005, we acquired all of the issued and outstanding Class&nbsp;A Subordinate Voting Shares of Decoma International&nbsp;Inc. not already owned by us and
we amalgamated Decoma into Magna as part of the privatization of Decoma. See "ITEM 2. GENERAL DEVELOPMENT OF THE BUSINESS&nbsp;&#151;&nbsp;OPERATING STRUCTURE AND
PRINCIPLES&nbsp;&#151;&nbsp;Privatizations".
<BR><BR></FONT></DD><DT style='margin-bottom:-9pt;'><FONT SIZE=1>(6)</FONT></DT><DD><FONT SIZE=1>Effective
February&nbsp;6, 2005, we acquired all of the issued and outstanding Class&nbsp;A Subordinate Voting Shares of Tesma International&nbsp;Inc. not already owned by us as
part of the privatization of Tesma. See "ITEM 2. GENERAL DEVELOPMENT OF THE BUSINESS&nbsp;&#151;&nbsp;OPERATING STRUCTURE AND
PRINCIPLES&nbsp;&#151;&nbsp;Privatizations". </FONT></DD></DL>
<P ALIGN="CENTER"><FONT SIZE=2>55</FONT></P>

<HR NOSHADE>
<P style='page-break-before:always'></p>
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<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="page_dq1382_1_56"> </A> </FONT></P>

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<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="dq1382_schedule_b_audit_committee_charter/mandate"> </A>
<A NAME="toc_dq1382_1"> </A>
<BR></FONT><FONT SIZE=2><B>SCHEDULE&nbsp;B<BR>  <BR>    AUDIT COMMITTEE CHARTER/MANDATE    <BR>    </B></FONT></P>

<UL>

<P><FONT SIZE=2><B> <U>Purpose</U>  </B></FONT></P>

</UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>(1)</FONT></DT><DD><FONT SIZE=2>The
Audit Committee (the&nbsp;"Committee") of the Board of Directors (the&nbsp;"Board") of the Corporation shall provide assistance to the Board in fulfilling its oversight
responsibilities to the Corporation's shareholders with respect to the integrity of the Corporation's financial statements and reports and financial reporting process. In so doing, it is the
responsibility of the Committee to maintain free and open communication between the Board, the independent Auditor, the internal auditors for the Corporation (the&nbsp;"Internal Auditors") and
management of the Corporation and monitor their performance, recognizing that the independent Auditor is ultimately responsible to the Committee, the Board and the shareholders of the Corporation. </FONT></DD></DL>
<UL>

<P><FONT SIZE=2><B> <U>Organization</U>  </B></FONT></P>

</UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>(2)</FONT></DT><DD><FONT SIZE=2>The
Committee shall be composed of not less than three (3)&nbsp;nor more than five (5)&nbsp;members, each of whom shall be financially literate and shall have such accounting or
financial management expertise as is required to comply with applicable law and the applicable rules and regulations of the Ontario Securities Commission ("OSC"), the United&nbsp;States Securities
and Exchange Commission (the&nbsp;"SEC"), The New&nbsp;York Stock Exchange ("NYSE") and any other applicable regulator or authority from time to time. Each of such members shall meet the
independence standards required by the applicable rules of the OSC, the SEC, the NYSE and any other applicable regulatory authorities which are in effect from time to time. No member of the Committee
shall serve as a member of the audit committees of more than three other boards of directors of other public companies. The Board shall annually appoint the members of the Committee who shall appoint
a Chairman from amongst those appointed, to hold office until the next annual meeting of shareholders of the Corporation. The members of the Committee shall serve at the pleasure of the Board and
vacancies occurring from time to time shall be filled by the Board.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(3)</FONT></DT><DD><FONT SIZE=2>A
majority of the members of the Committee shall constitute a quorum and all actions of the Committee shall be taken by a majority of the members present at the meeting.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(4)</FONT></DT><DD><FONT SIZE=2>Meetings
of the Committee shall be called by the Chairman of the Committee, and may be called by any member of the Committee, by the Chairman, a Vice-Chairman, the Chief
Executive Officer, the President, the Chief Financial Officer or the Secretary of the Corporation, by the head of the Corporation's Internal Audit Department or by the independent Auditor of the
Corporation.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(5)</FONT></DT><DD><FONT SIZE=2>Unless
otherwise determined by the Committee, the Secretary or an Assistant Secretary of the Corporation shall act as Secretary of the Committee and shall provide the independent
Auditor, the Chairman, the Chief Executive Officer, the President, any Vice-Chairmen and the Chief Financial Officer of the Corporation, as well as the head of the Internal Audit
Department and each member of the Committee with notice of each meeting of the Committee, all of whom shall be entitled to attend each Committee meeting. The Secretary of the Committee will keep
minutes of the Committee and such minutes will be retained in the corporate records of the Corporation. The Chairman of the Committee or the Committee may request any officer or employee of the
Corporation or its affiliates to attend a Committee meeting.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(6)</FONT></DT><DD><FONT SIZE=2>In
addition to any meeting of the Committee called pursuant to Section&nbsp;4 above, the Committee shall meet with management and the independent Auditor of the Corporation within:
<BR><BR></FONT>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>(a)</FONT></DT><DD><FONT SIZE=2>sixty
(60)&nbsp;days, or such lesser period as may be prescribed by applicable law, following the end of each of the first three financial quarters of the Corporation, but in any
event prior to the release of the financial results for each such quarter and their filing with the applicable regulatory authorities, to review and discuss the financial results of the Corporation
for the preceding fiscal quarter and the related Management's Discussion and Analysis of Results of Operations and Financial Condition ("MD&amp;A") as well as the results of the independent Auditor's
review of the financial results for such quarter and, if satisfied, report thereon to, and recommend their approval by, the Board and their inclusion in the Corporation's required regulatory filings
for such quarter; and </FONT></DD></DL>
</DD></DL>
<P ALIGN="CENTER"><FONT SIZE=2>56</FONT></P>

<HR NOSHADE>
<P style='page-break-before:always'></p>
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<A NAME="page_dq1382_1_57"> </A>
<UL>
<UL>
</UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>(b)</FONT></DT><DD><FONT SIZE=2>ninety
(90)&nbsp;days, or such lesser period as may be prescribed by applicable law, following the financial year-end of the Corporation, but in any event prior to the
release of the financial results for the financial year and their filing with the applicable regulatory authorities, to review and discuss the audited financial statements of the Corporation for the
preceding fiscal year and the related MD&amp;A and, if satisfied, report thereon to, and recommend their approval by, the Board and the Corporation's shareholders as required by applicable law and their
inclusion in the Corporation's Annual Report and other required regulatory filings. </FONT></DD></DL>
</UL>
<UL>

<P><FONT SIZE=2>In
reviewing the quarterly and annual financial results the Committee shall ensure that there are adequate procedures for review of such financial results, including timely review by the independent
Auditor. </FONT></P>

</UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>(7)</FONT></DT><DD><FONT SIZE=2>For
the purpose of performing their duties and responsibilities, the members of the Committee shall have full access to and the right to discuss any matters relating to such duties
with management, any employee of the Corporation, the Internal Audit Department staff, the independent Auditor or any advisors to the Corporation as well as the right to inspect all books, records and
facilities of the Corporation and its subsidiaries and shall be permitted to discuss such books, records and facilities and any other matters relating to the financial position of the Corporation with
the employees, management, the independent Auditor and other external advisors of the Corporation as well as the Internal Auditors.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(8)</FONT></DT><DD><FONT SIZE=2>The
Committee may retain outside financial, legal and other experts at the expense of the Corporation as it deems reasonably necessary to assist and advise the Committee in carrying
out the Committee's duties and responsibilities. </FONT></DD></DL>
<UL>

<P><FONT SIZE=2><B> <U>Duties and Responsibilities</U>  </B></FONT></P>

</UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>(9)</FONT></DT><DD><FONT SIZE=2>With
respect to audit related matters and in addition to the duties and obligations of the Committee under applicable law, the Committee may examine and consider such matters in
relation to the internal and external audit of the Corporation's accounts (including the results of such audits), financial controls, financial reporting and in relation to the general financial
affairs of the Corporation as the Committee may deem necessary or desirable except for those matters specifically delegated by the Board to another standing Board committee or retained by the Board. </FONT></DD></DL>
<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
carrying out the Committee's responsibilities, the Committee shall: </FONT></P>

<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>(a)</FONT></DT><DD><FONT SIZE=2>be
directly responsible for the appointment, compensation, retention and oversight of the work of the independent Auditor, including resolution of disagreements between management and
the independent Auditor regarding financial reporting, for the purpose of preparing or issuing an audit report or related work or performing other audit, review or attest services for the Corporation;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(b)</FONT></DT><DD><FONT SIZE=2>pre-approve,
or establish procedures and policies for the pre-approval of, the engagement and compensation of the independent Auditor in respect of the
provision of (i)&nbsp;all audit, audit-related, review or attest engagements required by applicable law and (ii)&nbsp;all non-audit services permitted to be provided by the independent
Auditor in accordance with applicable law and the rules of the OSC, SEC and any other applicable regulatory authority;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(c)</FONT></DT><DD><FONT SIZE=2>review
and approve the objectives and general scope of the external audit (including the overall audit plan, the proposed timing and completion dates) and discuss the external audit
with the independent Auditor;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(d)</FONT></DT><DD><FONT SIZE=2>evaluate
the performance, quality control procedures and efficiency of the independent Auditor in carrying out its responsibilities, review the experience and qualifications of the
independent Auditor team, make annual recommendations to the Board as to the appointment or re-appointment of the independent Auditor and need for rotation of the independent Auditor
(if&nbsp;any) and review such Auditor's independence, including the receipt at least annually of a disclosure report from the independent Auditor regarding the Auditor's independence as required by
Independence Standards Board Standard No.&nbsp;1, "Independence Discussions with Audit Committees", or other applicable regulatory requirements; </FONT></DD></DL>
</UL>
<P ALIGN="CENTER"><FONT SIZE=2>57</FONT></P>

<HR NOSHADE>
<P style='page-break-before:always'></p>
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<A NAME="page_dq1382_1_58"> </A>
<UL>
<UL>
</UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>(e)</FONT></DT><DD><FONT SIZE=2>satisfy
itself generally that there is a good working relationship between management and the independent Auditor, review any management letters, schedule of unadjusted differences or
other reports of the independent Auditor and discuss any material differences of opinion between management and the independent Auditor;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(f)</FONT></DT><DD><FONT SIZE=2>satisfy
itself that management has established and is maintaining an adequate and effective system of internal financial and accounting controls and is responding on a timely basis to
any significant weaknesses which have been identified, meet with and review significant reports of the Internal Auditors and the independent Auditor relating to such internal controls and review the
appointment, termination and replacement of the senior management of the Internal Auditors, the scope of the Internal Auditor's work plan and the overall performance, staffing and resources of the
Internal Auditors
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(g)</FONT></DT><DD><FONT SIZE=2>review
annually management's assessment and report relating to the effectiveness of the Corporation's internal financial controls and procedures in respect of each fiscal year of the
Corporation, as well as the independent Auditors' attestation of such assessment in each case when required under applicable law;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(h)</FONT></DT><DD><FONT SIZE=2>review
the (i)&nbsp;selection, use and quality of application of, and proposed material changes to, critical accounting principles and practices and related judgments, and
(ii)&nbsp;alternative GAAP treatments for policies and practices relating to material items, including the ramifications of such alternative disclosures or treatments and any recommended treatment,
to ensure that the critical accounting policies and practices and GAAP treatments adopted are appropriate and consistent with the Corporation's needs and applicable requirements, and discuss the same
with the independent Auditor;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(i)</FONT></DT><DD><FONT SIZE=2>review
with management and the independent Auditor any issues raised by regulators or governmental agencies and any employee complaints or published reports which raise material
issues regarding the Corporation's financial statements or accounting or auditing practices;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(j)</FONT></DT><DD><FONT SIZE=2>review
on behalf of the Board, any actual or potential illegal, improper or fraudulent behaviour which may have a negative effect on the integrity or reputation of the Corporation,
review the findings of any regulatory authorities in relation to the financial affairs of the Corporation, review the disclosure of all insider and related party transactions and monitor compliance
with the Corporation's Code of Conduct which may be in effect from time to time;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(k)</FONT></DT><DD><FONT SIZE=2>satisfy
itself that there is an agreed course of action leading to the resolution of significant unsettled issues that do not affect the audited financial statements
(e.g.&nbsp;disagreements regarding correction of internal control weaknesses or the application of accounting principles to proposed transactions), if any;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(l)</FONT></DT><DD><FONT SIZE=2>assess
with management the Corporation's material risk exposures and the Corporation's actions to monitor and control such exposures;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(m)</FONT></DT><DD><FONT SIZE=2>review
and approve the hiring of former employees of the independent Auditor who were engaged on the Corporation's account within the last three years prior to such hiring;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(n)</FONT></DT><DD><FONT SIZE=2>review
all material off-balance sheet transactions and the related accounting presentation and disclosure;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(o)</FONT></DT><DD><FONT SIZE=2>discuss
with the independent Auditor the matters required to be discussed by the Statement of Auditing Standards No.&nbsp;54, 61, 89&nbsp;and 90 (and&nbsp;comparable generally
accepted auditing standards in Canada) and other applicable standards or requirements in effect from time to time relating to the conduct of the audit and quarterly review of the interim financial
results;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(p)</FONT></DT><DD><FONT SIZE=2>review
and assess this Audit Committee Charter annually and make recommendations to the Board for such changes to the Charter as the Committee shall consider necessary or desirable; </FONT></DD></DL>
</UL>
<P ALIGN="CENTER"><FONT SIZE=2>58</FONT></P>

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<DT style='margin-bottom:-11pt;'><FONT SIZE=2>(q)</FONT></DT><DD><FONT SIZE=2>prepare
the Audit Committee report in the form and at the time required by the applicable rules of the OSC, SEC, NYSE or other applicable regulatory authorities which are in effect
from time to time for inclusion in the Corporation's Annual Report, Annual Information Form and/or information circular/proxy statement;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(r)</FONT></DT><DD><FONT SIZE=2>review
and approve in advance all non-audit services otherwise permitted at law to be provided by the independent Auditor to the Corporation, provided that the Committee
may pre-approve certain services within designated thresholds on an annual basis and further provided that the Committee may delegate to the Chairman of the Committee or such other members
of the Committee that it deems appropriate certain pre-approval authority. Any such approval granted by such persons shall be reported at the next regularly scheduled meeting of the
Committee.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(s)</FONT></DT><DD><FONT SIZE=2>review
and, where appropriate, approve all public disclosure documents of the Corporation containing financial information or forecasts of the Corporation prior to its release,
including all press releases containing such information or forecasts;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(t)</FONT></DT><DD><FONT SIZE=2>establish
procedures for (i)&nbsp;the receipt, retention and treatment of complaints received by the Corporation regarding accounting, internal controls, and auditing matters, and
(ii)&nbsp;the confidential, anonymous submission of complaints by employees of the Corporation of concerns regarding questionable accounting or auditing matters; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(u)</FONT></DT><DD><FONT SIZE=2>perform
such other functions as requested or delegated by the Board from time to time or as required by the Corporation's articles and by-laws, applicable law or
applicable regulatory agencies.
<BR><BR></FONT></DD></DL>
</UL>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>(10)</FONT></DT><DD><FONT SIZE=2>Notwithstanding
the foregoing and subject to applicable law, the Committee shall not be responsible to plan or conduct internal or external audits or to determine that the
Corporation's financial statements are complete and accurate and are in accordance with generally accepted accounting principles as these are the responsibility of management, the Internal Auditors
and the independent Auditor. This Charter has been established to assist in ensuring sound business practices within the Corporation and to ensure the Corporation's compliance with applicable laws or
regulations; however, nothing in this Charter is intended to expand applicable standards of liability under statutory and regulatory requirements for the directors of the Corporation or members of the
Committee. </FONT></DD></DL>
<P ALIGN="CENTER"><FONT SIZE=2>59</FONT></P>

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<FONT SIZE=2><A HREF="#toc_bg1382_1">TABLE&#160;OF&#160;CONTENTS</A></FONT><BR>
<FONT SIZE=2><A HREF="#toc_bg1382_2">FORWARD-LOOKING STATEMENTS</A></FONT><BR>
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<FONT SIZE=2><A HREF="#toc_de1382_1">ITEM 1. CORPORATE STRUCTURE</A></FONT><BR>
<FONT SIZE=2><A HREF="#toc_de1382_2">ITEM 2. GENERAL DEVELOPMENT OF THE BUSINESS</A></FONT><BR>

<!-- TOC_BEGIN -->
<FONT SIZE=2><A HREF="#toc_dg1382_1">ITEM 3. DESCRIPTION OF THE BUSINESS</A></FONT><BR>
<!-- TOC_BEGIN -->
<FONT SIZE=2><A HREF="#toc_dk1382_1">ITEM 4. DIVIDENDS</A></FONT><BR>
<FONT SIZE=2><A HREF="#toc_dk1382_2">ITEM 5. MANAGEMENT'S DISCUSSION AND ANALYSIS</A></FONT><BR>
<FONT SIZE=2><A HREF="#toc_dk1382_3">ITEM 6. DESCRIPTION OF CAPITAL STRUCTURE</A></FONT><BR>
<FONT SIZE=2><A HREF="#toc_dk1382_4">ITEM 7. MARKET FOR SECURITIES</A></FONT><BR>
<FONT SIZE=2><A HREF="#toc_dk1382_5">ITEM 8. DIRECTORS AND OFFICERS</A></FONT><BR>
<FONT SIZE=2><A HREF="#toc_dk1382_6">ITEM 9. CORPORATE CONSTITUTION</A></FONT><BR>
<FONT SIZE=2><A HREF="#toc_dk1382_7">ITEM 10. LEGAL PROCEEDINGS</A></FONT><BR>
<!-- TOC_BEGIN -->
<FONT SIZE=2><A HREF="#toc_dm1382_1">ITEM 11. INTEREST OF MANAGEMENT AND OTHERS IN MATERIAL TRANSACTIONS</A></FONT><BR>
<FONT SIZE=2><A HREF="#toc_dm1382_2">ITEM 12. TRANSFER AGENT AND REGISTRAR</A></FONT><BR>
<FONT SIZE=2><A HREF="#toc_dm1382_3">ITEM 13. AUDIT COMMITTEE</A></FONT><BR>
<FONT SIZE=2><A HREF="#toc_dm1382_4">ITEM 14. ADDITIONAL INFORMATION</A></FONT><BR>

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<FONT SIZE=2><A HREF="#toc_do1382_1">SCHEDULE A PRINCIPAL SUBSIDIARIES</A></FONT><BR>
<!-- TOC_BEGIN -->
<FONT SIZE=2><A HREF="#toc_dq1382_1">SCHEDULE B AUDIT COMMITTEE CHARTER/MANDATE</A></FONT><BR>

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<DOCUMENT>
<TYPE>EX-3
<SEQUENCE>3
<FILENAME>a2154594zex-3.htm
<DESCRIPTION>EXHIBIT 3
<TEXT>
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<P ALIGN="RIGHT"><FONT SIZE=2><B>Exhibit&nbsp;3  </B></FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="ga1382_consent_of_independent_auditors"> </A>
<A NAME="toc_ga1382_1"> </A>
<BR></FONT><FONT SIZE=2><B>CONSENT OF INDEPENDENT AUDITORS    <BR>    </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We consent to the use of our report dated February&nbsp;28, 2005 on the consolidated financial statements of Magna International&nbsp;Inc. as at
December&nbsp;31, 2004 and 2003, and for each of the years in the three-year period ended December&nbsp;31, 2004, in connection with the Annual Report on Form&nbsp;40-F
of Magna International&nbsp;Inc. for the year ended December&nbsp;31, 2004. </FONT></P>

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<TD WIDTH="49%"><FONT SIZE=2>Toronto, Canada</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="49%" ALIGN="RIGHT"><FONT SIZE=2>/s/ Ernst&nbsp;&amp; Young&nbsp;LLP</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="49%"><FONT SIZE=2>March&nbsp;30, 2005</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="49%" ALIGN="RIGHT"><FONT SIZE=2>Chartered Accountants</FONT></TD>
</TR>
</TABLE>
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<P><br><A NAME="05TOR1382_3">QuickLinks</A><br></P><!-- TOC_BEGIN -->
<FONT SIZE=2><A HREF="#toc_ga1382_1">CONSENT OF INDEPENDENT AUDITORS</A></FONT><BR>
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<DOCUMENT>
<TYPE>EX-99.1
<SEQUENCE>4
<FILENAME>a2154594zex-99_1.htm
<DESCRIPTION>EXHIBIT 99.1
<TEXT>
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<P ALIGN="RIGHT"><FONT SIZE=2><B>Exhibit&nbsp;99.1  </B></FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="ha1382_certification"> </A>
<A NAME="toc_ha1382_1"> </A>
<BR></FONT><FONT SIZE=2><B>CERTIFICATION    <BR>    </B></FONT></P>

<P><FONT SIZE=2>I,
Frank Stronach, the Chairman and Interim Chief Executive Officer, certify that: </FONT></P>

<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>1.</FONT></DT><DD><FONT SIZE=2>I
have reviewed this annual report on Form&nbsp;40-F of Magna International&nbsp;Inc.;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>2.</FONT></DT><DD><FONT SIZE=2>Based
on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the
circumstances under which such statements were made, not misleading with respect to the period covered by this report;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>3.</FONT></DT><DD><FONT SIZE=2>Based
on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of
operation and cash flows of the issuer as of, and for, the periods presented in this report;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>4.</FONT></DT><DD><FONT SIZE=2>The
issuer's other certifying officer(s)&nbsp;and I are responsible for establishing and maintaining disclosure controls and procedures (as&nbsp;defined in Exchange Act
Rules&nbsp;13a-15(e)&nbsp;for&nbsp;the issuer and have:
<BR><BR></FONT>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>a)</FONT></DT><DD><FONT SIZE=2>designed
such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating
to the issuer, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>b)</FONT></DT><DD><FONT SIZE=2>evaluated
the effectiveness of the issuer's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and
procedures as of the end of the period covered by this report based on such evaluation; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>c)</FONT></DT><DD><FONT SIZE=2>disclosed
in this report any change in the issuer's internal control over financial reporting that occurred during the period covered by the annual report that has materially affected,
or is reasonably likely to materially affect, the issuer's internal control over financial reporting.
<BR><BR></FONT></DD></DL>
</DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>5.</FONT></DT><DD><FONT SIZE=2>The
issuer's other certifying officer(s)&nbsp;and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the issuer's auditors and the
audit committee of the issuer's board of directors (or&nbsp;persons performing the equivalent functions):
<BR><BR></FONT>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>a)</FONT></DT><DD><FONT SIZE=2>all
significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to adversely affect the
issuer's ability to record, process, summarize and report financial information; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>b)</FONT></DT><DD><FONT SIZE=2>any
fraud, whether or not material, that involves management or other employees who have a significant role in the issuer's internal control over financial reporting. </FONT></DD></DL>
</DD></DL>
<BR>

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<TD WIDTH="33%"><FONT SIZE=2>Date: March&nbsp;30, 2005</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="61%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="33%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="61%"><FONT SIZE=2><BR>
/s/&nbsp;&nbsp;</FONT><FONT SIZE=2>FRANK STRONACH</FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><HR NOSHADE><FONT SIZE=2> Frank Stronach<BR>
Chairman and Interim Chief Executive Officer</FONT></TD>
</TR>
</TABLE>
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<FONT SIZE=2><A HREF="#toc_ha1382_1">CERTIFICATION</A></FONT><BR>
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<TYPE>EX-99.2
<SEQUENCE>5
<FILENAME>a2154594zex-99_2.htm
<DESCRIPTION>EXHIBIT 99.2
<TEXT>
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<P ALIGN="RIGHT"><FONT SIZE=2><B>Exhibit&nbsp;99.2  </B></FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="hc1382_certification"> </A>
<A NAME="toc_hc1382_1"> </A>
<BR></FONT><FONT SIZE=2><B>CERTIFICATION    <BR>    </B></FONT></P>

<P><FONT SIZE=2>I,
Vincent J. Galifi, the Executive Vice-President and Chief Financial Officer, certify that: </FONT></P>

<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>1.</FONT></DT><DD><FONT SIZE=2>I
have reviewed this annual report on Form&nbsp;40-F of Magna International&nbsp;Inc.;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>2.</FONT></DT><DD><FONT SIZE=2>Based
on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the
circumstances under which such statements were made, not misleading with respect to the period covered by this report;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>3.</FONT></DT><DD><FONT SIZE=2>Based
on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of
operation and cash flows of the issuer as of, and for, the periods presented in this report;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>4.</FONT></DT><DD><FONT SIZE=2>The
issuer's other certifying officer(s)&nbsp;and I are responsible for establishing and maintaining disclosure controls and procedures (as&nbsp;defined in Exchange Act
Rules&nbsp;13a-15(e)&nbsp;for&nbsp;the issuer and have:
<BR><BR></FONT>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>a)</FONT></DT><DD><FONT SIZE=2>designed
such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating
to the issuer, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>b)</FONT></DT><DD><FONT SIZE=2>evaluated
the effectiveness of the issuer's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and
procedures as of the end of the period covered by this report based on such evaluation; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>c)</FONT></DT><DD><FONT SIZE=2>disclosed
in this report any change in the issuer's internal control over financial reporting that occurred during the period covered by the annual report that has materially affected,
or is reasonably likely to materially affect, the issuer's internal control over financial reporting.
<BR><BR></FONT></DD></DL>
</DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>5.</FONT></DT><DD><FONT SIZE=2>The
issuer's other certifying officer(s)&nbsp;and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the issuer's auditors and the
audit committee of the issuer's board of directors (or&nbsp;persons performing the equivalent functions):
<BR><BR></FONT>
<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>a)</FONT></DT><DD><FONT SIZE=2>all
significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to adversely affect the
issuer's ability to record, process, summarize and report financial information; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>b)</FONT></DT><DD><FONT SIZE=2>any
fraud, whether or not material, that involves management or other employees who have a significant role in the issuer's internal control over financial reporting. </FONT></DD></DL>
</DD></DL>
<BR>

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<TD WIDTH="33%"><FONT SIZE=2>Date: March&nbsp;30, 2005</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="61%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="33%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="61%"><FONT SIZE=2><BR>
/s/&nbsp;&nbsp;</FONT><FONT SIZE=2>VINCENT J. GALIFI</FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><HR NOSHADE><FONT SIZE=2> Vincent J. Galifi<BR>
Executive Vice-President and<BR>
Chief Financial Officer</FONT></TD>
</TR>
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<FONT SIZE=2><A HREF="#toc_hc1382_1">CERTIFICATION</A></FONT><BR>
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<DOCUMENT>
<TYPE>EX-99.3
<SEQUENCE>6
<FILENAME>a2154594zex-99_3.htm
<DESCRIPTION>EXHIBIT 99.3
<TEXT>
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<P ALIGN="RIGHT"><FONT SIZE=2><B>Exhibit&nbsp;99.3  </B></FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="ka1382_certificate_of_principal_execu__cer04997"> </A>
<A NAME="toc_ka1382_1"> </A>
<BR></FONT><FONT SIZE=2><B>CERTIFICATE OF PRINCIPAL EXECUTIVE OFFICER<BR>  PURSUANT TO<BR>  18&nbsp;U.S.C. SECTION 1350<BR>  AS ADOPTED PURSUANT TO SECTION 906&nbsp;OF THE SARBANES-OXLEY ACT OF&nbsp;2002    <BR>    </B></FONT></P>

<P><FONT SIZE=2>I,
Frank Stronach, the Chairman and Interim Chief Executive Officer of Magna International&nbsp;Inc. (the&nbsp;"Company"), certify that: </FONT></P>

<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>1.</FONT></DT><DD><FONT SIZE=2>the
Annual Report on Form&nbsp;40-F of the Company dated March&nbsp;30, 2005 for the fiscal year ending December&nbsp;31, 2004 (the&nbsp;"Report") fully complies
with the requirements of Sections&nbsp;13(a)&nbsp;and&nbsp;15(d)&nbsp;of the Securities Exchange Act of 1934; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>2.</FONT></DT><DD><FONT SIZE=2>the
information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. </FONT></DD></DL>
<BR>

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<TABLE WIDTH="100%" BORDER=0 CELLSPACING=0 CELLPADDING=0>
<TR VALIGN="TOP">
<TD WIDTH="33%"><FONT SIZE=2>Date: March&nbsp;30, 2005</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="61%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="33%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="61%"><FONT SIZE=2><BR>
/s/&nbsp;&nbsp;</FONT><FONT SIZE=2>FRANK STRONACH</FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><HR NOSHADE><FONT SIZE=2> Frank Stronach<BR>
Chairman and Interim Chief Executive Officer</FONT></TD>
</TR>
</TABLE>
<!-- end of user-specified TAGGED TABLE -->

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<TABLE WIDTH="90%" BORDER=0 CELLSPACING=0 CELLPADDING=0>
<TR VALIGN="TOP">
<TD WIDTH="100%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
</TABLE>
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<TABLE WIDTH="90%" BORDER=0 CELLSPACING=0 CELLPADDING=0>
<TR VALIGN="TOP">
<TD WIDTH="100%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
</TABLE>
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<P><FONT SIZE=2>A signed original of this written statement required by Section&nbsp;906 has been provided the Company and will be retained by the Company and furnished to the Securities and
Exchange Commission or its staff upon request. </FONT></P>

<HR NOSHADE>
<P style='page-break-before:always'></p>
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<FONT SIZE=2><A HREF="#toc_ka1382_1">CERTIFICATE OF PRINCIPAL EXECUTIVE OFFICER PURSUANT TO 18 U.S.C. SECTION 1350 AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002</A></FONT><BR>
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<DOCUMENT>
<TYPE>EX-99.4
<SEQUENCE>7
<FILENAME>a2154594zex-99_4.htm
<DESCRIPTION>EXHIBIT 99.4
<TEXT>
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<HEAD>
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<P ALIGN="RIGHT"><FONT SIZE=2><B>Exhibit&nbsp;99.4  </B></FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="kc1382_certificate_of_principal_finan__cer04952"> </A>
<A NAME="toc_kc1382_1"> </A>
<BR></FONT><FONT SIZE=2><B>CERTIFICATE OF PRINCIPAL FINANCIAL OFFICER<BR>  PURSUANT TO<BR>  18&nbsp;U.S.C. SECTION 1350<BR>  AS ADOPTED PURSUANT TO SECTION 906&nbsp;OF THE SARBANES-OXLEY ACT OF&nbsp;2002    <BR>    </B></FONT></P>

<P><FONT SIZE=2>I,
Vincent J. Galifi, the Executive Vice-President and Chief Financial Officer of Magna International&nbsp;Inc. (the&nbsp;"Company"), certify that: </FONT></P>

<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>1.</FONT></DT><DD><FONT SIZE=2>the
Annual Report on Form&nbsp;40-F of the Company dated March&nbsp;30, 2005 for the fiscal year ending December&nbsp;31, 2004 (the&nbsp;"Report") fully complies
with the requirements of Section&nbsp;13(a)&nbsp;and&nbsp;15(d)&nbsp;of the Securities Exchange Act of 1934; and
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>2.</FONT></DT><DD><FONT SIZE=2>the
information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. </FONT></DD></DL>
<BR>

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<TABLE WIDTH="100%" BORDER=0 CELLSPACING=0 CELLPADDING=0>
<TR VALIGN="TOP">
<TD WIDTH="33%"><FONT SIZE=2>Date: March&nbsp;30, 2005</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="61%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="33%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="61%"><FONT SIZE=2><BR>
/s/&nbsp;&nbsp;</FONT><FONT SIZE=2>VINCENT J. GALIFI</FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><HR NOSHADE><FONT SIZE=2> Vincent J. Galifi<BR>
Executive Vice-President and<BR>
Chief Financial Officer</FONT></TD>
</TR>
</TABLE>
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<TABLE WIDTH="90%" BORDER=0 CELLSPACING=0 CELLPADDING=0>
<TR VALIGN="TOP">
<TD WIDTH="100%"><FONT SIZE=2>&nbsp;</FONT></TD>
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<TD WIDTH="100%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
</TABLE>
<!-- end of user-specified TAGGED TABLE -->


<P><FONT SIZE=2>A signed original of this written statement required by Section&nbsp;906 has been provided to the Company and will be retained by the Company and furnished to the Securities
and Exchange Commission or its staff upon request. </FONT></P>

<HR NOSHADE>
<P style='page-break-before:always'></p>
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<FONT SIZE=2><A HREF="#toc_kc1382_1">CERTIFICATE OF PRINCIPAL FINANCIAL OFFICER PURSUANT TO 18 U.S.C. SECTION 1350 AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002</A></FONT><BR>
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