2024-04-04 06:19:08 ET
Summary
- BorgWarner is a leading manufacturer and supplier of auto parts and technologies for gas-powered and electric vehicles, counting many of the largest global automakers among its customers.
- The company's traditional auto parts business consistently generates strong profits and cash flows, which support the newer EV segment's ongoing development.
- The EV unit is growing rapidly and inking new supply deals with major EV manufacturers. Management aims to grow this segment to 45% of total revenues by 2030.
- The value of BorgWarner's EV operations is not reflected in the company's market valuation, presenting a cheap opportunity to invest in a profitable business with significant growth potential.
In a free market system, companies facing industrial disruption have only two options – adapt or die. BorgWarner ( BWA ), a century-old automotive supplier with a prized track record of industry-leading innovation and performance, is a business that refuses to simply roll over and wither away. Faced with the threat of electrification eventually rendering its traditional auto parts and technologies obsolete, BorgWarner has embarked on an aggressive yet measured campaign to position itself at the forefront of global EV production. Its EV parts and technologies segment is growing rapidly, with revenue exploding higher and new supply deals being inked with major EV manufacturers....
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BorgWarner: Cash Cow Auto Supplier With An Electric Future