) revealed that it expects Asia to account for half of its $2.3
billion in new business from 2013 to 2015, rather than Europe,
which is the market leader in new powertrain technology and
currently accounts for 45% of its business.
The company will reduce its exposure in Europe to 30% of new
business due to the economic weakness in the region. The
remaining 20% will be drawn from North America.
Asia accounted for 35% of the company's new business from 2010 to
2012. The company now expects China to account for one-third of
new business in the region.
Stringent fuel economy and emissions standard as well as
advancement in design, manufacturing and materials have boosted
the demand for BorgWarner's products, including dual-clutch
transmissions (DCT) and turbochargers.
The company expects a threefold increase in demand for DCT
modules - which improves fuel efficiency by 15% - to 8 million
units by 2016. Meanwhile, it anticipates global sales of
turbochargers - which improve fuel efficiency by 7.5% according
to the U.S. Department of Energy - to surge 50% to 50 million
units by 2017.
BorgWarner, a Zacks #3 Rank (Hold) company, posted a 3.5%
increase in profits to $1.19 per share (excluding non-recurring
items) in the third quarter of the year from $1.15 in the same
quarter of 2011. The profit was in line with the Zacks Consensus
Revenues dipped 5% to $1.7 billion due to a 6% fall in light
vehicle production in Europe, which comprises over half of the
company's sales. However, excluding the impact of foreign
currencies and dispositions in 2011, net sales went up 2% in the
The company revised its 2012 revenues and earnings guidance
downward owing to the economic slowdown in Europe. For the year,
the company anticipates annual sales growth between 0% and 1%
compared with the prior guidance of 4% to 6%. Excluding the
negative impact of foreign currencies, annual net sales growth is
expected between 5% and 6% compared with the prior level of 9% to
The company also expects net earnings between $4.90 and $5.00 per
share for the year, excluding special items, which is lower than
the prior outlook of $5.05 to $5.25 per share. Recently, the
company stated that it expects U.S. dollar to euro exchange rate
to go down to $1.25 in 2013 until 2015 from $1.35 over the last
BorgWarner is a leading manufacturer of powertrain products for
the world's major automakers. Its products include
four-wheel-drive and all-wheel-drive transfer cases (primarily
for light trucks and sport utility vehicles or SUVs), as well as
automatic transmission and timing chain systems. The company's
products are capable of improving vehicle performance and
stability meeting fuel-efficiency and emission standards.
The company operates in 57 locations in 19 countries, providing
products that increase fuel efficiency and reduction in emission.
These products are manufactured and sold worldwide, primarily to
original equipment manufacturers of passenger cars, SUVs, trucks
and commercial transportation products. The company's largest
Ford Motor Co.
Toyota Motor Corp.
Honda Motor Co.
BORG WARNER INC (BWA): Free Stock Analysis
FORD MOTOR CO (F): Free Stock Analysis Report
HONDA MOTOR (HMC): Free Stock Analysis Report
TOYOTA MOTOR CP (TM): Free Stock Analysis
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