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BorgWarner (BWA) Makes $62M Electrification Bet in US Facilities
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BorgWarner Inc. (BWA - Free Report) a leading automotive supplier, has announced plans to invest $42 million in the expansion of its Seneca, SC facility. This investment is aimed at increasing battery module and pack production in the United States and will result in the creation of 122 jobs. The company also revealed its plan to invest $20 million in its Michigan facilities, creating 186 jobs and accelerating the development and testing of electric vehicle (EV) products. Let’s delve deeper into both the developments.
South Carolina Facility Upgrade to Boost Battery Production
The $42 million investment in the South Carolina facility signifies the company's dedication to enhancing its battery module and pack production capabilities in the United States to meet the evolving demands of the automotive industry. This expansion will be vital for meeting the increasing demand for electrified transportation solutions in the country. The investment will be used for various purposes, including building and equipment upgrades, development of new manufacturing lines, and increasing the facility's annual battery module capacity to 3GWh.
With the support of the State of South Carolina and Oconee County, BorgWarner aims to create approximately 122 new jobs over the course of three years. These positions will span multiple domains, such as production, technical support, manufacturing, engineering, maintenance, and supporting functions. This job creation will contribute to the local economy and further solidify BorgWarner's presence in the region. The expansion is set to commence in the second quarter of 2023 and is expected to be completed by the first half of 2024.
Michigan's Electrification Boost to Enhance EV Infrastructure
BorgWarner's $20 million investment in its Michigan facilities aims to accelerate the development, manufacturing, and testing of EV products and charging infrastructure equipment. This investment will be spread across three existing facilities in Auburn Hills, Dearborn, and Hazel Park, as well as a new EV battery service center.
The investment in the Auburn Hills facility will be used to create new electrification labs, housing testing equipment and facilitating research and development activities. In Dearborn, the facility's footprint will be increased by approximately 7,000 square feet, enabling growth in manufacturing, engineering, and service departments dedicated to next-generation DC fast charging equipment. This expansion will allow the facility to double its current capacity and implement a second shift.
The Hazel Park facility, along with the new 100,000 square foot EV battery service center, will receive the largest capital investment of approximately $10.6 million. The new battery service center will focus on testing, diagnostics, and training for all BorgWarner batteries in North America. Additionally, a new battery module assembly line will be added in Hazel Park to increase battery module and pack production.
This investment in the Michigan facilities, coupled with the $1.86 million grant from the Michigan Economic Development Corporation (MEDC), will enable BorgWarner to create approximately 186 new jobs.
BWA’s Electrification Strides a Key Catalyst
As the demand for electric vehicles has surged over the past few years, BorgWarner has strategically shifted its focus toward EV technologies to maintain its competitive edge and meet the evolving needs of the automotive industry.
To that end, the company has acquired and partnered with several companies to strengthen its position in the EV market. Notable acquisitions include Delphi Technologies in 2020 and Akasol, a Germany-based battery systems manufacturer, in 2021. These acquisitions have expanded BorgWarner's product portfolio, allowing it to provide integrated electrification solutions for various vehicle segments.
BorgWarner has invested in the development of various EV technologies, such as electric motors, power electronics, and battery systems. It has introduced products like the integrated drive module (iDM), eAxle, and eGearDrive transmission, which combine electric motor, power electronics, and transmission systems into a single unit, simplifying EV design and manufacturing.
The company has also been working on expanding its manufacturing capabilities to meet the growing demand for EV components. This includes the construction of new facilities and the expansion of existing ones, enabling BorgWarner to produce a higher volume of EV parts. BorgWarner's latest investments in its South Carolina and Michigan facilities highlight the company's commitment to expanding its electrification capabilities and meeting the growing demand for clean, energy-efficient transportation solutions.
BWA is actively collaborating with leading automakers to provide advanced EV solutions. It has entered into multiple supply contracts with major automotive companies, such as Ford, Volkswagen, and Jaguar Land Rover, to supply components and systems for their electric vehicle programs.
The company’s 2023 electrification revenues are expected to increase to more than $1.5-$1.8 billion, up from $870 million from 2022. The firm’s booked eMotor volumes are expected to rise from 0.3 million units in 2021 to 2 million units by 2025, representing a CAGR of around 60%. BorgWarner has booked programs that will support approximately 2 million eMotors, 3.1 million inverters and close to 4 million e-heaters by 2025. The company is on track to achieve more than $4.3 billion of EV revenues by 2025, thanks to new business awards and strategic actions.
BWA is Worth Your Attention
Overall, BorgWarner's strategic shift toward electric vehicle technologies demonstrates its adaptability to the changing automotive landscape. By leveraging its extensive experience and expertise in powertrain components, the company aims to maintain its position as a leading supplier in the global automotive market.
BWA currently carries a Zacks Rank #3 (Hold). It has a VGM Score of A. The Zacks Consensus Estimate for the company’s 2023 sales and earnings estimates implies a year-over-year uptick of 8% and 5.4%, respectively. The same for 2024 sales and earnings implies year-over-year growth of 7% and 14.4%, respectively.
BWA surpassed the earnings estimates in each of the trailing four quarters, the average surprise being 24%. The company has a long-term expected EPS growth rate of 13.4%.
A few top-ranked players in the auto space are Geely Automobile Holdings Limited (GELYY - Free Report) , BYD Company Limited (BYDDY - Free Report) and Ferrari N.V. (RACE - Free Report) , all of which sport a Zacks Rank #1 at present.
Geely is engaged in automobile manufacturing and related areas. The Zacks Consensus Estimate for GELYY’s 2023 sales and earnings implies year-over-year growth of 57.5% and 7.4%, respectively.
BYD is engaged in the research, development, manufacture and distribution of automobiles, secondary rechargeable batteries, and mobile phone components. The Zacks Consensus Estimate for BYDDY’s 2023 and 2024 sales implies year-over-year growth of 175% and 26.2%, respectively.
Ferrari is engaged in designing, manufacturing and selling sports cars. The Zacks Consensus Estimate for RACE’s 2023 sales and earnings implies year-over-year growth of 14% and 19.8%, respectively.
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BorgWarner (BWA) Makes $62M Electrification Bet in US Facilities
BorgWarner Inc. (BWA - Free Report) a leading automotive supplier, has announced plans to invest $42 million in the expansion of its Seneca, SC facility. This investment is aimed at increasing battery module and pack production in the United States and will result in the creation of 122 jobs. The company also revealed its plan to invest $20 million in its Michigan facilities, creating 186 jobs and accelerating the development and testing of electric vehicle (EV) products. Let’s delve deeper into both the developments.
South Carolina Facility Upgrade to Boost Battery Production
The $42 million investment in the South Carolina facility signifies the company's dedication to enhancing its battery module and pack production capabilities in the United States to meet the evolving demands of the automotive industry. This expansion will be vital for meeting the increasing demand for electrified transportation solutions in the country. The investment will be used for various purposes, including building and equipment upgrades, development of new manufacturing lines, and increasing the facility's annual battery module capacity to 3GWh.
With the support of the State of South Carolina and Oconee County, BorgWarner aims to create approximately 122 new jobs over the course of three years. These positions will span multiple domains, such as production, technical support, manufacturing, engineering, maintenance, and supporting functions. This job creation will contribute to the local economy and further solidify BorgWarner's presence in the region. The expansion is set to commence in the second quarter of 2023 and is expected to be completed by the first half of 2024.
Michigan's Electrification Boost to Enhance EV Infrastructure
BorgWarner's $20 million investment in its Michigan facilities aims to accelerate the development, manufacturing, and testing of EV products and charging infrastructure equipment. This investment will be spread across three existing facilities in Auburn Hills, Dearborn, and Hazel Park, as well as a new EV battery service center.
The investment in the Auburn Hills facility will be used to create new electrification labs, housing testing equipment and facilitating research and development activities. In Dearborn, the facility's footprint will be increased by approximately 7,000 square feet, enabling growth in manufacturing, engineering, and service departments dedicated to next-generation DC fast charging equipment. This expansion will allow the facility to double its current capacity and implement a second shift.
The Hazel Park facility, along with the new 100,000 square foot EV battery service center, will receive the largest capital investment of approximately $10.6 million. The new battery service center will focus on testing, diagnostics, and training for all BorgWarner batteries in North America. Additionally, a new battery module assembly line will be added in Hazel Park to increase battery module and pack production.
This investment in the Michigan facilities, coupled with the $1.86 million grant from the Michigan Economic Development Corporation (MEDC), will enable BorgWarner to create approximately 186 new jobs.
BWA’s Electrification Strides a Key Catalyst
As the demand for electric vehicles has surged over the past few years, BorgWarner has strategically shifted its focus toward EV technologies to maintain its competitive edge and meet the evolving needs of the automotive industry.
To that end, the company has acquired and partnered with several companies to strengthen its position in the EV market. Notable acquisitions include Delphi Technologies in 2020 and Akasol, a Germany-based battery systems manufacturer, in 2021. These acquisitions have expanded BorgWarner's product portfolio, allowing it to provide integrated electrification solutions for various vehicle segments.
BorgWarner has invested in the development of various EV technologies, such as electric motors, power electronics, and battery systems. It has introduced products like the integrated drive module (iDM), eAxle, and eGearDrive transmission, which combine electric motor, power electronics, and transmission systems into a single unit, simplifying EV design and manufacturing.
The company has also been working on expanding its manufacturing capabilities to meet the growing demand for EV components. This includes the construction of new facilities and the expansion of existing ones, enabling BorgWarner to produce a higher volume of EV parts. BorgWarner's latest investments in its South Carolina and Michigan facilities highlight the company's commitment to expanding its electrification capabilities and meeting the growing demand for clean, energy-efficient transportation solutions.
BWA is actively collaborating with leading automakers to provide advanced EV solutions. It has entered into multiple supply contracts with major automotive companies, such as Ford, Volkswagen, and Jaguar Land Rover, to supply components and systems for their electric vehicle programs.
The company’s 2023 electrification revenues are expected to increase to more than $1.5-$1.8 billion, up from $870 million from 2022. The firm’s booked eMotor volumes are expected to rise from 0.3 million units in 2021 to 2 million units by 2025, representing a CAGR of around 60%. BorgWarner has booked programs that will support approximately 2 million eMotors, 3.1 million inverters and close to 4 million e-heaters by 2025. The company is on track to achieve more than $4.3 billion of EV revenues by 2025, thanks to new business awards and strategic actions.
BWA is Worth Your Attention
Overall, BorgWarner's strategic shift toward electric vehicle technologies demonstrates its adaptability to the changing automotive landscape. By leveraging its extensive experience and expertise in powertrain components, the company aims to maintain its position as a leading supplier in the global automotive market.
BWA currently carries a Zacks Rank #3 (Hold). It has a VGM Score of A. The Zacks Consensus Estimate for the company’s 2023 sales and earnings estimates implies a year-over-year uptick of 8% and 5.4%, respectively. The same for 2024 sales and earnings implies year-over-year growth of 7% and 14.4%, respectively.
BWA surpassed the earnings estimates in each of the trailing four quarters, the average surprise being 24%. The company has a long-term expected EPS growth rate of 13.4%.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Key Picks
A few top-ranked players in the auto space are Geely Automobile Holdings Limited (GELYY - Free Report) , BYD Company Limited (BYDDY - Free Report) and Ferrari N.V. (RACE - Free Report) , all of which sport a Zacks Rank #1 at present.
Geely is engaged in automobile manufacturing and related areas. The Zacks Consensus Estimate for GELYY’s 2023 sales and earnings implies year-over-year growth of 57.5% and 7.4%, respectively.
BYD is engaged in the research, development, manufacture and distribution of automobiles, secondary rechargeable batteries, and mobile phone components. The Zacks Consensus Estimate for BYDDY’s 2023 and 2024 sales implies year-over-year growth of 175% and 26.2%, respectively.
Ferrari is engaged in designing, manufacturing and selling sports cars. The Zacks Consensus Estimate for RACE’s 2023 sales and earnings implies year-over-year growth of 14% and 19.8%, respectively.