Borgwarner Inc. · NYSE:BWA

Borgwarner — Investor Day (September 2016)

144 slides from Borgwarner's investor day presentation, Sep 7, 2016

Slide 1: Welcome Investor Day
Welcome Investor Day September 7, 2016 1
Slide 2: Welcome Investor Day
Welcome Investor Day September 7, 2016 | Scott Gallett, Vice President Marketing 2
Slide 3: Safe Harbor Statement
Safe Harbor Statement Statements contained in this presentation may contain forward-looking statements as contemplated by the 1995 Private Securities Litigation Reform Act (the “Act”) that are based on management's current outlook, expectations, estimates and projections. Words such as "anticipates,
Slide 4: Investor Day Outline
Investor Day Outline  10:40 Keynote Address – James Verrier, President and CEO  11:10 Vehicle Mobility Trends – Chris Thomas, Chief Technology Officer  11:20 Combustion – Frederic Lissalde, President Turbo Systems  11:30 Hybrid – Stefan Demmerle, President PowerDrive Systems  11:40 Electric – J
Slide 5: Vehicle Mobility Trends
Vehicle Mobility Trends autonomous shared cars connected efficiency/CO2 driving and rideshare cars emissions © BorgWarner Inc. 5
Slide 6: Core Purpose Remains Unchanged
Core Purpose Remains Unchanged POINT A POINT B THERE WILL ALWAYS BE A NEED FOR A PROPULSION SYSTEM © BorgWarner Inc. 6
Slide 8: Light Vehicle Production
Electric Light Vehicle Production Hybrid Combustion 2% CAGR 107M 2.3M 0.5M 91M 23% CAGR 18M 3M 29% CAGR 88M 86M -0.3% CAGR 2016 IHS UNITS* 2023 IHS UNITS* © BorgWarner Inc. *Source market data: IHS Light Vehicle Forecast (June 2016) 8 All values are approximate
Slide 9: Growth and Participation in Combustion
aCPV (Average Content Per Vehicle) Growth and Participation in Combustion Combustion Vehicles with BW Content Revenue Market and 88M 86M Participation 2023 CAGR 5% aCPV aCPV 53% 44% $185 $215 2016 2016 IHS UNITS* 2023 IHS UNITS* © BorgWarner Inc. *Source market data: IHS Light Vehicle Forecast (June
Slide 10: Combustion Propulsion
Combustion Propulsion* Combustion Products:  Timing system  Variable cam timing  Exhaust gas recirculation  Clutch plates  All-wheel drive systems  Enhanced starters  Fans & fan drives Dual Clutch and Stop/Start Accumulator Turbocharger Control Module  Pictured products and many more… • Incl
Slide 11: Growth and Participation in Hybrid
aCPV (Average Content Per Vehicle) Growth and Participation in Hybrid Hybrid Vehicles with BW Content Revenue Market and Participation 18M 2023 CAGR 54% aCPV aCPV 3M $225 42% $140 20% 2016 2016 IHS UNITS* 2023 IHS UNITS* © BorgWarner Inc. *Source market data: IHS Light Vehicle Forecast (June 2016) 1
Slide 12: Hybrid Propulsion
Hybrid Propulsion* Combustion Products PLUS Hybrid Specific Products  Exhaust heat recovery systems  Electric drive motors  Disconnect clutch and controls  Pictured products and many more… eBooster® Belt Alternator Starter P2 Motor/Clutch Module Electric All-Wheel Drive $200 $250 $900 $1200 * In
Slide 13: Growth and Participation in Electric
aCPV (Average Content Per Vehicle) Growth and Participation in Electric Electric Vehicles with BW Content Revenue Market and Participation 2.3M 2023 CAGR 53% aCPV aCPV $620 0.5M 3% $285 29% 2016 2016 IHS UNITS* 2023 IHS UNITS* © BorgWarner Inc. *Source market data: IHS Light Vehicle Forecast (June 2
Slide 14: Electric Propulsion
Electric Propulsion* Electric Vehicle Products:  Electric all-wheel drive  Liquid heater  Auxiliary coolant pump  Fuel Cell air supply  Transmission Chain  Pictured products and many more… Friction Plates Cabin Air Heater eGearDrive® Electric Drive Motor Electric Drive Module * Includes batter
Slide 15: Excellent Balance – Light Vehicle
Electric Excellent Balance – Light Vehicle Hybrid Combustion 0.6% 0.1% 2.2% 1.6% 3.3% 1.1% 17.2% 14.8% 96.1% 98.7% 80.6% 83.6% 2016 IHS UNITS* 2016 BWA REVENUE (USD) 2023 IHS UNITS* 2023 BWA REVENUE (USD) © BorgWarner Inc. *Source market data: IHS Light Vehicle Forecast (June 2016) 15
Slide 16: Complementing Organic Growth with Acquisition
Complementing Organic Growth with Acquisition Trend Downsized Turbocharged Efficient Internal Combustion Engines Select BWA Products Turbochargers Variable Exhaust Cam Gas Timing Recirculation 1993 2008 2023 Select BWA Acquired Acquired Milestones turbocharger EGR cooler businesses business © BorgWa
Slide 17: Complementing Organic Growth with Acquisition
Complementing Organic Growth with Acquisition Trend Advanced Drivetrain Select BWA Products Dual Clutch Front Wheel Drive Transmission All-Wheel Drive Modules Coupling 1993 2008 2023 Select BWA Developed and Acquired FWD Milestones launched DCT All-Wheel Drive coupling business © BorgWarner Inc. 17
Slide 18: Complementing Organic Growth with Acquisition
Complementing Organic Growth with Acquisition Trend Electrification Select BWA Products eGearDrive® Electric P2 Motor & Transmission Drive Clutch module Motor 1993 2008 2023 Select BWA Developed and Acquired rotating Milestones launched electrics business electric vehicle transmission © BorgWarner I
Slide 19: Complementing Organic Growth with Acquisition
Complementing Organic Growth with Acquisition Trend Downsized Turbocharged Efficient Internal Combustion Engines Advanced Drivetrain Electrification Select BWA Products Turbochargers Variable Dual Clutch eGearDrive® Exhaust Front Wheel Drive Electric P2 Motor & Cam Transmission Transmission Gas All-
Slide 20: Strong Global Customer Relationships
Strong Global Customer Relationships Europe 38% China 14% VW/Audi 10% VW/Audi 3% Daimler 5% Ford 2% Ford 3% GM 1% Renault 3% Other China 8% BMW 2% PSA 2% FCA 2% Americas 34% GM 1% Ford 9% CV 3% FCA 5% Other 7% GM 3% Asian OEMs 2% Asia ex. China 14% Commercial 7% Europe 38% Vehicles Asia ex. China 14
Slide 22: Summary
Summary  Vehicle mobility trends are good for our business, all still need a propulsion system  BorgWarner’s product portfolio is diverse, deep and well positioned for future propulsion needs  Our technologies strength will continue to be a key differentiator for us with our customers  Results i
Slide 23: Investor Day
Investor Day September 7, 2016 23
Slide 24: Mobility Trends
Mobility Trends September 7, 2016 | Prof. Christopher Thomas, Chief Technology Officer 24
Slide 25: Vehicle Mobility Trends
Vehicle Mobility Trends autonomous shared cars connected efficiency/CO2 driving and rideshare cars emissions © BorgWarner Inc. 25
Slide 26: Mobility Trends – Key Points
Mobility Trends – Key Points 1. Understanding and impact on our business 2. Mobility trends all need a propulsion system 3. Continued drive for efficiency continues to be a large growth opportunity © BorgWarner Inc. 26
Slide 27: Autonomous Vehicles
Autonomous Vehicles Key Points:  Lower levels of autonomy around us today  Includes cruise control, active cruise control, autonomous emergency braking, lane keeping, automatic parking  Higher levels of autonomy require redundant systems  Joint development programs autonomous Propulsion System:
Slide 28: Shared Cars and Rideshare
Shared Cars and Rideshare Key Points:  Most prominent in urban areas  Business based ownership and decisions  Total Cost of ownership  Maximum up-time, minimal refueling time Propulsion System:  48V mild hybrids favored shared cars and  All propulsion types used today and into future rideshare
Slide 29: Connected Cars
Connected Cars Key Points:  Vehicles communicate with each other and surroundings  Improves safety and efficiency  Accidents avoided and routes changed to avoid congestion  Reduction in the duty cycle for stopping, idling, accelerating Propulsion System: Neutral  Will improve efficiency of all
Slide 30: Efficiency / CO2 Emissions
Efficiency / CO2 Emissions Key Points:  Cost per % fuel economy improvement is King Balanced global propulsion system mix:  Downsized, turbocharged, direct injection, variable cam timing, and stop/start (2016 high end technology)  More advanced combustion engines = above plus cooled EGR, VTG turb
Slide 31: Summary – Mobility Trends
Summary – Mobility Trends  Vehicle mobility trends are good for our business, all still need a propulsion system  We understand the interactions between the mobility trends and the impact on our business  Efficiency/CO2 regulations in combustion, hybrid, and electric vehicles remain a big growth
Slide 32: Investor Day
Investor Day September 7, 2016 32
Slide 33: Combustion
Combustion September 7, 2016 | Frederic Lissalde, President Turbo Systems 33
Slide 35: Definition – Combustion
Definition – Combustion Vehicles that have an internal combustion engine and no electric motors that help propulsion  Propulsion system includes transmissions and all-wheel drive systems © BorgWarner Inc. 35
Slide 36: Combustion – Key Point #1
Combustion – Key Point #1 1. Efficient combustion propulsion systems will play a key role in meeting government regulations Passenger car CO2 emissions and fuel consumption, normalized to NEDC Source ICCT © BorgWarner Inc. 36
Slide 37: Combustion – Key Point #2
Combustion – Key Point #2 2. Continued extreme pressure for innovation  $/% fuel economy © BorgWarner Inc. 37
Slide 38: Combustion – Key Points #3
Combustion – Key Points #3 3. Industry penetration rates continue to grow Technology Penetration % - Combustion Only (includes S/S) - Gas & Diesel 2016 2026 Turbochargers 42% 55% Exhaust Gas Recirculation 29% 47% Variable Cam Timing 54% 70% Dual Clutch Transmission 8% 10% Stop/Start 35% 65% © BorgWa
Slide 39: Growth and Participation in Combustion
aCPV (Average Content Per Vehicle) Growth and Participation in Combustion Combustion Vehicles with BW Content Revenue Market and 88M 86M Participation 2023 CAGR 5% aCPV aCPV 53% 44% $185 $215 2016 2016 IHS UNITS* 2023 IHS UNITS* © BorgWarner Inc. *Source market data: IHS Light Vehicle Forecast (June
Slide 40: Select Combustion Vehicles with BWA Content
Select Combustion Vehicles with BWA Content  Audi A6 P0 P2  Hyundai Santa Fe P3  BYD S7  Jaguar F-PACE  Chevrolet Malibu  Mercedes E-Class  Jeep Grand Cherokee  Nissan Sentra  Ford F-Series  Toyota Tundra  Ford Escape / Kuga  Volkswagen Golf  Honda CR-V  And another ~800+ nameplates ©
Slide 41: Combustion – Select Customer Awards
Combustion – Select Customer Awards Turbochargers: EGR Modules: 1.0L gas EU P0 P2 P3 N. America (3) 1.0L gas Asia EU 1.5L gas Asia Asia (2) Stop/Start Accumulators: Variable Cam Timing: N. America (2) Americas (3) Asia (2) EU (2) Asia (2) © BorgWarner Inc. 41
Slide 42: Combustion Vehicle Summary
Combustion Vehicle Summary  Combustion propulsion systems continue to be a large part of the market  The drive for more efficient combustion engines continues  Penetration rates for BorgWarner products continue to grow  We are growing our market penetration and average content per vehicle © Borg
Slide 43: Investor Day
Investor Day September 7, 2016 43
Slide 44: Hybrid
Hybrid September 7, 2016 | Stefan Demmerle, President PowerDrive Systems 44
Slide 46: Definition - Hybrid
Definition - Hybrid Vehicles that have an internal combustion engine and have some ability to propel the vehicle in combination with an electric motor © BorgWarner Inc. 46
Slide 47: Definition - Hybrid
Definition - Hybrid Propulsion power delivered from the electric motor can vary dramatically  Mild Hybrids vehicles with small electric motors and an internal combustion engine that can provide propulsion together to propel the vehicle  Full Hybrids vehicles with larger electric motors and an inte
Slide 48: Hybrid – Key Point #1
Hybrid – Key Point #1 1. Wide variety of architectures, customers deciding what mix of hybrid, combustion and electric is best for them  48V mild hybrid systems forecast to be the majority of the volume  BorgWarner’s portfolio includes a wide variety of hybrid specific products for all types of hy
Slide 49: Hybrid – Key Point #2
Hybrid – Key Point #2 2. Hybrids use highly efficient internal combustion engines Technology Penetration % - Hybrid Only - Gas & Diesel 2016 2026 Turbochargers 18% 56% Exhaust Gas Recirculation 12% 41% Variable Cam Timing 52% 68%  Hybrids drive increasing demand for BorgWarner’s efficient ICE produ
Slide 50: Hybrid Architecture
Hybrid Architecture Electric motors of different sizes and power levels can be placed in various positions throughout the propulsion system P1 P3 P4 PS P0 P2 © BorgWarner Inc. 50
Slide 51: Growth and Participation in Hybrid
aCPV (Average Content Per Vehicle) Growth and Participation in Hybrid Hybrid Vehicles with BW Content Revenue Market and Participation 18M 2023 CAGR 54% aCPV aCPV 3M $225 42% $140 20% 2016 2016 IHS UNITS* 2023 IHS UNITS* © BorgWarner Inc. *Source market data: IHS Light Vehicle Forecast (June 2016) 5
Slide 52: Select Hybrid vehicles with BWA Products
Select Hybrid vehicles with BWA Products  Audi A3  Hyundai Sonata  BMW 3 Series  Mercedes C-Class  BYD Tanga  Toyota Camry  Chevrolet Malibu  Volkswagen Jetta  Chevrolet Volt  Volvo XC90  Ford Fusion  And another ~20+ nameplates © BorgWarner Inc. 52
Slide 53: Hybrid – Select Customer Awards
Hybrid – Select Customer Awards IBAS: Wet disconnect Chain Drive: Asia P3 48V Asia & 200V EU and controls: Asia eBooster®: 48V EU (2) Exhaust Heat Recovery System: N. America © BorgWarner Inc. 53
Slide 54: Hybrid Summary
Hybrid Summary  Hybrid market is growing quickly  We have a wide variety of hybrid specific products  Hybrids use highly efficient internal combustion engines  Hybrids are additive to our business  We are winning business, increasing our penetration and content per vehicle © BorgWarner Inc. 54
Slide 55: Investor Day
Investor Day September 7, 2016 55
Slide 56: Electric
Electric September 7, 2016 | Joe Fadool, President Morse Systems 56
Slide 58: Definition – Electric
Definition – Electric An electric vehicle is propelled purely by an electric motor or sometimes multiple electric motors. © BorgWarner Inc. 58
Slide 59: Definition - Electric
Definition - Electric The electric motor(s) get their energy from a battery.  Battery Electric Vehicles (BEV’s) have just the battery as the power source and when it runs out you need to plug it in to recharge it.  Range Extended Electric Vehicles include the battery which supplies the power to th
Slide 60: Electric – Some Key Points
Electric – Some Key Points Electric Propulsion systems have 5 main areas:  Electric Motor  Transmission  Power Electronics  Thermal Management  Battery © BorgWarner Inc. 60
Slide 61: Electric – Some Key Points
Electric – Some Key Points BorgWarner supplies products in these four areas:  Electric Motor  Transmission  Power Electronics  Thermal Management  Battery © BorgWarner Inc. 61
Slide 62: Electric Vehicle Forecast
Electric l Vehicle Forecast  IHS predicts strong EV 7 growth with 19% CAGR Millions 6 5 4 3 IHS Forecast 2 1 0 2016 2021 2026 © BorgWarner Inc. 62
Slide 63: Electric Vehicle Forecast
Electric Vehicle Forecast  IHS predicts strong 7 EV growth Millions 6  Asia represents 40% of units in 2026 5 4 3 IHS Forecast NA Brands 2 Asia Brands 1 EU Brands 0 2016 2021 2026 © BorgWarner Inc. 63
Slide 64: Electric Vehicle Forecast
Electric Vehicle Forecast  IHS predicts strong 7 EV growth Millions 6  Asia represents 40% of units in 2026 5 Including OEM announcements  VW, Tesla and (Toyota 4 fuel cells, Daimler) 3 have publicly IHS Forecast NA Brands announced significantly 2 Asia Brands higher goals 1 EU Brands 0 2016 2021
Slide 65: Electric Vehicle Forecast
Electric Vehicle Forecast  IHS predicts strong 7 EV growth Millions Optimistic Forecast 6  Asia represents 40% of units in 2026 5 Including OEM announcements  VW, Tesla and Toyota 4 fuel cells have publicly 3 announced significantly IHS Forecast NA Brands higher goals 2 Asia Brands  Growth oppor
Slide 66: Electric Vehicle Market Influencers
Electric Vehicle Market Influencers  Government  Battery cost  Vehicle range  Performance  Infrastructure / recharge time  Consumer demand / passion © BorgWarner Inc. 66
Slide 67: Growth and Participation in Electric
aCPV (Average Content Per Vehicle) Growth and Participation in Electric Electric Vehicles with BW Content Revenue Market and Participation 2.3M 2023 CAGR 53% aCPV aCPV $620 0.5M 3% $285 29% 2016 2016 IHS UNITS* 2023 IHS UNITS* © BorgWarner Inc. *Source market data: IHS Light Vehicle Forecast (June 2
Slide 68: Electric - Select Customer Awards
Electric - Select Customer Awards P0 P2 P3 eGearDrive® Transmission: Electric Drive Motor: Electric Drive Module: Asia (4) N. America Asia © BorgWarner Inc. 68
Slide 69: Electric - Select Customer Awards
Electric - Select Customer Awards P0 P2 P3 Cabin Air Heater: Liquid Battery Heater: Friction Plates: N. America (2) Asia EU Auxiliary Coolant Pump: Asia © BorgWarner Inc. 69
Slide 70: Electric Summary
Electric Summary  Electric vehicles present some high dollar product opportunities  Our product offering serves 4 of the 5 main propulsion and efficiency areas  We are uniquely positioned to deliver mechanical and electrical products and modules  We are winning business and actively working with
Slide 71: Investor Day
Investor Day September 7, 2016 71
Slide 72: Commercial Vehicle
Commercial Vehicle September 7, 2016 | Brady Ericson, President Emissions Systems 72
Slide 74: Definition – Commercial Vehicle
Definition – Commercial Vehicle Includes on-highway vehicles (over six tons), off-highway, construction, agricultural, mining and marine Roughly 6 million unit annual market © BorgWarner Inc. 74
Slide 75: Commercial Vehicle Key Points
Commercial Vehicle Key Points Similar drive for efficiency as light vehicle market Greater pull from market rather than legislative push  Total Cost of Ownership and Functionality  Fuel Efficiency  Up-time / Reliability  Job Efficiency - Autonomous / Platooning  Operator Satisfaction © BorgWarn
Slide 76: Commercial Vehicle Key Points
Commercial Vehicle Key Points  Variation in duty cycles also drives need for innovative and proven product solutions  Technology transfer will continue between Commercial and Light vehicles © BorgWarner Inc. 76
Slide 78: Commercial - Select Customer Awards
Commercial - Select Customer Awards P2 Turbocharger: Electric Drive motor: N. America Asia EU (3) Asia S. America EGR module: Heavy Duty Transfer Case: EU (2) N. America © BorgWarner Inc. 78
Slide 79: Commercial Vehicle Summary
Commercial Vehicle Summary  Continues to be an important portion of our business going forward  Similar drive for efficiency and trends as light vehicles, U.S. Gov’t regulations  We have specific products for the hybrid and electric trend and they are additive to our CV combustion business  Tech
Slide 80: Investor Day
Investor Day September 7, 2016 80
Slide 81: Static Displays, Demo Vehicles, Lunch
Static Displays, Demo Vehicles, Lunch September 7, 2016 | Scott Gallett, Vice President Marketing 81
Slide 83: Logistics
Logistics  Lunch available now through 2:15 Group 1 Group 2  Now – 1:15 Demo Vehicles  Now – 12:30 Lunch  1:15 – 1:45 Lunch  12:30 – 1:15 Static Displays  1:45 – 2:30 Static Displays  1:15 – 2:30 Demo Vehicles  2:35 – Resume group presentations with Ron Hundzinski, CFO © BorgWarner Inc. 83
Slide 84: Investor Day Outline
Investor Day Outline  10:40 Keynote Address – James Verrier, President and CEO  11:10 Vehicle Mobility Trends – Chris Thomas, Chief Technology Officer  11:20 Combustion – Frederic Lissalde, President Turbo Systems  11:30 Hybrid – Stefan Demmerle, President PowerDrive Systems  11:40 Electric – J
Slide 85: Financial Discipline
Financial Discipline September 7, 2016 | Ron Hundzinski, Chief Financial Officer 85
Slide 87: BorgWarner
BorgWarner  Product leaders in clean, efficient propulsion system technology  A trusted global partner  Financial focus on ROIC, operating margins and economic value © BorgWarner Inc. 87
Slide 88: Delivering Operating Margins
Delivering Operating Margins Strong Operating Income Margins 12.4% 12.9% 13.0% 11.1% 11.7% >12% 9.3% 2010 2011 2012 2013 2014 2015* 2016E* © BorgWarner Inc. 88
Slide 89: Delivering ROIC
Delivering ROIC Strong Operating 21.7% Income Margins 20.7% 20.0% 19.4% 18.3% ~18% 16.7% 2010 2011 2012 2013 2014 2015 2016E © BorgWarner Inc. 89
Slide 90: Favorable Market Dynamics
Favorable Market Dynamics 1. Demand for combustion technology remains strong 2. For all architectures – combustion, hybrid and electric:  Similar competitive landscape  Opportunity for differentiation through manufacturing and product technology 3. OEMs reliance on the supply base for component le
Slide 91: Competitive Landscape
Competitive Landscape Average number of major competitors is similar for each product category Turbochargers Belt Alternator Starters Drive Motors VCT Hybrid Drive Motors Transmissions EGR Disconnect Clutches Power Electronics ~6 ~5 Transmission Friction Hybrid Modules Battery Thermal Mgmt ~6 Transm
Slide 92: BorgWarner’s Economic Moat
BorgWarner’s Economic Moat Evolving portfolio aligned with market trends Deep, tribal knowledge Economic of critical BWA value- Emerging Alternative Direct Competition propulsion based Margins business Technologies system technologies model Operational excellence © BorgWarner Inc. 92
Slide 93: Expected Returns
Expected Returns Incremental Sales $1.00 Incremental Operating Income $0.13 - $0.16 Incremental Capex & Working Capital $0.55 - $0.60 ROIC ~20% Focus and return on invested capital, margins & economic value remains strong © BorgWarner Inc. 93
Slide 94: Summary
Summary  Confident in our long-term profitable growth  Excited about our current and future products and future complementary acquisitions  Balanced participation in light vehicle propulsion systems minimizes risk  Financial Discipline will continue © BorgWarner Inc. 94
Slide 95: Investor Day
Investor Day September 7, 2016 95
Slide 96: Investor Day Q&A
Investor Day Q&A September 7, 2016 96
Slide 97: Investor Day
Investor Day September 7, 2016 97
Slide 98: Combustion - Select Customer Awards
Combustion - Select Customer Awards  Variable cam timing Americas (3) (2017, 2018, 2019)  Stop/Start accumulator N. America (2) (2017, 2018)  Variable cam timing EU (2017, 2019), Asia (2018, 2019)  EGR module EU (2017), Asia (2) (2018, 2019)  EGR module N. America (3) (2018, 2018, 2018)  Plug
Slide 99: Hybrid - Select Customer Awards
Hybrid - Select Customer Awards  Chain drive for P3 Asia (2016)  Wet disconnect and controls for P2 Asia (2) (2016, 2018)  48V iBAS for P0 Asia (2017)  eBooster® EU (2) (2017, 2017)  200V iBAS for P0 EU (2019)  Exhaust heat recovery system N. America (2019) © BorgWarner Inc. 99
Slide 100: Electric - Select Customer Awards
Electric - Select Customer Awards  Auxiliary coolant pump Asia (2016)  eGearDrive® transmission Asia (2017, 2017, 2018, 2018)  Electric Drive Module Asia (2017)  Cabin Air Heater N. America (2017, 2019)  Electric Drive Motor N. America (2018)  Liquid heater Asia (2018)  Transmission friction
Slide 101: Commercial - Select Customer Awards
Commercial - Select Customer Awards  Turbocharger: N. America (2017)  Turbocharger: S. America (2017)  Turbocharger: Asia (2017)  Turbocharger: EU (2018, 2018, 2018)  Transfer-case: N. America (2018)  Exhaust Gas Recirculation Module: N. America (2018, 2018)  Electric Drive motor: Asia (2019)
Slide 102: Summary
Summary  Vehicle mobility trends are good for our business, all still need a propulsion system  BorgWarner’s product portfolio is diverse, deep and well positioned for future propulsion needs  Our technologies strength will continue to be a key differentiator for us with our customers  Results i
Slide 104: Investor Day
Investor Day September 7, 2016 104
Slide 107: Gasoline Exhaust Gas Recirculation (EGR) System
Gasoline Exhaust Gas Recirculation (EGR) System © BorgWarner Inc.
Slide 108: 2/3 Step Discrete Valve Lift Cam/Cam Lobe System
2/3 Step Discrete Valve Lift Cam/Cam Lobe System © BorgWarner Inc.
Slide 111: i-Clutch Actuation System for Manual Transmissions
i-Clutch Actuation System for Manual Transmissions © BorgWarner Inc.
Slide 113: Combustion Vehicle Summary
Combustion Vehicle Summary  Combustion propulsion systems continue to be a large part of the market  The drive for more efficient combustion engines continues  Penetration rates for BorgWarner products continue to grow  We are growing our market penetration and average content per vehicle © Borg
Slide 117: Heavy Duty Transfer Case – Class 5+
Heavy Duty Transfer Case – Class 5+ Increased Material Thickness Housing Wider Chain Larger Gearset Increased Rear Larger Shift Output Shaft System Diameters Components Increased Front Output Shaft Diameters © BorgWarner Inc.
Slide 121: eTurbo for Commercial Vehicle
eTurbo for Commercial Vehicle Turbo Speed Versus Time, 7.2L Diesel, 0-25mph 140000 120000 Turbo Speed (RPM) 100000 80000 eTurbo eTurbo Core 60000 40000 Time to boost reduced by 50% 20000 4.7 2.4 seconds Power Electronics Time (sec.) © BorgWarner Inc.
Slide 122: Electric Drive Motor for Commercial Vehicles
Electric Drive Motor for Commercial Vehicles Integrated electronic unit Energy storage system Engine Allison H3000 Integrated drive unit (motor/generator and transmission) Mechanical linkage Electrical linkage Control and communication linkage HVH 410 BAE HybiDrive © BorgWarner Inc.
Slide 123: Commercial Vehicle Summary
Commercial Vehicle Summary  Continues to be an important portion of our business going forward  Similar drive for efficiency and trends as light vehicles, U.S. Gov’t regulations  We have specific products for the hybrid and electric trend and they are additive to our CV combustion business  Tech
Slide 125: EV Transmission and e-Drive Motor
EV Transmission and e-Drive Motor eGearDrive® Electric Drive Motors © BorgWarner Inc.
Slide 126: Integrated Electric Drive Module (eDM)
Integrated Electric Drive Module (eDM) Co-axial HVH250 Motor Gearbox Off-axis Gearbox HVH250 Motor © BorgWarner Inc.
Slide 131: Electric Summary
Electric Summary  EVs present high dollar product opportunities  Our product offering covers 4 of the 5 main propulsion and efficiency areas  We are uniquely positioned to deliver mechanical & electrical products and modules  We are winning business and actively working with traditional and new
Slide 134: Hybrid Architecture
Hybrid Architecture Electric motors of different sizes and power levels can be placed in various positions throughout the propulsion system P1 P3 P4 PS P0 P2 © BorgWarner Inc.
Slide 135: iBAS Belt Alternator Starter with Integrated Electronics
P0 iBAS Belt Alternator Starter with Integrated Electronics P4 P1 P3 P4 PS P0 P2 Integrated 48V P0 Electronics Module © BorgWarner Inc.
Slide 136: Clutch and Motor/Generator Module – Co-Axial
P2 Clutch and Motor/Generator Module – Co-Axial P1 P3 P4 PS P0 P2 P2 © BorgWarner Inc.
Slide 137: Component Supply Options
P2 Component Supply Options P1 Hybrid Disconnect Clutch P2 Rotor/Stator P3 P4 with Integrated Damper Components PS P0 P2 P2 Control Module © BorgWarner Inc.
Slide 138: PS Component Supply
PS PS Component Supply P1 Mini Direct- Acting P3 P4 Solenoid Multi-Mode Clutch PS P0 P2 Module PS HY-VO® Chain © BorgWarner Inc.
Slide 139: Hybrid Chain Drive
P3 Hybrid Chain Drive P1 P3 P4 PS P0 P2 P3 Chain Design Customer Application © BorgWarner Inc.
Slide 140: eAWD Electric Drive Module 48V
P4 P4 eAWD Electric Drive Module 48V P1 P3 P4 PS P0 P2 eAWD Electric Drive P4 Module 48V © BorgWarner Inc.
Slide 143: All Hybrids – Exhaust Heat Recovery System
All Hybrids – Exhaust Heat Recovery System P1 P3 P4 PS P0 P2 © BorgWarner Inc.
Slide 144: Hybrid Summary
Hybrid Summary  Hybrid market is growing quickly  We have a wide variety of hybrid specific products  Hybrids use highly efficient internal combustion engines  Hybrids are additive to our business  We are winning business, increasing our penetration and content per vehicle © BorgWarner Inc.

BorgWarner — Investor Day (September 2016) on 6ix

Borgwarner — Investor Day (September 2016)

Slide 1: Welcome Investor Day

Slide 2: Welcome Investor Day

Slide 3: Safe Harbor Statement

Slide 4: Investor Day Outline

Slide 5: Vehicle Mobility Trends

Slide 6: Core Purpose Remains Unchanged

Slide 7: Vehicle Propulsion System Categories

Slide 8: Light Vehicle Production

Slide 9: Growth and Participation in Combustion

Slide 10: Combustion Propulsion

Slide 11: Growth and Participation in Hybrid

Slide 12: Hybrid Propulsion

Slide 13: Growth and Participation in Electric

Slide 14: Electric Propulsion

Slide 15: Excellent Balance – Light Vehicle

Slide 16: Complementing Organic Growth with Acquisition

Slide 17: Complementing Organic Growth with Acquisition

Slide 18: Complementing Organic Growth with Acquisition

Slide 19: Complementing Organic Growth with Acquisition

Slide 20: Strong Global Customer Relationships

Slide 21: Zone of Growth - Organic

Slide 22: Summary

Slide 23: Investor Day

Slide 24: Mobility Trends

Slide 25: Vehicle Mobility Trends

Slide 26: Mobility Trends – Key Points

Slide 27: Autonomous Vehicles

Slide 28: Shared Cars and Rideshare

Slide 29: Connected Cars

Slide 30: Efficiency / CO2 Emissions

Slide 31: Summary – Mobility Trends

Slide 32: Investor Day

Slide 33: Combustion

Slide 34: Combustion

Slide 35: Definition – Combustion

Slide 36: Combustion – Key Point #1

Slide 37: Combustion – Key Point #2

Slide 38: Combustion – Key Points #3

Slide 39: Growth and Participation in Combustion

Slide 40: Select Combustion Vehicles with BWA Content

Slide 41: Combustion – Select Customer Awards

Slide 42: Combustion Vehicle Summary

Slide 43: Investor Day

Slide 44: Hybrid

Slide 45: Hybrid

Slide 46: Definition - Hybrid

Slide 47: Definition - Hybrid

Slide 48: Hybrid – Key Point #1

Slide 49: Hybrid – Key Point #2

Slide 50: Hybrid Architecture

Slide 51: Growth and Participation in Hybrid

Slide 52: Select Hybrid vehicles with BWA Products

Slide 53: Hybrid – Select Customer Awards

Slide 54: Hybrid Summary

Slide 55: Investor Day

Slide 56: Electric

Slide 57: Electric

Slide 58: Definition – Electric

Slide 59: Definition - Electric

Slide 60: Electric – Some Key Points

Slide 61: Electric – Some Key Points

Slide 62: Electric Vehicle Forecast

Slide 63: Electric Vehicle Forecast

Slide 64: Electric Vehicle Forecast

Slide 65: Electric Vehicle Forecast

Slide 66: Electric Vehicle Market Influencers

Slide 67: Growth and Participation in Electric

Slide 68: Electric - Select Customer Awards

Slide 69: Electric - Select Customer Awards

Slide 70: Electric Summary

Slide 71: Investor Day

Slide 72: Commercial Vehicle

Slide 73: Commercial Vehicle

Slide 74: Definition – Commercial Vehicle

Slide 75: Commercial Vehicle Key Points

Slide 76: Commercial Vehicle Key Points

Slide 77: Making Commercial Vehicles Efficient

Slide 78: Commercial - Select Customer Awards

Slide 79: Commercial Vehicle Summary