Issue: Mar 2006


BorgWarner Expands Ningbo, China Operations to Support Growing Asian Demand



by Alan Tran

BorgWarner has opened a new operation in Ningbo, China for the assembly of turbochargers and transmission solenoids. The manufacturing facility is the first of several operations planned for a campus that comprises BorgWarner Automotive Components (Ningbo) Co., Ltd., the company's wholly foreign-owned enterprise in the Ningbo Yinzhou industrial zone. A new office building there houses employees of BorgWarner Turbo & Emissions Systems, BorgWarner Morse TEC and BorgWarner Transmission Systems, as well as a Shared Services group of finance, information technology and human resources professionals who will support all of BorgWarner's business units in China.

"This new facility marks another milestone in the advancement of our growth strategy for Asia," said Tim Manganello, BorgWarner Chairman and CEO. "More countries are adopting European emissions standards for fuel economy and air quality, and they need advanced powertrain technologies in order to meet them," Manganello said. "We expect a five-fold increase in our sales in China alone over the next five years. We are taking steps to ensure that we are well-positioned to take full advantage of this growth."

In addition to this enterprise, BorgWarner operates three joint ventures in China. The first was formed in 1993 to supply transmission products to Beijing Jeep. That business was restructured in 2000 to focus on four-wheel drive/all-wheel drive products. A second joint venture, also in Ningbo, was formed in 1998 for the production of thermal products. The company is also a 50%-owner of transmission products-maker NSK-Warner, which also opened a new plant in Shanghai this month. BorgWarner opened a corporate office in Shanghai in November 2004.

Customers who will be served by the new Ningbo operation include China National Heavy Duty Truck (Sino Truck), VW/Audi, FAW, and Yulin Diesel. Eventually, it is expected that most of the Chinese OEMs and engine makers will be supplied from this plant with turbochargers, emissions systems, timing chain systems and transmission controls.

In late 2005, BorgWarner announced $1.6 billion in expected new business between 2006-8, 15% of which is expected in Asia. About 18% of BorgWarner's global sales, including unconsolidated joint ventures, were in Asia in 2005, driven by customer needs in fuel efficiency, emissions reduction, vehicle stability and demand for advanced technology.

Auburn Hills, Michigan-based BorgWarner Inc. (NYSE:BWA) is a product leader in highly engineered components and systems for vehicle powertrain applications worldwide. The company operates manufacturing and technical facilities in 62 locations in 17 countries. Customers include Ford, VW/Audi, DaimlerChrysler, General Motors, Toyota, Renault/Nissan, Hyundai/Kia, Honda, BMW, Caterpillar, Navistar International, and Peugeot. The Internet address for BorgWarner is: http://www.borgwarner.com/ .


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