The CEO of auto supplier BorgWarner told CNBC on Friday the company hopes to have nearly 50% of its revenues be tied to electric vehicles within the next decade.
Currently, less than 3% of the Michigan-based firm’s sales are related to EVs.
“Our assumption is that 30% of the vehicle will be battery electric in 2030. It’s already kind of a bullish assumption. Our assumption is that we’ll be at 45% of our revenue,” CEO Frederic Lissalde said in an interview with Jim Cramer on “Mad Money.”
BorgWarner’s push to grow its EV business is in line with the moves made across the automotive industry. A range of electric-vehicle start-ups have hit the public markets in recent months, and established titans like General Motors and Ford have announced aggressive efforts to move away from internal combustion engines.
GM plans to exclusively offer EVs by 2035, the company announced earlier this year, and to become carbon neutral by 2040. In February, crosstown rival Ford revealed intentions to almost double its investment in EVs through 2025.
BorgWarner makes automatic transmissions and turbochargers, among other products. Both Ford and GM are customers, as are Volkswagen and Stellantis, which makes Jeep and Dodge vehicles.
BorgWarner is investing heavily to grows its EV business and plans to spend roughly $8 billion on the effort between now and 2025, Lissalde told Cramer: “We’re self-funding this pivot.”
“This moves towards electrification, we think at BorgWarner that is really profound. It goes at different speed and different region but it’s profound. Both in light vehicle and in commercial vehicle,” he added.
Shares of BorgWarner rose 4.7% Friday to close at $45.74 apiece. The stock is up more than 18% year to date and roughly 83% in the past 12 months.