The CEO of car supplier BorgWarner told CNBC on Friday that the company hopes that almost 50% of its revenues will be related to electric vehicles in the next decade.
Currently, less than 3% of Michigan company sales are related to electric vehicles.
“Our assumption is that 30% of the vehicle will be battery-powered by 2030. It’s already a hypothetical assumption. Our assumption is that we will be at 45% of our revenue,” said CEO Frederic Lissalde in an interview with Jim Cramer on “Crazy Money.”
BorgWarner’s pressure to grow its EV business is in line with the moves made in the automotive industry. A number of electric vehicle start-ups have hit public markets in recent months, and established titans such as General Motors and Ford have announced aggressive efforts to move away from internal combustion engines.
GM plans to offer exclusively electric vehicles by 2035, the company announced earlier this year, and to become carbon neutral by 2040. In February, rival Ford in Crosstown revealed its intentions to double almost investment in electric vehicles by 2025.
BorgWarner makes automatic transmissions and turbochargers, among other products. Both Ford and GM are customers, as are Volkswagen and Stellantis, which produce Jeep and Dodge vehicles.
BorgWarner is investing heavily to grow its EV business and plans to spend about $ 8 billion on the effort from now until 2025, Lissalde told Cramer, “We are self-financing this pivot.”
“This is heading towards electrification, we believe that at BorgWarner it is very deep. It is going at different speeds and regions, but it is deep. Both in light vehicles and in commercial vehicles,” he added.
Shares of BorgWarner rose 4.7% on Friday to close at $ 45.74 a piece. The stock has grown by over 18% so far and about 83% in the last 12 months.