CEO of car supplier BorgWarner told CNBC on Friday that the company expects to have about 50% of its revenue linked to electric vehicles over the next decade.
Currently, less than 3% of Michigan-based sales are related to electric vehicles.
“Our assumption is that 30% of the vehicle will be battery-powered by 2030. It’s already 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 in “Mad Money.”
BorgWarner’s drive to grow its electric vehicle business is in line with the moves made in the automotive industry. A number of electric vehicle launches have hit public markets in recent months and established titles such as General Motors and Ford have announced aggressive efforts to move away from internal combustion engines.
GM plans to offer electric vehicles exclusively in 2035, the company announced earlier this year, and become carbon neutral in 2040. In February, rival Ford City revealed its intention to nearly double its investment. in electric vehicles until 2025.
BorgWarner manufactures automatic transmissions and turbochargers, among other products. Both Ford and GM are customers, as are Volkswagen and Stellantis, which manufacture Jeep and Dodge vehicles.
BorgWarner is investing heavily to grow its electric vehicle business and plans to invest approximately $ 8 billion in the effort by 2025, according to Lissalde to Cramer: “We are self-financing this pivot.”
“This is moving towards electrification. We think at BorgWarner it’s really deep. It’s going at different speeds and different regions, but it’s deep. In both light and commercial vehicles,” he added.
Shares of BorgWarner rose 4.7% on Friday to close at $ 45.74 each. Shares have risen more than 18% to date and about 83% in the last twelve months.