BorgWarner Inc. Q2 2008 Earnings Conference Call Transcript

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2008-07-31 11:50:25.0

Tags: Borg Warner Inc.

Question-and-Answer Session

Operator

(Operator instructions) Our first question will come from the line of Brian Johnson with Lehman Brothers.

Brian Johnson – Lehman Brothers

Hey. Questions are more strategic this morning. Can you give us any update on the likely pace through 2009, 2010, and 2011 of turbo rollout in turbocharged gas in the U.S.?

Tim Manganello

What you’re going to see is continued increased penetration of gas turbocharged engines as they come, as they're develop and launched through the U.S. just like you said. I don’t know the whole market, but I can tell you on the BorgWarner side of the equation, we’ll going to be rolling out 22 gas turbocharged vehicle platforms or vehicle engines in the next couple of years. So that’s a pretty healthy rollout plan and pretty healthy launch schedule for gas, and we’re going to have a significant amount of diesels that we would be rolling out. Now, these vehicles maybe start out as European vehicles that are sold in North America and some are maybe North American vehicles that are manufactured by North Americans, but it’s going to be a very healthy penetration of turbocharged gas engines in North America.

Brian Johnson – Lehman Brothers

On the Ford ones in particular, can you clarify which EcoBoost you’re on versus your competitor?

Tim Manganello

Yes, very easily. We are on the high-volume rear-wheel drive 3.5 liter V6 Ford EcoBoost which we’ve been told by Ford will be the high-volume portion of the V6 EcoBoost family.

Brian Johnson – Lehman Brothers

Okay, have they said what platforms they will put that in?

Tim Manganello

Well, I don’t know if they've said it or not, but let’s just say this, it will be replacing V8s, and V8s – there’s a significant amount of V8s used in rear-wheel drive vehicles and so you can pretty much figure out that there’s a – the rear-wheel drive platforms within Ford are significant – mainly passenger car and trucks.

Brian Johnson – Lehman Brothers

Pickups and taxicabs. And is that –?

Tim Manganello

Some SUV – and some SUVs.

Brian Johnson – Lehman Brothers

Right. Is that a move forward of their plans?

Tim Manganello

Well, I know, I can’t tell you what their plans are but I can tell you this, Ford in general is accelerating their focus on fuel-efficient engines. In North America, they are pulling their programs ahead as fast as they can to improve fuel efficiency. And as you already know, they’re moving very quickly. They’re bringing European power trains and European vehicles over to North America to increase their fleet fuel economy average.

 

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