AUBURN HILLS, Mich. - BorgWarner Inc. (NYSE: NYSE:BWA), a global product leader in clean and efficient technology solutions for combustion, hybrid, and electric vehicles, has announced a leadership change with Joseph Fadool set to take the helm as President and CEO, succeeding Frédéric Lissalde, who will retire on February 6, 2025. The company's board approved the succession plan, promoting Fadool, currently the Executive Vice President and Chief Operating Officer, to lead the company into its next phase.
Lissalde will remain in an advisory capacity until August 30, 2025, to ensure a smooth transition. During his tenure, Lissalde has been credited with reshaping BorgWarner's product portfolio and positioning the company to lead in the transition to electrified vehicles. His leadership has been praised for instilling a culture of innovation and customer focus at BorgWarner, which is expected to continue under Fadool's stewardship.
Fadool, who joined BorgWarner in 2010, has held various top positions within the company and has been instrumental in developing its technology-focused product portfolio and operations. His experience includes roles as President and General Manager of several BorgWarner business units, and prior to BorgWarner, he held positions at Continental Automotive Systems and Ford Motor Company (NYSE:F). Fadool's appointment is seen as a strategic move to maintain operational excellence and drive value creation for stakeholders.
The transition comes at a time when BorgWarner is navigating the automotive industry's shift towards electrification, with a product portfolio that supports this transition. The company believes that its focus on innovation, customer-centric culture, and strong operating model will continue to yield favorable business results.
BorgWarner has a history of over 130 years of industry innovation and is committed to sustainable mobility. The company's forward-looking statements involve risks and uncertainties, including market demands, technological changes, and global economic conditions, which could materially affect actual results.
This leadership announcement is based on a press release statement from BorgWarner.
In other recent news, BorgWarner has reported a solid Q3 performance with organic sales surpassing $3.4 billion, despite a 5% year-over-year decline. The company managed to outperform the market, which saw a 6% decrease, and strengthened its adjusted operating margin to 10.1%. This contributed to an increase in earnings per share (EPS) to $1.09. BorgWarner also announced the completion of a $400 million stock repurchase program and projected a positive outlook for the full year, forecasting sales between $14.0 billion and $14.2 billion and an adjusted EPS of $4.15 to $4.30.
The company's battery segment sales grew by 36%, with the goal to break even as it scales. BorgWarner also plans to deploy $475 million to $575 million in free cash flow, primarily through share repurchases and dividends. Despite concerns about potential recoveries from OEMs due to EV program cancellations, BorgWarner remains focused on managing costs effectively and adapting its production processes for electrification.
These recent developments highlight BorgWarner's resilience in a challenging market and its strategic focus on cost management, new product awards, and a strong performance in the battery segment. Without making predictions, these factors suggest that BorgWarner is poised to maintain profitability and continue its market outperformance into the next fiscal year.
InvestingPro Insights
As BorgWarner Inc. (NYSE: BWA) prepares for this significant leadership transition, InvestingPro data provides additional context to the company's current financial position and outlook.
BorgWarner's market capitalization stands at $7.62 billion, reflecting its substantial presence in the automotive technology sector. The company's P/E ratio of 8.79 suggests that it may be undervalued relative to its earnings, which aligns with an InvestingPro Tip indicating that BWA is "trading at a low P/E ratio relative to near-term earnings growth." This could be particularly relevant as the company navigates the transition to new leadership and continues its focus on electrification technologies.
Despite the challenges of industry transformation, BorgWarner has demonstrated financial resilience. An InvestingPro Tip notes that the company "has maintained dividend payments for 12 consecutive years," which may reassure investors during this period of change. Additionally, with a current dividend yield of 1.26%, BWA offers a modest income stream to shareholders.
The company's financial health appears solid, with another InvestingPro Tip highlighting that "liquid assets exceed short-term obligations." This financial stability could provide the incoming CEO, Joseph Fadool, with the flexibility needed to execute strategic initiatives and continue the company's trajectory in clean and efficient technology solutions.
It's worth noting that InvestingPro offers 9 additional tips for BWA, providing a more comprehensive analysis for investors interested in deeper insights during this transitional period. These additional tips could be particularly valuable as the market assesses the potential impact of the leadership change on BorgWarner's future performance and strategic direction.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.