BorgWarner Fuel-Efficient Engine and Drivetrain Technology Drive Worldwide Growth

CHICAGO, Nov. 3, 2004 -- BorgWarner Inc. today announced $1.4 billion of expected net new powertrain business for 2005 through 2006, providing growth anticipated to outpace that of the auto industry. As a leading provider of highly engineered engine and drivetrain components and systems to vehicle makers worldwide, the company's new business is expanding most rapidly with automakers including Volkswagen/Audi, General Motors and Hyundai/Kia.

About 66% of the new business is expected to be engine-related products such as turbochargers, engine timing systems, variable cam timing modules and emissions/thermal products. The other 34% is expected in transmission modules and four-wheel/all-wheel drive systems including the company's first to market technology for DualTronic(TM) transmission systems and InterActive Torque Management(TM) systems.

"Over the next three years, our fuel-efficient technology will clearly be a strong growth catalyst for new business as we continue to serve the needs of our global customer base," said Timothy M. Manganello, chairman and chief executive officer, who is presenting the new business outlook today at the 28th Annual Automotive Symposium sponsored by Gabelli & Company. "With BorgWarner's anticipated acquisition of Beru AG, we have strengthened our technology even further, particularly in the expanding diesel market and electronic controls area."

Manganello pointed out that the anticipated growth in BorgWarner's new business, as well as volume increases in existing business with its global customers, positions the company to continue to deliver growth consistent with its past track record. He also noted that in 2006, about 40% of the company's sales are anticipated from the traditional "Big Three" automakers while the remaining 60% will come from other global car and truck makers.

"Our new business is expected to provide balanced growth around the world, even if auto production is flat," said Manganello. "Growth in North America with both the Japanese and domestic automakers accounts for 45% of the new business over the three years. Europe remains our fastest growing market with 34% of our new business. As our expansion in Asia continues, those markets are expected to account for about 20% of our new business by the end of the period," he said.

The company expects significant customer programs during the 2005 through 2007 period to include:

  Engine Group
  -- Next generation passenger car turbochargers in Europe for VW and Audi,
     Renault, PSA, BMW, Ford and Fiat
  -- Turbochargers for light truck programs in North America and commercial
     vehicle programs in Europe and North America
  -- Emissions and thermal products for Asian and European car and truck
     makers and the DaimlerChrysler world engine
  -- Chain-driven timing systems for Honda, Nissan, Hyundai and a Chinese
     OEM, and for the DaimlerChrysler world engine program
  -- Variable cam timing for OEMs in North America

  Drivetrain Group
  -- DualTronic transmission technology for four European programs
  -- Electronic all-wheel drive for a major North American OEM and for
     Hyundai, Honda and a Chinese automaker
  -- Four-wheel drive systems for General Motors and a major European
     automaker

New business programs are expected to yield approximately $400 million in sales in 2005, with the remainder in the next two years. The value will depend on production volumes, launch timing and currency.

BorgWarner Inc. is a product leader in highly engineered components and systems for vehicle powertrain applications worldwide. The company operates manufacturing and technical facilities in 43 locations in 14 countries. Customers include Ford, DaimlerChrysler, General Motors, Toyota, Honda, Hyundai/Kia, Caterpillar, Navistar International, Renault/Nissan, Peugeot and VW/Audi. Investor conferences are webcast at: http://www.bwauto.com/investor_webcasts.html .