BorgWarner expects compound annual sales growth of 45% in China until at least 2014 as it expands there, its chief executive has said.
BorgWarner , like rival supplier ArvinMeritor, has projected strong growth in China where government policy incentives and a strong economy drove vehicle sales to record highs in 2009 as the global industry suffered a steep downturn.
“From 2000 to 2009 we had a 45% compound annual growth rate. We will see that growth rate at least through 2014,” Timothy Manganello told Reuters in Shanghai.
BorgWarner , which set up its first manufacturing venture in China 17 years ago, now generates roughly 12% of its global sales there.
Manganello expected the ratio to rise to more than 15% four years from now, or over half of its sales at that time in Asia, where the supplier also has operations in Japan, South Korea and India.
“All of Asia will be 30% plus or minus, maybe on the plus side. And China will be probably a little bit over half of that,” he said. “It’s a growing percentage of a growing piece of the pie.”
Asia made up 23% of the firm’s global sales in 2009.
Its focus on components that can improve fuel economy and performance has placed it in a growth area of the auto industry.
Some of BorgWarner ‘s Chinese products are sold to foreign automakers’ local manufacturing joint ventures but a growing portion is supporting indigenous players such as SAIC Motor , FAW Group and Chery Automobile , Manganello said.
Manganello said BorgWarner was little affected by the controversial undervalued yuan issue but declined to comment further.
“As long as I continue to manufacture and sell in China, the currency doesn’t affect me one way or the other,” he said.
“I will let that debate go between the politicians.”