BorgWarner Inc. swung to a net loss of $98 million compared with a gain of $172 million in the year-earlier period as the ongoing COVID-19 pandemic disrupted its global production levels, the company said Aug. 5.
The supplier of turbochargers and electric motors said revenue for the quarter fell 44 percent to $1.43 billion as a result of production slowdowns and shutdowns brought on by the pandemic. BorgWarner's engine-segment sales tumbled 47 percent to $826 million, while drivetrain-segment net sales dropped about 39 percent to $607 million, the company said in a statement.
Shares of BorgWarner rose 4.2 percent to close at $38.72 on Wall Street Aug. 5. The company's results exceeded Wall Street forecasts.
"We met the challenges of managing costs and cash during the production shutdown while ensuring the ability to supply our customers as production resumed," CEO Fred Lissalde said in a call with analysts. "All this was done putting the health and safety of our employees in front."
Lissalde also said that BorgWarner will be building integrated drive modules for Ford's all-electric Mustang Mach-E crossover. The company's "eAxle" iDM technology will power the Mach-E's rear- and all-wheel-drive configurations. The company also will supply the secondary drive unit for the all-wheel-drive GT, he said.
BorgWarner also is on track to close its long-awaited acquisition of Delphi Technologies this year.
BorgWarner updated its 2020 financial guidance since its first-quarter report, when it projected net sales to be $7.25 billion to $8 billion. Full-year operating cash flow was expected to be $530 million to $780 million, and free cash flow was expected to be $100 million to $300 million.
Not accounting for the potential impact from the Delphi acquisition, net sales now are expected to be $8 billion to $8.4 billion if production is not further disrupted. Full-year operating cash flow is expected to be $700 million to $850 million, and free cash flow is expected to be $300 million to $400 million.
The supplier also expects its blended light-vehicle market to fall 22 to 25 percent this year.