CompanyGraph
BorgWarner Inc.
BWA · NYSE Arca · United States
Makes turbochargers and electric vehicle inverters at one facility in Auburn Hills, where both product lines share the same testing equipment and OEM approvals.
BorgWarner makes turbochargers and electric-drive inverters for cars, and both product lines are built and approved at a single campus in Auburn Hills, Michigan. The inverters run on silicon carbide semiconductors that take 18 months to validate for each vehicle — a Mercedes EQS inverter has to be tested alongside Mercedes engineers using Mercedes thermal data, so once that process is done, Mercedes cannot simply move to another supplier without starting the clock again from scratch. The turbocharger line shares the same high-temperature test chambers, the same certified engineers, and the same OEM approval history, which means Auburn Hills is not just a factory but the only address where all of those approvals legally live. That concentration is also the company's single point of fragility: if Auburn Hills goes offline, Ford, Mercedes, and Stellantis each lose their only certified source for components they cannot substitute within 48 hours.
How does this company make money?
Most revenue comes from selling components to automakers — Ford, Mercedes, Stellantis — under multi-year platform contracts where the price is locked in during the vehicle's development phase. The company also sells replacement parts through distributors at higher margins than the original production parts. A third stream comes from charging automakers for engineering consulting work during the transition from combustion powertrains to electric ones.
What makes this company hard to replace?
An OEM that wanted to move to a different inverter supplier would have to run 18 months of revalidation because the coolant flow algorithms are written specifically for each vehicle's thermal management system and are not transferable. The battery management system software embedded in control modules is tied to OEM-specific protocols, so switching suppliers would require full vehicle recertification. Turbocharger actuators are programmed to each platform's CAN bus communication standard, meaning a replacement part from another supplier would not simply plug in and work.
What limits this company?
The company can only build as many inverters as Wolfspeed and STMicroelectronics deliver silicon carbide wafers, and those deliveries are fixed on 26-week lead times. Standard silicon cannot do the job at 800V automotive voltages, so there is no substitute material. Each wafer batch is already committed to a specific vehicle platform's approved design, meaning a shortfall on one program cannot be quietly shifted to another without starting an 18-month revalidation from scratch.
What does this company depend on?
The company cannot run without silicon carbide wafers from Wolfspeed and STMicroelectronics, vanadium steel alloys for turbocharger turbine wheels rated to survive 1,000°C exhaust temperatures, lithium-ion battery cells from CATL and LG Energy Solution, automotive-grade microcontrollers from Infineon and NXP, and active ISO 26262 functional safety certification covering all electronic control units.
Who depends on this company?
Ford's F-150 hybrid production lines would stop within 48 hours if eBoosters for the 3.5L PowerBoost engine stopped arriving. Mercedes-Benz's EQS assembly plant in Sindelfingen requires the company's specific 800V inverters and has no alternative supplier that integrates with the EQS thermal management system. Stellantis's 8-speed automatic transmissions depend on friction plate modules that carry proprietary clutch engagement software no other supplier holds.
How does this company scale?
Turbocharger housing casting and battery module assembly can be replicated at other facilities using standardized tooling and robotic welding systems, so those parts of the business can grow without adding unique infrastructure. Silicon carbide inverter work cannot follow the same path — every new vehicle platform requires custom electromagnetic interference testing and thermal cycling validation that must happen next to the OEM's own integration team, which is why that work stays anchored to Auburn Hills and Stuttgart no matter how large the order book grows.
What external forces can significantly affect this company?
The European Union's 2035 ban on new internal combustion engines is pushing demand away from turbochargers and toward inverters faster than production capacity can shift. China's restrictions on lithium exports, combined with the concentration of battery mineral processing around Ganzhou, push up the cost of battery modules. The U.S. Inflation Reduction Act's domestic content rules are forcing the company to move semiconductor assembly work back from Asia-Pacific facilities to qualify for incentives.
Where is this company structurally vulnerable?
If the Auburn Hills campus went offline — from a fire, a prolonged power outage, or physical damage to the shared test chambers — every active OEM approval would be voided at the same moment. Ford could not find replacement eBoosters within 48 hours. Mercedes could not re-source EQS inverters without 18 months of revalidation at a different site. Stellantis would lose the only certified production source for its transmission modules. Three separate vehicle assembly lines would stall because all of their approvals live at one address.
Supply Chain
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Automotive Supply Chain
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