eProducts revenue was approximately $506 million for the three months ended March 31, 2024, compared to $415 million for the three months ended March 31, 2023. eProducts now represent 14% of total revenue, up from 12% in the prior year.

The Company maintains a positive long-term outlook for its global business and is committed to new product development and strategic investments to enhance its product leadership strategy. There are several trends that are driving the Company's long-term growth that management expects to continue, including adoption of product offerings for electrified vehicles and increasingly stringent global emissions standards.

On December 1, 2023, the Company completed its acquisition of the electric hybrid systems business segment of Eldor Corporation. The Company expects the acquisition to complement its existing ePropulsion product portfolio by enhancing the Company's engineering capabilities.

In 2023, the Company announced a $130 million to $150 million restructuring plan to address structural costs primarily in its Foundational products businesses. During the three months ended March 31, 2024, the Company recorded $19 million of restructuring costs related to this plan.

As a result of executing its strategy, the Company expects that, by 2027, it will achieve over $10 billion in annual eProduct sales, deliver eProduct adjusted operating margin of approximately 7% and maintain its double-digit adjusted operating margin for its Foundational products portfolio.

The Company maintains a positive long-term outlook for its global business and is committed to new product development and strategic investments to enhance its product leadership strategy.

During the three months ended March 31, 2024, there have been no material changes from the risk factors disclosed in the Company's Annual Report on the Form 10-K for the year ended December 31, 2023.

In the normal course of business, the Company is party to various commercial and legal claims, actions and complaints, including matters involving warranty claims, intellectual property claims, governmental investigations and related proceedings, general liability and other risks.

The Company and certain of its current and former direct and indirect corporate predecessors, subsidiaries and divisions have been identified as potentially responsible parties at various hazardous waste disposal sites under the Comprehensive Environmental Response, Compensation and Liability Act.

However, the Company expects net new business-related sales growth, due to the increased penetration of BorgWarner products, including eProducts, to drive a sales increase despite flat or decreased market production.

There are several trends that are driving the Company's long-term growth that management expects to continue, including adoption of product offerings for electrified vehicles and increasingly stringent global emissions standards that the Company believes support demand for the Company's products that drive vehicle efficiency.

The ePropulsion segment's net sales decreased $51 million, or 10%, and Segment Adjusted Operating Loss increased $27 million from the three months ended March 31, 2023... The decrease excluding these items was primarily due to approximately $47 million of a reduction in volume, mix and net new business driven by decreased demand for the Company's light vehicle eProducts in North America.

In 2023, the Company announced a $130 million to $150 million restructuring plan to address structural costs primarily in its Foundational products businesses. During the three months ended March 31, 2024, the Company recorded $19 million of restructuring costs related to this plan.

The resulting gross savings related to this plan are expected to be in the range of $80 million to $90 million annually by 2027 and are being utilized to sustain overall operating margin profile and cost competitiveness.

As a result, the Company expects a trend of slight increasing or flat costs.

Research and Development ("R&D") costs increased by $21 million. R&D costs, net of customer reimbursements, were 5.2% of net sales for the three months ended March 31, 2024, compared to 4.9% of net sales for the three months ended March 31, 2023. The increase in R&D costs, net of customer reimbursements, was primarily due to increasing net investment related to the Company's eProduct portfolio.

The Company expects global market production to be flat or to decrease modestly year over year in 2024.

The Company maintains a positive long-term outlook for its global business and is committed to new product development and strategic investments to enhance its product leadership strategy.

In November 2023, the Company's Board of Directors authorized the purchase of up to $544 million of the Company's common stock, which replaced the previous repurchase authorization. In April 2024, the Company's Board of Directors authorized the purchase of up to $767 million of the Company's common stock, which replaces the previous authorization.

As of March 31, 2024, the Company had repurchased $277 million of common stock under this repurchase program.

On February 7, 2024 and April 24, 2024, the Company's Board of Directors declared quarterly cash dividends of $0.11 per share of common stock, respectively.

The Company and certain of its current and former direct and indirect corporate predecessors, subsidiaries and divisions have been identified as potentially responsible parties at various hazardous waste disposal sites under the Comprehensive Environmental Response, Compensation and Liability Act.

The Company had an accrual for environmental liabilities of $5 million as of March 31, 2024.

There are several trends that are driving the Company's long-term growth that management expects to continue, including adoption of product offerings for electrified vehicles and increasingly stringent global emissions standards that the Company believes support demand for the Company's products that drive vehicle efficiency.

The Company expects global market production to be flat or to decrease modestly year over year in 2024.

Prices for commodities have started showing a lower level of volatility in comparison to what the Company had experienced from the beginning of 2021.

At the same time, many economies, including the United States, are still experiencing elevated levels of inflation, which continues to put pressure on other input costs.