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Automotive News World CongressJanuary 17, 2006

“It’s not all that bad.”A look at the flip side of the coin

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Company OverviewFocused on Powertrain Systems

Drivetrain

Engine

•2005E Sales

•Employees

•Operations

•Growth Drivers

•1987 LBO

~$4.3 Billion

17,500

61 Locations17 Countries

Fuel EconomyPerformanceAir QualityVehicle Stability

Restructured/Refinanced and went public again in 1993

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100

200

300

400

500

1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

Gro

wth

In

dex

BorgWarner13.1%

North American Production1.3%

Global Production3.3%

Sustainable Long Term GrowthBorgWarner Sales CAGR vs. Auto IndustryProduction CAGR

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Technology FocusFuel

Efficiency Performance EmissionsVehicle Stability

Engine Group

Electronic Controls + + + + + + + + + + + +

Turbochargers + + + + + + + +

Variable Cam Timing + + + + + + + + +

Smart Thermal Systems + + + + +

Beru Ignition Technology + + + + + + +

Exhaust Gas Recirculation + + + + +

Timing Chain Systems + + + + + +

Drivetrain Group

Electronic Controls + + + + + + + + + + + +

DualTronic™ + + + + + + + +

Traditional 6-Speed Automatics + + + + +

ITM™ (FWD-based)** + + + + + + +

Torque on Demand™ (RWD)** + + + + + + +

*Technologies rated individually relative to benefits **Relative to passive AWD

*

5

18%

40%

42%

Asia

Europe

Americas

Customer and Geographic Diversity

* Includes Beru and NSK Warner

Hyundai/Kia 6%

Renault/Nissan 7%

VW/Audi 12%

GM 8%

DCX 12%

Toyota 7%

BMW 2%

Honda 3%

PSA 2%

Caterpillar 2%International 2%

ZF 1%

John Deere 1%

All Others 21%

Ford 14%

2006 Projected Revenue by Customer*

2006 Projected Revenue by Region*

Detroit Big 3 approximately 22% of total 2006 projected revenue

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Europe: 55%Europe: 55%

VW/AudiVW/Audi•TurbochargersTurbochargers•DualTronicDualTronicTMTM

•Transfer casesTransfer cases

GM, Ford, PSA, GM, Ford, PSA, Renault/NissanRenault/Nissan•TurbochargersTurbochargers•SynchronizersSynchronizers

BMWBMW•TurbochargersTurbochargers

European OEMsEuropean OEMs•DualTronicDualTronicTMTM

Asia: 15%Asia: 15%

HyundaiHyundai• Transfer casesTransfer cases• TurbochargersTurbochargers• Transmission Transmission

componentscomponents

Chinese OEMsChinese OEMs• TurbochargersTurbochargers• Engine timingEngine timing• Transfer casesTransfer cases

Japanese OEMsJapanese OEMs• Engine timingEngine timing• TurbochargersTurbochargers

Americas: 30%Americas: 30%

InternationalInternational• TurbochargersTurbochargers

GMGM• Transfer casesTransfer cases• Variable cam timingVariable cam timing• Transmission componentsTransmission components DaimlerChryslerDaimlerChrysler• Transmission modules and Transmission modules and

componentscomponents• AWD systemsAWD systems• Engine timingEngine timing

John DeereJohn Deere• TurbochargersTurbochargers

ToyotaToyota• Engine componentsEngine components• Transmission componentsTransmission components

$1.6 Billion of New Business$1.6 Billion of New BusinessExpected value based on Fall 2005 forecasts; includes BeruExpected value based on Fall 2005 forecasts; includes Beru

Demonstrable Future Growth New Business 2006 thru 2008

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7.5%

6.1%

9.2%8.8% 8.8% 8.7%

2000 2001 2002 2003 2004 9 mos. ending Sept. 30, 2005*

Operating Margins

*Excludes charge related to the anticipated cost of settling all Crystal Springs-related alleged environmental contamination personal injury and property damage claims, income associated with divestitures and the immediate write-off of the excess purchase price associated with Beru’s in-process R&D. Including these items, operating margin in the first nine months of 2005 was 7.2%

Maintaining ProfitabilityPredictability of Earnings

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11.9%

8.8%

11.5%

12.3%

13.1% 13.0%

2000 2001 2002 2003 2004 Q3 2005

Return on Invested Capital*

* Rolling four quarters

Generating Investment Returns“Financial Discipline”

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Financial StrengthInvestment Grade Balance SheetPre- and Post- Q1 2005 Beru Acquisition

9/30/2005 12/31/2004

Cash and cash equivalents $140 $230

Total debt 801 585Total equity 1,626 1,534Total capital 2,426 2,119

Debt to capital ratio 33.0% 27.6%

$ in Millions

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Auto Sector ReturnsGood Place to Invest?

50

100

150

200

250

300

350

2000 2001 2002 2003 2004 2005

Ind

exed

Val

ue

BWA

Proxy Peer Group

S&P 500

Total returns assuming dividends are re-invested during the period shown

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BorgWarner Difference• Superior, Sustainable Sales Growth

Through Technology Leadership

• Customer and Geographic Diversity

• Maintaining Profitability/ Predictability of Earnings

• Generating Investment Returns/ Financial Discipline

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Forward-Looking StatementsStatements contained in this presentation may contain forward-looking statements as contemplated by the 1995 Private Securities Litigation Reform Act that are based on management's current expectations, estimates and projections. Words such as "expects," "anticipates," "intends," "plans," "believes," "estimates," variations of such words and similar expressions are intended to identify such forward-looking statements. Forward-looking statements are subject to risks and uncertainties, many of which are difficult to predict and generally beyond the control of the Company, that could cause actual results to differ materially from those expressed, projected or implied in or by the forward-looking statements. Such risks and uncertainties include: fluctuations in domestic or foreign automotive production, the continued use of outside suppliers by original equipment manufacturers, fluctuations in demand for vehicles containing the Company's products, general economic conditions, as well as other risks detailed in the Company's filings with the Securities and Exchange Commission, including the Cautionary Statements filed as Exhibit 99.1 to the Form 10-K for the fiscal year ended December 31, 2004. The Company does not undertake any obligation to update any forward-looking statement.