All right. Thanks, Edison. Good morning, everybody, or I should All right. Thanks, Edison. Good morning, everybody, or I should All right. Thanks, Edison. Good morning, everybody, or I should say good afternoon. Just wanted to get you up to speed. Is this working okay? Seems very loud from my perspective. You're good. Okay. I just want to get everybody in the room up to speed on what's been going on at BorgWarner and what we're focused on. First, I'll start with we've had a really strong first quarter. Just to give you some numbers, our first quarter results, we saw strong outgrowth, about almost 4% above industry production. We saw great outgrowth on both sides of our portfolio, our e-product portfolio, as well as the foundational side of our portfolio. Operating margin came in quite strong at about 10%. We had really strong free cash flow, about $270 million above prior year. Every metric that we looked at, really strong start to the year, set us up quite well to execute our guidance for the full year. As we think about tariffs, because that's obviously a big headline right now, when we came out with our April guide, we shared publicly that tariffs were going to be about a 1.6% impact as a percentage of sales. So 1.6% as a percentage of sales. We were in the process of trying to mitigate those tariffs, as well as our expectation was 100% recovery from our customers. The good news is we've seen that number come down really for two reasons. First, our teams have done a fantastic job finding creative solutions to mitigate those tariffs. That's been a nice action that we've taken to reduce that exposure. The other big item is executive orders have changed on us, and that's taking that number down as well. We'll give a further update in July, but that number is less of a risk for us as we move forward. We're engaged with all of our customers, working actively with them to effectively recover that tariff, but that is in process as we speak. Tariffs are certainly not in our control, but industry production, I would say, as we sit here today, is our biggest concern. Where we're concerned is in the U.S. with tariff headwinds, does that have an impact on industry production in Q3 and Q4? Right now, we're not seeing that, but that's one of our risks as we look out for the rest of the year. Effectively, as we sit here, we're focused on what can BorgWarner control, and it's really focused on three areas. We need to continue to outgrow industry production, turn that outgrowth into income, drive EPS up, drive operating income higher, and deliver strong free cash flow that we can deploy responsibly through share buybacks, through dividends, and through inorganic investments through accretive M&A. With that, I'll turn it back over to you. Thank you. We'll certainly hit on several of those topics as we progress along. Wanted to start with what you're seeing on the ground, perhaps by region. You mentioned that it's mainly a second half, probably a risk. If we look at North America, obviously, that's front and center for the tariffs. Has that been kind of playing out in line with expectations? Yeah, I think we're pleasantly surprised. If you go back to the start of the year and think about what was the expectations from a market perspective, we expected the market to be down 1-3% globally. In April, we increased that to 2-4% down. Why? North America. We were concerned about industry production in the back half of the year because of tariffs and the impact tariffs may have on industry production. As we sit here today, Q2 remains strong, similar to Q1 levels, but we only have visibility six to eight weeks out. It is a little too early to see what the impact may be in Q3 and Q4. We're watching it every day. The good news is volumes are holding up in North America as we sit here through the second quarter. Has the visibility improved a bit now that we do have a little bit of macro policy stability? Is that getting a bit easier to kind of deal with the OEMs on that front? I think clarity is always helpful. Anytime we have clarity, that's certainly helpful. We are going to have to see how it plays out. Fundamentally, it's just how will the consumer be impacted by higher prices potentially, and will that somehow impact demand in the third quarter and fourth quarter? One ask on Europe. What's the latest you're hearing about the emissions situation or the impact of that? Also, I think we've heard just in recent weeks about some callouts relatively related to rare earths. I don't know if that's meaningful at all, but. Yeah. From a rare earth perspective, our main exposure is magnets. We use magnets on both sides of our portfolio, on the e-product side of the business and also the foundational side of the business. A lot of those magnets come from China. We are actively submitting applications. In fact, all of our applications are with the Chinese government, and they are getting approved, but it is taking a little bit of time. Every week we get an update, and every week it gets progressively better. The good news is that we are working with our OE partners as well. It is not just us acting on our own. A good example is we are providing a product to BMW, and we need a magnet for that product. If we are not getting approval, we are calling BMW and asking for their support. We're acting as a team to try to resolve this issue. I don't have all the details of the executive order that was discussed last night, but it sounds like that was one of the items that was hopefully resolved. That's hopefully good news for us. I would say overall, Europe volumes have held up quite well, which was nice as we executed Q1 and into Q2. What's interesting is the clarity that was provided on the regulations and the averaging for emissions standards. For us, we've seen really strong demand for our e-products. What we're waiting to see with that averaging is if there will be more demand for our foundational products. It makes logical sense that there will be, but we're waiting to see that. Closing the loop on China, I know your local mix is already very high, especially for U.S., probably the highest. Industry volumes have been very strong here to date. Given you have such high mix to who's growing there, could this be maybe a better tailwind for you going forward? Yeah. I mean, you're right. Our exposure in China is very diverse. I mean, our exposure to the local OEMs is about 75% of our revenue there. China is about 20% of our overall revenue. So China locals in China is about 15% of our overall revenue. When you look at that breakdown of who we're playing with, the customers, the top six OEMs, China locals represent about 70% of that share of that business. China is a strength for us in terms of our business. We saw nice performance in the business in the first quarter, some modest outgrowth. We're seeing really strong outgrowth in terms of both on the e-product side of our business as well as on the foundational side of our business. Higher level, I wanted to ask, you're obviously a leading player in powertrain. In the U.S., we kind of get maybe perhaps too negative on BEV adoption and EV adoption. Given that you have this kind of more worldly view, what are you kind of seeing from customers in Europe and maybe in China in their efforts on whether it's hybrid and on BEV? Yeah. So you're right. I mean, the one thing that's clear is the adoption rates of electrified vehicles are going to vary widely by the various regions. If you look at China, clearly growing the fastest, it's going to be about a third of that market this year is going to be pure BEV. Then you add on plugins and REVs, and you obviously get to a higher number in terms of NEVs. Europe, we're still seeing strong growth there. We're launching a lot of businesses this year, and that's gone pretty much, I would say, as planned in terms of timing. The one thing that we've changed I think will slow Europe a little bit is the change in the regulations. It's now an average over three years versus the OEMs needing to get to a certain level this year, but still good adoption rate on the electrification side. The area where we think electrification is going to grow a little bit slower is in North America. I don't think that's a surprise to anyone in the room, but that's okay. How we've designed our portfolio is we want to outgrow overall. What that fundamentally means is we want what we call our foundational businesses to outgrow combustion plus hybrid volumes, which will be more like what North America will look like. We want our e-products businesses to outgrow hybrid + electric volumes, which will be stronger in China and Europe, like I just talked about. As long as we're doing that, we'll outgrow the overall market. Because the one thing that we know for sure is that predictions will be wrong in terms of penetration. So we're really driving the business to outgrow on both sides, so we outgrow overall. In North America, is there kind of a stealth opportunity with turbos as we think about if emissions do get kind of or BEVs get kind of less popular and not as popular? Is there kind of stealth opportunity there? I do not think I would call it stealth, but I think when you look at opportunities that we see in North America, I think there are two things going on. I think we are starting to see an increasing amount of foundational or combustion awards on our foundational products. You have seen that the past several quarters, not only in North America, but certainly stronger in North America. This last quarter, we actually announced two e-product awards in North America, but on hybrid vehicles. I think that there is an opportunity both for the foundational side of our business in North America, but if there are hybrids in North America, that would be an opportunity for the e-products here as well. We love hybrids. It pulls from both sides of our portfolio, higher content per vehicle. That is a great solution for the market and a great tailwind for BorgWarner. That's a great pivot to or a great segue to hybrids. It seems there's kind of two flavors of it. You have the PHEV, and then you have the EREV, which is essentially, I think, basically only popular in China right now. What's the future of those types of powertrains in the U.S. and in Europe? Advanced hybrids, I think you should think about, have been with the industry for a while. We see plug, the way that we think about it, whether it's a plug-in or it's an REV, it's an advanced hybrid, like hybrid that you're plugging in. And those vehicles, we've already seen growth in those vehicles both in China, and you're starting to see them in Europe. There's actually a couple that are coming in North America. Is it REV? Is it plug-in? We don't lose a lot of sleep on that, but advanced hybrids, more high-voltage hybrids are where we think we'll be stronger. Can you give us some context on the content that you would have on these? Sure. If you think I'll take two ends of the spectrum to start, and then I'll talk about hybrid fills in the middle. If you look at our addressable content per vehicle on a combustion vehicle, it's in that $550 range, actually slightly higher. Our addressable content on a BEV is just under $2,600 per vehicle. That excludes battery packs because we do that just for a commercial vehicle. Our hybrid opportunity is similar to that full BEV opportunity, but it's more of a mix. There's a mixture of e-products that are only on BEVs, and there's a mixture of the foundational products. That's when Craig said it's a nice opportunity for us. It's going to pull from both sides of our portfolio. Understood. Understood. Let's go a little bit more into the numbers. Your growth above market, how do we think about the drivers going forward? In particular, I kind of alluded to this earlier, turbochargers, e-turbos seem to be kind of maybe underappreciated aspect of that. What are the key drivers on growth above market in the next few years? Yeah. So when you think about that, and when you think about turbos as an example, what's our goal? Our goal, like Pat spoke about, was outgrow that industry. That industry is combustion plus hybrid vehicles. We're seeing a nice pull because of that. Because the world still needs efficient propulsion engines around the world, whether that's in Europe, whether that's in North America, where penetration can still rise. We're seeing a nice win. Some of the product wins that we've announced and Pat just mentioned are good examples, good proof points that the world still needs efficient engines. We're seeing a nice pull, not just on turbos, but on all-wheel drive products, VCT products. We're number one or number two in all of those products across the world. Customers need our solutions to drive those more efficient engines. In terms of how much the business is ICE or gasoline today, can you walk us through the layers of the foundation business? And kind of what's within that? What are the% takes? What are the key drivers? What's kind of a little bit weaker? It's about 83% of our revenue last year was on the foundational side of our business, 17% on the e-product side of our business. We see e-products continue to grow in the future as adoption rates rise, but there's still a need for these foundational products for years to come. We see that being pulled from around the world, whether it's in Europe. Even in China, we're seeing some of our products still being adopted. Again, the world needs more efficient engines, and we're a leader in all of these spaces: turbochargers, all-wheel drive products, VCT products, transmission systems. These are all things that we provide. Again, we're number one or number two in the market. Customers are coming to us to look for those solutions. Given that you are, this is slightly unrelated to financials, but just thought it just occurred to me. Given that you are number one or number two, I guess, what's the outlook for market share, the level of competition going forward? Are your competitors sort of backing off, or did they back off a lot a couple of years ago, and now they're kind of coming back? How are you seeing the level of investment from the competition? Yeah. I mean, what we see is as the market declines, which inevitably will, it's going to be harder for those small players to compete. And because of our scale, because of our expertise, because we have significant market share, does our market share rise over a period of time because those players just drop out? They can't be profitable, but we can. That's what we think. We think there'll be a little bit more consolidation, and we think it can happen organically versus inorganically. We're really focused on extensions, conquest business, et cetera, and we're seeing nice wins across the world. Again, we think it gives us a great opportunity to gain additional market share as these smaller players fall away. On the growth side, maybe there's some variation geographically on this as well. When you think about the cycle times, China seems to be moving much faster in terms of quoting and fulfilling versus other parts of the world. Can that gap close? If it does, does that help? I think the answer lies in how the OEMs address their businesses and how they grow. I mean, when you think about cycle times, why are cycle times faster in China? Chinese OEMs will lean on the supply base. If you are a leader in a certain technology, for example, BorgWarner is a leader in inverters, right? We have one of the highest outsourced market shares in the market. Clearly, we are a technology leader. The Chinese OEMs will approach us to quote on a business based on what they are looking for in terms of design and specs. For sure, this will not be what I hate, the phrase off the shelf, right? That is not the message. The message is they are going to the supply base, looking for the leaders, and seeing how they can adapt existing technologies to meet the need on a specific platform. In the Western world, it's still very much, well, you are a leader in that technology, that's great, but now let's go back and reinvent the wheel to that product a little bit, which inherently takes more dollars, more time. That's the difference in the time is the fact that the Chinese are willing to leverage the technology that's out there, make the necessary modifications, and get to market. That's their priority: speed to market. That's a very good point. Shift to margins. You talked about, I think in the past, 10% EBIT over the long term, no matter what the mix in this area is, whether it's ICE or EV. That's obviously very impressive. How does one think about managing that? Because it would seem you'd almost have to kind of make a bet to kind of get the full cost savings or extract all the margin. How are you able to balance that so effectively? Yeah. First, I think the teams have done an exceptional job having sustained performance over time. I took over this position about a year ago, and our margin performance has been 10% + every quarter over the last four quarters. That is nice for me to see sustained performance over time. We have taken a lot of actions to make sure that we have a competitive cost structure, whether that is restructuring savings on the e-product side of the portfolio and the foundation side of the portfolio. That has certainly helped our P&L, but also supply chain savings and productivity. We are driving operational excellence in BorgWarner. That is what we need to do to make sure that we keep our cost structure in line, provide a great price product to our customer, at the same time, make sure that our profitability stays intact. Our goal as a company is to continue to increment in the mid-teens. We do not see a cap on 10%. Actually, we would like to drive margins higher by continuing to increment on that extra volume at a mid-teens conversion on an all-in basis. Just to answer my next question, I was going to say, how much higher can we go? So it's essentially any other% takes, I guess, besides the incrementing on that, any other areas of cost savings? I know, for example, being able to extract savings from R&D on the EV side. Are there any other levers? Yeah. It's mostly from an R&D perspective, driving efficiency through the R&D function, using tools like artificial intelligence to drive efficiency through our processes, but also, again, leveraging our supply base as volume grows, productivity savings in all of our plants. We watch these metrics day in and day out, and that's really had a big benefit on us continuing to drive our margin profiles higher. You mentioned sort of the AI component. How meaningful can automation, robots, or et cetera? How meaningful can that be of a tailwind to margin? Let me take that one. Yeah. I mean, TBD on the margin side of it, but I think there are opportunities for increased efficiency on the plants. With a preface that we're already doing some things like that in terms of validation and line testing, I think that's where there's some applications on. I think we're still in the early days of thinking about what that opportunity could be. We're using robotics in our plants that have been highly successful. When we get, obviously, there are a lot of requirements coming from our OEs, and we've been able to use artificial intelligence to make it much more efficient for our engineers to get through all of those different requirements. We're seeing nice examples that we can hopefully leverage across the entire business. Gotcha. On, I guess, capital allocation, a couple of elements here. I think in the past, you have done some pretty meaningful M&A. You've also obviously kind of done the opposite. You've obviously divested as well. What are you kind of looking for going, what are you looking for going ahead on in terms of whether to tuck in or what's the thinking? Yeah. So we really have three criteria when we look at M&A. The first is, does it have industrial logic? Does it link to the core competencies of the company? That is pillar number one. If we do not get past pillar number one, we do not move to pillar number two. Number two is we are looking for an asset that is accretive. Our goal as a company is to drive earnings per share up, operating income higher. That is our goal. We want to have an accretive asset. The third criteria is we need to make sure that we pay a fair price for it. Obviously, volumes are a little bit all over the place, and mix is a little bit all over the place. We need to run a lot of different scenarios to make sure that we pay a fair price for that asset. We've worked through this process over the last couple of quarters. Our CEO was just appointed in the middle of February. I'll tell you that it's a very disciplined process, and we've put a number of targets through this criteria. We haven't moved forward with any of them because we're trying to stay very disciplined towards hitting that criteria. As we move forward, obviously, M&A is an important aspect for us. We're going to continue to invest organically and inorganically to support our growth. You should expect us to continue to be inquisitive as it relates to M&A. With that said, we're looking for a balanced capital allocation approach. We want to make sure over a five-year time horizon, we're allocating our capital appropriately between inorganic investments, organic investments, stock repurchases, dividends. In fact, last year was not a heavy M&A year, so we repurchased $400 million of our own stock. Any one year might be a little lumpy. Some years might be heavy M&A. Some years might be heavy repurchase. Over a five-year time horizon, we expect it to be pretty balanced. From a strategic perspective, are there any pockets in your portfolio you feel are interesting or worth calling out? Yeah. I mean, again, it has to link to the core competency of the company. We have a lot of core competencies. Our goal was to increase the aperture. Let's look at what's possible, filter it down based on these criteria. Ultimately, it needs to link to the company's core competency and ensure that it's accretive. Those are our two main criteria. Of course, make sure we pay a fair price for the asset. I have a couple more, but I wanted to take a pause and check with the audience. Anybody have any questions to raise? Everybody's sleeping from lunch. Oh, I think we have one up front. Thank you. I would have one, might be a bit strange, one on contractual structures that you see in the EV space. European peers of yours reported that because there have been quite significant volume gaps between plan and reality, especially for some premium players, there had been volume compensation as a result of that. Now this is sort of being more implemented into the contractual structure as well. I wanted to get your thoughts on that. Do you see that happening on your end as well? Does it change the margin profile of the contract in any sense? Do you see that as essentially quite significant net positive for suppliers? Or given that the expectations are now reset and there is a more clean path of EV growth, especially in Europe, it is no big change whatsoever? Yeah. I mean, it's a pretty dynamic environment right now. In a scenario where the vehicle does quite well and volumes are consistent with what we quoted, then the program runs normal course. There are examples where, for whatever reason, volumes do not materialize. The car or the vehicle was not adopted by the consumer, and production goes down. In that scenario, we will go back to the customer for recovery of our capital. We have actually been successful in doing that. In fact, in Q3 of last year, we called out a little over $20 million, which was a volume recovery. Obviously, it is a dynamic conversation. These conversations are challenging, but ultimately, we need to recover that capital if the volumes do not materialize. That is how we are handling that type of situation. We are also taking cost actions that are within our control. You have seen us take restructuring actions within our e-product-focused segments as we needed to adjust the cost structure there so that these businesses could deliver our typical mid-teens incremental margins as they now grow on this new path. It is not just recoveries. It is taking those cost actions a while. That is what we saw in the first quarter, actually. We announced this e-product restructuring last year for our power drive system segment. That is our e-product segment, one of them. What did we see? We saw 63% revenue growth, great growth, and they converted 15 cents on every extra dollar of revenue. That gives us confidence. Got the cost structure right. They are incrementing in the mid-teens. Great to see that growth. Hopefully, it continues, and we expect it to continue because we are winning a lot of programs across the globe. Just a couple more for me then. Yeah. We talk about EV by region, and you've done, I think, a very effective job at kind of managing those costs. If we go forward, let's say that EV penetration does actually come up and pick up at some point, how do you think about the investment cycle then? Are you basically nimble enough to kind of ramp that up and then address it? Do you already have everything in place to do it? How do you manage, I guess, the potential scenario of EV kind of doing better? Yeah. I'd say a couple of things that we've learned through the ups and downs of this cycle. The first is it makes a lot of sense for us to have flexible equipment on the east side of the business because volumes are very difficult to predict. The success of one customer versus another is difficult to predict. If a platform does not go well for whatever reason, if the equipment is flexible, we can move it to the next program that we win. If it costs us a little bit more money to do it, it is a good use of our capital. I would say that if e-products grow significantly, of course, it is going to mean more investment for us. What's important is that we need to make sure that we see sustained revenue growth because if it's not sustained, then we need to really question our cost structure. We need to have a line of sight to a sustained revenue growth. It makes sense to put in those R&D resources. It makes sense to put in those lines to support those volumes. Just on CapEx, thoughts about that in terms of EV or just more in general going forward? In general, I'd say on the foundational side of the business, we're really leveraging our CapEx. If you break down our capital, it's in the 2.5%-3% of sales range. Obviously, a lot more capital going into the east side of the portfolio because it's growing. I think as you get out the curve and you get more of a maturity on the east side of the portfolio, we're probably more in the 4%-5% CapEx as a percentage of sales area. Right now, there's a lot of investment because of the programs that we're winning. We're always balancing it. I would say the most important area that we're looking at is ensuring that we're utilizing every piece of equipment to its fullest potential. We don't want to put more capital at risk if we're not utilizing all the equipment that we have in use. We want a lot of programs. The market changed on us. So we do have some equipment that isn't fully utilized. First step is to make sure that's utilized before we put in an extra dollar of investment. That's what we're focused on in our business. From a brick-and-mortar standpoint, also keep in mind we have a good number of plants that are what we call Zebra Plants, where they're doing foundational and e-products. That is one of the levers that we have in terms from a capital standpoint, how we can manage these shifts. There will be years where e-products grow faster than we expected. There will be years we're certain that they grow slower. If we have plants that are mixed between those two products, it will not be perfect, but it will be one additional lever for us to be able to flex that capacity and our workforce to keep them with BorgWarner as well. To your point on the Zebra Plants, now it seems there's more, we saw announcement yesterday, pretty high-profile, kind of shifting more production stateside. Should we expect that to potentially be a tailwind for you in the midterm, mid-long term? Yeah. I'll start, and you can add on. I think so. Because when you think about foundational products, which I think is the announcement you're referring to, we're number one or number two in the market. I think whenever there's an increase in capacity in the market, that's a good thing for BorgWarner. Because we're a product leader in that space, we should see a tailwind because of that. Any additional production, especially on the foundational side, will be a nice cash flow tailwind for us. Nothing else to add. Great. Last thing for me. Most unappreciated aspect of BorgWarner right now. What do you think we're missing? I think our operating model is a little bit underappreciated. Our teams are very resilient. We have a very entrepreneurial spirit. Every plant in BorgWarner has a plant manager and a plant controller. That's the CEO and CFO of the plant. What makes us unique is that operating model that drives accountability all the way down to the plant floor. Our results are a reflection of that. We have a margin profile that's at the top of the peer group. We consistently have strong free cash flow that we can utilize to drive shareholder value in multiple ways. We're seeing a lot of growth on both sides of our portfolio and outgrowing the industry. When I look around the company, I feel very bullish. I think we're absolutely moving in the right direction. Our goal as a company, again, is to outgrow the industry, turn our growth into income, expand margins, expand operating income, expand EPS, and deliver a lot of cash flow that we can utilize to drive shareholder value. From the IR perspective, if you would ask me where do I think the underappreciated portion is, I think that we get credit for our operational strength. I think we've shown consistently over time that we can outgrow our markets. I think you've seen us now begin to regrow our margins, deliver our incremental margin performance. I think we're getting credit for that or starting to. I think the underappreciated part is the additional value that we can unlock with our free cash flow generation. We're generating a significant amount of cash flow as a company. Midpoint of our guide this year is $700 million. We need to show investors that we're going to create additional value with that cash generation, and how we're going to create value for our shareholders. I think you've heard Craig talk about that. Fundamentally, what it comes down to is that free cash flow generation needs to go towards accretive inorganic investments. In absence of that, there's potential to return that capital to shareholders, i.e., grow the earnings power of the company. That's the goal with our free cash flow. That's the part I would say is still underappreciated. Go ahead. Thank you very much, Craig. Thanks, Edison. Thank you, everybody. Thanks, everyone. Thank you.