BorgWarner has agreed to form a joint venture with Romeo Power Technology, a deal that enables the Auburn Hills-based company to add battery packs to its broad propulsion portfolio.

The new joint venture with Romeo Power, a battery module and pack supplier based in California, will be split 60/40 with BorgWarner holding the larger share.

“This joint venture will not only complement our strong existing propulsion portfolio, but we expect it to fill a gap in the marketplace between battery cell manufacturers and hybrid and electric vehicle customers,” Joel Wiegert, president and general manager at BorgWarner Morse Systems said in a statement. “We believe our global engineering and manufacturing footprint enables us to quickly commercialize cutting-edge technology, delivering even more value to our customers.”

The joint venture will encompass the mobility portion of the battery pack business, initially focused on performance and light vehicles. BorgWarner will also take a 20 percent equity position in Romeo Power and will fill two seats on its board. The equity investment and the joint venture are expected to close in the second quarter of 2019, subject to the satisfaction of customary closing conditions.               

BorgWarner's strategic acquisition of companies involved in vehicle electrification to complement its organic efforts started in 2015 with the acquisition of Remy International, Inc., a leading manufacturer of rotating electrical components such as alternators, starter motors and electric traction motors for the automotive and commercial vehicle industry.

In 2017, BorgWarner acquired Sevcon Inc., a global player in electrification technologies. Sevcon complemented BorgWarner's power electronics capabilities and also added onboard charging to the portfolio. In February, BorgWarner announced it formed Cascadia Motion and acquired two Oregon-based businesses, Rinehart Motion Systems LLC and AM Racing Inc. and merged their operations into a new, wholly owned company focused on electric and hybrid propulsion solutions for niche and emerging applications.

These acquisitions, along with the joint venture, are viewed as significant milestones as BorgWarner continues to execute its strategy as a propulsion systems leader for combustion, hybrid and electric vehicles.