Vitesco Benefits From High Growth in Vehicle Powertrain Electrification

We believe Vitesco will capitalize on vehicle electrification arising from global clean air regulation. Vitesco’s products are used in internal combustion engines, hybrid electric, battery electric, and fuel cell electric vehicles. The company's electrified vehicle powertrain product lines should support revenue growth in the mid-single-digit range, despite declining noncore ICE product lines. The company benefits from its ability to continuously innovate, a global manufacturing footprint, highly integrated long-term customer ties, high customer switching costs, and moderate pricing power from new technologies.