Technology is king at BorgWarner (NYSE:BWA), a Motley Fool Stock Advisor recommendation. The producer of engine and drivetrain products for Ford (NYSE:F), General Motors (NYSE:GM), Chrysler (NYSE:DCX), Caterpillar (NYSE:CAT), and many others makes vehicles more powerful and more fuel-efficient while meeting emissions standards. By continually advancing technology, BorgWarner has been able to create and expand shareholder value in a tough automotive environment.

The company reported earnings this morning before the bell. Sales were up slightly for the Drivetrain group and up 38% for the Engine group. Overall, sales increased 24% for the quarter despite lower production from North American automakers. Strong demand outside the U.S. propelled international sales up by 20% (18% excluding currency effects) over the year-ago quarter.

Only 11% of the growth was organic, though, as BorgWarner completed its acquisition of 69.42% of Beru, the German manufacturer of electronic engine controls.

Management touted its cost-reduction efforts in the release, but the results were mixed. Drivetrain operating margins increased one percentage point, while Engine margins fell 1.5 points. I'm sure that costs associated with the acquisition drove the number up, so we'll just keep an eye on it over time.

BorgWarner also announced that it has started producing turbochargers for Hyundai/Kia automobiles and will be supplying a new turbocharger design for the Audi A4 and Volkswagen Golf GTI and Passat. That's cool stuff, but does a Hyundai or Kia really need a turbocharger?

But I digress .

At 13.7 times 2005 earnings estimates, which include the Beru acquisition and settlement charges for environmental cleanup at a plant owned by one of the company's purchased subsidiaries, BorgWarner is not a screaming buy right now. But a company that can advance technology to build shareholder value is always one to watch.

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David Meier does not own shares in any of the companies mentioned.