Garrett Motion (GTX) CMD 2026 summary

Strategic direction and growth outlook

• Targeting at least 5% revenue CAGR through 2030 and 2035, with annual sales expected to exceed $5B by 2030 and over 50% of revenue from outside passenger vehicles, including LCV, CV, Industrial, and Aftermarket segments.

• Zero-emission mobility products and Zero Emission Technologies (ZET) are expected to enter production by 2027, targeting $1B revenue by 2030 and $2.5B by 2035.

• Industrial segment sales are targeted at $500M by 2030 and $850M by 2035, with a CAGR above 20% and addressable industry expansion to ~$9B by 2035.

• Turbo revenue in 2035 is projected to exceed 2025 levels, supported by strong win rates and portfolio expansion into hybrids, CV, and industrial applications.

• Diversification into HVAC, energy infrastructure, and air compression leverages technology synergies across automotive and industrial sectors.

Technology and product innovation

• Five to six technology pillars—including turbo compressors, oil-free foil bearings, high-speed electric motors, high-speed power electronics, and advanced control software—enable rapid, differentiated product development.

• Over 1,300 engineers and approximately 1,350 patents/patents pending, with six global R&D centers driving innovation.

• Proprietary AI and simulation tools accelerate design, optimize performance, and reduce development cycle time by 2x–10x, cutting RD&E spend by 20–50%.

• Technology reuse across products (e.g., E-Powertrain, E-Cooling, fuel cell compressors) enables efficient expansion into new markets.

• Partnerships and strategic collaborations (e.g., HanDe Axle, Ingersoll Rand, Yutong, Trane) support rapid commercialization and market entry.

Financial performance and capital allocation

• Operating model emphasizes low CapEx (<3% of sales), high variable cost structure (>80%), and productivity gains (~5%/year).

• Margins guided at 14.9% for 2026, with potential for expansion as industrial mix grows post-2030; adjusted EBIT margin of 14.9% (2026E midpoint).

• Over $2B in free cash flow expected through 2030, with 75%+ returned to shareholders via buybacks and dividends.

• R&D and RD&E remain below 5% of revenue, with efficiency gains from technology reuse and streamlined development.

• M&A considered selectively, with preference for organic growth and disciplined capital deployment.