Nonconsolidated Partially-Owned Affiliates

9 Months Ended

Jun. 30, 2022

Equity Method Investments and Joint Ventures [Abstract]

Nonconsolidated Partially-Owned Affiliates

16. Nonconsolidated Partially-Owned Affiliates

Investments in the net assets of nonconsolidated partially-owned affiliates are reported in the "Investments in partially-owned affiliates" line in the consolidated statements of financial position as of June 30, 2022 and September 30, 2021. Equity in the net income of nonconsolidated partially-owned affiliates are reported in the "Equity income (loss)" line in the consolidated statements of income (loss) for the three and nine months ended June 30, 2022 and 2021, respectively.

Adient maintains total investments in partially-owned affiliates of $348 million and $335 million at June 30, 2022 and September 30, 2021, respectively. Operating information for nonconsolidated partially-owned affiliates is as follows:

	Nine Months Ended June 30,
(in millions)	2022		2021
Income statement data:
Net sales	$	2,993	$	6,795
Gross profit	$	291	$	717
Net income	$	132	$	418
Net income attributable to the entity	$	131	$	413

The decrease in net sales and profitability at Adient's nonconsolidated partially-owned affiliates are primarily attributable to the 2021 Yanfeng Transaction. Refer to Note 3, "Acquisitions and Divestitures," of the notes to consolidated financial statements for transactions involving Adient's investments in nonconsolidated partially-owned affiliates. Further, Adient is pursing a sale of a portion of a partially-owned affiliate in South Africa for $2 million. As a result, Adient concluded that indicators of other-than-temporary impairment were present related to this joint venture and recorded a non-cash impairment charge of $6 million during the second quarter of fiscal 2022.

An affiliate of Yanfeng has asserted that, in its capacity as a customer of KEIPER, it is entitled to a payment in the amount of approximately $46 million. Adient believes there is no basis for such payment by KEIPER and is disputing that such Yanfeng affiliate is entitled to any payment by KEIPER. Payment of such claim by KEIPER could have an approximate $17 million impact on Adient’s equity income after taxes from the KEIPER joint venture. KEIPER is also currently disputing the payment obligation.