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Disposals
 12 Months Ended
Dec. 31, 2025
Business Combination, Asset Acquisition, Transaction between Entities under Common Control, and Joint Venture Formation [Abstract]  
Disposals
Note 2. Disposals
On November 7, 2023, the Board of the Company approved a strategic plan to wind down its powertrain business and preserve the related intellectual property (the “Plan”). As part of the Plan, the Company will continue to focus on commercialization of its KARNO Power Module technology. The majority of wind down activities were completed in the fourth quarter of fiscal year 2025. We have not accounted for the impacts of the Plan as a discontinued operation as we have not abandoned or sold the underlying intellectual property, with assets held for sale at December 31, 2025 dispositioned in January 2026 including a gain of $0.4 million recognized in the first quarter of 2026.
Total charges and expenses related to the Plan of $0.5 million and $3.0 million for the years ended December 31, 2025 and 2024, respectively, inclusive of recoveries from assets sold and charges to assets held for sale discussed below, are included in exit and termination costs in the consolidated statements of operations. The change in total liabilities associated with the Plan is included within accrued expenses and other current liabilities as presented in Note 10, and accounts payable, and is summarized as follows (in millions):
December 31, 2024Charged to Expense (Benefit)Costs Paid or SettledDecember 31, 2025
Employee severance and retention$0.1 $— $(0.1)$— 
Contract terminations0.6 0.1 (0.7)— 
Warranty obligations0.1 (0.1)— — 
$0.8 $— $(0.8)$— 
December 31, 2023BenefitCosts Paid or SettledDecember 31, 2024
Employee severance and retention$1.1 $— $(1.0)$0.1 
Contract terminations6.5 (0.8)(5.1)0.6 
Warranty obligations0.4 (0.3)— 0.1 
$8.0 $(1.1)$(6.1)$0.8 
The above estimates of the cash expenditures and charges that the Company expects to incur in connection with the Plan, and the timing thereof, are subject to a number of assumptions and actual amounts may differ materially from estimates. In addition, the Company may incur other cash expenditures or charges not currently contemplated due to unanticipated events.
Assets Held for Sale
At the time of initial classification as held for sale at March 31, 2024, we estimated that the sale of these assets was expected to be completed within one year and it was unlikely that significant changes to the plan of sale would be made. Due to increased uncertainty regarding the timing of the disposition, driven by deteriorating market conditions in the electric vehicle industry, in the first quarter of 2025 we reclassified assets previously recorded as held for sale totaling $1.0 million to property and equipment, net, on the consolidated balance sheets, and recognized charges of $1.6 million, included in the amount indicated below, during the three months ended March 31, 2025. In the fourth quarter of 2025 we reclassified $1.2 million in assets from property and equipment, net on the consolidated balance sheets to assets held for sale.
We had assets held for sale of $1.2 million and $2.6 million consisting of property and equipment in connection with the Plan at their fair value less costs to sell on the consolidated balance sheets at December 31, 2025 and 2024, respectively. We used fair value hierarchy Level III inputs including comparable assets or nonbinding third-party bids, adjusted for condition, and recorded charges of $1.6 million and $6.5 million for the years ended December 31, 2025 and 2024, respectively, included in exit and termination costs in the consolidated statements of operations.
We recorded net benefits for recoveries related to asset sales of $1.5 million and $2.8 million for the years ended December 31, 2025 and 2024, respectively, included in exit and termination costs in the consolidated statements of operations and in gain on disposal of assets, including assets held for sale in the consolidated statements of cash flows.