REVENUE FROM CONTRACTS WITH CUSTOMERS

6 Months Ended

Jun. 30, 2021

Revenue from Contract with Customer [Abstract]

REVENUE FROM CONTRACTS WITH CUSTOMERS

REVENUE FROM CONTRACTS WITH CUSTOMERS

The Company manufactures and sells products, primarily to OEMs of light vehicles and, to a lesser extent, to other OEMs of commercial vehicles and off-highway vehicles, to certain Tier One vehicle systems suppliers and into the aftermarket. The Company’s payment terms are based on customary business practices and vary by customer type and products offered. We have evaluated the terms of our arrangements and determined that they do not contain significant financing components.

Generally, revenue is recognized upon shipment or delivery; however, a limited number of the Company’s customer arrangements for its highly customized products with no alternative use provide the Company with the right to payment during the production process. As a result, for these limited arrangements, revenue is recognized as goods are produced and control transfers to the customer using the input cost-to-cost method. The Company recorded a contract asset of $22 million and $16 million at June 30, 2021 and December 31, 2020, respectively, for these arrangements. These amounts are reflected in Prepayments and other current assets in the Company’s Condensed Consolidated Balance Sheets.

In limited instances, certain customers have provided payments in advance of receiving related products, typically at the onset of an arrangement prior to the beginning of production. These contract liabilities are reflected as Other current liabilities and Other non-current liabilities in the Condensed Consolidated Balance Sheets and were $16 million and $1 million at June 30, 2021 and $22 million and $6 million at December 31, 2020, respectively. These amounts are reflected as revenue over the term of the arrangement (typically 3 to 7 years) as the underlying products are shipped and represent the Company’s remaining performance obligations as of the end of the period.

Sales to certain aftermarket customers provide to the customers a right of return. The Company recognizes an estimated return asset (and adjusts for cost of sales) for the right to recover the products returned by the customer. ASC Topic 606 requires that return assets be presented separately from inventory. As of June 30, 2021 and December 31, 2020, the Company had return assets of $8 million recorded in Prepayments and other current assets.

The Company continually seeks business development opportunities and at times provides customer incentives for new program awards. When the Company determines that the payments are incremental and incurred only if the new business is obtained and expects to recover these amounts from the customer over the term of the new business arrangement, the Company capitalizes these amounts. As of June 30, 2021 and December 31, 2020, the Company recorded customer incentive payments of $43 million in Prepayments and other current assets, and $148 million and $166 million in Other non-current assets in the Condensed Consolidated Balance Sheets, respectively.

The following tables represent a disaggregation of revenue from contracts with customers by reporting segment and region and reflects the results of former Delphi Technologies entities in the three and six months ended June 30, 2021. Refer to Note 22, “Reporting Segments And Related Information,” to the Condensed Consolidated Financial Statements for more information.

	Three Months Ended June 30, 2021
(In millions)	Air Management		e-Propulsion & Drivetrain		Fuel Injection		Aftermarket		Total
North America	$	464	$	453	$	1	$	84	$	1,002
Europe	785		251		259		108		1,403
Asia	531		584		147		17		1,279
Other	38		6		17		13		74
Total	$	1,818	$	1,294	$	424	$	222	$	3,758
	Three Months Ended June 30, 2020
(In millions)	Air Management		e-Propulsion & Drivetrain		Fuel Injection		Aftermarket		Total
North America	$	167	$	190	$	—	$	—	$	357
Europe	338		90		—		—		428
Asia	306		324		—		—		630
Other	8		3		—		—		11
Total	$	819	$	607	$	—	$	—	$	1,426
	Six Months Ended June 30, 2021
(In millions)	Air Management		e-Propulsion & Drivetrain		Fuel Injection		Aftermarket		Total
North America	$	996	$	988	$	4	$	151	$	2,139
Europe	1,618		527		530		210		2,885
Asia	1,103		1,186		284		30		2,603
Other	69		12		32		27		140
Total	$	3,786	$	2,713	$	850	$	418	$	7,767
	Six Months Ended June 30, 2020
(In millions)	Air Management		e-Propulsion & Drivetrain		Fuel Injection		Aftermarket		Total
North America	$	554	$	613	$	—	$	—	$	1,167
Europe	1,049		281		—		—		1,330
Asia	597		566		—		—		1,163
Other	38		7		—		—		45
Total	$	2,238	$	1,467	$	—	$	—	$	3,705