REVENUE FROM CONTRACTS WITH CUSTOMERS

9 Months Ended

Sep. 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 $21 million and $16 million at September 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 $23 million and $1 million at September 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 September 30, 2021 and December 31, 2020, the Company had return assets of $9 million and $8 million, respectively, recorded in Prepayments and other current assets in the Company’s Condensed Consolidated Balance Sheets.

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 September 30, 2021 and December 31, 2020, the Company recorded customer incentive payments of $38 million and $43 million, respectively, in Prepayments and other current assets, and $142 million and $166 million, respectively, in Other non-current assets in the Condensed Consolidated Balance Sheets.

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 nine months ended September 30, 2021. Refer to Note 23, “Reporting Segments And Related Information,” to the Condensed Consolidated Financial Statements for more information.

	Three Months Ended September 30, 2021
(In millions)	Air Management		e-Propulsion & Drivetrain		Fuel Injection		Aftermarket		Total
North America	$	460	$	471	$	13	$	81	$	1,025
Europe	647		183		201		114		1,145
Asia	483		524		144		16		1,167
Other	43		6		16		14		79
Total	$	1,633	$	1,184	$	374	$	225	$	3,416
	Three Months Ended September 30, 2020
(In millions)	Air Management		e-Propulsion & Drivetrain		Fuel Injection		Aftermarket		Total
North America	$	384	$	456	$	—	$	—	$	840
Europe	658		186		—		—		844
Asia	391		429		—		—		820
Other	26		4		—		—		30
Total	$	1,459	$	1,075	$	—	$	—	$	2,534
	Nine Months Ended September 30, 2021
(In millions)	Air Management		e-Propulsion & Drivetrain		Fuel Injection		Aftermarket		Total
North America	$	1,456	$	1,459	$	17	$	232	$	3,164
Europe	2,265		710		731		324		4,030
Asia	1,586		1,710		428		46		3,770
Other	112		18		48		41		219
Total	$	5,419	$	3,897	$	1,224	$	643	$	11,183
	Nine Months Ended September 30, 2020
(In millions)	Air Management		e-Propulsion & Drivetrain		Fuel Injection		Aftermarket		Total
North America	$	938	$	1,069	$	—	$	—	$	2,007
Europe	1,707		467		—		—		2,174
Asia	988		995		—		—		1,983
Other	64		11		—		—		75
Total	$	3,697	$	2,542	$	—	$	—	$	6,239