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REVENUE FROM CONTRACTS WITH CUSTOMERS
 12 Months Ended
Dec. 31, 2022
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. The Company has evaluated the terms of its 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 $16 million and $17 million at December 31, 2022 and 2021, respectively, for these arrangements. These amounts are reflected in Prepayments and other current assets in the Company’s 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 in the Consolidated Balance Sheets and were $16 million at December 31, 2022 and $21 million at December 31, 2021, respectively. These amounts are reflected as revenue over the term of the arrangement (typically three to seven years) as the underlying products are shipped and represent the Company’s remaining performance obligations as of the end of the period.
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 December 31, 2022 and 2021, the Company recorded customer incentive payments of $34 million and $36 million, respectively, in Prepayments and other current assets, and $99 million and $137 million, respectively, in Other non-current assets in the Consolidated Balance Sheets.
The following table represents a disaggregation of revenue from contracts with customers by reporting segment and region for the years ended December 31, 2022, 2021, and 2020. The balances for the years ended December 31, 2021 and 2020 have been recast for inter-segment transitions of certain businesses that were completed during 2022. Refer to Note 24, Reporting Segments and Related Information to the Consolidated Financial Statements for more information.
Year ended December 31, 2022
(in millions)
Air Managemente-Propulsion & DrivetrainFuel SystemsAftermarketTotal
North America$1,989 $1,868 $473 $711 $5,041 
Europe2,845 1,195 913 401 5,354 
Asia2,018 2,377 599 64 5,058 
Other182 — 67 99 348 
Total$7,034 $5,440 $2,052 $1,275 $15,801 
Year ended December 31, 2021
(in millions)
Air Managemente-Propulsion & DrivetrainFuel SystemsAftermarketTotal
North America$1,664 $1,616 $302 $643 $4,225 
Europe2,805 973 1,004 423 5,205 
Asia2,103 2,329 627 61 5,120 
Other148 — 63 77 288 
Total$6,720 $4,918 $1,996 $1,204 $14,838 
Year ended December 31, 2020
(in millions)
Air Managemente-Propulsion & DrivetrainFuel SystemsAftermarketTotal
North America$1,358 $1,284 $67 $348 $3,057 
Europe2,458 733 277 91 3,559 
Asia1,585 1,631 180 15 3,411 
Other95 — 13 30 138 
Total$5,496 $3,648 $537 $484 $10,165