UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q



x☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~September 30, 2017~~March 31, 2021



¨☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to .

Commission file number: 001-35346

~~DELPHI AUTOMOTIVE~~APTIV PLC

(Exact name of registrant as specified in its charter)



Jersey		98-1029562
(State or other jurisdiction of	~~(I.R.S. Employer~~
incorporation or organization)	(I.R.S. Employer Identification No.)

~~Courteney Road~~5 Hanover Quay

~~Hoath Way~~Grand Canal Dock

~~Gillingham, Kent ME8 0RU~~

~~United Kingdom~~Dublin, D02 VY79, Ireland

(Address of principal executive ~~offices)~~offices, including zip code)

~~011-44-163-423-4422~~

(Registrant’s telephone number, including area code) 353-1-259-7013

~~N/A~~

(Former name, former address and former fiscal year, if changed since last report)N/A

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading symbol(s)

Name of each exchange on which registered

Ordinary Shares. $0.01 par value per share

APTV

New York Stock Exchange

5.50% Mandatory Convertible Preferred Shares, Series A, $0.01 par value per share

APTV PRA

New York Stock Exchange

1.500% Senior Notes due 2025

APTV

New York Stock Exchange

4.250% Senior Notes due 2026

APTV

New York Stock Exchange

1.600% Senior Notes due 2028

APTV

New York Stock Exchange

4.350% Senior Notes due 2029

APTV

New York Stock Exchange

4.400% Senior Notes due 2046

APTV

New York Stock Exchange

5.400% Senior Notes due 2049

APTV

New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x.☒ No ¨.☐

Indicate by check mark whether the registrant has submitted electronically ~~and posted on its corporate Web site, if any,~~ every Interactive Data File required to be submitted ~~and posted~~ pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit ~~and post~~ such files). Yes x.☒ No ¨.☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☒

Accelerated filer

¨.

☐

Non-accelerated filer

☐

¨.

~~(Do not check if a smaller reporting company)~~

Smaller reporting company

¨.

☐

Emerging growth company

¨.

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨.☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨.☐ No x.☒

The number of the registrant’s ordinary shares outstanding, $0.01 par value per share as of ~~October 27, 2017,~~April 30, 2021, was ~~265,839,794.~~270,462,749.

Table of Contents

~~DELPHI AUTOMOTIVE~~APTIV PLC

INDEX



		Page
Part I - Financial Information
Item 1.	Financial Statements
	Consolidated Statements of Operations for the Three ~~and Nine~~ Months Ended ~~September 30, 2017~~March 3 1 , 202 1 and ~~2016~~20 20 (Unaudited)	3
	Consolidated Statements of Comprehensive Income for the Three ~~and Nine~~ Months Ended ~~September 30, 2017~~March 3 1 , 202 1 and ~~2016~~20 20 (Unaudited)	4
	Consolidated Balance Sheets as of ~~September 30, 2017~~March 31, 2021 (Unaudited) and December 31, ~~2016~~2020	5
	Consolidated Statements of Cash Flows for the ~~Nine~~ Three Months Ended ~~September 30, 2017~~March 3 1 , 202 1 and ~~2016~~20 20 (Unaudited)	6
	Consolidated ~~Statement~~Statements of Shareholders’ Equity for the ~~Nine~~ Three Months Ended ~~September 30, 2017~~March 3 1 , 202 1 and 20 2 0 (Unaudited)	7
	Notes to Consolidated Financial Statements (Unaudited)	8
	Cautionary Statement Regarding Forward Looking Information	5837
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	5938
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	8256
Item 4.	Controls and Procedures	8257

Part II - Other Information
Item 1.	Legal Proceedings	8458
Item 1A.	Risk Factors	8458
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	8458

Item 6.	Exhibits	8558

Signatures		8659
Exhibits

Table of Contents

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

~~DELPHI AUTOMOTIVE~~APTIV PLC

CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)

Three Months Ended September 30, Nine Months Ended September 30,
2017 2016 2017 2016

(in millions, except per share amounts)
Net sales $ 4,333
$ 4,091
$ 12,943
$ 12,348
Operating expenses:
Cost of sales 3,450
3,253
10,314
9,861
Selling, general and administrative 317
278
906
833
Amortization 34
34
100
101
Restructuring (Note 7) 21
63
180
252
Total operating expenses 3,822
3,628
11,500
11,047
Operating income 511
463
1,443
1,301
Interest expense (36 ) (41 ) (105 ) (123 )
Other expense, net (Note 16) (9 ) (69 ) (29 ) (73 )
Income from continuing operations before income taxes and equity income 466
353
1,309
1,105
Income tax expense (60 ) (57 ) (183 ) (216 )
Income from continuing operations before equity income 406
296
1,126
889
Equity income, net of tax 7
10
25
23
Income from continuing operations 413
306
1,151
912
Income from discontinued operations, net of tax (Note 21) —
—
—
108
Net income 413
306
1,151
1,020
Net income attributable to noncontrolling interest 18
13
52
44
Net income attributable to Delphi $ 395
$ 293
$ 1,099
$ 976

Amounts attributable to Delphi:
Income from continuing operations $ 395
$ 293
$ 1,099
$ 871
Income from discontinued operations —
—
—
105
Net income $ 395
$ 293
$ 1,099
$ 976

Basic net income per share:
Continuing operations $ 1.48
$ 1.08
$ 4.11
$ 3.18
Discontinued operations —
—
—
0.38
Basic net income per share attributable to Delphi $ 1.48
$ 1.08
$ 4.11
$ 3.56
Weighted average number of basic shares outstanding 266.24
272.19
267.60
273.91

Diluted net income per share:
Continuing operations $ 1.48
$ 1.07
$ 4.10
$ 3.18
Discontinued operations —
—
—
0.38
Diluted net income per share attributable to Delphi $ 1.48
$ 1.07
$ 4.10
$ 3.56
Weighted average number of diluted shares outstanding 267.16
272.77
268.23
274.39

Cash dividends declared per share $ 0.29
$ 0.29
$ 0.87
$ 0.87


	Three Months Ended March 31,
		2021		2020

		(in millions, except per share amounts)
Net sales		$	4,023	$	3,226
Operating expenses:
Cost of sales		3,296		2,725
Selling, general and administrative		255		252
Amortization		37		36
Restructuring (Note 7)		6		28
Gain on autonomous driving joint venture (Note 17)		0		(1,434)
Total operating expenses		3,594		1,607
Operating income		429		1,619
Interest expense		(40)		(43)
Other income (expense), net (Note 16)		1		(1)
Income before income taxes and equity (loss) income		390		1,575
Income tax expense		(48)		(10)
Income before equity (loss) income		342		1,565
Equity (loss) income, net of tax		(42)		2


Net income		300		1,567
Net income (loss) attributable to noncontrolling interest		5		(5)
Net income attributable to Aptiv		295		1,572
Mandatory convertible preferred share dividends (Note 12)		(16)		0
Net income attributable to ordinary shareholders		$	279	$	1,572






Basic net income per share:


Basic net income per share attributable to ordinary shareholders		$	1.03	$	6.15
Weighted average number of basic shares outstanding		270.31		255.51

Diluted net income per share (Note 12):


Diluted net income per share attributable to ordinary shareholders		$	1.03	$	6.14
Weighted average number of diluted shares outstanding		271.14		255.83

See notes to consolidated financial statements.

Table of Contents

~~DELPHI AUTOMOTIVE~~APTIV PLC

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited)

Three Months Ended September 30, Nine Months Ended September 30,
2017 2016 2017 2016

(in millions)
Net income $ 413
$ 306
$ 1,151
$ 1,020
Other comprehensive income:
Currency translation adjustments 87
27
276
8
Net change in unrecognized (loss) gain on derivative instruments, net of tax (Note 14) (9 ) 6
34
55
Employee benefit plans adjustment, net of tax (6 ) 6
(1 ) 28
Other comprehensive income 72
39
309
91
Comprehensive income 485
345
1,460
1,111
Comprehensive income attributable to noncontrolling interests 21
14
59
43
Comprehensive income attributable to Delphi $ 464
$ 331
$ 1,401
$ 1,068


	Three Months Ended March 31,
		2021		2020

		(in millions)
Net income		$	300	$	1,567
Other comprehensive (loss) income:
Currency translation adjustments		(92)		(131)
Net change in unrecognized loss on derivative instruments, net of tax (Note 14)		(7)		(153)
Employee benefit plans adjustment, net of tax		7		7
Other comprehensive loss		(92)		(277)
Comprehensive income		208		1,290
Comprehensive income (loss) attributable to noncontrolling interests		4		(10)
Comprehensive income attributable to Aptiv		$	204	$	1,300

See notes to consolidated financial statements.

Table of Contents

~~DELPHI AUTOMOTIVE~~APTIV PLC

CONSOLIDATED BALANCE SHEETS


	September 30, 2017			December 31, 2016				March 31, 2021		December 31, 2020
	(Unaudited)							(Unaudited)

	(in millions)							(in millions)
ASSETS							ASSETS
Current assets:							Current assets:
Cash and cash equivalents	$	557		$	838		Cash and cash equivalents	$	2,830	$	2,821
Cash in escrow related to Powertrain Spin-Off senior notes offering (Note 8)	796			—
Restricted cash	1			1			Restricted cash	52		32
Accounts receivable, net	3,225			2,938
Accounts receivable, net of allowance for doubtful accounts of $43 million and $40 million, respectively (Note 2)							Accounts receivable, net of allowance for doubtful accounts of $43 million and $40 million, respectively (Note 2)	2,798		2,812
Inventories (Note 3)	1,642			1,232			Inventories (Note 3)	1,525		1,297
Other current assets (Note 4)	489			410			Other current assets (Note 4)	596		503

Total current assets	6,710			5,419			Total current assets	7,801		7,465
Long-term assets:							Long-term assets:
Property, net	3,819			3,515			Property, net	3,164		3,301
Operating lease right-of-use assets							Operating lease right-of-use assets	359		380
Investments in affiliates	130			101			Investments in affiliates	1,962		2,011
Intangible assets, net (Note 2)	1,213			1,240			Intangible assets, net (Note 2)	1,033		1,091
Goodwill (Note 2)	1,670			1,508			Goodwill (Note 2)	2,503		2,580
Other long-term assets (Note 4)	624			509			Other long-term assets (Note 4)	654		694

Total long-term assets	7,456			6,873			Total long-term assets	9,675		10,057
Total assets	$	14,166		$	12,292		Total assets	$	17,476	$	17,522
LIABILITIES AND SHAREHOLDERS’ EQUITY							LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:							Current liabilities:
Short-term debt (Note 8)	$	15		$	12		Short-term debt (Note 8)	$	78	$	90
Accounts payable	2,745			2,563			Accounts payable	2,624		2,571

Accrued liabilities (Note 5)	1,383			1,573			Accrued liabilities (Note 5)	1,260		1,385

Total current liabilities	4,143			4,148			Total current liabilities	3,962		4,046
Long-term liabilities:							Long-term liabilities:
Long-term debt (Note 8)	4,884			3,959			Long-term debt (Note 8)	3,946		4,011
Pension benefit obligations	1,004			955			Pension benefit obligations	504		525
Long-term operating lease liabilities							Long-term operating lease liabilities	276		300
Other long-term liabilities (Note 5)	521			467			Other long-term liabilities (Note 5)	512		540

Total long-term liabilities	6,409			5,381			Total long-term liabilities	5,238		5,376
Total liabilities	10,552			9,529			Total liabilities	9,200		9,422
Commitments and contingencies (Note 10)							Commitments and contingencies (Note 10)	0		0
Shareholders’ equity:							Shareholders’ equity:
Preferred shares, $0.01 par value per share, 50,000,000 shares authorized, none issued and outstanding	—			—
Ordinary shares, $0.01 par value per share, 1,200,000,000 shares authorized, 265,839,088 and 269,789,959 issued and outstanding as of September 30, 2017 and December 31, 2016, respectively	3			3
Preferred shares, $0.01 par value per share, 50,000,000 shares authorized; 11,500,000 shares of 5.50% Mandatory Convertible Preferred Shares, Series A, issued and outstanding as of March 31, 2021 and December 31, 2020							Preferred shares, $0.01 par value per share, 50,000,000 shares authorized; 11,500,000 shares of 5.50% Mandatory Convertible Preferred Shares, Series A, issued and outstanding as of March 31, 2021 and December 31, 2020	0		0
Ordinary shares, $0.01 par value per share, 1,200,000,000 shares authorized, 270,462,749 and 270,025,374 issued and outstanding as of March 31, 2021 and December 31, 2020, respectively							Ordinary shares, $0.01 par value per share, 1,200,000,000 shares authorized, 270,462,749 and 270,025,374 issued and outstanding as of March 31, 2021 and December 31, 2020, respectively	3		3
Additional paid-in-capital	1,628			1,633			Additional paid-in-capital	3,881		3,897
Retained earnings	2,485			1,980			Retained earnings	4,829		4,550
Accumulated other comprehensive loss (Note 13)	(913		)	(1,215		)	Accumulated other comprehensive loss (Note 13)	(636)		(545)
Total Delphi shareholders’ equity	3,203			2,401
Total Aptiv shareholders’ equity							Total Aptiv shareholders’ equity	8,077		7,905
Noncontrolling interest	411			362			Noncontrolling interest	199		195
Total shareholders’ equity	3,614			2,763			Total shareholders’ equity	8,276		8,100
Total liabilities and shareholders’ equity	$	14,166		$	12,292		Total liabilities and shareholders’ equity	$	17,476	$	17,522

See notes to consolidated financial statements.

Table of Contents

~~DELPHI AUTOMOTIVE~~APTIV PLC

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)


	Nine Months Ended September 30,							Three Months Ended March 31,
	2017			2016				2021		2020

	(in millions)							(in millions)
Cash flows from operating activities:							Cash flows from operating activities:
Net income	$	1,151		$	1,020		Net income	$	300	$	1,567
Income from discontinued operations, net of tax	—			108
Income from continuing operations	1,151			912

Adjustments to reconcile net income to net cash provided by operating activities:							Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation	439			425			Depreciation	156		144
Amortization	100			101			Amortization	37		36
Amortization of deferred debt issuance costs	5			7			Amortization of deferred debt issuance costs	3		1
Restructuring expense, net of cash paid	18			73			Restructuring expense, net of cash paid	(25)		(15)
Deferred income taxes	2			21			Deferred income taxes	3		(18)
Pension and other postretirement benefit expenses	66			45			Pension and other postretirement benefit expenses	10		10
Income from equity method investments, net of dividends received	(18		)	(15		)
Loss on extinguishment of debt	—			73
Gain on sale of assets	—			(4		)
Loss (income) from equity method investments, net of dividends received							Loss (income) from equity method investments, net of dividends received	42		(2)

Share-based compensation	50			47			Share-based compensation	29		(1)
Gain on autonomous driving joint venture, net							Gain on autonomous driving joint venture, net	0		(1,434)
Changes in operating assets and liabilities:							Changes in operating assets and liabilities:
Accounts receivable, net	(279		)	(230		)	Accounts receivable, net	14		260
Inventories	(410		)	(193		)	Inventories	(228)		(77)
Other assets	(121		)	9			Other assets	(60)		12
Accounts payable	214			74			Accounts payable	101		(170)
Accrued and other long-term liabilities	(147		)	(2		)	Accrued and other long-term liabilities	(120)		(98)
Other, net	30			(25		)	Other, net	(4)		(45)
Pension contributions	(60		)	(60		)	Pension contributions	(6)		(9)
Net cash provided by operating activities from continuing operations	1,040			1,258
Net cash provided by operating activities from discontinued operations	—			—

Net cash provided by operating activities	1,040			1,258			Net cash provided by operating activities	252		161
Cash flows from investing activities:							Cash flows from investing activities:
Capital expenditures	(591		)	(614		)	Capital expenditures	(134)		(205)
Proceeds from sale of property / investments	12			14			Proceeds from sale of property / investments	1		2
Net proceeds from divestiture of discontinued operations	—			52
Cost of business acquisitions, net of cash acquired	(40		)	(15		)
Cost of technology investments	(51		)	(3		)

Cost of business acquisitions and other transactions, net of cash acquired							Cost of business acquisitions and other transactions, net of cash acquired	0		(5)

Settlement of derivatives	(12		)	(16		)	Settlement of derivatives	(1)		1
Increase in restricted cash	—			(1		)
Net cash used in investing activities from continuing operations	(682		)	(583		)
Net cash used in investing activities from discontinued operations	—			(4		)

Net cash used in investing activities	(682		)	(587		)	Net cash used in investing activities	(134)		(207)
Cash flows from financing activities:							Cash flows from financing activities:
Net repayments under short-term debt agreements	(8		)	(14		)
Repayment of senior notes	—			(862		)
Proceeds from issuance of senior notes, net of issuance costs	796			852
Escrow of proceeds from Powertrain Spin-off senior notes issuance	(796		)	—
Contingent consideration and deferred acquisition purchase price payments	(24		)	(4		)
Net repayments under other short-term debt agreements							Net repayments under other short-term debt agreements	(8)		(29)
Net (repayments) proceeds under other long-term debt agreements							Net (repayments) proceeds under other long-term debt agreements	(8)		1,900

Dividend payments of consolidated affiliates to minority shareholders	(10		)	(24		)	Dividend payments of consolidated affiliates to minority shareholders	0		(6)
Repurchase of ordinary shares	(383		)	(530		)	Repurchase of ordinary shares	0		(57)
Distribution of cash dividends	(233		)	(238		)
Taxes withheld and paid on employees' restricted share awards	(33		)	(40		)
Net cash used in financing activities	(691		)	(860		)
Effect of exchange rate fluctuations on cash and cash equivalents	52			5
Decrease in cash and cash equivalents	(281		)	(184		)
Cash and cash equivalents at beginning of the period	838			579
Cash and cash equivalents at end of the period	$	557		$	395
Distribution of mandatory convertible preferred share cash dividends							Distribution of mandatory convertible preferred share cash dividends	(16)		0
Distribution of ordinary share cash dividends							Distribution of ordinary share cash dividends	0		(56)
Taxes withheld and paid on employees’ restricted share awards							Taxes withheld and paid on employees’ restricted share awards	(45)		(32)
Net cash (used in) provided by financing activities							Net cash (used in) provided by financing activities	(77)		1,720
Effect of exchange rate fluctuations on cash, cash equivalents and restricted cash							Effect of exchange rate fluctuations on cash, cash equivalents and restricted cash	(12)		(16)
Increase in cash, cash equivalents and restricted cash							Increase in cash, cash equivalents and restricted cash	29		1,658
Cash, cash equivalents and restricted cash at beginning of the period							Cash, cash equivalents and restricted cash at beginning of the period	2,853		429
Cash, cash equivalents and restricted cash at end of the period							Cash, cash equivalents and restricted cash at end of the period	$	2,882	$	2,087

See notes to consolidated financial statements.

Table of Contents

~~DELPHI AUTOMOTIVE~~APTIV PLC

CONSOLIDATED ~~STATEMENT~~STATEMENTS OF SHAREHOLDERS’ EQUITY (Unaudited)

Ordinary Shares
Number of Shares Amount Additional Paid in Capital Retained Earnings Accumulated Other Comprehensive Loss Total Delphi Shareholders’ Equity Noncontrolling Interest Total Shareholders’ Equity

(in millions)
Balance at January 1, 2017 270
$ 3
$ 1,633
$ 1,980
$ (1,215 ) $ 2,401
$ 362
$ 2,763
Net income —
—
—
1,099
—
1,099
52
1,151
Other comprehensive income —
—
—
—
302
302
7
309
Dividends on ordinary shares —
—
3
(236 ) —
(233 ) —
(233 )
Dividend payments of consolidated affiliates to minority shareholders —
—
—
—
—
—
(10 ) (10 )
Taxes withheld on employees' restricted share award vestings —
—
(33 ) —
—
(33 ) —
(33 )
Repurchase of ordinary shares (5 ) —
(25 ) (358 ) —
(383 ) —
(383 )
Share-based compensation 1
—
50
—
—
50
—
50
Balance at September 30, 2017 266
$ 3
$ 1,628
$ 2,485
$ (913 ) $ 3,203
$ 411
$ 3,614


	Three Months Ended March 31,

	Ordinary Shares			Preferred Shares

	Number of shares	Amount of shares		Number of shares	Amount of shares		Additional Paid in Capital		Retained Earnings		Accumulated Other Comprehensive Loss		Total Aptiv Shareholders’ Equity		Noncontrolling Interest		Total Shareholders’ Equity

2021	(in millions)
Balance at January 1, 2021	270	$	3	12	$	0	$	3,897	$	4,550	$	(545)	$	7,905	$	195	$	8,100
Net income	—	—		—	—		—		295		—		295		5		300
Other comprehensive loss	—	—		—	—		—		—		(91)		(91)		(1)		(92)


Mandatory convertible preferred share cumulative dividends	—	—		—	—		—		(16)		—		(16)		—		(16)
Taxes withheld on employees’ restricted share award vestings	—	—		—	—		(45)		—		—		(45)		—		(45)



Share-based compensation	0	—		—	—		29		—		—		29		—		29


Balance at March 31, 2021	270	$	3	12	$	0	$	3,881	$	4,829	$	(636)	$	8,077	$	199	$	8,276

2020
Balance at January 1, 2020	255	$	3	0	$	0	$	1,645	$	2,890	$	(719)	$	3,819	$	192	$	4,011
Net income (loss)	—	—		—	—		—		1,572		—		1,572		(5)		1,567
Other comprehensive loss	—	—		—	—		—		—		(272)		(272)		(5)		(277)
Dividends on ordinary shares	—	—		—	—		1		(57)		—		(56)		0		(56)

Taxes withheld on employees’ restricted share award vestings	—	—		—	—		(33)		—		—		(33)		—		(33)
Repurchase of ordinary shares	(1)	—		—	—		(6)		(51)		—		(57)		—		(57)
Share-based compensation	1	—		—	—		(1)		—		—		(1)		—		(1)

Adjustment for recently adopted accounting pronouncements	—	—		—	—		—		(1)		0		(1)		—		(1)
Balance at March 31, 2020	255	$	3	0	$	0	$	1,606	$	4,353	$	(991)	$	4,971	$	182	$	5,153

See notes to consolidated financial statements.

Table of Contents

~~DELPHI AUTOMOTIVE~~APTIV PLC

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

1. GENERAL

General and basis of presentation—“~~Delphi,~~Aptiv,” the “Company,” “we,” “us” and “our” refer to ~~Delphi Automotive~~Aptiv PLC, a public limited company ~~which was~~ formed under the laws of Jersey on May 19, 2011~~, together with its subsidiaries, including Delphi Automotive LLP, a limited liability partnership incorporated under the laws of England and Wales which was formed on~~ ~~August 19, 2009~~ ~~for the purpose of acquiring certain assets of the former Delphi Corporation (the "Acquisition"), and became a subsidiary of~~ as Delphi Automotive PLC, ~~in connection with the completion of the Company’s~~which completed an initial public offering on November 22, ~~2011~~. 2011. On December 4, 2017, the Company completed the separation (the “Separation”) of its former Powertrain Systems segment by distributing to Aptiv shareholders on a pro rata basis all of the issued and outstanding ordinary shares of Delphi Technologies PLC, a public limited company formed to hold the spun-off business. Following the Separation, the remaining company changed its name to Aptiv PLC and New York Stock Exchange (“NYSE”) symbol to “APTV.”

The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”)~~. All~~ and all adjustments, consisting of only normal recurring items, which are necessary for a fair presentation, have been included. The consolidated financial statements and notes thereto included in this report should be read in conjunction with ~~Delphi's 2016~~Aptiv’s 2020 Annual Report on Form 10-K.

Nature of operations—~~Delphi~~Aptiv is a leading global technology and mobility architecture company primarily serving the automotive sector. ~~Delphi designs~~We design and ~~manufactures~~manufacture vehicle components and ~~provides~~provide electrical, electronic and ~~electronic, powertrain and~~active safety technology solutions to the global automotive and commercial vehicle markets. ~~Delphi~~Aptiv operates manufacturing facilities and technical centers utilizing a regional service model that enables the Company to efficiently and effectively serve its global customers from best cost countries. In line with the ~~long term~~long-term growth in emerging markets, ~~Delphi~~Aptiv has been increasing its focus on these markets, particularly in China, where the Company has a major manufacturing base and strong customer relationships.

~~Powertrain Spin-Off and Renaming of Remaining Company—~~On May 3, 2017, the Company announced its intention to pursue a separation of its Powertrain Systems segment into a new, independent publicly traded company, through a transaction expected to be treated as a tax-free spin-off to its shareholders (the "Separation"). The new publicly traded Powertrain spin-off company will be named Delphi Technologies PLC, and will trade on the New York Stock Exchange ("NYSE") under the symbol "DLPH" following the distribution date. Upon completion of the Separation, the remaining company will change its name to Aptiv PLC, pending shareholder approval. Following the distribution date, Aptiv PLC will trade on the NYSE under the ticker symbol "APTV". Refer to Note 22. Separation of Powertrain Systems for additional detail.

2. SIGNIFICANT ACCOUNTING POLICIES

Consolidation—The consolidated financial statements include the accounts of ~~Delphi~~Aptiv and United States (“U.S.”) and non-U.S. subsidiaries in which ~~Delphi~~Aptiv holds a controlling financial or management interest and variable interest entities of which ~~Delphi~~Aptiv has determined that it is the primary beneficiary. ~~Delphi’s~~Aptiv’s share of the earnings or losses of non-controlled affiliates, over which ~~Delphi~~Aptiv exercises significant influence (generally a 20% to 50% ownership interest), is included in the consolidated operating results using the equity method of accounting. When ~~Delphi~~Aptiv does not have the ability to exercise significant influence (generally when ownership interest is less than 20%), investments in non-consolidated affiliates without readily determinable fair values are ~~accounted~~measured at cost, less impairments, adjusted for ~~using~~observable price changes in orderly transactions for identical or similar investments of the ~~cost method.~~same issuer. All significant intercompany transactions and balances between consolidated ~~Delphi~~Aptiv businesses have been eliminated. The Company monitors its investments in affiliates for indicators of other-than-temporary declines in value on an ongoing basis. If the Company determines that such a decline has occurred, an impairment loss is recorded, which is measured as the difference between carrying value and estimated fair value. Estimated fair value is generally determined using an income approach based on discounted cash flows or negotiated transaction values.

~~During the three and nine months ended September 30, 2017, Delphi received a dividend of $7 million from one of its~~Aptiv’s equity ~~method investments. During the three and nine months ended September 30, 2016, Delphi received dividends of $4~~investments totaled $113 million and $8 million, respectively, from one of its equity method investments. The dividends were recognized as a reduction to the investment and represented a return on investment included in cash flows from operating activities.

~~Investments in affiliates accounted for under the cost method totaled $77 million and $26~~$113 million as of ~~September 30, 2017~~March 31, 2021 and December 31, ~~2016,~~2020, respectively, and are classified within other long-term assets in the consolidated balance ~~sheet.~~sheets. Refer to Note 17. Acquisitions and Divestitures for additional information regarding Aptiv’s equity investments.

Use of estimates—Preparation of consolidated financial statements in conformity with U.S. GAAP requires the use of estimates and assumptions that affect amounts reported therein. Generally, matters subject to estimation and judgment include amounts related to accounts receivable realization, inventory obsolescence, asset impairments, useful lives of intangible and fixed assets, deferred tax asset valuation allowances, income taxes, pension benefit plan assumptions, accruals related to litigation, warranty costs, environmental remediation costs, contingent consideration arrangements, worker’s compensation accruals and healthcare accruals. Due to the inherent uncertainty involved in making estimates, including the duration and severity of the impacts of the COVID-19 pandemic, actual results reported in future periods may be based upon amounts that differ from those estimates.

Revenue recognition—Aptiv recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which we expect to be entitled in exchange for those goods or services. Accordingly, revenue is measured based on consideration specified in a contract with a customer. Refer to Note 20. Revenue for additional information regarding the Company’s revenue recognition policies.

Net income per share—Basic net income per share is computed by dividing net income attributable to ~~Delphi~~ordinary shareholders by the weighted average number of ordinary shares outstanding during the period. Diluted net income per share reflects the weighted

~~Table of Contents~~

average dilutive impact of all potentially dilutive securities from the date of issuance and is computed using the treasury stock and if-converted methods. The if-converted method ~~by dividing~~is used to determine if the impact of conversion of the 5.50% Mandatory Convertible Preferred Shares, Series A, $0.01 par value per share (the “MCPS”) into ordinary shares is more dilutive than the MCPS dividends to net income ~~attributable~~per share. If so, the MCPS are assumed to ~~Delphi by~~have been converted at the ~~diluted weighted average number~~

Table of Contents

later of the beginning of the period or the time of issuance, and the resulting ordinary shares ~~outstanding. See~~are included in the denominator and the MCPS dividends are added back to the numerator. Unless otherwise noted, share and per share amounts included in these notes are on a diluted basis. Refer to Note 12. Shareholders’ Equity and Net Income Per Share for additional information including the calculation of basic and diluted net income per share.

Cash and cash equivalents—Cash and cash equivalents are defined as short-term, highly liquid investments with original maturities of three months or ~~less.~~less, for which the book value approximates fair value.

~~Cash~~Restricted cash—Restricted cash includes balances on deposit at financial institutions that have issued letters of credit in ~~escrow related to Powertrain Spin-off debt—As~~favor of ~~September 30, 2017, the Company~~Aptiv and cash deposited into an escrow $796 million of net proceeds from the issuance of $800 million principal amount of unsecured senior notes by Delphi Technologies PLC, a wholly owned subsidiary of the Company formed in connection with the planned spin-off of the Company's Powertrain Systems segment, which prior to October 10, 2017 was named Delphi Jersey Holdings plc. These proceeds will be released to Delphi Technologies PLC upon satisfaction of certain conditions, including completion of the Separation. At December 31, 2016, there was no cash in escrow for this purpose.account. Refer to Note ~~8. Debt~~15. Fair Value of Financial Instruments for further ~~description of this senior notes offering.~~information regarding amounts deposited into an escrow account.

Accounts receivable—~~Delphi~~Aptiv enters into agreements to sell certain of its accounts receivable, primarily in ~~North America and~~ Europe. Sales of receivables are accounted for in accordance with ~~FASB~~Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic ~~ASC~~ 860, Transfers and Servicing ("“ASC ~~860"~~860”). Agreements which result in true sales of the transferred receivables, as defined in ASC 860, which occur when receivables are transferred without recourse to the Company, are excluded from amounts reported in the consolidated balance sheets. Cash proceeds received from such sales are included in operating cash flows. Agreements that allow ~~Delphi~~Aptiv to maintain effective control over the transferred receivables and which do not qualify as a sale, as defined in ASC 860, are accounted for as secured borrowings and recorded in the consolidated balance sheets within accounts receivable, net and short-term debt. The expenses associated with receivables factoring are recorded in the consolidated statements of operations within interest expense.

Credit losses—Aptiv is exposed to credit losses primarily through the sale of vehicle components and services. Aptiv assesses the creditworthiness of a counterparty by conducting ongoing credit reviews, which considers the Company’s expected billing exposure and timing for payment, as well as the counterparty’s established credit rating. When a credit rating is not available, the Company’s assessment is based on an analysis of the counterparty’s financial statements. Aptiv also considers contract terms and conditions, country and political risk, and business strategy in its evaluation. Based on the outcome of this review, the Company establishes a credit limit for each counterparty. The Company continues to monitor its ongoing credit exposure through active review of counterparty balances against contract terms and due dates, which includes timely account reconciliation, payment confirmation and dispute resolution. The Company may also employ collection agencies and legal counsel to pursue recovery of defaulted receivables, if necessary.

Aptiv primarily utilizes historical loss and recovery data, combined with information on current economic conditions and reasonable and supportable forecasts to develop the estimate of the allowance for doubtful accounts in accordance with ASC Topic 326, Financial Instruments – Credit Losses (“ASC 326”). As of March 31, 2021 and December 31, 2020, the Company reported $2,798 million and $2,812 million, respectively, of accounts receivable, net of allowances, which includes the allowance for doubtful accounts of $43 million and $40 million, respectively. Changes in the allowance for doubtful accounts were not material for the three months ended March 31, 2021.

Intangible assets—Intangible assets were ~~$1,213~~$1,033 million and ~~$1,240~~$1,091 million as of ~~September 30, 2017~~March 31, 2021 and December 31, ~~2016,~~2020, respectively. ~~Delphi~~Aptiv amortizes definite-lived intangible assets over their estimated useful lives. ~~Delphi~~Aptiv has definite-lived intangible assets related to patents and developed technology, customer relationships and trade names. Indefinite-lived in-process research and development intangible assets are not amortized, but are tested for impairment annually, or more frequently when indicators of potential impairment exist, until the completion or abandonment of the associated research and development efforts. Upon completion of the projects, the assets will be amortized over the expected economic life of the asset, which will be determined on that date. Should the project be determined to be abandoned, and if the asset developed has no alternative use, the full value of the asset will be charged to expense. The Company also has intangible assets related to acquired trade names that are classified as indefinite-lived when there are no foreseeable limits on the periods of time over which they are expected to contribute cash flows. These indefinite-lived trade name assets are tested for impairment annually, or more frequently when indicators of potential impairment exist. Costs to renew or extend the term of acquired intangible assets are recognized as expense as incurred. Amortization expense was ~~$34~~$37 million and ~~$100~~$36 million for the three ~~and nine~~ months ended ~~September 30, 2017~~March 31, 2021 and ~~$34 million and $101 million for~~2020, respectively, which includes the ~~three and nine months ended September 30, 2016, respectively.~~impact of any intangible asset impairment charges recorded during the period.

Goodwill—Goodwill is the excess of the purchase price over the estimated fair value of identifiable net assets acquired in business combinations. The Company tests goodwill for impairment annually in the fourth quarter, or more frequently when indications of potential impairment exist. The Company monitors the existence of potential impairment indicators throughout the fiscal year. The Company tests for goodwill impairment at the reporting unit level. Our reporting units are the components of operating segments which constitute businesses for which discrete financial information is available and is regularly reviewed by segment management.

The impairment test involves first qualitatively assessing goodwill for impairment. If the qualitative assessment is not met the Company then performs a quantitative assessment by ~~first~~ comparing the estimated fair value of each reporting unit to its

Table of Contents

carrying value, including goodwill. Fair value reflects the price a market participant would be willing to pay in a potential sale of the reporting unit. If the estimated fair value exceeds carrying value, then we conclude that no goodwill impairment has occurred. If the carrying value of the reporting unit exceeds its estimated fair value, a second step is required to measure possible goodwill impairment loss. The second step includes hypothetically valuing the tangible and intangible assets and liabilities of the reporting unit as if the reporting unit had been acquired in a business combination. Then, the implied fair value of the reporting unit's goodwill is compared to the carrying value of that goodwill. If the carrying value of the reporting unit's goodwill exceeds the implied fair value of the goodwill, the Company recognizes an impairment loss in an amount equal to the excess, not to exceed the ~~carrying value. There~~amount of goodwill allocated to the reporting unit. The Company qualitatively concluded there were no ~~indicators of potential~~ goodwill ~~impairment~~impairments during the ~~nine~~three months ended ~~September 30, 2017.~~March 31, 2021 and 2020. Goodwill was ~~$1,670~~$2,503 million and ~~$1,508~~$2,580 million as of ~~September 30, 2017~~March 31, 2021 and December 31, ~~2016,~~2020, respectively.

Warranty and product recalls—Expected warranty costs for products sold are recognized at the time of sale of the product based on an estimate of the amount that eventually will be required to settle such obligations. These accruals are based on factors such as past experience, production changes, industry developments and various other considerations. Costs of product recalls, which may include the cost of the product being replaced as well as the customer’s cost of the recall, including

~~Table of Contents~~

labor to remove and replace the recalled part, are accrued as part of our warranty accrual at the time an obligation becomes probable and can be reasonably estimated. These estimates are adjusted from time to time based on facts and circumstances that impact the status of existing claims. Refer to Note 6. Warranty Obligations for additional information.

~~Discontinued operations~~—The Company reports financial results for discontinued operations separately from continuing operations to distinguish the financial impact of disposal transactions from ongoing operations. Discontinued operations reporting occurs only when the disposal of a component or a group of components of the Company represents a strategic shift that will have a major effect on the Company's operations and financial results. During the year ended December 31, 2015, Delphi completed the divestitures of the Company's wholly owned Thermal Systems business and the Company's interest in its KDAC joint venture. During the nine months ended September 30, 2016, Delphi completed the divestiture of its interest in its Shanghai Delphi Automotive Air Conditioning ("SDAAC") joint venture. Delphi's interests in the KDAC and SDAAC joint ventures were previously reported within the Thermal Systems segment. Accordingly, the assets and liabilities, operating results and operating and investing cash flows for the previously reported Thermal Systems segment are presented as discontinued operations separate from the Company’s continuing operations and segment results for all periods presented in these consolidated financial statements and the notes to the consolidated financial statements, unless otherwise noted. Refer to Note 21. Discontinued Operations for further information regarding the Company's discontinued operations.

Income taxes—Deferred tax assets and liabilities reflect temporary differences between the amount of assets and liabilities for financial and tax reporting purposes. Such amounts are adjusted, as appropriate, to reflect changes in tax rates expected to be in effect when the temporary differences reverse. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in earnings in the period that includes the enactment date. A valuation allowance is recorded to reduce deferred tax assets to the amount that is more likely than not to be realized. In the event the Company determines it is more likely than not that the deferred tax assets will not be realized in the future, the valuation allowance adjustment to the deferred tax assets will be charged to earnings in the period in which the Company makes such a determination. In determining whether an uncertain tax position exists, the Company determines, based solely on its technical merits, whether the tax position is more likely than not to be sustained upon examination, and if so, a tax benefit is measured on a cumulative probability basis that is more likely than not to be realized upon the ultimate settlement. In determining the provision for income taxes for financial statement purposes, the Company makes certain estimates and judgments which affect its evaluation of the carrying value of its deferred tax assets, as well as its calculation of certain tax liabilities. Refer to Note 11. Income Taxes for additional information.

Restructuring—~~Delphi~~Aptiv continually evaluates alternatives to align the business with the changing needs of its customers and to lower operating costs. This includes the realignment of its existing manufacturing capacity, facility closures, or similar actions, either in the normal course of business or pursuant to significant restructuring programs. These actions may result in employees receiving voluntary or involuntary employee termination benefits, which are mainly pursuant to union or other contractual ~~agreements.~~agreements or statutory requirements. Voluntary termination benefits are accrued when an employee accepts the related offer. Involuntary termination benefits are accrued upon the commitment to a termination plan and when the benefit arrangement is communicated to affected employees, or when liabilities are determined to be probable and estimable, depending on the existence of a substantive plan for severance or termination. Contract termination costs and certain early termination lease costs are recorded when contracts are ~~terminated or when Delphi ceases to use the leased facility and no longer derives economic benefit from the contract.~~terminated. All other exit costs are expensed as incurred. Refer to Note 7. Restructuring for additional information.

Customer concentrations—As reflected in the table below, ~~combined~~ net sales ~~from continuing operations~~ to Stellantis N.V. (“Stellantis”), General Motors Company ~~("GM"~~(“GM”) and Volkswagen Group ~~("VW"~~(“VW”), ~~Delphi's two~~Aptiv’s three largest customers, totaled approximately ~~19%~~29% and ~~21%~~32% of our total net sales for the three ~~and nine~~ months ended ~~September 30, 2017, respectively,~~March 31, 2021 and ~~23%~~2020, respectively.


		Percentage of Total Net Sales					Accounts Receivable
	Three Months Ended March 31,					March 31, 2021	December 31, 2020
		2021		2020

							(in millions)
Stellantis (1)		12	%	13	%		$	337	$	352
GM		9	%	10	%		205		200
VW		8	%	9	%		211		216

(1)On January 16, 2021, Fiat Chrysler Automobiles N.V. (“FCA”) and ~~22%~~Peugeot Citroën (“PSA”) merged to form a new, combined company (“Stellantis”). Net sales to FCA and PSA before the date of the merger are included in net sales to Stellantis in the table above for the three ~~and nine~~ months ended ~~September 30, 2016 respectively.~~March 31, 2021 and 2020. As of December 31, 2020, accounts receivable due from FCA and PSA are shown on a combined basis as accounts receivable due from Stellantis.

Percentage of Total Net Sales Accounts and Other Receivables
Three Months Ended September 30, Nine Months Ended September 30, September 30,
2017 December 31,
2016
2017 2016 2017 2016

(in millions)
GM 11 % 15 % 13 % 14 % $ 291
$ 370
VW 8 % 8 % 8 % 8 % 205
150

~~Retrospective changes~~Recently adopted accounting pronouncements—~~Prior period information has been reclassified as a result of the Company's adoption of~~Aptiv adopted Accounting Standards Update ~~("ASU"~~(“ASU”) ~~2017-07, as defined~~2020-01, Investments—Equity Securities (Topic 321), Investments—Equity Method and ~~further described below, on a retrospective basis in 2017. In accordance with~~Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815)—Clarifying the ~~adoption of this guidance, prior year amounts related to the components of net periodic pension~~Interactions between Topic 321, Topic 323, and postretirement benefit cost other than service costs have been reclassified from cost of goods sold and selling, general and administrative expense to other expense within the consolidated statement of operations for all periods presented.

~~Recently adopted accounting pronouncements—Delphi adopted ASU 2015-11,~~ ~~Inventory (Topic 330): Simplifying the Measurement of Inventory~~,Topic 815 in the first quarter of ~~2017~~2021 on a prospective basis. This guidance ~~requires an entity~~clarifies the interactions between accounting for equity securities under the measurement alternative in Topic 321 and the equity method of accounting in Topic 323, as well as the accounting for certain forward

Table of Contents

contracts and purchased options to ~~measure inventory at~~purchase securities that, upon settlement or exercise, would be accounted for under the ~~lower~~equity method of ~~cost and net realizable value, rather than at the lower of cost or market.~~accounting. The adoption of this guidance did not have a significant impact on ~~Delphi's~~Aptiv’s financial statements.

~~Table of Contents~~

~~Delphi adopted ASU 2016-05,~~ ~~Derivatives and Hedging (Topic 815): Effect of Derivative Contract Novations on Existing Hedge Accounting Relationships~~ ~~and ASU 2016-06,~~ ~~Derivatives and Hedging (Topic 815): Contingent Put and Call Options in Debt Instruments~~ in the first quarter of 2017 on a prospective basis. ASU 2016-05 clarifies that a change in the counterparty to a derivative instrument that has been designated as a hedging instrument does not, in and of itself, require dedesignation of that hedging relationship provided that all other hedge accounting criteria continue to be met. ASU 2016-06 also clarifies the steps required to determine bifurcation of an embedded derivative. The adoption of this guidance did not have a significant impact on Delphi's financial statements.

~~Delphi adopted ASU 2016-09,~~ ~~Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting~~ ("ASU 2016-09") in the first quarter of 2017. This guidance contains multiple updates related to the accounting and financial statement presentation of share-based payment transactions. The provisions of ASU 2016-09 related to the timing of when excess tax benefits are recognized were adopted using a modified retrospective transition method by means of an immaterial cumulative-effect adjustment to equity as of January 1, 2017. On a prospective basis, excess tax benefits are recognized within income tax expense in the period in which the awards vest, as opposed to being recognized in additional paid-in capital when the deduction reduced taxes payable. Such excess tax benefits are classified as an operating activity within the consolidated statement of cash flows prospectively, as opposed to a financing activity. There was no change to the Company's historical presentation of minimum statutory withholdings as a financing activity within the consolidated statement of cash flows. The Company’s share-based compensation expense continues to reflect estimated forfeitures. The adoption of ASU 2016-09 did not materially impact the Company’s financial position, results of operations, equity or cash flows.

~~Delphi adopted ASU 2017-07,~~ ~~Compensation—Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost~~ ("ASU 2017-07") in the first quarter of 2017. ASU 2017-07 changes the presentation of net periodic pension and postretirement benefit cost in the income statement. Under the new guidance, employers present the service cost component of the net periodic benefit cost in the same income statement line items as other employee compensation costs for services rendered during the period. In addition, only the service cost component is eligible for capitalization as an asset. Employers present the other components of net periodic benefit cost separately from the income statement line items that include the service cost component, outside of operating income. The new guidance is effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. Early adoption is permitted as of the beginning of an annual period. The new guidance related to the presentation of the components of net periodic benefit cost within the income statement is to be applied retrospectively. The new guidance limiting the capitalization of net periodic benefit cost in assets to the service cost component will be applied prospectively. As permitted, the Company elected to early adopt this guidance effective January 1, 2017, and has classified the components of net periodic pension and postretirement benefit cost other than service costs from cost of goods sold and selling, general and administrative expense to other expense within the consolidated statement of operations for all periods presented. The adoption of this guidance resulted in the reclassification of $3 million and $9 million of net periodic benefit cost components other than service cost from operating expense to other expense for the three and nine months ended September 30, 2016, respectively, and had no impact on net income attributable to Delphi. Approximately $9 million and $25 million of net periodic benefit cost components other than service cost are included within other expense for the three and nine months ended September 30, 2017, respectively. Refer to Note. 9. Pension Benefits for further detail of the components of net periodic benefit costs.

~~Recently issued accounting pronouncements not yet adopted—In May 2014, the Financial Accounting Standards Board ("FASB") issued ASU 2014-09,~~ ~~Revenue from Contracts with Customers. This ASU supersedes most of the existing guidance on revenue recognition in Accounting Standards Codification ("ASC") Topic 605,~~ ~~Revenue Recognition~~ and establishes a broad principle that would require an entity to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve this principle, an entity identifies the contract with a customer, identifies the separate performance obligations in the contract, determines the transaction price, allocates the transaction price to the separate performance obligations and recognizes revenue when each separate performance obligation is satisfied. The FASB has subsequently issued additional ASUs to clarify certain elements of the new revenue recognition guidance. The guidance is effective for fiscal years beginning after December 15, 2017 and is to be applied retrospectively using one of two transition methods at the entity's election. The full retrospective method requires companies to recast each prior reporting period presented as if the new guidance had always existed. Under the modified retrospective method, companies would recognize the cumulative effect of initially applying the standard as an adjustment to opening retained earnings at the date of initial application.

The Company has continued to monitor FASB activity related to the new standard, and has worked with various non-authoritative industry groups to assess certain interpretative issues and the associated implementation of the new standard. The Company has drafted its accounting policy for the new standard based on a detailed review of its business and contracts. While the Company continues to assess all potential impacts of the new standard, we do not currently expect that the adoption of the new revenue standard will have a material impact on our revenues, results of operations or financial position. As a result of the adoption of this standard, the Company expects to make additional disclosures related to the nature, amount, timing and

~~Table of Contents~~

uncertainty of revenue and cash flows arising from contracts with customers as required by the new standard. The Company plans to adopt the new revenue standard effective January 1, 2018. The Company currently intends to adopt the new standard using the modified retrospective method, and continues to evaluate the effect of the standard on our ongoing financial reporting.

~~In January 2016, the FASB issued ASU 2016-01,~~ ~~Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities.~~ This guidance makes targeted improvements to existing U.S. GAAP for financial instruments, including requiring equity investments (except those accounted for under the equity method of accounting, or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income as opposed to other comprehensive income; requiring entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes; requiring separate presentation of financial assets and financial liabilities by measurement category and form of financial asset; and requiring entities to present separately in other comprehensive income the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk (also referred to as “own credit”) when the organization has elected to measure the liability at fair value in accordance with the fair value option. The new guidance is effective for public companies for fiscal years beginning after December 15, 2017 by means of a cumulative-effect adjustment to the balance sheet as of the beginning of the fiscal year of adoption. Early adoption of the own credit provision is permitted. The Company is currently evaluating the impact that the adoption of this guidance will have on its consolidated financial statements; however, based on the nature of financial instruments held by Delphi as of September 30, 2017, the Company does not currently expect that the adoption of ASU 2016-01 will have a material impact on its financial position, results of operations or cash flows. The Company will continue to evaluate any changes in its investments or market conditions, and the related potential impacts of the adoption of ASU 2016-01.

~~In February 2016, the FASB issued ASU 2016-02,~~ ~~Leases (Topic 842)~~. Under this guidance, lessees will be required to recognize on the balance sheet a lease liability and a right-of-use asset for all leases, with the exception of short-term leases. The lease liability represents the lessee's obligation to make lease payments arising from a lease, and will be measured as the present value of the lease payments. The right-of-use asset represents the lessee’s right to use a specified asset for the lease term, and will be measured at the lease liability amount, adjusted for lease prepayment, lease incentives received and the lessee’s initial direct costs. The standard also requires a lessee to recognize a single lease cost allocated over the lease term, generally on a straight-line basis. The new guidance is effective for fiscal years beginning after December 15, 2018. ASU 2016-02 is required to be applied using the modified retrospective approach for all leases existing as of the effective date and provides for certain practical expedients. Early adoption is permitted. The Company is currently evaluating the effects that the adoption of ASU 2016-02 will have on the Company’s consolidated financial statements, and anticipates the new guidance will significantly impact its consolidated financial statements as the Company has a significant number of leases.

~~In June 2016, the FASB issued ASU 2016-13,~~ ~~Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments~~. This guidance requires the measurement of all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions and reasonable and supportable forecasts. This guidance also requires enhanced disclosures regarding significant estimates and judgments used in estimating credit losses. The new guidance is effective for fiscal years beginning after December 15, 2019. Early adoption is permitted for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. The Company is currently evaluating the impact that the adoption of this guidance will have on its consolidated financial statements.

~~In September 2016, the FASB issued ASU 2016-15,~~ ~~Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments~~. This guidance clarifies the presentation requirements of eight specific issues within the statement of cash flows. The new guidance is effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. Early adoption is permitted. The adoption of this guidance is not expected to have a significant impact on Delphi's financial statements, as Delphi's treatment of the relevant affected items within its consolidated statement of cash flows is consistent with the requirements of this guidance.

~~In October 2016, the FASB issued ASU No. 2016-16,~~ ~~Accounting for Income Taxes: Intra-Entity Asset Transfers of Assets Other than Inventory~~. This guidance requires that the tax effects of all intra-entity sales of assets other than inventory be recognized in the period in which the transaction occurs. The new guidance is effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. Early adoption as of the beginning of an annual reporting period is permitted. The guidance is to be applied on a modified retrospective basis through a cumulative-effect adjustment to retained earnings as of the beginning of the period of adoption. The Company is currently evaluating the impact that the adoption of this guidance will have on its consolidated financial statements.

~~In November 2016, the FASB issued ASU 2016-18,~~ ~~Statement of Cash Flows (Topic 230): Restricted Cash~~. This guidance requires that a statement of cash flows explain the change during the period in the total of cash, cash equivalents, and restricted cash. As a result, restricted cash will be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. The new guidance is effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. Early adoption is permitted, and the new guidance is to

~~Table of Contents~~

be applied retrospectively. The adoption of this guidance is not expected to have a significant impact on Delphi's financial statements, other than the classification of restricted cash within the beginning-of-period and end-of-period totals on the consolidated statement of cash flows, as opposed to being excluded from these totals.

~~In January 2017, the FASB issued ASU 2017-04,~~ ~~Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment~~. This guidance simplifies how an entity is required to test goodwill for impairment by eliminating step two from the goodwill impairment test, which measures a goodwill impairment loss by comparing the implied fair value of a reporting unit’s goodwill with the carrying amount. Under the new guidance, if a reporting unit’s carrying amount exceeds its fair value, an entity will record an impairment charge based on that difference. The impairment charge will be limited to the amount of goodwill allocated to that reporting unit. The standard will be applied prospectively and is effective for annual and interim impairment tests performed in periods beginning after December 15, 2019. Early adoption is permitted. The Company is currently evaluating the impact of adopting this standard on its financial statements, but does not anticipate a material impact. As this standard is prospective in nature, the impact to Delphi's financial statements of not performing a step two in order to measure the amount of any potential goodwill impairment will depend on various factors associated with the Company's assessment of goodwill for impairment in those future periods.

~~In August 2017, the FASB issued ASU 2017-12,~~ ~~Derivatives and Hedging - Targeted Improvements to Accounting for Hedging Activities~~, which expands and refines the application of hedge accounting for both non-financial and financial risk components and aligns the recognition and presentation of the effects of the hedging instrument and the hedged item in the financial statements. The standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early adoption is permitted. The Company is currently evaluating the impact that the adoption of this guidance will have on its consolidated financial statements.

3. INVENTORIES

Inventories are stated at the lower of cost, determined on a first-in, first-out basis, or net realizable value, including direct material costs and direct and indirect manufacturing costs. A summary of inventories is shown below:


	March 31, 2021		December 31, 2020

	(in millions)
Productive material	$	914	$	745
Work-in-process	135		111
Finished goods	476		441
Total	$	1,525	$	1,297

September 30,
2017 December 31,
2016
��
(in millions)
Productive material $ 855
$ 649
Work-in-process 152
113
Finished goods 635
470
Total $ 1,642
$ 1,232

4. ASSETS

Other current assets consisted of the following:

September 30,
2017 December 31,
2016

(in millions)
Value added tax receivable $ 194
$ 192
Prepaid insurance and other expenses 81
66
Reimbursable engineering costs 52
63
Notes receivable 43
43
Income and other taxes receivable 72
26
Deposits to vendors 9
8
Derivative financial instruments (Note 14) 36
11
Other 2
1
Total $ 489
$ 410

~~Table of Contents~~


	March 31, 2021		December 31, 2020

	(in millions)
Value added tax receivable	$	193	$	155

Prepaid insurance and other expenses	86		47
Reimbursable engineering costs	175		169
Notes receivable	8		8
Income and other taxes receivable	49		41
Deposits to vendors	5		5
Derivative financial instruments (Note 14)	49		48
Capitalized upfront fees (Note 20)	31		30

Total	$	596	$	503

Other long-term assets consisted of the following:


	March 31, 2021		December 31, 2020

	(in millions)
Deferred income taxes, net	$	167	$	174
Unamortized Revolving Credit Facility debt issuance costs	9		11
Income and other taxes receivable	26		25
Reimbursable engineering costs	169		186
Value added tax receivable	27		29
Equity investments (Note 17)	113		113
Derivative financial instruments (Note 14)	20		22
Capitalized upfront fees (Note 20)	74		86
Other	49		48
Total	$	654	$	694

September 30,
2017 December 31,
2016

(in millions)
Deferred income taxes, net $ 272
$ 283
Unamortized Revolving Credit Facility debt issuance costs (Note 8) 17
10
Income and other taxes receivable 74
56
Reimbursable engineering costs 51
26
Value added tax receivable 39
33
Cost method investments (Note 17) 77
26
Derivative financial instruments (Note 14) 12
8
Other 82
67
Total $ 624
$ 509

Table of Contents

5. LIABILITIES

Accrued liabilities consisted of the following:


	September 30, 2017		December 31, 2016			March 31, 2021		December 31, 2020

	(in millions)					(in millions)
Payroll-related obligations	$	284	$	233	Payroll-related obligations	$	286	$	293
Employee benefits, including current pension obligations	83		106		Employee benefits, including current pension obligations	56		84
Reserve for Unsecured Creditors litigation (Note 10)	—		300
Income and other taxes payable	217		188		Income and other taxes payable	175		177
Warranty obligations (Note 6)	112		102		Warranty obligations (Note 6)	48		51
Restructuring (Note 7)	155		153		Restructuring (Note 7)	59		82
Customer deposits	31		30		Customer deposits	53		62
Derivative financial instruments (Note 14)	16		45		Derivative financial instruments (Note 14)	10		8
Accrued interest	30		40		Accrued interest	21		48
MCPS dividends payable					MCPS dividends payable	3		3
Operating lease liabilities					Operating lease liabilities	98		100
Other	455		376		Other	451		477
Total	$	1,383	$	1,573	Total	$	1,260	$	1,385

Other long-term liabilities consisted of the following:


	March 31, 2021		December 31, 2020

	(in millions)
Environmental (Note 10)	$	4	$	4

Extended disability benefits	5		5
Warranty obligations (Note 6)	8		8
Restructuring (Note 7)	37		43
Payroll-related obligations	11		11
Accrued income taxes	152		156
Deferred income taxes, net	203		207
Derivative financial instruments (Note 14)	3		1

Other	89		105
Total	$	512	$	540

September 30,
2017 December 31,
2016

(in millions)
Environmental (Note 10) $ 5
$ 5
Extended disability benefits 8
8
Warranty obligations (Note 6) 53
59
Restructuring (Note 7) 82
45
Payroll-related obligations 10
9
Accrued income taxes 129
125
Deferred income taxes, net 178
158
Derivative financial instruments (Note 14) 3
11
Other 53
47
Total $ 521
$ 467

~~Table of Contents~~

6. WARRANTY OBLIGATIONS

Expected warranty costs for products sold are recognized principally at the time of sale of the product based on an estimate of the amount that eventually will be required to settle such obligations. These accruals are based on factors such as past experience, production changes, industry developments and various other considerations. The estimated costs related to product recalls based on a formal campaign soliciting return of that product are accrued at the time an obligation becomes probable and can be reasonably estimated. These estimates are adjusted from time to time based on facts and circumstances that impact the status of existing claims. ~~Delphi~~Aptiv has recognized its best estimate for its total aggregate warranty reserves, including product recall costs, across all of its operating segments as of ~~September 30, 2017.~~March 31, 2021. The Company estimates the reasonably possible amount to ultimately resolve all matters in excess of the recorded reserves as of ~~September 30, 2017~~March 31, 2021 to be ~~zero~~0 to ~~$30~~$10 million.

Table of Contents

The table below summarizes the activity in the product warranty liability for the ~~nine~~three months ended ~~September 30, 2017:~~March 31, 2021:


	Warranty Obligations

	(in millions)
Accrual balance at beginning of period	$	59
Provision for estimated warranties incurred during the period	7
Changes in estimate for pre-existing warranties	4
Settlements made during the period (in cash or in kind)	(13)
Foreign currency translation and other	(1)
Accrual balance at end of period	$	56

Warranty Obligations

(in millions)
Accrual balance at beginning of period $ 161
Provision for estimated warranties incurred during the period 64
Changes in estimate for pre-existing warranties 48
Settlements made during the period (in cash or in kind) (117 )
Foreign currency translation and other 9
Accrual balance at end of period $ 165

In September 2016, one of the Company's OEM customers initiated a recall to enhance airbag deployment systems in certain vehicles. Delphi's Electronics and Safety segment had supplied sensors and related control modules for the airbags in the affected vehicles. During the first quarter of 2017, Delphi reached an agreement with its customer related to this matter. In addition to the Company's previously recorded reserve estimate, Delphi recognized an incremental $43 million of warranty expense within cost of sales during the nine months ended September 30, 2017 related to this matter.

7. RESTRUCTURING

~~Delphi’s~~Aptiv’s restructuring activities are undertaken as necessary to implement management’s strategy, streamline operations, take advantage of available capacity and resources, and ultimately achieve net cost reductions. These activities generally relate to the realignment of existing manufacturing capacity and closure of facilities and other exit or disposal activities, as ~~they relate~~it relates to executing ~~Delphi’s~~Aptiv’s strategy, either in the normal course of business or pursuant to significant restructuring programs.

As part of ~~Delphi's~~Aptiv’s continued efforts to optimize its cost structure, it has undertaken several restructuring programs which include workforce reductions as well as plant closures. These programs are primarily focused on the continued rotation of our manufacturing footprint to best cost locations in Europe and on reducing global overhead ~~costs, including programs implemented to realign the Company's organizational structure due to changes in roles and workforce as a result of the planned spin-off of the Powertrain Systems segment.~~costs. The Company recorded employee-related and other restructuring charges related to these programs totaling approximately ~~$21~~$6 million ~~and $180 million during the three and nine months ended September 30, 2017, respectively.~~

~~Restructuring costs recorded~~ during the three months ended September 30, 2017 included $9 million for programs focused on the continued rotation of our manufacturing footprint to best cost locations in Europe, as well as $6 million for programs implemented to reduce global overhead costs. The charges recorded during the nine months ended September 30, 2017 included the recognition of approximately $54 million of employee-related and other costs related to the initiationMarch 31, 2021. None of the ~~closure of a Western European manufacturing site within the Powertrain Systems segment pursuant to the~~ Company's ~~on-going European footprint rotation strategy. Cash payments for this~~individual restructuring action are expected to be principally completed by 2020. The charges recorded during the nine months ended September 30, 2017 also included $36 million of costs related to the closure of an Electronics and Safety Western European manufacturing site.

~~Restructuring costs of approximately $63 million and $252 million were recorded during the three and nine months ended September 30, 2016, respectively. These charges included $50 million recorded~~programs initiated during the three months ended ~~September 30, 2016~~March 31, 2021 were material and there have been no changes in previously initiated programs that have resulted (or are expected to result) in a material change to our restructuring costs. The Company expects to incur additional restructuring costs of approximately $30 million (of which approximately $15 million relates to the Signal and Power Solutions segment and approximately $15 million relates to the Advanced Safety and User Experience segment) for programs approved as of March 31, 2021, which are primarily expected to be incurred within the next twelve months.

During the three months ended March 31, 2020, Aptiv recorded employee-related and other restructuring charges totaling approximately $28 million of which $11 million was recognized for programs implemented ~~to reduce global overhead costs, as well as $152 million recorded during~~in the ~~nine months ended September 30, 2016 for programs focused on the continued rotation of our manufacturing footprint to low cost locations~~

~~Table of Contents~~

~~in Europe, $90 million of which related~~European region, pursuant to the initiation of the closure of a European manufacturing site within the Powertrain Systems segment. Cash payments for this restructuring action are expected to be principally completed in 2017. Additionally, Delphi recognized non-cash asset impairment charges of $19 million during the nine months ended~~September 30, 2016 related to this plant closure, which were recorded within~~Company’s ongoing overhead cost ~~of sales.~~reduction strategy.

Restructuring charges for employee separation and termination benefits are paid either over the severance period or in a lump sum in accordance with either statutory requirements or individual agreements. ~~Delphi~~Aptiv incurred cash expenditures related to its restructuring programs of approximately ~~$162~~$31 million and ~~$179~~$43 million in the ~~nine~~three months ended ~~September 30, 2017~~March 31, 2021 and ~~2016,~~2020, respectively.

The following table summarizes the restructuring charges recorded for the three ~~and nine~~ months ended ~~September 30, 2017~~March 31, 2021 and ~~2016~~2020 by operating segment:


	Three Months Ended March 31,
		2021		2020

		(in millions)
Signal and Power Solutions		$	(2)	$	19
Advanced Safety and User Experience		8		9
Total		$	6	$	28

Three Months Ended September 30, Nine Months Ended September 30,
2017 2016 2017 2016

(in millions)
Electrical/Electronic Architecture $ 17
$ 30
$ 43
$ 65
Powertrain Systems 4
22
81
157
Electronics and Safety —
11
56
30
Total $ 21
$ 63
$ 180
$ 252

Table of Contents

The table below summarizes the activity in the restructuring liability for the ~~nine~~three months ended ~~September 30, 2017:~~March 31, 2021:


	Employee Termination Benefits Liability		Other Exit Costs Liability		Total

	(in millions)
Accrual balance at January 1, 2021	$	125	$	0	$	125
Provision for estimated expenses incurred during the period	6		0		6
Payments made during the period	(31)		0		(31)
Foreign currency and other	(4)		0		(4)
Accrual balance at March 31, 2021	$	96	$	0	$	96

Employee Termination Benefits Liability Other Exit Costs Liability Total

(in millions)
Accrual balance at January 1, 2017 $ 193
$ 5
$ 198
Provision for estimated expenses incurred during the period 180
—
180
Payments made during the period (159 ) (3 ) (162 )
Foreign currency and other 22
(1 ) 21
Accrual balance at September 30, 2017 $ 236
$ 1
$ 237

~~Table of Contents~~

8. DEBT

The following is a summary of debt outstanding, net of unamortized issuance costs and discounts, as of ~~September 30, 2017~~March 31, 2021 and December 31, ~~2016, respectively:~~2020:

September 30,
2017 December 31,
2016

(in millions)
3.15%, senior notes, due 2020 (net of $2 and $3 unamortized issuance costs and $1 and $1 discount, respectively) $ 647
$ 646
4.15%, senior notes, due 2024 (net of $4 and $4 unamortized issuance costs and $1 and $2 discount, respectively) 695
694
1.50%, Euro-denominated senior notes, due 2025 (net of $4 and $4 unamortized issuance costs and $3 and $3 discount, respectively) 815
729
4.25%, senior notes, due 2026 (net of $4 and $4 unamortized issuance costs, respectively) 646
646
1.60%, Euro-denominated senior notes, due 2028 (net of $4 and $4 unamortized issuance costs and $0 and $1 discount, respectively) 583
521
4.40%, senior notes, due 2046 (net of $3 and $3 unamortized issuance costs and $2 and $2 discount, respectively) 295
295
Tranche A Term Loan, due 2021 (net of $2 and $2 unamortized issuance costs, respectively) 398
398
Capital leases and other 38
42
Sub-total 4,117
3,971
Powertrain Spin-Off Debt: 5.00%, senior notes, due 2025 (net of $14 and $0 unamortized issuance costs and $4 and $0 discount, respectively) 782
—
Total debt 4,899
3,971
Less: current portion (15 ) (12 )
Long-term debt $ 4,884
$ 3,959


	March 31, 2021		December 31, 2020

	(in millions)



4.15%, senior notes, due 2024 (net of $1 and $1 unamortized issuance costs and $1 and $1 discount, respectively)	$	698	$	698
1.50%, Euro-denominated senior notes, due 2025 (net of $2 and $2 unamortized issuance costs and $1 and $2 discount, respectively)	820		857
4.25%, senior notes, due 2026 (net of $2 and $2 unamortized issuance costs, respectively)	648		648
1.60%, Euro-denominated senior notes, due 2028 (net of $3 and $3 unamortized issuance costs, respectively)	585		612
4.35%, senior notes, due 2029 (net of $3 and $3 unamortized issuance costs, respectively)	297		297
4.40%, senior notes, due 2046 (net of $3 and $3 unamortized issuance costs and $1 and $1 discount, respectively)	296		296
5.40%, senior notes, due 2049 (net of $4 and $4 unamortized issuance costs and $1 and $1 discount, respectively)	345		345
Tranche A Term Loan, due 2022 and 2021 (net of $1 and $1 unamortized issuance costs, respectively)	312		320
Finance leases and other	23		28
Total debt	4,024		4,101
Less: current portion	(78)		(90)
Long-term debt	$	3,946	$	4,011

Credit Agreement

~~Delphi Automotive~~Aptiv PLC and its wholly-owned subsidiary ~~Delphi~~Aptiv Corporation entered into a credit agreement (the ~~"Credit Agreement"~~“Credit Agreement”) with JPMorgan Chase Bank, N.A., as administrative agent (the ~~"Administrative Agent"~~“Administrative Agent”), under which it maintains senior ~~secured~~unsecured credit facilities currently consisting of a term loan (the “Tranche A Term Loan”) and a revolving credit facility of ~~$2.0~~$2 billion (the “Revolving Credit Facility”). The Credit Agreement was entered into in March 2011 and has been subsequently amended and restated on several occasions, most recently on ~~August 17, 2016.~~May 1, 2020 (the “May 2020 Amendment”) and June 8, 2020 (the “June 2020 Amendment”). The ~~2016 amendment~~May 2020 Amendment extended the maturity of $1,779 million in principal amount of the Revolving Credit Facility and $298 million in principal amount of the Tranche A Term Loan from ~~2018~~August 17, 2021 to ~~2021,~~August 17, 2022 and increased the ~~capacity~~leverage ratio maintenance covenant until July 1, 2021 (the “Covenant Relief Period”), unless Aptiv elects to terminate the Covenant Relief Period at an earlier date. Under the terms of the May 2020 Amendment, Aptiv’s consolidated leverage ratio (the ratio of Consolidated Total Indebtedness to Consolidated EBITDA, each as defined in the May 2020 Amendment) is increased from not more than 3.5 to 1.0 to not more than 4.5 to 1.0 during the Covenant Relief Period, and Aptiv is subject to certain additional covenant restrictions during the Covenant Relief Period, including restrictions on Aptiv’s ability to execute repurchases of or pay dividends on its outstanding ordinary shares. The maturity date of the remaining portions of the Revolving Credit Facility ~~from $1.5 billion~~and Tranche A Term Loan were not extended and will mature on August 17, 2021. The June 2020 Amendment amended the dividends and distributions covenant set forth in the Credit Agreement to ~~$2.0 billion~~permit the payment of dividends on convertible preferred shares in connection with the preferred equity offering as further discussed in

Table of Contents

Note 12. Shareholders’ Equity and ~~permitted Delphi Automotive~~Net Income Per Share. During the year ended December 31, 2020, Aptiv Global Financing Limited (“AGFL”), a wholly-owned Irish subsidiary of Aptiv PLC, executed a joinder agreement to the Credit Agreement, which allows it to act as a borrower onunder the ~~Revolving~~ Credit ~~Facility. A loss on debt extinguishment of $3 million was recorded within other income (expense), net~~Agreement, and a guaranty supplement, under which AGFL guarantees the obligations under the Credit Agreement, subject to certain exceptions set forth in the ~~consolidated statement of operations during the third quarter of 2016 in conjunction with the 2016 amendment.~~Credit Agreement.

~~The Tranche A Term Loan and the Revolving Credit Facility mature on August 17, 2021. Delphi~~Aptiv is obligated to make quarterly principal payments ~~beginning December 31, 2017,~~ throughout the term of the Tranche A Term Loan, according to the amortization schedule in the Credit Agreement. The Credit Agreement also contains an accordion feature that permits ~~Delphi~~Aptiv to increase, from time to time, the aggregate borrowing capacity under the Credit Agreement by up to an additional $1 billion ~~(or a greater amount based~~ upon ~~a formula set forth in the Credit Agreement) upon Delphi's~~Aptiv’s request, the agreement of the lenders participating in the increase, and the approval of the Administrative Agent and existing lenders.

As of ~~September 30, 2017, there were~~March 31, 2021, Aptiv had no amounts ~~drawn on~~outstanding under the Revolving Credit Facility and ~~approximately $7~~less than $1 million in letters of credit were issued under the Credit Agreement. Letters of credit issued under the Credit Agreement reduce availability under the Revolving Credit Facility.

Loans under the Credit Agreement bear interest, at ~~Delphi's~~Aptiv’s option, at either (a) the Administrative Agent’s Alternate Base Rate (“ABR” as defined in the Credit Agreement) or (b) the London Interbank Offered Rate (the “Adjusted LIBO Rate” as defined in the Credit Agreement) (“LIBOR”) plus in either case a percentage per annum as set forth in the table below (the “Applicable Rate”). The Applicable Rates under the Credit Agreement on the specified dates are set forth below:


	March 31, 2021				December 31, 2020
	LIBOR plus		ABR plus		LIBOR plus		ABR plus
Revolving Credit Facility (1)	1.10	%	0.10	%	1.10	%	0.10	%
Revolving Credit Facility (2)	1.40	%	0.40	%	1.40	%	0.40	%
Tranche A Term Loan (1)	1.25	%	0.25	%	1.25	%	0.25	%
Tranche A Term Loan (2)	1.75	%	0.75	%	1.75	%	0.75	%

~~Table~~(1)Applicable to principal balances under the Credit Agreement which were not extended as part of ~~Contents~~the May 2020 Amendment as described above.

September 30, 2017 December 31, 2016
LIBOR plus ABR plus LIBOR plus ABR plus
Revolving Credit Facility 1.10 % 0.10 % 1.10 % 0.10 %
Tranche A Term Loan 1.25 % 0.25 % 1.25 % 0.25 %
(2)Applicable to principal balances under the Credit Agreement which were extended as part of the May 2020 Amendment as described above.

The Applicable Rate under the Credit Agreement may increase or decrease from time to time based on changes in the ~~Company's~~Company’s credit ratings. Accordingly, the interest rate will fluctuate during the term of the Credit Agreement based on changes in the ABR, LIBOR or future changes in the ~~Company's~~Company’s corporate credit ratings. The Credit Agreement also requires that ~~Delphi~~Aptiv pay certain facility fees on the Revolving Credit Facility and certain letter of credit issuance and fronting fees.

The interest rate period with respect to LIBOR interest rate options can be set at one-, two-, three-, or six-months as selected by ~~Delphi~~Aptiv in accordance with the terms of the Credit Agreement (or other period as may be agreed by the applicable lenders). ~~Delphi~~Aptiv may elect to change the selected interest rate option in accordance with the provisions of the Credit Agreement. As of ~~September 30, 2017, Delphi~~March 31, 2021, Aptiv selected the one-month LIBOR interest rate option on the Tranche A Term Loan, and the ~~rate~~rates effective as of ~~September 30, 2017~~,March 31, 2021, as detailed in the table below, ~~was~~were based on the ~~Company's~~Company’s current credit rating and the Applicable Rate for the Credit Agreement:


		Borrowings as of
		March 31, 2021		Rates effective as of
	Applicable Rate	(in millions)		March 31, 2021




Tranche A Term Loan (1)	LIBOR plus 1.25%	$	49	1.375	%
Tranche A Term Loan (2)	LIBOR plus 1.75%	$	264	1.875	%

Borrowings as of
September 30, 2017 Rate effective as of
Applicable Rate (in millions) September 30, 2017
Tranche A Term Loan LIBOR plus 1.25% $ 400
2.50 %
(1)Applicable to principal balances under the Credit Agreement which were not extended as part of the May 2020 Amendment as described above.

(2)Applicable to principal balances under the Credit Agreement which were extended as part of the May 2020 Amendment as described above.

Borrowings under the Credit Agreement are prepayable at ~~Delphi's~~Aptiv’s option without premium or penalty.

The Credit Agreement contains certain covenants that limit, among other things, the Company’s (and the Company’s subsidiaries’) ability to incur certain additional indebtedness or liens or to dispose of substantially all of its assets. In addition, the Credit Agreement requires that the Company maintain a consolidated leverage ratio (the ratio of Consolidated Total Indebtedness to Consolidated EBITDA, each as defined in the Credit Agreement) of ~~less~~not more than ~~3.50~~3.5 to 1.0,. which was increased to 4.5 to 1.0 until July 1, 2021 under the May 2020 Amendment. The Credit Agreement also contains events of default customary for financings of this type. The Company was in compliance with the Credit Agreement covenants as of ~~September 30, 2017~~.March 31, 2021.

Table of Contents

As of ~~September 30, 2017,~~March 31, 2021, all obligations under the Credit Agreement were borrowed by ~~Delphi~~Aptiv Corporation and jointly and severally guaranteed by its direct and indirect parent companies, subject to certain exceptions set forth in the Credit Agreement. ~~Refer to Note 19. Supplemental Guarantor and Non-Guarantor Condensed Consolidating Financial Statements for additional information.~~

Senior Unsecured Notes

~~On February 14, 2013, Delphi Corporation issued~~ ~~$800 million~~ of ~~5.00%~~ ~~senior unsecured notes due~~ ~~2023~~ (the “2013 Senior Notes”) in a transaction registered under Rule 144A and Regulation S of the Securities Act of 1933 (the “Securities Act”). The proceeds were primarily utilized to prepay our term loan indebtedness under the Credit Agreement. Delphi paid approximately $12 million of issuance costs in connection with the 2013 Senior Notes. Interest was payable semi-annually on February 15 and August 15 of each year to holders of record at the close of business on February 1 or August 1 immediately preceding the interest payment date. In September 2016, Delphi redeemed for cash the entire $800 million aggregate principal amount outstanding of the 2013 Senior Notes, primarily financed by the proceeds from the issuance of the 2016 Euro-denominated Senior Notes and the 2016 Senior Notes, each as defined below. As a result of the redemption of the 2013 Senior Notes, Delphi recognized a loss on debt extinguishment of approximately $70 million during the third quarter of 2016 within other income (expense), net in the consolidated statement of operations.

On March 3, 2014, ~~Delphi~~Aptiv Corporation issued $700 million in aggregate principal amount of 4.15% senior unsecured notes due 2024 (the “2014 Senior Notes”) in a transaction registered under the Securities ~~Act.~~Act of 1933, as amended (the “Securities Act”). The 2014 Senior Notes were priced at 99.649% of par, resulting in a yield to maturity of 4.193%. The proceeds were primarily utilized to redeem $500 million of 5.875% senior unsecured notes due 2019 and to repay a portion of the Tranche A Term Loan. ~~Delphi~~Aptiv paid approximately $6 million of issuance costs in connection with the 2014 Senior Notes. Interest is payable semi-annually on March 15 and September 15 of each year to holders of record at the close of business on March 1 or September 1 immediately preceding the interest payment date.

On March 10, 2015, ~~Delphi Automotive~~Aptiv PLC issued €700 million in aggregate principal amount of 1.50% Euro-denominated senior unsecured notes due 2025 (the “2015 Euro-denominated Senior Notes”) in a transaction registered under the Securities Act. The 2015 Euro-denominated Senior Notes were priced at 99.54% of par, resulting in a yield to maturity of 1.55%. The proceeds were primarily utilized to redeem $500 million of 6.125% senior unsecured notes due 2021, and to fund

~~Table of Contents~~

growth initiatives, such as acquisitions, and share repurchases. ~~Delphi~~Aptiv incurred approximately $5 million of issuance costs in connection with the 2015 Euro-denominated Senior Notes. Interest is payable annually on March 10. The Company has designated the 2015 Euro-denominated Senior Notes as a net investment hedge of the foreign currency exposure of its investments in certain Euro-denominated wholly-owned subsidiaries. Refer to ~~Note.~~Note 14. Derivatives and Hedging Activities for further information.

On November 19, 2015, ~~Delphi Automotive~~Aptiv PLC issued $1.3 billion in aggregate principal amount of senior unsecured notes in a transaction registered under the Securities Act, comprised of $650 million of 3.15% senior unsecured notes due 2020 (the ~~"3.15%~~“3.15% Senior ~~Notes"~~Notes”) and $650 million of 4.25% senior unsecured notes due 2026 (the ~~"4.25%~~“4.25% Senior ~~Notes"~~Notes”) (collectively, the ~~"2015~~“2015 Senior ~~Notes"~~Notes”). The 3.15% Senior Notes were priced at 99.784% of par, resulting in a yield to maturity of 3.197%, and the 4.25% Senior Notes were priced at 99.942% of par, resulting in a yield to maturity of 4.256%. The proceeds were primarily utilized to fund a portion of the cash consideration for the acquisition of HellermannTyton ~~as further described in Note. 17. Acquisitions and Divestitures,~~PLC and for general corporate purposes, including the payment of fees and expenses associated with the HellermannTyton PLC acquisition and the related financing transaction. ~~Delphi~~Aptiv incurred approximately $8 million of issuance costs in connection with the 2015 Senior Notes. Interest on the 3.15% Senior Notes iswas payable semi-annually on May 19 and November 19 of each year to holders of record at the close of business on May 4 or November 4 immediately preceding the interest payment date. Interest on the 4.25% Senior Notes is payable semi-annually on January 15 and July 15 of each year to holders of record at the close of business on January 1 or July 1 immediately preceding the interest payment date. In March 2019, Aptiv redeemed for cash the entire $650 million aggregate principal amount outstanding of the 3.15% Senior Notes, financed by the proceeds received from the issuance of the 2019 Senior Notes, as defined below.

On September 15, 2016, ~~Delphi Automotive~~Aptiv PLC issued €500 million in aggregate principal amount of 1.60% Euro-denominated senior unsecured notes due 2028 (the “2016 Euro-denominated Senior Notes”) in a transaction registered under the Securities Act. The 2016 Euro-denominated Senior Notes were priced at 99.881% of par, resulting in a yield to maturity of 1.611%. The proceeds, together with proceeds from the 2016 Senior Notes described below, were utilized to redeem the ~~2013 Senior Notes. Delphi~~$800 million of 5.00% senior unsecured notes due 2023. Aptiv incurred approximately $4 million of issuance costs in connection with the 2016 Euro-denominated Senior Notes. Interest is payable annually on September 15. The Company has designated the 2016 Euro-denominated Senior Notes as a net investment hedge of the foreign currency exposure of its investments in certain Euro-denominated wholly-owned subsidiaries. Refer to ~~Note.~~Note 14. Derivatives and Hedging Activities for further information.

On September 20, 2016, ~~Delphi Automotive~~Aptiv PLC issued $300 million in aggregate principal amount of 4.40% senior unsecured notes due 2046 (the “2016 Senior Notes”) in a transaction registered under the Securities Act. The 2016 Senior Notes were priced at 99.454% of par, resulting in a yield to maturity of 4.433%. The proceeds, together with proceeds from the 2016 Euro-denominated Senior Notes, were utilized to redeem the ~~2013 Senior Notes. Delphi~~$800 million of 5.00% senior unsecured notes due 2023. Aptiv incurred approximately $3 million of issuance costs in connection with the 2016 Senior Notes. Interest is payable semi-annually on April 1 and October 1 of each year to holders of record at the close of business on March 15 or September 15 immediately preceding the interest payment date.

On March 14, 2019, Aptiv PLC issued $650 million in aggregate principal amount of senior unsecured notes in a transaction registered under the Securities Act, comprised of $300 million of 4.35% senior unsecured notes due 2029 (the “4.35% Senior Notes”) and $350 million of 5.40% senior unsecured notes due 2049 (the “5.40% Senior Notes”) (collectively, the “2019 Senior Notes”). The 4.35% Senior Notes were priced at 99.879% of par, resulting in a yield to maturity of 4.365%, and the 5.40% Senior Notes were priced at 99.558% of par, resulting in a yield to maturity of 5.430%. The proceeds were utilized to redeem the 3.15% Senior Notes. Aptiv incurred approximately $7 million of issuance costs in connection with the 2019 Senior Notes. Interest on the 2019 Senior Notes is payable semi-annually on March 15 and September 15 of each year to holders of record at the close of business on March 1 or September 1 immediately preceding the interest payment date.

Table of Contents

Although the specific terms of each indenture governing each series of senior notes vary, the indentures contain certain restrictive covenants, including with respect to ~~Delphi's~~Aptiv’s (and ~~Delphi's~~Aptiv’s subsidiaries) ability to incur liens, enter into sale and leaseback transactions and merge with or into other entities. As of ~~September 30, 2017,~~March 31, 2021, the Company was in compliance with the provisions of all series of the outstanding senior notes.

The ~~2013 Senior Notes and the~~ 2014 Senior Notes ~~were~~ issued by ~~Delphi Corporation. The 2014 Senior Notes~~Aptiv Corporation are ~~and prior to their redemption, the 2013 Senior Notes were,~~ fully and unconditionally guaranteed, jointly and severally, by ~~Delphi Automotive~~Aptiv PLC and by certain of ~~Delphi Automotive PLC's~~Aptiv PLC’s direct and indirect subsidiaries, which are directly or indirectly 100% owned by ~~Delphi Automotive~~Aptiv PLC, subject to customary release provisions (other than in the case of ~~Delphi Automotive~~Aptiv PLC). The 2015 Euro-denominated Senior Notes, ~~2015~~4.25% Senior Notes, 2016 Euro-denominated Senior Notes, 2016 Senior Notes and ~~2016~~2019 Senior Notes issued by ~~Delphi Automotive~~Aptiv PLC are fully and unconditionally guaranteed, jointly and severally, by certain of ~~Delphi Automotive PLC's~~Aptiv PLC’s direct and indirect subsidiaries (including ~~Delphi~~Aptiv Corporation), which are directly or indirectly 100% owned by ~~Delphi Automotive~~Aptiv PLC, subject to customary release provisions. ~~Refer to Note 19. Supplemental Guarantor and Non-Guarantor Condensed Consolidating Financial Statements for additional information.~~

~~Spin-off Financing~~

Delphi Technologies PLC ("Delphi Technologies"), a wholly owned subsidiary of the Company, was formed in connection with the Separation as a holding company to directly or indirectly own substantially all of the operating subsidiaries of the spin-off, to issue debt and to perform treasury operations of the spin-off, which prior to October 10, 2017 was named Delphi Jersey Holdings plc. Delphi Powertrain Corporation ("DPC"), a wholly owned U.S. subsidiary of the Company that will become a wholly owned subsidiary of Delphi Technologies PLC upon completion of the Separation, was also formed for the same purposes.

~~Table of Contents~~

~~Spin-off Credit Agreement~~

On September 7, 2017, Delphi Technologies PLC and DPC entered into a credit agreement (the "Spin-Off Credit Agreement") with JPMorgan Chase Bank, N.A., as administrative agent, with respect to $1.25 billion in senior secured credit facilities. The Credit Agreement consists of a senior secured five-year $750 million term loan facility (the “Spin-Off Term Loan A Facility”) and a $500 million five-year senior secured revolving credit facility (the “ Spin-Off Revolving Credit Facility”) (collectively, the “Spin-Off Credit Facilities”) with the lenders party thereto and JPMorgan Chase Bank, N.A.

The Spin-Off Credit Facilities are expected to become available to Delphi Technologies PLC no later than the date of the Separation, subject to the satisfaction of certain conditions customary for financings of this type, including the spin-off. Accordingly, no amounts were drawn or available to be drawn under the Spin-Off Credit Facilities as of September 30, 2017. Prior to the date of the Separation, Delphi Technologies PLC is required to pay a 0.30% per annum commitment fee on the committed loans under the Spin-Off Credit Facilities. The Company incurred approximately $9 million of debt issuance costs in connection with the Spin-Off Credit Agreement.

The borrowers under the Spin-Off Credit Agreement will comprise Delphi Technologies PLC and DPC. Additional subsidiaries of Delphi Technologies PLC may be added as co-borrowers or guarantors under the Spin-Off Credit Agreement from time to time on the terms and conditions set forth in the Spin-Off Credit Agreement. The obligations of each borrower under the Spin-Off Credit Agreement will be jointly and severally guaranteed by each other borrower and by certain of Delphi Technologies PLC's existing and future direct and indirect subsidiaries, subject to certain exceptions customary for financings of this type. All obligations of the borrowers and the guarantors will be secured by certain assets of such borrowers and guarantors, including a perfected first-priority pledge of all of the capital stock in DPC.

~~Spin-Off Senior Notes~~

On September 28, 2017, Delphi Technologies PLC issued $800 million in aggregate principal amount of 5.00% senior unsecured notes due 2025 in a transaction exempt from registration under the Securities Act (the "Spin-Off Senior Notes"). The Spin-Off Senior Notes were priced at 99.50% of par, resulting in a yield to maturity of 5.077%. Approximately $14 million of issuance costs were incurred in connection with the Spin-Off Senior Notes offering. Interest is payable semi-annually on April 1 and October 1 of each year to holders of record at the close of business on March 15 or September 15 immediately preceding the interest payment date. The proceeds received from the Spin-Off Senior Notes offering were deposited into escrow for release to Delphi Technologies PLC upon satisfaction of certain conditions, including completion of the Separation. If the conditions for the release of the proceeds of this offering from escrow are not satisfied by June 30, 2018, the Spin-Off Senior Notes will be subject to mandatory redemption. The Spin-Off Senior Notes have not been, and are not expected to be, guaranteed by the Company or any of its subsidiaries that will not be subsidiaries of Delphi Technologies PLC following the spin-off. Upon completion of the Separation, Delphi Technologies PLC will use the proceeds from the Spin-Off Senior Notes together with the proceeds from the Spin-Off Term Loan A Facility to fund a dividend to the Company, fund operating cash and pay taxes and related fees and expenses.

Other Financing

Receivable factoring—~~Delphi~~Aptiv maintains a ~~€400~~€450 million European accounts receivable factoring facility ~~which~~that is available on a ~~non-committed basis.~~committed basis and allows for factoring of receivables denominated in both Euros and U.S. dollars (“USD”). This facility became effective on January 1, 2021 and replaced Aptiv’s previous €300 million European accounts receivable factoring facility. This facility is accounted for as short-term debt and borrowings are subject to the availability of eligible accounts receivable. Collateral is not required related to these trade accounts receivable. ~~This~~The program ~~automatically renews on~~is for a ~~non-committed, indefinite basis unless terminated by~~term of three years, subject to Aptiv’s right to terminate at any time with three months’ notice. After expiration of the three year term, either ~~party.~~party can terminate with three months’ notice. Borrowings denominated in Euros under the facility bear interest at ~~LIBOR plus 1.05% for borrowings denominated in pounds sterling and~~the three-month Euro Interbank Offered Rate ~~("EURIBOR"~~(“EURIBOR”) plus ~~0.80% for~~0.50% and USD borrowings ~~denominated in Euros. No~~bear interest at two-month LIBOR plus 0.50%, with borrowings under either denomination carrying a minimum interest rate of 0.20%. As of March 31, 2021, Aptiv had no amounts ~~were outstanding~~drawn on the new European accounts receivable factoring facility and as of ~~September 30, 2017 or~~ December 31, ~~2016.~~2020, Aptiv had no amounts outstanding on the previous European accounts receivable factoring facility.

The Company has entered into arrangements with various financial institutions to sell eligible trade receivables from certain aftermarket customers in North America. These arrangements can be terminated at any time subject to prior written notice. The receivables under these arrangements are sold without recourse to the Company and are therefore accounted for as true sales. During the three and nine months ended September 30, 2017, $25 million and $63 million of receivables were sold under these arrangements, and expenses of $1 million and $2 million, respectively, were recognized within interest expense. During the three and nine months ended September 30, 2016, $19 million and $94 million of receivables were sold under these arrangements, and expenses of less than $1 million and $2 million, respectively, were recognized within interest expense.

~~Capital~~Finance leases and other—As of ~~September 30, 2017~~March 31, 2021 and December 31, ~~2016,~~2020, approximately ~~$38~~$23 million and ~~$42~~$28 million, respectively, of other debt primarily issued by certain non-U.S. subsidiaries and ~~capital~~finance lease obligations ~~was~~were outstanding.

Interest—Cash paid for interest related to debt outstanding totaled ~~$109~~$63 million and ~~$131~~$66 million for the ~~nine~~three months ended ~~September 30, 2017~~March 31, 2021 and ~~2016,~~2020, respectively.

~~Table~~Letter of ~~Contents~~credit facilities—In addition to the letters of credit issued under the Credit Agreement, Aptiv had approximately $3 million and $2 million outstanding through other letter of credit facilities as of March 31, 2021 and December 31, 2020, respectively, primarily to support arrangements and other obligations at certain of its subsidiaries.

9. PENSION BENEFITS

Certain of ~~Delphi’s~~Aptiv’s non-U.S. subsidiaries sponsor defined benefit pension plans, which generally provide benefits based on negotiated amounts for each year of service. ~~Delphi’s~~Aptiv’s primary non-U.S. plans are located in France, Germany, Mexico, Portugal and the ~~United Kingdom (“~~U.K.~~”).~~ The U.K. and certain Mexican plans are funded. In addition, ~~Delphi~~Aptiv has defined benefit plans in South Korea, Turkey and Italy for which amounts are payable to employees immediately upon separation. The obligations for these plans are recorded over the requisite service period.

~~Delphi~~Aptiv sponsors a Supplemental Executive Retirement Program (“SERP”) for those employees who were U.S. executives of the former Delphi Corporation ~~(now known as DPH Holdings Corp. (“DPHH”))~~ prior to September 30, 2008 and were still U.S. executives of ~~Delphi~~the Company on October 7, 2009, the effective date of the program. This program is unfunded. Executives receive benefits over 5 years after an involuntary or voluntary separation from ~~Delphi.~~Aptiv. The SERP is closed to new members.

Table of Contents

The amounts shown below reflect the defined benefit pension expense for the three ~~and nine~~ months ended ~~September 30, 2017~~March 31, 2021 and ~~2016~~:2020:

Non-U.S. Plans U.S. Plans

Three Months Ended September 30,
2017 2016 2017 2016

(in millions)
Service cost $ 13
$ 12
$ —
$ —
Interest cost 16
17
—
—
Expected return on plan assets (19 ) (18 ) —
—
Curtailment loss 1
—
—
—
Amortization of actuarial losses 11
4
—
—
Net periodic benefit cost $ 22
$ 15
$ —
$ —

Non-U.S. Plans U.S. Plans

Nine Months Ended September 30,
2017 2016 2017 2016

(in millions)
Service cost $ 40
$ 37
$ —
$ —
Interest cost 45
51
1
1
Expected return on plan assets (54 ) (54 ) —
—
Curtailment loss 4
—
—
—
Amortization of actuarial losses 29
11
—
—
Net periodic benefit cost $ 64
$ 45
$ 1
$ 1

As described in Note 2. Significant Accounting Policies, during the first quarter of 2017, the Company elected to early adopt ASU 2017-07. As a result, service costs are classified as employee compensation costs within cost of sales and selling, general and administrative expense within the consolidated statement of operations. All other components of net periodic benefit cost are classified within other expense for all periods presented.

















	Non-U.S. Plans				U.S. Plans

	Three Months Ended March 31,
	2021		2020		2021		2020

	(in millions)
Service cost	$	5	$	5	$	0	$	0
Interest cost	5		6		0		0
Expected return on plan assets	(5)		(5)		0		0


Amortization of actuarial losses	5		4		0		0

Net periodic benefit cost	$	10	$	10	$	0	$	0

Other postretirement benefit obligations were approximately $5$1 million and $5$1 million at ~~September 30, 2017~~March 31, 2021 and December 31, ~~2016,~~2020, respectively.

~~Table of Contents~~

10. COMMITMENTS AND CONTINGENCIES

Ordinary Business Litigation

~~Delphi~~Aptiv is from time to time subject to various legal actions and claims incidental to its business, including those arising out of alleged defects, alleged breaches of contracts, product warranties, intellectual property matters, and employment-related matters. It is the opinion of ~~Delphi~~Aptiv that the outcome of such matters will not have a material adverse impact on the consolidated financial position, results of operations, or cash flows of ~~Delphi.~~Aptiv. With respect to warranty matters, although ~~Delphi~~Aptiv cannot ensure that the future costs of warranty claims by customers will not be material, ~~Delphi~~Aptiv believes its established reserves are adequate to cover potential warranty settlements.

~~Unsecured Creditors Litigation~~Matters Related to Global Supply Chain Disruptions

~~Delphi~~Due to various factors, there are currently global supply chain disruptions, including a worldwide semiconductor supply shortage. The semiconductor supply shortage, due in part to increased demand across multiple industries, is impacting production in automotive and other industries. We anticipate these supply chain disruptions will persist throughout much of the remainder of 2021. We, along with most automotive component supply companies that use semiconductors, have been unable to fully meet the vehicle production demands of OEMs because of events which are outside our control, including but not limited to, the COVID-19 pandemic, the global semiconductor shortage, recent fires in our suppliers’ facilities, unprecedented weather events in the southwestern United States, and other extraordinary events. Although we are working closely with suppliers and customers to minimize any potential adverse impacts of these events, some of our customers have indicated that they expect us to bear at least some responsibility for their lost production. While no assurances can be made as to the ultimate outcome of these customer expectations or any other future claims, we do not currently believe a loss is probable, and accordingly, no reserve has been ~~subject to ongoing litigation related to general unsecured claims against the former Delphi Corporation, now known~~made as ~~DPHH, resulting from that entity's 2005 bankruptcy filing. The Fourth Amended and Restated Limited Liability Partnership Agreement~~ of Delphi Automotive LLP (the “Fourth LLP Agreement”) was entered into on July 12, 2011 by the members of Delphi Automotive LLP in order to position the Company for its initial public offering. Under the terms of the Fourth LLP Agreement, if cumulative distributions to the members of Delphi Automotive LLP under certain provisions of the Fourth LLP Agreement exceed $7.2 billion, Delphi, as disbursing agent on behalf of DPHH, is required to pay to the holders of allowed general unsecured claims against DPHH $32.50 for every $67.50 in excess of $7.2 billion distributed to the members, up to a maximum amount of $300 million. In December 2014, a complaint was filed in the United States Bankruptcy Court for the Southern District of New York (the "Bankruptcy Court") alleging that the 2011 redemption by Delphi Automotive LLP of the membership interests of GM and the Pension Benefit Guaranty Corporation (the "PBGC") totaling $4.4 billion, and the subsequent repurchase of shares and payment of dividends by Delphi Automotive PLC, constituted distributions under the terms of the Fourth LLP Agreement approximating $7.2 billion, triggering the maximum $300 million distribution to the holders of general unsecured claims.

In May 2016, the Bankruptcy Court initially denied both parties' motions for summary judgment, requiring further submissions to the Bankruptcy Court regarding the parties' intent with respect to the redemptions of the GM and PBGC membership interests. On January 12, 2017, the Bankruptcy Court granted summary judgment in favor of the plaintiffs, ruling that the membership interest redemption payments qualified as distributions, which, along with share repurchases and dividend payments made by Delphi, count toward the $7.2 billion threshold, and thus the $300 million maximum distribution for general unsecured claims has been triggered. In connection with the January 2017 ruling, the Company recorded a reserve of $300 million in the fourth quarter of 2016. The reserve was recorded to other expense in the consolidated statement of operations, and resulted in a corresponding reduction in earnings per diluted share of approximately $1.10 for the year ended December 31, 2016. In March 2017, the Bankruptcy Court issued a ruling on the application of pre-judgment interest owed on the amount of the distribution to be made to the holders of general unsecured claims. Pursuant to this ruling, Delphi recorded an additional reserve of $27 million during the three months ended March 31, ~~2017.~~

~~During the three months ended June 30, 2017, Delphi~~2021. We will continue to actively monitor all direct and ~~the plaintiffs reached an agreement~~indirect potential impacts of these supply chain disruptions, and will seek to settle this matter for $310 million, which was subsequently approved by the Bankruptcy Court. In accordance with the terms of the settlement agreement, the Company recorded a net incremental charge of $10 million to other expense during the nine months ended September 30, 2017. In July 2017, the Company paid the $310 million settlement pursuant to the terms of the settlement agreement.aggressively mitigate and minimize their impact on our business.

Brazil Matters

~~Delphi~~Aptiv conducts business operations in Brazil that are subject to the Brazilian federal labor, social security, environmental, tax and customs laws, as well as a variety of state and local laws. While ~~Delphi~~Aptiv believes it complies with such laws, they are complex, subject to varying interpretations, and the Company is often engaged in litigation with government agencies regarding the application of these laws to particular circumstances. As of ~~September 30, 2017,~~March 31, 2021, the majority of claims asserted against ~~Delphi~~Aptiv in Brazil relate to such litigation. The remaining claims in Brazil relate to commercial and labor litigation with private parties. As of ~~September 30, 2017,~~March 31, 2021, claims totaling approximately ~~$215~~$95 million (using ~~September 30, 2017~~March 31, 2021 foreign currency rates) have been asserted against ~~Delphi~~Aptiv in Brazil. As of ~~September 30, 2017,~~March 31, 2021, the Company maintains accruals for these asserted claims of ~~$30~~$20 million (using ~~September 30, 2017~~March 31, 2021 foreign currency rates). The amounts accrued represent claims that are deemed probable of loss and are reasonably estimable based on the Company’s analyses and assessment of the asserted claims and prior experience with similar matters. While the Company believes its accruals are adequate, the final amounts required to resolve these matters could differ materially from the Company’s recorded estimates and ~~Delphi’s~~Aptiv’s results of operations could be materially affected. The Company estimates the reasonably possible loss in excess of the amounts accrued related to these claims to be ~~zero~~0 to ~~$185~~$75 million.

Table of Contents

Environmental Matters

~~Delphi~~Aptiv is subject to the requirements of U.S. federal, state, local and non-U.S. environmental and safety and health laws and regulations. As of ~~September 30, 2017~~March 31, 2021 and December 31, ~~2016,~~2020, the undiscounted reserve for environmental investigation and remediation was approximately $7$4 million ~~(of which $2 million was recorded in accrued liabilities and $5 million~~(which was recorded in other long-term liabilities) and $6$4 million ~~(of which $1 million was recorded in accrued liabilities and $5 million~~(which was recorded in other long-term liabilities), respectively. ~~Delphi~~Aptiv cannot ensure that environmental requirements will not change or become more stringent over time or that its eventual environmental remediation costs and liabilities will not exceed the amount of its current reserves. In the event that such liabilities were to significantly exceed the amounts recorded, ~~Delphi’s~~Aptiv’s results of operations could be materially affected. At ~~September 30, 2017,~~March 31, 2021, the difference between the recorded liabilities and the reasonably possible range of potential loss was not material.

11. INCOME TAXES

At the end of each interim period, the Company makes its best estimate of the annual expected effective income tax rate and applies that rate to its ordinary year-to-date earnings or loss. The income tax provision or benefit related to unusual or infrequent items, if applicable, that will be separately reported or reported net of their related tax effects are individually computed and recognized in the interim period in which those items occur. In addition, the effect of changes in enacted tax laws or rates, tax status, judgment on the realizability of a beginning-of-the-year deferred tax asset in future years or income tax contingencies is recognized in the interim period in which the change occurs.

The computation of the annual expected effective income tax rate at each interim period requires certain estimates and assumptions including, but not limited to, the expected pre-tax income (or loss) for the year, projections of the proportion of income (and/or loss) earned and taxed in respective jurisdictions, permanent and temporary differences, and the likelihood of the realizability of deferred tax assets generated in the current year. The ongoing volatile global economic conditions resulting from the COVID-19 pandemic, the future direct and indirect impacts of which are difficult to predict, may cause fluctuations in our expected pre-tax income (or loss) for the year, which could create volatility in our annual expected effective income tax rate. Jurisdictions with a projected loss for the year or a year-to-date loss for which no tax benefit or expense can be recognized due to a valuation allowance are excluded from the estimated annual effective tax rate. The impact of such an exclusion could result in a higher or lower effective tax rate during a particular quarter, based upon the composition and timing of actual earnings compared to annual projections. The estimates used to compute the provision or benefit for income taxes may change as new events occur, additional information is obtained or as our tax environment changes. To the extent that the expected annual effective income tax rate changes, the effect of the change on prior interim periods is included in the income tax provision in the period in which the change in estimate occurs.

The ~~Company's~~Company’s income tax expense and effective tax rate for the three ~~and nine~~ months ended ~~September 30, 2017~~March 31, 2021 and ~~2016~~2020 were as follows:


	Three Months Ended September 30,						Nine Months Ended September 30,							Three Months Ended March 31,
	2017			2016			2017			2016					2021			2020

	(dollars in millions)														(dollars in millions)
Income tax expense	$	60		$	57		$	183		$	216		Income tax expense		$	48		$	10
Effective tax rate	13		%	16		%	14		%	20		%	Effective tax rate		12		%	1		%

The Company’s tax rate is affected by the fact that its parent entity is ~~a U.K.~~an Irish resident taxpayer, the tax rates in ~~the U.K.~~Ireland and other jurisdictions in which the Company operates, the relative amount of income earned by jurisdiction and the relative amount of losses or income for which no tax benefit or expense was recognized due to a valuation allowance. The Company’s effective tax rate ~~was~~is also impacted by ~~favorable changes in geographic income mix in 2017 as compared to 2016 primarily due to changes in the underlying business operations,~~ the receipt of certain tax incentives and holidays that ~~reduced~~reduce the effective tax rate for certain subsidiaries below the statutory ~~rate and the impact of losses recorded during the nine months ended September 30, 2016 in foreign jurisdictions for which no tax benefit was recognized due to a valuation allowance.~~rate.

The Company’s effective tax rate for the three months ended ~~September 30, 2017~~March 31, 2021 also includes net discrete tax benefits of ~~$11~~$1 million primarily related to changes in accruals for unremitted earnings and provision to return adjustments. The effective tax rate for the three months ended March 31, 2020 includes net discrete tax benefits of $3 million primarily related to changes in reserves, changes in accruals for unremitted earnings and provision to return adjustments. ~~The Company’s effective tax rate for~~Also included as a discrete item in the nine months ended September 30, 2017 includes net discrete tax benefits of $22 million primarily related to provision to return adjustments, net of related changes in valuation allowances and reserves. The effective tax rate for the three ~~and nine~~ months ended ~~September 30, 2016 includes net discrete~~March 31, 2020 is the beneficial impact of approximately 11 points resulting from the gain on the autonomous driving joint venture. The tax ~~benefits~~expense associated with the gain was insignificant as Aptiv’s aggregate autonomous driving assets were exempt from capital gains tax in the jurisdiction from which they were sold. The aggregate autonomous driving assets had been acquired, purchased or developed in taxable transactions in prior periods and reflect changes made to the corporate entity operating structure for intellectual property following the Separation of ~~$4 million and $3 million, respectively, primarily related to provision to return adjustments.~~its former Powertrain Systems segment.

Table of Contents

~~Delphi Automotive~~Aptiv PLC is ~~a U.K.~~an Irish resident taxpayer and not a domestic corporation for U.S. federal income tax ~~purposes, and as~~purposes. As such, it is not subject to U.S. tax on remitted foreign earnings and, as a result of its capital structure, is also generally not subject to ~~U.K.~~Irish tax on ~~remitted~~the repatriation of foreign earnings.

Cash paid or withheld for income taxes was ~~$199~~$52 million and ~~$233~~$48 million for the ~~nine~~three months ended ~~September 30, 2017~~March 31, 2021 and ~~2016~~2020, respectively.

12. SHAREHOLDERS’ EQUITY AND NET INCOME PER SHARE

2020 Public Equity Offering

In June 2020, the Company completed the underwritten public offering of approximately 15.1 million ordinary shares at a price of $75.91 per share (the “Ordinary Share Offering”), resulting in net proceeds of approximately $1,115 million, after deducting expenses and the underwriters’ discount of $35 million. Simultaneously, the Company completed the underwritten public offering of 11.5 million 5.50% Mandatory Convertible Preferred Shares, Series A, $0.01 par value per share (the “MCPS”) with a liquidation preference of $100 per share (the “MCPS Offering”), resulting in net proceeds of approximately $1,115 million, after deducting expenses and the underwriters’ discount of $35 million. The Company intends to use the net proceeds from the Ordinary Share Offering and MCPS Offering for general corporate purposes, which may include funding potential future investments (including acquisitions), capital expenditures, working capital, repayment of outstanding indebtedness and the satisfaction of other obligations.

Each share of MCPS will mandatorily convert on the mandatory conversion date of June 15, 2023, into between 1.0754 and 1.3173 shares of the Company’s ordinary shares, subject to customary anti-dilution adjustments, and further adjustment if there are any accumulated and unpaid MCPS dividends at the conversion date. The number of the Company’s ordinary shares issuable upon conversion will be determined based on the volume-weighted average price per share of the Company’s ordinary shares over the 20 consecutive trading day period beginning on, and including the 21st scheduled trading day immediately before June 15, 2023. Subject to certain exceptions, at any time prior to June 15, 2023, holders of the MCPS may elect to convert each share into 1.0754 ordinary shares, subject to further anti-dilution adjustments. In the event of a fundamental change, the MCPS will convert at the fundamental change rates specified in the statement of rights, and the holders of the MCPS would be entitled to a fundamental change make-whole dividend.

Holders of the MCPS will be entitled to receive, when and if declared by the Company’s Board of Directors, cumulative dividends at the annual rate of 5.50% of the liquidation preference of $100 per share (equivalent to $5.50 annually per share), payable in cash or, subject to certain limitations, by delivery of the Company’s ordinary shares or any combination of cash and the Company’s ordinary shares, at the Company’s election. If declared, dividends on the MCPS will be payable quarterly on March 15, June 15, September 15 and December 15 of each year (commencing on September 15, 2020 to, and including June 15, 2023), to the holders of record of the MCPS as they appear on the Company’s share register at the close of business on the immediately preceding March 1, June 1, September 1 or December 1, respectively.

Net Income Per Share

Basic net income per share is computed by dividing net income attributable to ~~Delphi~~ordinary shareholders by the weighted average number of ordinary shares outstanding during the period. Diluted net income per share reflects the weighted average dilutive impact of all potentially dilutive securities from the date of issuance and is computed using the treasury stock and if-converted methods. The if-converted method ~~by dividing~~is used to determine if the impact of the conversion of the MCPS into ordinary shares is more dilutive than the MCPS dividends to net income ~~attributable~~per share. If so, the MCPS are assumed to ~~Delphi by~~have been converted at the later of the beginning of the period or the time of issuance, and the resulting ordinary shares are included in the denominator and the MCPS dividends are added back to the numerator. Unless otherwise noted, share and per share amounts included in these notes are on a diluted basis. For the three months ended March 31, 2021, the impact of the MCPS calculated under the if-converted method was anti-dilutive, and as such 12.37 million ordinary shares underlying the MCPS were excluded from the diluted ~~weighted average number of ordinary shares outstanding.~~net income per share calculation. For all periods presented, the calculation of ~~diluted~~ net income per share also contemplates the dilutive impacts, if any, of the Company’s share-based compensation plans. Refer to Note 18. Share-Based Compensation for additional information.

Table of Contents

Weighted Average Shares

The following table illustrates net income per share attributable to ~~Delphi~~ordinary shareholders and the weighted average shares outstanding used in calculating basic and diluted income per share:

Three Months Ended September 30, Nine Months Ended September 30,
2017 2016 2017 2016

(in millions, except per share data)
Numerator:
Income from continuing operations $ 395
$ 293
$ 1,099
$ 871
Income from discontinued operations —
—
—
105
Net income attributable to Delphi $ 395
$ 293
$ 1,099
$ 976
Denominator:
Weighted average ordinary shares outstanding, basic 266.24
272.19
267.60
273.91
Dilutive shares related to restricted stock units ("RSUs") 0.92
0.58
0.63
0.48
Weighted average ordinary shares outstanding, including dilutive shares 267.16
272.77
268.23
274.39

Basic net income per share:
Continuing operations $ 1.48
$ 1.08
$ 4.11
$ 3.18
Discontinued operations —
—
—
0.38
Basic net income per share attributable to Delphi $ 1.48
$ 1.08
$ 4.11
$ 3.56
Diluted net income per share:
Continuing operations $ 1.48
$ 1.07
$ 4.10
$ 3.18
Discontinued operations —
—
—
0.38
Diluted net income per share attributable to Delphi $ 1.48
$ 1.07
$ 4.10
$ 3.56
Anti-dilutive securities share impact —
—
—
—


	Three Months Ended March 31,
		2021		2020

		(in millions, except per share data)
Numerator:




Net income attributable to ordinary shareholders		$	279	$	1,572




Denominator:
Weighted average ordinary shares outstanding, basic		270.31		255.51
Dilutive shares related to restricted stock units (“RSUs”)		0.83		0.32

Weighted average ordinary shares outstanding, including dilutive shares		271.14		255.83

Net income per share attributable to ordinary shareholders:


Basic		$	1.03	$	6.15



Diluted		$	1.03	$	6.14

Share Repurchase ~~Program~~Programs

In April 2016, the Board of Directors authorized a share repurchase program of up to $1.5 billion of ordinary shares, which commenced in September ~~2016 following the completion of the Company's $1.5 billion January 2015 share repurchase program.~~2016. This share repurchase program provides for share purchases in the open market or in privately negotiated transactions, depending on share price, market conditions and other factors, as determined by the Company.

~~Table of Contents~~

There were no shares repurchased during the three months ended March 31, 2021. A summary of the ordinary shares repurchased during the three ~~and nine~~ months ended ~~September 30, 2017 and 2016~~March 31, 2020 is as follows:

Three Months Ended September 30, Nine Months Ended September 30,
2017 2016 2017 2016
Total number of shares repurchased 1,018,930
1,487,900
4,667,193
7,980,325
Average price paid per share $ 92.99
$ 67.24
$ 82.00
$ 67.00
Total (in millions) $ 95
$ 100
$ 383
$ 535




Total number of shares repurchased	1,059,075
Average price paid per share	$	53.73
Total (in millions)	$	57

As of ~~September 30, 2017,~~March 31, 2021, approximately ~~$989~~$13 million of share repurchases remained available under the April 2016 share repurchase ~~program.~~program, which is in addition to the share repurchase program of up to $2.0 billion that was previously announced in January 2019. This program, which will commence following the completion of the April 2016 share repurchase program, provides for share purchases in the open market or in privately negotiated transactions, depending on share price, market conditions and other factors, as determined by the Company. All repurchased shares were retired, and are reflected as a reduction of ordinary share capital for the par value of the shares, with the excess applied as reductions to additional paid-in-capital and retained earnings.

Although both the April 2016 and the additional share repurchase program remain authorized, the Company is restricted from executing further share repurchases under the terms of the May 2020 Amendment to the Credit Agreement for as long as the Covenant Relief Period remains in effect, as further described in Note 8. Debt. Furthermore, in order to preserve liquidity during the COVID-19 pandemic crisis, the Company does not anticipate executing further share repurchases until such time as the global economic uncertainties and business impacts resulting from the pandemic have abated.

Table of Contents

Dividends

The Company has declared and paid cash dividends per ordinary and preferred share during the periods presented as follows:

Dividend Amount
Per Share (in millions)
2017:
Third quarter $ 0.29
$ 77
Second quarter 0.29
78
First quarter 0.29
78
Total $ 0.87
$ 233
2016:
Fourth quarter $ 0.29
$ 79
Third quarter 0.29
79
Second quarter 0.29
79
First quarter 0.29
80
Total $ 1.16
$ 317

In addition, in October 2017, the Board of Directors declared a regular quarterly cash dividend of $0.29 per ordinary share, payable November 22, 2017 to shareholders of record at the close of business on November 8, 2017.

~~Other~~

~~Prior to the completion of the initial public offering on~~ ~~November 22, 2011, net income and other changes to membership interests were allocated to the respective outstanding classes based on the cumulative distribution provisions of the Fourth LLP Agreement.~~


	Ordinary Shares				Preferred Shares
	Dividend		Amount		Dividend		Amount
	Per Share		(in millions)		Per Share		(in millions)
2021:


First quarter	$	0	$	0	$	1.38	$	16
Total	$	0	$	0	$	1.38	$	16
2020:
Fourth quarter	$	0	$	0	$	1.38	$	16
Third quarter	0		0		1.42		16
Second quarter	0		0		0		0
First quarter	0.22		56		0		0
Total	$	0.22	$	56	$	2.80	$	32

Under the terms of the ~~Fourth LLP Agreement, if cumulative distributions~~May 2020 Amendment to the ~~members~~Credit Agreement, the Company is restricted from the payment of ~~Delphi Automotive LLP under certain provisions of~~further ordinary share cash dividends for as long as the ~~Fourth LLP Agreement exceed $7.2 billion, Delphi,~~Covenant Relief Period remains in effect, as disbursing agent on behalf of DPHH, is required to pay to the holders of allowed general unsecured claims against DPHH $32.50 for every $67.50 in excess of $7.2 billion distributed to the members, up to a maximum amount of $300 million. Asfurther described in Note ~~10. Commitments~~8. Debt. Additionally, the Company does not anticipate making further ordinary share cash dividend payments, until such time as the global economic uncertainties and ~~Contingencies, Delphi settled~~business impacts resulting from the ~~litigation related to this matter during the nine months ended September 30, 2017.~~

~~Table of Contents~~COVID-19 pandemic have abated.

13. CHANGES IN ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

The changes in accumulated other comprehensive income (loss) attributable to ~~Delphi~~Aptiv (net of tax) for the three ~~and nine~~ months ended ~~September 30, 2017~~March 31, 2021 and ~~2016~~2020 are shown ~~below. Prior period other comprehensive income includes activity relating~~below:


	Three Months Ended March 31,
		2021		2020

		(in millions)
Foreign currency translation adjustments:
Balance at beginning of period		$	(445)	$	(597)
Aggregate adjustment for the period (1)		(91)		(126)
Balance at end of period		(536)		(723)

Gains (losses) on derivatives:
Balance at beginning of period		40		13
Other comprehensive income (loss) before reclassifications (net tax effect of $0 and $0)		12		(149)
Reclassification to income (net tax effect of $0 and $0)		(19)		(4)

Balance at end of period		33		(140)

Pension and postretirement plans:
Balance at beginning of period		(140)		(135)
Other comprehensive income before reclassifications (net tax effect of $2 and $1)		3		4
Reclassification to income (net tax effect of $1 and $1)		4		3

Balance at end of period		(133)		(128)

Accumulated other comprehensive loss, end of period		$	(636)	$	(991)

(1)Includes gains of $63 million and $6 million for the three months ended March 31, 2021 and 2020, respectively, related to ~~discontinued operations.~~non-derivative net investment hedges. Refer to Note 14. Derivatives and Hedging Activities for further description of these hedges.

Three Months Ended September 30, Nine Months Ended September 30,
2017 2016 2017 2016

(in millions)
Foreign currency translation adjustments:
Balance at beginning of period $ (614 ) $ (678 ) $ (799 ) $ (661 )
Aggregate adjustment for the period (1) 84
26
269
9
Balance at end of period (530 ) (652 ) (530 ) (652 )

Gains (losses) on derivatives:
Balance at beginning of period 32
(57 ) (11 ) (106 )
Other comprehensive income before reclassifications (net tax effect of $5, $10, $15 and $17) (3 ) (16 ) 26
(21 )
Reclassification to income (net tax effect of $0, $8, $10 and $24) (6 ) 22
8
76
Balance at end of period 23
(51 ) 23
(51 )

Pension and postretirement plans:
Balance at beginning of period (400 ) (244 ) (405 ) (266 )
Other comprehensive income before reclassifications (net tax effect of $4, $0, $8 and $4) (15 ) 3
(25 ) 19
Reclassification to income (net tax effect of $2, $0, $5 and $1) 9
3
24
9
Balance at end of period (406 ) (238 ) (406 ) (238 )

Accumulated other comprehensive loss, end of period $ (913 ) $ (941 ) $ (913 ) $ (941 )

~~(1)~~

Includes losses of $44 million and $147 million for the three and nine months ended September 30, 2017, and losses of $10 million and $18 million for the three and nine months ended September 30, 2016, respectively, related to non-derivative net investment hedges, principally offset by the foreign currency impact of intra-entity loans that are of a long-term investment nature in each period. Refer to Note 14. Derivatives and Hedging Activities for further description of these hedges.

Table of Contents

Reclassifications from accumulated other comprehensive income (loss) to income for the three ~~and nine~~ months ended~~September 30, 2017~~ March 31, 2021 and ~~2016~~2020 were as follows:


Reclassification Out of Accumulated Other Comprehensive Income (Loss)
Details About Accumulated Other Comprehensive Income Components	Three Months Ended March 31,				Affected Line Item in the Statements of Operations
			2021				2020

		(in millions)


Gains (losses) on derivatives:
Commodity derivatives			$	19	$	(3)		Cost of sales
Foreign currency derivatives			0		7			Cost of sales

			19		4			Income before income taxes
			0		0			Income tax expense
			19		4			Net income
			0		0			Net income attributable to noncontrolling interest
			$	19	$	4		Net income attributable to Aptiv

Pension and postretirement plans:

Actuarial losses			$	(5)	$	(4)		Other income (expense), net (1)

			(5)		(4)			Income before income taxes
			1		1			Income tax expense
			(4)		(3)			Net income
			0		0			Net income attributable to noncontrolling interest
			$	(4)	$	(3)		Net income attributable to Aptiv

Total reclassifications for the period			$	15	$	1

Reclassification Out of Accumulated Other Comprehensive Income
Details About Accumulated Other Comprehensive Income Components Three Months Ended September 30, Nine Months Ended September 30, Affected Line Item in the Statement of Operations
2017 2016 2017 2016

(in millions)
Gains (losses) on derivatives:
Commodity derivatives $ 5
$ (10 ) $ 8
$ (35 ) Cost of sales
Foreign currency derivatives 1
(20 ) (26 ) (65 ) Cost of sales
6
(30 ) (18 ) (100 ) Income before income taxes
—
8
10
24
Income tax expense
6
(22 ) (8 ) (76 ) Net income
—
—
—
—
Net income attributable to noncontrolling interest
$ 6
$ (22 ) $ (8 ) $ (76 ) Net income attributable to Delphi

Pension and postretirement plans:
Actuarial losses $ (11 ) $ (3 ) $ (29 ) $ (10 ) Other expense (1)
(11 ) (3 ) (29 ) (10 ) Income before income taxes
2
—
5
1
Income tax expense
(9 ) (3 ) (24 ) (9 ) Net income
—
—
—
—
Net income attributable to noncontrolling interest
$ (9 ) $ (3 ) $ (24 ) $ (9 ) Net income attributable to Delphi

Total reclassifications for the period $ (3 ) $ (25 ) $ (32 ) $ (85 )


~~(1)~~	~~These accumulated other comprehensive loss components are components of net periodic pension cost (see Note 9. Pension Benefits for additional details).~~

(1)These accumulated other comprehensive loss components are included in the computation of net periodic pension cost (see Note 9. Pension Benefits for additional details).

14. DERIVATIVES AND HEDGING ACTIVITIES

Cash Flow Hedges

~~Delphi~~Aptiv is exposed to market risk, such as fluctuations in foreign currency exchange rates, commodity prices and changes in interest rates, which may result in cash flow risks. To manage the volatility relating to these exposures, ~~Delphi~~Aptiv aggregates the exposures on a consolidated basis to take advantage of natural offsets. For exposures that are not offset within its operations, ~~Delphi~~Aptiv enters into various derivative transactions pursuant to its risk management policies, which prohibit holding or issuing derivative financial instruments for speculative purposes, and designation of derivative instruments is performed on a transaction basis to support hedge accounting. The changes in fair value of these hedging instruments are offset in part or in whole by corresponding changes in the fair value or cash flows of the underlying exposures being hedged. ~~Delphi~~Aptiv assesses the initial and ongoing effectiveness of its hedging relationships in accordance with its documented policy.

Table of Contents

As of ~~September 30, 2017,~~March 31, 2021, the Company had the following outstanding notional amounts related to commodity and foreign currency forward and option contracts designated as cash flow hedges that were entered into to hedge forecasted exposures:

~~Table of Contents~~

Commodity

Quantity Hedged

Unit of Measure

Notional Amount
(Approximate USD Equivalent)

(in thousands)

(in millions)

Copper

68,897

pounds

280


Foreign Currency	Quantity Hedged	Unit of Measure	Notional Amount (Approximate USD Equivalent)

	(in millions)
Mexican Peso	15,148	MXN	$	735
Chinese Yuan Renminbi	2,206	RMB	335
Euro	178	EUR	210
Polish Zloty	508	PLN	130

Hungarian Forint	4,714	HUF	15

Commodity Quantity Hedged Unit of Measure Notional Amount
(Approximate USD Equivalent)

(in thousands) (in millions)
Copper 57,124
pounds $ 170

Foreign Currency Quantity Hedged Unit of Measure
Notional Amount
(Approximate USD Equivalent)

(in millions)
Mexican Peso 16,872
MXN $ 925
Chinese Yuan Renminbi 2,410
RMB 365
Polish Zloty 344
PLN 95
New Turkish Lira 185
TRY 50
Hungarian Forint 4,025
HUF 15

~~The Company had additional foreign currency forward contracts designated as cash flow hedges with notional amounts that individually amounted to less than $10 million.~~ As of ~~September 30, 2017, Delphi~~March 31, 2021, Aptiv has entered into derivative instruments to hedge cash flows extending out to ~~September 2019.~~March 2023.

Gains and losses on derivatives qualifying as cash flow hedges are recorded in accumulated ~~other comprehensive income ("OCI"),~~OCI, to the extent that hedges are effective, until the underlying transactions are recognized in earnings. Unrealized amounts in accumulated OCI will fluctuate based on changes in the fair value of hedge derivative contracts at each reporting period. Net gains on cash flow hedges included in accumulated OCI as of ~~September 30, 2017~~March 31, 2021 were ~~approximately $34~~$55 million (approximately ~~$31~~$55 million, net of tax). Of this total, approximately ~~$28~~$41 million of gains are expected to be included in cost of sales within the next 12 months and $6approximately $14 million of gains are expected to be included in cost of sales in subsequent periods. Cash flow hedges are discontinued when ~~Delphi~~Aptiv determines it is no longer probable that the originally forecasted transactions will occur. ~~The amount included in cost of sales related to cash flow hedge ineffectiveness was insignificant for the three and nine months ended September 30, 2017 and 2016.~~ Cash flows from derivatives used to manage commodity and foreign exchange risks designated as cash flow hedges are classified as operating activities within the consolidated ~~statement~~statements of cash flows.

Net Investment Hedges

The Company is also exposed to the risk that adverse changes in foreign currency exchange rates could impact its net investment in non-U.S. subsidiaries. To manage this risk, the Company designates certain qualifying derivative and non-derivative instruments, including foreign currency forward contracts and foreign currency-denominated debt, as net investment hedges of certain non-U.S. subsidiaries. The ~~effective portion of the~~ gains or losses on instruments designated as net investment hedges are recognized within OCI to offset changes in the value of the net investment in these foreign currency-denominated operations. ~~Any ineffective portion of gains or losses on net investment hedges are reclassified to other income (expense), net within the consolidated statement of operations.~~ Gains and losses reported in accumulated ~~other comprehensive income (loss)~~OCI are reclassified to earnings only when the related currency translation adjustments are required to be reclassified, usually upon sale or liquidation of the investment. Cash flows from derivatives designated as net investment hedges are classified as investing activities within the consolidated ~~statement~~statements of cash flows.

~~During 2016 and 2017, the~~The Company has entered into a series of forward contracts, each of which were designated as net investment hedges of the foreign currency exposure of the ~~Company's~~Company’s investments in certain Chinese Yuan Renminbi ~~("RMB"~~(“RMB”)-denominated subsidiaries. During the ~~first quarter~~three months ended March 31, 2021 and 2020, the Company paid $1 million and received $1 million, respectively, at settlement related to this series of ~~2016,~~forward contracts which matured during the period. In March 2021, the Company entered into a forward contract with a notional amount of ~~2.4~~2.3 billion RMB (approximately ~~$370~~$350 million, using March 31, 2016 foreign currency rates), which matured in May 2016, and the Company paid $1 million at settlement. In December 2016, the Company entered into a forward contract with a notional amount of 1.8 billion RMB (approximately $265 million, using December 31, 2016 foreign currency rates), which matured in June 2017, and the Company paid $12 million at settlement. In June 2017, the Company entered into a forward contract with a notional amount of 2.4 billion RMB (approximately $345 million, using June 30, 20172021 foreign currency rates), which matures in ~~December 2017.~~

June 2021. Refer to the tables below for details of the fair value recorded in the consolidated balance ~~sheet~~sheets and the effects recorded in the consolidated ~~statement~~statements of operations and consolidated ~~statement~~statements of comprehensive income related to these derivative instruments.

The Company has designated the €700 million 2015 Euro-denominated Senior Notes and the €500 million 2016 Euro-denominated Senior Notes, as more fully described in Note 8. Debt, as net investment hedges of the foreign currency exposure of its investments in certain Euro-denominated subsidiaries. Due to changes in the value of the Euro-denominated debt

~~Table of Contents~~

instruments designated as net investment hedges, during the three ~~and nine~~ months ended ~~September 30, 2017, $44~~March 31, 2021 and 2020, $63 million and ~~$147~~$6 million ~~respectively,~~ of ~~losses~~gains, respectively, were recognized within the cumulative translation adjustment component of OCI. During the three and nine months ended September 30, 2016, $10 million and $19 million, respectively, of losses were recognized within the cumulative translation adjustment component of OCI. Cumulative (losses) gains includedIncluded in accumulated OCI onrelated to these net investment hedges were ~~$(87)~~cumulative losses of $90 million and $153 million as of ~~September 30, 2017~~March 31, 2021 and ~~$60 million as of~~ December 31, ~~2016. There were no amounts reclassified or recognized for ineffectiveness during the three and nine months ended September 30, 2017 or 2016.~~2020, respectively.

Table of Contents

Derivatives Not Designated as Hedges

In certain occasions the Company enters into certain foreign currency and commodity contracts that are not designated as hedges. When hedge accounting is not applied to derivative contracts, gains and losses are recorded to other income (expense), net and cost of sales in the consolidated ~~statement~~statements of operations.

As more fully disclosed in Note 17. Acquisitions and Divestitures, on July 30, 2015, Delphi made a recommended offer to acquire HellermannTyton. In conjunction with the acquisition, in August 2015, the Company entered into option contracts with notional amounts totaling £917 million to hedge portions of the currency risk associated with the cash payment for the acquisition at a cost of $15 million. Subsequently, in conjunction with the closing of the acquisition, Delphi entered into offsetting option contracts. Pursuant to the requirements of ASC 815, ~~Derivatives and Hedging~~, the options did not qualify as hedges for accounting purposes. The Company paid $15 million to settle these options during the nine months ended September 30, 2016, which is reflected within investing activities in the consolidated statement of cash flows.

Fair Value of Derivative Instruments in the Balance Sheet

The fair value of derivative financial instruments recorded in the consolidated balance sheets as of ~~September 30, 2017~~March 31, 2021 and December 31, ~~2016~~2020 are as follows:


	Asset Derivatives			Liability Derivatives			Net Amounts of Assets and (Liabilities) Presented in the Balance Sheet
	Balance Sheet Location	March 31, 2021		Balance Sheet Location	March 31, 2021		March 31, 2021

	(in millions)
Derivatives designated as cash flow hedges:
Commodity derivatives	Other current assets	$	38	Accrued liabilities	$	0
Foreign currency derivatives*	Other current assets	10		Other current assets	3		$	7
Foreign currency derivatives*	Accrued liabilities	7		Accrued liabilities	17		(10)
Commodity derivatives	Other long-term assets	15		Other long-term liabilities	0
Foreign currency derivatives*	Other long-term assets	7		Other long-term assets	2		5
Foreign currency derivatives*	Other long-term liabilities	0		Other long-term liabilities	3		(3)


Total derivatives designated as hedges		$	77		$	25

Derivatives not designated:
Commodity derivatives	Other current assets	$	4	Accrued liabilities	$	0





Total derivatives not designated as hedges		$	4		$	0

Asset Derivatives Liability Derivatives Net Amounts of Assets and (Liabilities) Presented in the Balance Sheet
Balance Sheet Location September 30,
2017 Balance Sheet Location September 30,
2017 September 30,
2017

(in millions)
Derivatives designated as cash flow hedges:
Commodity derivatives Other current assets $ 20
Accrued liabilities $ —

Foreign currency derivatives* Other current assets 23
Other current assets 7
$ 16
Foreign currency derivatives* Accrued liabilities 2
Accrued liabilities 6
(4 )
Commodity derivatives Other long-term assets 5
Other long-term liabilities —

Foreign currency derivatives* Other long-term assets 8
Other long-term assets 1
7
Foreign currency derivatives* Other long-term liabilities —
Other long-term liabilities 3
(3 )
Derivatives designated as net investment hedges:
Foreign currency derivatives Other current assets $ —
Accrued liabilities $ 12

Total derivatives designated as hedges $ 58
$ 29

Table of Contents


	Asset Derivatives			Liability Derivatives			Net Amounts of Assets and (Liabilities) Presented in the Balance Sheet				Asset Derivatives			Liability Derivatives			Net Amounts of Assets and (Liabilities) Presented in the Balance Sheet
	Balance Sheet Location	December 31, 2016		Balance Sheet Location	December 31, 2016		December 31, 2016				Balance Sheet Location	December 31, 2020		Balance Sheet Location	December 31, 2020		December 31, 2020

	(in millions)										(in millions)
Derivatives designated as cash flow hedges:	Derivatives designated as cash flow hedges:									Derivatives designated as cash flow hedges:
Commodity derivatives	Other current assets	$	7	Accrued liabilities	$	—				Commodity derivatives	Other current assets	$	26	Accrued liabilities	$	0
Foreign currency derivatives*	Other current assets	6		Other current assets	3		$	3		Foreign currency derivatives*	Other current assets	24		Other current assets	5		$	19
Foreign currency derivatives*	Accrued liabilities	9		Accrued liabilities	55		(46		)	Foreign currency derivatives*	Accrued liabilities	7		Accrued liabilities	13		(6)
Commodity derivatives	Other long-term assets	4		Other long-term liabilities	—					Commodity derivatives	Other long-term assets	9		Other long-term liabilities	0
Foreign currency derivatives*	Other long-term assets	8		Other long-term assets	4		4			Foreign currency derivatives*	Other long-term assets	17		Other long-term assets	4		13
Foreign currency derivatives*	Other long-term liabilities	—		Other long-term liabilities	11		(11		)	Foreign currency derivatives*	Other long-term liabilities	0		Other long-term liabilities	1		(1)
Derivatives designated as net investment hedges:	Derivatives designated as net investment hedges:									Derivatives designated as net investment hedges:
Foreign currency derivatives	Other current assets	$	2	Accrued liabilities	$	—				Foreign currency derivatives	Other current assets	0		Accrued liabilities	2
Total derivatives designated as hedges	Total derivatives designated as hedges	$	36		$	73				Total derivatives designated as hedges		$	83		$	25

Derivatives not designated:	Derivatives not designated:									Derivatives not designated:

Foreign currency derivatives*	Other current assets	$	—	Other current assets	$	1	(1		)	Foreign currency derivatives*	Other current assets	$	3	Other current assets	$	0	3
Foreign currency derivatives*	Accrued liabilities	2		Accrued liabilities	1		1

Total derivatives not designated as hedges	Total derivatives not designated as hedges	$	2		$	2				Total derivatives not designated as hedges		$	3		$	0

* Derivative instruments within this category are subject to master netting arrangements and are presented on a net basis in the consolidated balance sheets in accordance with accounting guidance related to the offsetting of amounts related to certain contracts.

The fair value of ~~Delphi’s~~Aptiv’s derivative financial instruments was in a net asset position as of ~~September 30, 2017~~March 31, 2021 and ~~a net liability position as of~~ December 31, ~~2016~~.

~~Table of Contents~~

2020.

Effect of Derivatives on the ~~Statement~~Statements of Operations and ~~Statement~~Statements of Comprehensive Income

The pre-tax effect of derivative financial instruments in the consolidated ~~statement~~statements of operations and consolidated ~~statement~~statements of comprehensive income for the three months ended ~~September 30, 2017~~March 31, 2021 and 2020 is as follows:


Three Months Ended September 30, 2017	Gain (loss) Recognized in OCI (Effective Portion)			Gain Reclassified from OCI into Income (Effective Portion)		Gain Recognized in Income (Ineffective Portion Excluded from Effectiveness Testing)
Three Months Ended March 31, 2021								Three Months Ended March 31, 2021	Gain (Loss) Recognized in OCI		Gain Reclassified from OCI into Income

	(in millions)								(in millions)
Derivatives designated as cash flow hedges:								Derivatives designated as cash flow hedges:
Commodity derivatives	$	15		$	5	$	—	Commodity derivatives	$	34	$	19
Foreign currency derivatives	(13		)	1		—		Foreign currency derivatives	(23)		0
Derivatives designated as net investment hedges:								Derivatives designated as net investment hedges:
Foreign currency derivatives	(10		)	—		—		Foreign currency derivatives	1		0
Total	$	(8	)	$	6	$	—	Total	$	12	$	19



	Gain (Loss) Recognized in Income

	(in millions)
Derivatives not designated:
Commodity derivatives	$	—1
Foreign currency derivatives	—(2)
Total	$	—(1)

The pre-tax effect of derivative financial instruments in the consolidated statement of operations and consolidated statement of comprehensive income for the three months ended September 30, 2016 is as follows:

Three Months Ended September 30, 2016 Gain (loss) Recognized in OCI (Effective Portion) Loss Reclassified from OCI into Income (Effective Portion) Gain Recognized in Income (Ineffective Portion Excluded from Effectiveness Testing)

(in millions)
Derivatives designated as cash flow hedges:
Commodity derivatives $ 1
$ (10 ) $ —
Foreign currency derivatives (26 ) (20 ) —
Derivatives designated as net investment hedges:
Foreign currency derivatives (1 ) —
—
Total $ (26 ) $ (30 ) $ —

Gain Recognized in Income

(in millions)
Derivatives not designated:
Foreign currency derivatives $ 1
Total $ 1

The pre-tax effect of derivative financial instruments in the consolidated statement of operations and consolidated statement of comprehensive income for the nine months ended September 30, 2017 is as follows:

Table of Contents


Nine Months Ended September 30, 2017	Gain (loss) Recognized in OCI (Effective Portion)			Gain (loss) Reclassified from OCI into Income (Effective Portion)			Gain Recognized in Income (Ineffective Portion Excluded from Effectiveness Testing)
Three Months Ended March 31, 2020									Three Months Ended March 31, 2020	(Loss) Gain Recognized in OCI		(Loss) Gain Reclassified from OCI into Income

	(in millions)									(in millions)
Derivatives designated as cash flow hedges:									Derivatives designated as cash flow hedges:
Commodity derivatives	$	26		$	8		$	—	Commodity derivatives	$	(39)	$	(3)
Foreign currency derivatives	41			(26		)	—		Foreign currency derivatives	(111)		7
Derivatives designated as net investment hedges:									Derivatives designated as net investment hedges:
Foreign currency derivatives	(26		)	—			—		Foreign currency derivatives	1		0
Total	$	41		$	(18	)	$	—	Total	$	(149)	$	4

Loss Recognized in Income

(in millions)
Derivatives not designated:
Foreign currency derivatives $ (5 )
Total $ (5 )


	Loss Recognized in Income

	(in millions)
Derivatives not designated:

Foreign currency derivatives	$	(2)
Total	$	(2)

Nine Months Ended September 30, 2016 Gain (loss) Recognized in OCI (Effective Portion) Loss Reclassified from OCI into Income (Effective Portion) Gain Recognized in Income (Ineffective Portion Excluded from Effectiveness Testing)

(in millions)
Derivatives designated as cash flow hedges:
Commodity derivatives $ 5
$ (35 ) $ —
Foreign currency derivatives (46 ) (65 ) —
Derivatives designated as net investment hedges:
Foreign currency derivatives 3
—
—
Total $ (38 ) $ (100 ) $ —

Loss Recognized in Income

(in millions)
Derivatives not designated:
Foreign currency derivatives $ (1 )
Total $ (1 )

~~The gain or loss reclassified from OCI into income for the effective portion of designated derivative instruments and the~~ gain or loss recognized in income for ~~the ineffective portion of~~ designated and non-designated derivative instruments ~~excluded from effectiveness testing were~~was recorded to ~~other income, net and~~ cost of sales and other income (expense), net in the consolidated statements of operations for the three ~~and nine~~ months ended~~September 30, 2017~~ March 31, 2021 and ~~2016. The gain or loss recognized in income for non-designated derivative instruments was recorded in other income (expense), net and cost of sales for the~~ ~~three and nine months endedSeptember 30, 2017~~ ~~and~~ ~~2016~~.2020, respectively.

~~Table of Contents~~

15. FAIR VALUE OF FINANCIAL INSTRUMENTS

Fair Value Measurements on a Recurring Basis

Derivative instruments—All derivative instruments are required to be reported on the balance sheet at fair value unless the transactions qualify and are designated as normal purchases or sales. Changes in fair value are reported currently through earnings unless they meet hedge accounting criteria. ~~Delphi’s~~Aptiv’s derivative exposures are with counterparties with long-term investment grade credit ratings. ~~Delphi~~Aptiv estimates the fair value of its derivative contracts using an income approach based on valuation techniques to convert future amounts to a single, discounted amount. Estimates of the fair value of foreign currency and commodity derivative instruments are determined using exchange traded prices and rates. ~~Delphi~~Aptiv also considers the risk of non-performance in the estimation of fair value, and includes an adjustment for non-performance risk in the measure of fair value of derivative instruments. The non-performance risk adjustment reflects the credit default spread (“CDS”) applied to the net commodity by counterparty and foreign currency exposures by counterparty. When ~~Delphi~~Aptiv is in a net derivative asset position, the counterparty CDS rates are applied to the net derivative asset position. When ~~Delphi~~Aptiv is in a net derivative liability position, estimates of peer companies’ CDS rates are applied to the net derivative liability position.

In certain instances where market data is not available, ~~Delphi~~Aptiv uses management judgment to develop assumptions that are used to determine fair value. This could include situations of market illiquidity for a particular currency or commodity or where observable market data may be limited. In those situations, ~~Delphi~~Aptiv generally surveys investment banks and/or brokers and utilizes the surveyed prices and rates in estimating fair value.

As of ~~September 30, 2017~~March 31, 2021 and December 31, ~~2016, Delphi~~2020, Aptiv was in a net derivative asset ~~(liability)~~ position of ~~$29~~$56 million and ~~$(37)~~$61 million, respectively, and no significant adjustments were recorded for nonperformance risk based on the application of peer companies’ CDS rates, evaluation of our own nonperformance risk and because ~~Delphi’s~~Aptiv’s exposures were to counterparties with investment grade credit ratings. Refer to Note 14. Derivatives and Hedging Activities for further information regarding derivatives.

Contingent consideration—As described in Note 17. Acquisitions and Divestitures, as of September 30, 2017, additional contingent consideration may be earned as a result of Delphi's acquisition agreements for Movimento Group ("Movimento"), Control-Tec LLC ("Control-Tec"), Ottomatika, Inc. ("Ottomatika") and Antaya Technologies Corporation ("Antaya"). The liability for contingent consideration is estimated as of the date of the acquisition and is recorded as part of the purchase price, and is subsequently re-measured to fair value at each reporting date, based on a probability-weighted ~~discounted cash flow~~ analysis using a rate that reflects the uncertainty surrounding the expected outcomes, which the Company believes is appropriate and representative of market participant assumptions. The measurement of the liability for contingent consideration is based on significant inputs that are not observable in the market, and is therefore classified as a Level 3 measurement in accordance with ~~ASU~~ASC Topic 820-10-35. Examples of utilized unobservable inputs are estimated future earnings or milestone achievements of the acquired businesses and applicable discount rates. The estimate of the liability may fluctuate if there are changes in the ~~forecast of the acquired businesses' future earnings, as a result of~~ actual ~~earnings levels achieved~~or forecasted inputs utilized or in the discount rates used to determine the present value of

Table of Contents

contingent future cash flows. ~~As of September 30, 2017, the range of periods in which the earn-out provisions may be achieved is from 2017 to 2018.~~ The Company regularly reviews these assumptions and makes adjustments to the fair value measurements as required by facts and circumstances. As of March 31, 2021, the Company has determined that all earn-out provisions have been achieved under existing agreements.

As of ~~September 30, 2017~~March 31, 2021 and December 31, ~~2016,~~2020, the liability for contingent consideration was ~~$22~~$52 million ~~(of which $2~~and $52 million, (which was classified within other current liabilities and $20 million was classified within other long-term liabilities) and $35 million (of which was $22 million classified within other current liabilities and $13 million was classified within other long-term liabilities).as of both periods presented), respectively, representing the maximum required amounts to be paid under existing agreements. Adjustments to this liability for interest accretion are recognized in interest expense, and any other changes in the fair value of this liability are recognized within other income (expense), net in the consolidated ~~statement~~statements of operations.

~~The~~There were no changes in the contingent consideration liability classified as a Level 3 measurement ~~for~~during the ~~nine~~three months ended ~~September 30, 2017 were as follows:~~March 31, 2021.

Contingent Consideration Liability

(in millions)
Fair value at beginning of period $ 35
Additions 8
Payments (22 )
Interest accretion 1
Fair value at end of period $ 22

~~Table of Contents~~

~~During~~In accordance with existing agreements, the ~~nine months ended September 30, 2017, Delphi recorded a liability of $8~~Company was required to deposit $52 million ~~for the estimated fair value of~~related to the contingent consideration ~~for~~liability into an escrow account (of which $16 million was deposited in the ~~acquisition~~second quarter of ~~Movimento, as further described~~2019, $16 million was deposited in ~~Note 17. Acquisitions~~the first quarter of 2020 and ~~Divestitures. Also during the nine months ended September 30, 2017, Delphi paid~~ $20 million was deposited in the first quarter of ~~contingent consideration related~~2021). Accordingly, this amount is classified as restricted cash in the consolidated balance sheets. All amounts are anticipated to ~~its 2015 acquisition~~be released from the escrow account in the fourth quarter of ~~Control-Tec and $2 million of contingent consideration related to its 2015 acquisition of Ottomatika.~~2021.

As of ~~September 30, 2017~~March 31, 2021 and December 31, ~~2016, Delphi~~2020, Aptiv had the following assets measured at fair value on a recurring basis:


										Total		Quoted Prices in Active Markets Level 1		Significant Other Observable Inputs Level 2		Significant Unobservable Inputs Level 3
	Total		Quoted Prices in Active Markets Level 1		Significant Other Observable Inputs Level 2		Significant Unobservable Inputs Level 3
										(in millions)
	(in millions)
As of September 30, 2017
As of March 31, 2021:									As of March 31, 2021:
Commodity derivatives	$	25	$	—	$	25	$	—	Commodity derivatives	$	57	$	0	$	57	$	0
Foreign currency derivatives	23		—		23		—		Foreign currency derivatives	12		0		12		0

Total	$	48	$	—	$	48	$	—	Total	$	69	$	0	$	69	$	0
As of December 31, 2016:
As of December 31, 2020:									As of December 31, 2020:
Commodity derivatives	$	11	$	—	$	11	$	—	Commodity derivatives	$	35	$	0	$	35	$	0
Foreign currency derivatives	8		—		8		—		Foreign currency derivatives	35		0		35		0

Total	$	19	$	—	$	19	$	—	Total	$	70	$	0	$	70	$	0

As of ~~September 30, 2017~~March 31, 2021 and December 31, ~~2016, Delphi~~2020, Aptiv had the following liabilities measured at fair value on a recurring basis:


	Total		Quoted Prices in Active Markets Level 1		Significant Other Observable Inputs Level 2		Significant Unobservable Inputs Level 3

	(in millions)
As of March 31, 2021:

Foreign currency derivatives	$	13	$	0	$	13	$	0
Contingent consideration	52		0		0		52
Total	$	65	$	0	$	13	$	52
As of December 31, 2020:

Foreign currency derivatives	$	9	$	0	$	9	$	0
Contingent consideration	52		0		0		52
Total	$	61	$	0	$	9	$	52

Total Quoted Prices in Active Markets
Level 1 Significant Other Observable Inputs
Level 2 Significant Unobservable Inputs
Level 3

(in millions)
As of September 30, 2017
Commodity derivatives $ —
$ —
$ —
$ —
Foreign currency derivatives 19
—
19
—
Contingent consideration 22
—
—
22
Total $ 41
$ —
$ 19
$ 22
As of December 31, 2016:
Foreign currency derivatives $ 56
$ —
$ 56
$ —
Contingent consideration 35
—
—
35
Total $ 91
$ —
$ 56
$ 35

Non-derivative financial instruments—~~Delphi’s~~Aptiv’s non-derivative financial instruments include cash and cash equivalents, accounts and notes receivable, accounts payable, as well as debt, which consists of its accounts receivable factoring ~~arrangements, capital~~arrangement, finance leases and other debt issued by ~~Delphi’s~~Aptiv’s non-U.S. subsidiaries, the Revolving Credit Facility, the Tranche A Term Loan and all series of outstanding senior notes. The fair value of debt is based on quoted market prices for instruments with public market data or significant other observable inputs for instruments without a quoted public market price (Level 2). As of ~~September 30, 2017~~March 31, 2021 and December 31, ~~2016,~~2020, total debt was recorded at ~~$4,899~~$4,024 million and ~~$3,971~~$4,101 million, respectively, and had estimated fair values of ~~$5,002~~$4,411 million and ~~$4,007~~$4,490 million, respectively. For all other financial instruments recorded at ~~September 30, 2017~~March 31, 2021 and December 31, ~~2016,~~2020, fair value approximates book value.

Table of Contents

Fair Value Measurements on a Nonrecurring Basis

In addition to items that are measured at fair value on a recurring basis, ~~Delphi~~Aptiv also has items in its balance sheet that are measured at fair value on a nonrecurring basis. As these items are not measured at fair value on a recurring basis, they are not included in the tables above. Nonfinancial assets and liabilities that are measured at fair value on a nonrecurring basis include certain long-lived assets, equity ~~and cost method~~ investments, intangible assets, asset retirement obligations, share-based compensation and liabilities for exit or disposal activities measured at fair value upon initial recognition. During the three ~~and nine~~ months ended ~~September 30, 2017, Delphi~~March 31, 2021 and 2020, Aptiv recorded no non-cash asset impairment ~~charges totaling $1 million and $10 million, respectively, within cost of sales related to declines in the fair values of certain fixed assets. During the three and nine~~

~~Table of Contents~~

months ended September 30, 2016, Delphi recorded non-cash asset impairment charges totaling $1 million and $23 million, respectively, within cost of sales related to declines in the fair values of certain fixed assets, $19 million of which related to the initiation of a plant closure of a European manufacturing site within the Powertrain Systems segment in the second quarter of 2016, as further described in Note 7. Restructuring.charges. Fair value of long-lived and intangible assets is determined primarily using the anticipated cash flows discounted at a rate commensurate with the risk involved and a review of ~~appraisals.~~appraisals or other market indicators and management estimates. As such, ~~Delphi~~Aptiv has determined that the fair value measurements of long-lived and intangible assets fall in Level 3 of the fair value hierarchy.

16. OTHER INCOME, NET

Other income (expense), net included:


	Three Months Ended March 31,
		2021		2020

		(in millions)
Interest income		$	3	$	3


Components of net periodic benefit cost other than service cost (Note 9)		(5)		(5)



Other, net		3		1
Other income (expense), net		$	1	$	(1)

Three Months Ended September 30, Nine Months Ended September 30,
2017 2016 2017 2016

(in millions)
Interest income $ 2
$ 1
$ 5
$ 2
Loss on extinguishment of debt —
(73 ) —
(73 )
Components of net periodic benefit cost other than service cost (Note 9) (9 ) (3 ) (25 ) (9 )
Reserve for Unsecured Creditors litigation —
—
(10 ) —
Other, net (2 ) 6
1
7
Other expense, net $ (9 ) $ (69 ) $ (29 ) $ (73 )

As further discussed in Note 10. Commitments and Contingencies, during the three months ended June 30, 2017, Delphi and the plaintiffs reached an agreement to settle the Unsecured Creditors litigation for $310 million, which was subsequently approved by the Bankruptcy Court. In July 2017, the Company paid the $310 million settlement pursuant to the terms of the settlement agreement. In accordance with the terms of the settlement agreement, the Company recorded a net incremental charge of $10 million to its previously recorded reserve of $300 million to other expense during the nine months ended September 30, 2017.

As further discussed in Note 8. Debt, during the three and nine months ended September 30, 2016, Delphi redeemed for cash the entire $800 million aggregate principal amount outstanding of the 2013 Senior Notes, resulting in a loss on debt extinguishment of approximately $70 million. Delphi also recorded a loss on debt extinguishment of $3 million during the three and nine months ended September 30, 2016 in conjunction with the 2016 amendment to the Credit Agreement, as further discussed in Note 8. Debt. Additionally, as further discussed in Note 21. Discontinued Operations, during the three and nine months ended September 30, 2016, Delphi recorded $2 million and $7 million for certain fees earned pursuant to the transition services agreement in connection with the sale of the Company's wholly owned Thermal Systems business.

17. ACQUISITIONS AND DIVESTITURES

Acquisition of ~~nuTonomy~~Dynawave Inc.

On October 20, 2017, Delphi agreed to acquire nuTonomy, Inc. ("nuTonomy"), a leading provider of autonomous driving software and technology, for total consideration of up to $454 million. Of the total consideration, $290 million of purchase price is payable at closing, subject to certain post-closing adjustments, and approximately $110 million will vest to certain selling shareholders in annual installments over 3 years from the acquisition date, subject to those selling shareholders' compliance with certain service conditions. Of the $110 million, approximately $8 million is payable after one year and approximately $51 million is payable after each of the second and third years following the acquisition date. These remaining installments will be recorded as a component of Selling, general and administrative expense ratably over the respective installment period. Additionally, the total consideration includes a cash payment of up to $54 million contingent upon the achievement of certain performance metrics over a future 3-year period.

The acquisition is subject to the satisfaction of customary closing conditions and the receipt of regulatory and other approvals, and is expected to close in the fourth quarter of 2017. The Company intends to acquire nuTonomy utilizing cash on hand. Upon completion, nuTonomy will become part of Delphi’s Electronics and Safety segment.

~~Table of Contents~~

~~Acquisition of Movimento Group~~

~~On January 3, 2017, Delphi~~August 4, 2020, Aptiv acquired 100% of the equity interests of ~~Movimento Group ("Movimento"~~Dynawave Inc. (“Dynawave”), a ~~leading provider~~specialized manufacturer of ~~Over-the-Air software and data management for the automotive sector,~~custom-engineered interconnect solutions for a ~~purchase price of $40 million at closing and an additional cash payment of up to $10 million contingent upon the achievement of certain performance metrics over a future 2-year period. The~~wide range of ~~the undiscounted amounts the Company could be required to pay under this arrangement is between $0 and $10~~industries, for total consideration of $22 million. As of the closing date of the acquisition, the contingent consideration was assigned a fair value of approximately $8 million. Refer to Note 15. Fair Value of Financial Instruments for additional information regarding the measurement of the contingent consideration liability. The results of the operations of ~~Movimento~~Dynawave are reported within the ~~Electronics~~Signal and ~~Safety~~Power Solutions segment from the date of the acquisition. The Company acquired ~~Movimento~~Dynawave utilizing cash on hand.

The acquisition was accounted for as a business combination, with the total purchase price allocated on a preliminary basis using information available, in the ~~first~~third quarter of ~~2017.~~2020. The preliminary purchase price and related allocation to the acquired net assets of ~~Movimento~~Dynawave based on their estimated fair values is shown below (in millions):

Assets acquired and liabilities assumed

Purchase price, cash consideration, net of cash acquired $ 40
Purchase price, fair value of contingent consideration 8
Total purchase price, net of cash acquired $ 48

Intangible assets $ 22
Other assets, net 4
Identifiable net assets acquired 26
Goodwill resulting from purchase 22
Total purchase price allocation $ 48


Purchase price, cash consideration, net of cash acquired	$	22




Intangible assets	$	7
Other assets, net	5
Identifiable net assets acquired	12
Goodwill resulting from purchase	10
Total purchase price allocation	$	22

Intangible assets primarily include ~~$8 million~~amounts recognized for the fair value of ~~the acquired trade name,~~customer-based assets, which ~~has an estimated useful life of approximately 25 years, $4 million of customer-based and technology-related assets with~~will be amortized over their estimated useful lives of approximately 7 years, and $10 million of in-process research and development, which will not be amortized, but tested for impairment until the completion or abandonment of the associated research and development efforts.9 years. The estimated fair value of these assets was based on third-party valuations and ~~management's~~management’s estimates, generally utilizing income and market approaches. Goodwill recognized in this transaction is primarily attributable to synergies expected to arise after the acquisition and the assembled workforce of Dynawave, and is not expected to be deductible for tax purposes.

The purchase price and related allocation are preliminary and could be revised as a result of adjustments made to the purchase price, additional information obtained regarding liabilities assumed, including, but not limited to, contingent liabilities, revisions of provisional estimates of fair values, including, but not limited to, the completion of independent appraisals and valuations related to property, plant and equipment and intangible assets, and certain tax attributes.

Table of Contents

The pro forma effects of this acquisition would not materially impact the ~~Company's~~Company’s reported results for any period presented, and as a result no pro forma financial statements were presented.

Acquisition of ~~PureDepth,~~Ulti-Mate Connector, Inc.

On ~~March 23, 2016, Delphi~~April 30, 2021, Aptiv acquired 100% of the equity interests of ~~PureDepth,~~Ulti-Mate Connector, Inc. ("~~PureDepth"~~Ulti-Mate"), a ~~leading provider~~manufacturer of ~~3D display technology,~~miniature and micro-miniature connectors and cable assemblies, for approximately ~~$15 million. The results of operations of PureDepth are reported within the Electronics~~$45 million, subject to customary post-closing adjustments, which will primarily be allocated to goodwill and ~~Safety segment from the date of acquisition.~~other intangible assets. The acquisition ~~was~~will be accounted for as a business combination, with the ~~total purchase price allocated on a preliminary basis using information available, in the first quarter~~operating results of 2016. The purchase price and related allocation were finalized in the first quarter of 2017, and resulted in no adjustments from the amounts previously disclosed. The purchase price and related allocation to the acquired net assets of PureDepth based on their estimated fair values is shown below (in millions):

~~Assets acquired and liabilities assumed~~

Purchase price, cash consideration $ 15

Intangible assets $ 10
Goodwill resulting from purchase 5
Total purchase price allocation $ 15

~~Table of Contents~~

Intangible assets include amounts recognized for the fair value of in-process research and development, which will not be amortized, but tested for impairment until the completion or abandonment of the associated research and development efforts. The fair value of these assets was based on third-party valuations and management's estimates, generally utilizing income and market approaches.

~~The pro forma effects of this acquisition would not materially impact~~Ulti-Mate included within the Company's ~~reported results for any period presented,~~Signal and ~~as a result no pro forma financial statements were presented.~~

~~Acquisition of HellermannTyton Group PLC~~

~~On December 18, 2015, pursuant to the terms of a recommended offer made on July 30, 2015~~, Delphi completed the acquisition of 100% of the issued ordinary share capital of HellermannTyton Group PLC ("HellermannTyton"), a public limited company based in the United Kingdom, and a leading global manufacturer of high-performance and innovative cable management solutions. Delphi paid 480 pence per HellermannTyton share, totaling approximately $1.5 billion in aggregate, net of cash acquired. Approximately $242 million of HellermannTyton outstanding debt to third-party creditors was assumed and subsequently paid off.

HellermannTyton had 2014 sales of approximately €600 million (approximately 6% of which were to Delphi and will be eliminated on a consolidated basis). Upon completing the acquisition, Delphi incurred transaction related expenses totaling approximately $23 million, which were recorded within other income (expense), net in the statement of operations in the fourth quarter of 2015.

The acquisition was accounted for as a business combination, with the total purchase price allocated on a preliminary basis using information available, in the fourth quarter of 2015. The purchase price and related allocation were finalized in the fourth quarter of 2016. As a result of additional information obtained, changes to the preliminary fair values of certain property, plant and equipment, and other assets purchased and liabilities assumed, including contingent tax liabilities, from the amounts disclosed as of December 31, 2015 were recorded during the year ended December 31, 2016, which resulted in a net adjustment to goodwill of $10 million. These adjustments did not result in significant effects to the consolidated statement of operations for the year ended December 31, 2016. The purchase price and related allocation to the acquired net assets of HellermannTyton based on their estimated fair values is shown below (in millions):

~~Assets acquired and liabilities assumed~~

Purchase price, cash consideration, net of cash acquired $ 1,534
Debt and pension liabilities assumed 258
Total consideration, net of cash acquired $ 1,792

Property, plant and equipment $ 326
Indefinite-lived intangible assets 128
Definite-lived intangible assets 554
Other liabilities, net (82 )
Identifiable net assets acquired 926
Goodwill resulting from purchase 866
Total purchase price allocation $ 1,792

Goodwill recognized in this transaction is primarily attributable to synergies expected to arise after the acquisition and the assembled workforce of HellermannTyton, and is not deductible for tax purposes. Intangible assets primarily include $128 million recognized for the fair value of the acquired trade name, which has an indefinite useful life, $451 million of customer-based assets with approximate useful lives of 13 years and $103 million of technology-related assets with approximate useful lives of 13 years. The valuation of the intangible assets acquired was based on third-party valuations, management's estimates, available information and reasonable and supportable assumptions. The fair value of the acquired trade name and the technology-related assets was generally estimated utilizing the relief from royalty method under the income approach, and the fair value of customer-based assets was generally estimated utilizing the multi-period excess earnings method.

~~The results of operations of HellermannTyton are reported within the Electrical/Electronic Architecture~~Power Solutions segment from the date of acquisition. The ~~pro forma effects of this acquisition would not materially impact the Company's reported results for any period presented, and as a result no pro forma financial statements were presented.~~

~~Table of Contents~~

~~Acquisition financing~~

Delphi financed the cash payment required to close the acquisition of HellermannTyton primarily with the net proceeds received from the offering of $1.3 billion of 2015 Senior Notes, as further described in Note 8. Debt, with the remainder of the purchase price funded withCompany acquired Ulti-Mate utilizing cash on hand that was received from the sale of the Company's Thermal Systems business, as further described below. Prior to the transaction closing, in connection with the offer to acquire HellermannTyton in July 2015, £540 million ($844 million using July 30, 2015 foreign currency rates) was placed on deposit for purposes of satisfying a portion of the consideration required to effect the acquisition.hand.

~~Sale of Mechatronics Business~~

On December 30, 2016, Delphi completed the sale of its Mechatronics business, which was previously reported within the Electronics and Safety segment, for net cash proceeds of approximately $197 million. The net sales of this business in 2016 prior to the divestiture were approximately $290 million. Delphi recognized a pre-tax gain on the divestiture of $141 million, net of $29 million of accumulated currency translation losses transferred from accumulated other comprehensive income, which is included in cost of sales in the consolidated statement of operations. The gain on the divestiture, net of tax, was $124 million, resulting in an increase in earnings per diluted share of approximately $0.45 for the year ended December 31, 2016. The results of operations of this business were not significant to the consolidated financial statements for any period presented, and the divestiture did not meet the discontinued operations criteria.

~~Sale of Thermal Systems Business~~

On June 30, 2015, Delphi completed the sale of the Company's wholly owned Thermal Systems business. On September 24, 2015, Delphi completed the sale of its interest in its KDAC joint venture, and on March 31, 2016, Delphi completed the sale of its interest in its SDAAC joint venture. Delphi's interests in the SDAAC and KDAC joint ventures were previously reported within the Thermal Systems segment. Accordingly, the results of the Thermal Systems business are classified as discontinued operations for all periods presented. Refer to Note 21. Discontinued Operations for further disclosure related to the Company's discontinued operations, including details of the divestiture transactions.

Technology Investments

The Company has made technology investments in certain non-consolidated affiliates for ownership interests of less than 20%, ~~which~~as described in Note 2. Significant Accounting Policies. These investments do not have readily determinable fair values and are ~~accounted~~measured at cost, less impairments, adjusted for ~~under~~observable price changes in orderly transactions for identical or similar investments of the ~~cost method.~~same issuer.

~~During the third quarter~~The following is a summary of 2017, the Company's Electronics and Safety segment made investments in two leading developers of Light Detection and Ranging (“LIDAR”) technology, a $15 million investment in Innoviz Technologies and a $10 million investment in LeddarTech, Inc. The Company's Powertrain Systems segment also made an additional $1 million investment in Tula Technology Inc., an engine control software company in which the Company made an initial $20 million investment in 2015.

~~As of September 30, 2017, the Company had the following~~ technology investments, which are classified within other long-term assets in the consolidated balance ~~sheet:~~sheets, as of March 31, 2021 and December 31, 2020:


Investment Name	Segment	Investment Date	March 31, 2021		December 31, 2020
			(in millions)
Krono-Safe, SAS	Advanced Safety and User Experience	Q4 2019	$	6	$	6
Affectiva, Inc.	Advanced Safety and User Experience	Q4 2018	15		15
Innoviz Technologies	Advanced Safety and User Experience	Q3 2017	25		25
LeddarTech, Inc.	Advanced Safety and User Experience	Q3 2017	10		10
Valens Semiconductor Ltd.	Signal and Power Solutions	Q2 2017	10		10
Otonomo Technologies Ltd.	Advanced Safety and User Experience	Q1 2017; Q1 2019	37		37
Quanergy Systems, Inc	Advanced Safety and User Experience	Q2 2015; Q1 2016	6		6
Other investments	Advanced Safety and User Experience	Various	4		4
Total			$	113	$	113

In April 2021, Innoviz Technologies (“Innoviz”) merged with a publicly traded Special Purpose Acquisition Company (“SPAC”) and shares of Innoviz began trading on the Nasdaq Capital Market under the symbol INVZ. As part of the SPAC merger, our preferred shares in Innoviz were converted into Innoviz ordinary shares. Following this conversion, the Company will measure the fair value of the Innoviz investment on a recurring basis, with changes in fair value recorded to other income (expense), net.

There were no other material transactions, events or changes in circumstances requiring an impairment or an observable price change adjustment to these investments. The Company continues to monitor these investments to identify potential transactions which may indicate an impairment or an observable price change requiring an adjustment to its carrying value.

Autonomous Driving Joint Venture

On March 26, 2020, Aptiv completed the transaction with Hyundai Motor Group (“Hyundai”) to form a joint venture focused on the design, development and commercialization of autonomous driving technologies. The joint venture operates globally under the Motional brand name. Under the terms of the agreement, Aptiv contributed to the joint venture autonomous driving technology, intellectual property and approximately 700 employees for a 50% ownership interest in the entity. Hyundai contributed to the joint venture approximately $1.6 billion in cash, along with vehicle engineering services, research and development resources and access to intellectual property for a 50% ownership interest in the entity. As a result, subsequent to the closing of the transaction, the joint venture is expected to fund all of its future operating expenses and investments in autonomous driving technologies for the foreseeable future. Consequently, Aptiv is no longer required to fund these investments and expenses, which approximated $180 million for the year ended December 31, 2019 prior to the joint venture formation. Upon closing of the transaction, Aptiv deconsolidated the carrying value of the associated assets and liabilities contributed to the joint venture, previously classified as held for sale, and recognized an asset of approximately $2 billion within investments in affiliates in the consolidated balance sheet, based on the preliminary fair value of its investment in the

Investment Name Segment Investment Date
Investment
(in millions)
Innoviz Technologies Electronics and Safety Q3 2017 $ 15
LeddarTech, Inc. Electronics and Safety Q3 2017 10
Valens Semiconductor Ltd. Electrical/Electronic Architecture Q2 2017 10
Otonomo Technologies Ltd. Electronics and Safety Q1 2017 15
Tula Technology Inc. Powertrain Systems Q2 2015; Q3 2017 21
Quanergy Systems, Inc Electronics and Safety Q2 2015; Q1 2016 6
$ 77

Table of Contents

newly formed joint venture. The Company recognized a pre-tax gain of approximately $1.4 billion in the consolidated statement of operations (approximately $5.63 per diluted share during the three months ended March 31, 2020), net of transaction costs of $22 million, based on the difference between the carrying value of its contribution to the joint venture and the preliminary fair value of its investment in the entity. The estimated fair value of Aptiv’s ownership interest in the joint venture was determined primarily based on third-party valuations and management estimates, generally utilizing income and market approaches. Determining the fair value of the joint venture and the underlying assets requires the use of management’s judgment and involves significant estimates and assumptions with respect to the timing and amount of future cash flows, market rate assumptions, projected growth rates and margins, and appropriate discount rates, among other items. The estimated fair value was determined on a preliminary basis using information available in the first quarter of 2020 and was finalized in the first quarter of 2021. The effects of this transaction would not materially impact the Company’s reported results for any period presented, and the transaction did not meet the criteria to be reflected as a discontinued operation.

In connection with the closing of the transaction, Aptiv and the entity entered into various agreements to facilitate an orderly transition and to provide a framework for their relationship going forward, which included a transition services agreement. The transition services primarily involve Aptiv providing certain administrative services to the joint venture for a period of up to 24 months after the closing date. These agreements are not material to Aptiv.

The Company’s investment in the joint venture is accounted for using the equity method of accounting and Aptiv recognized an equity loss of $45 million and $1 million, net of tax, during the three months ended March 31, 2021 and 2020, respectively. The pre-tax loss of Aptiv’s autonomous driving operations that were contributed to the joint venture on March 26, 2020, included within Aptiv’s consolidated operating results, was $41 million for the three months ended March 31, 2020.

Motional Lease Agreement

Upon closing of the transaction, Aptiv agreed to sublease certain office space to Motional, which has a remaining lease term of approximately 8 years as of March 31, 2021. Total income under the agreement was $1 million and less than $1 million during the three months ended March 31, 2021 and 2020, respectively. The sublease income and Aptiv’s associated operating lease cost are recorded to cost of sales in the consolidated statement of operations. The Company believes the terms of the lease agreement have not significantly been affected by the fact the Company and the lessee are related parties.

18. SHARE-BASED COMPENSATION

~~Long Term~~Long-Term Incentive Plan

The ~~Delphi Automotive~~Aptiv PLC Long-Term Incentive Plan, as amended and restated effective April 23, 2015 (the “PLC LTIP”), allows for the grant of awards of up to ~~22,977,116~~25,665,448 ordinary shares for long-term compensation. The PLC LTIP is designed to align the interests of management and shareholders. The awards can be in the form of shares, options, stock appreciation rights, restricted stock, restricted stock units ~~("RSUs"~~(“RSUs”), performance awards and other share-based awards to the employees, directors, consultants and advisors of the Company. The Company has awarded annual long-term grants of RSUs under the PLC LTIP in ~~each year from 2012 to 2017 in~~ order to align management compensation with ~~Delphi's~~Aptiv’s overall business strategy. ~~The~~In addition, the Company has competitive and market-appropriate ownership ~~requirements.~~requirements for its directors and officers. All of the RSUs granted under the PLC LTIP are eligible to receive dividend equivalents for any dividend paid from the grant date through the vesting date. Dividend equivalents are generally paid out in ordinary shares upon vesting of the underlying RSUs. ~~Historical amounts disclosed within this note include amounts attributable to the Company's discontinued operations, unless otherwise noted.~~

Board of Director Awards

OnAptiv has granted RSUs to the Board of Directors as detailed in the table below:


Grant Date	RSUs granted	Grant Date Fair Value (1)		Vesting Date	Shares Issued Upon Vesting	Fair Value of Shares at Issuance		Shares Withheld to Cover Withholding Taxes
(dollars in millions)

April 2020	48,745	$	3	April 2021	41,896	$	6	6,849
April 2019	20,765	2		April 2020	23,816	1		2,041

(1)Determined based on the closing price of the Company’s ordinary shares on the date of the grant.

In addition, in April ~~23, 2015, Delphi~~2021, Aptiv granted ~~20,347~~17,589 RSUs to the Board of Directors at a grant date fair value of approximately $2$3 million. The grant date fair value was determined based on the closing price of the ~~Company's~~Company’s ordinary shares on ~~April 23, 2015. The RSUs vested on April 27, 2016, and 24,542 ordinary shares, which included shares issued in connection with dividend equivalents, were issued to members~~the date of the ~~Board of Directors at a fair value of approximately $2 million. 1,843 ordinary shares were withheld to cover the minimum U.K. withholding taxes.~~

On April 28, 2016, Delphi granted 27,238 RSUs to the Board of Directors at a grant date fair value of approximately $2 million. The grant date fair value was determined based on the closing price of the Company's ordinary shares on April 28, 2016. The RSUs vested on April 26, 2017, and 26,580 ordinary shares, which included shares issued in connection with dividend equivalents, were issued to members of the Board of Directors at a fair value of approximately $2 million. 3,472 ordinary shares were withheld to cover the minimum U.K. withholding taxes.

On April 27, 2017, Delphi granted 26,782 RSUs to the Board of Directors at a grant date fair value of approximately $2 million. The grant date fair value was determined based on the closing price of the Company's ordinary shares on April 27, 2017.grant. The RSUs will vest onin April ~~25, 2018, the day before the 2018 annual meeting~~2022.

Table of ~~shareholders.~~Contents

Executive Awards

~~Delphi~~Aptiv has made annual grants of RSUs to its executives in February of each year beginning in 2012. These awards include a time-based vesting portion and a performance-based vesting portion, as well as continuity awards in certain years. The time-based RSUs, which make up ~~25%~~40% (25% prior to 2021) of the awards for ~~Delphi’s~~Aptiv’s officers and 50% for ~~Delphi’s~~Aptiv’s other executives, vest ratably over three years beginning on the first anniversary of the grant date. The performance-based RSUs, which make up ~~75%~~60% (75% prior to 2021) of the awards for ~~Delphi’s~~Aptiv’s officers and 50% for ~~Delphi’s~~Aptiv’s other executives, vest at the completion of a three-year performance period if certain targets are met. Each executive will receive between 0% and ~~200%~~150% of his or her target performance-based award based on the Company’s performance against established company-wide performance metrics, which are:


Metric	2020 - 2021 Grants	2017 - 2019 Grants
Average return on net assets (1)	33%	50%
Cumulative net income	33%	25%

Relative total shareholder return (2)	33%	25%

Metric 2016 - 2017 Grants 2013 - 2015 Grants
Average return on net assets (1) 50% 50%
Cumulative net income 25% N/A
Cumulative earnings per share (2) N/A 30%
Relative total shareholder return (3) 25% 20%
(1)Average return on net assets is measured by tax-affected operating income divided by average net working capital plus average net property, plant and equipment for each calendar year during the respective performance period.


~~(1)~~	Average return on net assets is measured by tax-affected operating income divided by average net working capital plus average net property, plant and equipment for each calendar year during the respective performance period.


~~(2)~~	~~Cumulative earnings per share is measured by net income attributable to Delphi divided by the weighted average number of diluted shares outstanding for the respective three-year performance period.~~

~~(3)~~

(2)Relative total shareholder return is measured by comparing the average closing price per share of the Company’s ordinary shares for all available trading days in the fourth quarter of the end of the performance period to the average closing price per share of the Company’s ordinary shares for all available trading days in the fourth quarter of the year preceding the grant, including dividends, and assessed against a comparable measure of competitor and peer group companies.

~~Table~~ of ~~Contents~~

the Company’s ordinary shares for the specified trading days in the fourth quarter of the end of the performance period to the average closing price per share of the Company’s ordinary shares for the specified trading days in the fourth quarter of the year preceding the grant, including dividends, and assessed against a comparable measure of competitor and peer group companies.

The details of the executive grants were as follows:

Grant Date RSUs Granted Grant Date Fair Value Time-Based Award Vesting Dates Performance-Based Award Vesting Date
(in millions)
February 2013 1.45
$ 60
Annually on anniversary of grant date, 2014 - 2016 December 31, 2015
February 2014 0.78
53
Annually on anniversary of grant date, 2015 - 2017 December 31, 2016
February 2015 0.90
76
Annually on anniversary of grant date, 2016 - 2018 December 31, 2017
February 2016 0.71
48
Annually on anniversary of grant date, 2017 - 2019 December 31, 2018
February 2017 0.80
63
Annually on anniversary of grant date, 2018 - 2020 December 31, 2019

Any new executives hired after the annual executive RSU grant date may be eligible to participate in the PLC LTIP. Any off cycle grants made for new hires are valued at their grant date fair value based on the closing price of the Company's ordinary shares on the date of such grant.

Grant Date

RSUs Granted

Grant Date Fair Value

Time-Based Award Vesting Dates

Performance-Based Award Vesting Date

(in millions)

February 2017

0.80

Annually on anniversary of grant date, 2018 - 2020

December 31, 2019

February 2018

0.63

Annually on anniversary of grant date, 2019 - 2021

December 31, 2020

February 2019

0.71

Annually on anniversary of grant date, 2020 - 2022

December 31, 2021

February 2020

0.75

Annually on anniversary of grant date, 2021 - 2023

December 31, 2022

February 2021

0.44

Annually on anniversary of grant date, 2022 - 2024

December 31, 2023

The grant date fair value of the RSUs is determined based on the target number of awards issued, the closing price of the Company’s ordinary shares on the date of the grant of the award, including an estimate for forfeitures, and a contemporaneous valuation performed by an independent valuation specialist with respect to the relative total shareholder return awards.

~~In February 2016,~~Any new executives hired after the annual executive RSU grant date may be eligible to participate in the PLC LTIP. The Company has also granted additional awards to employees in certain periods under the ~~time-based vesting terms~~PLC LTIP. Any off cycle grants made for new hires or to other employees are valued at their grant date fair value based on the closing price of the ~~2013, 2014 and 2015 grants, 395,744~~Company’s ordinary shares ~~were issued to Delphi executives at a fair value~~on the date of ~~approximately $24 million, of which 146,726 ordinary shares were withheld to cover minimum withholding taxes.~~ such grant.

The performance-based RSUs associated with the 2013 grant vested at the completion of a three-year performance period on December 31, 2015, and in the first quarter of 2016, 1,265,339 ordinary shares were issued to Delphi executives at a fair value of approximately $77 million, of which 512,371 ordinary shares were withheld to cover minimum withholding taxes.

~~In February 2017, under the time-based vesting terms~~details of the ~~2014, 2015 and 2016~~shares issued upon vesting of the executive grants ~~248,008 ordinary shares were issued to Delphi executives at a fair value~~are as follows:


	Time-Based Awards				Performance-Based Awards
Vesting Date	Ordinary Shares Issued Upon Vesting	Fair Value of Shares at Issuance		Ordinary Shares Withheld to Cover Withholding Taxes	Ordinary Shares Issued Upon Vesting	Fair Value of Shares at Issuance		Ordinary Shares Withheld to Cover Withholding Taxes
		(in millions)				(in millions)

Q1 2021	449,426	$	67	177,825	288,074	$	43	121,609
Q1 2020	468,240	37		181,495	580,390	45		243,080

Table of approximately $19 million, of which 88,807 ordinary shares were withheld to cover minimum withholding taxes. The performance-based RSUs associated with the 2014 grant vested at the completion of a three-year performance period on December 31, 2016, and in the first quarter of 2017, 797,210 ordinary shares were issued to Delphi executives at a fair value of approximately $60 million, of which 324,555 ordinary shares were withheld to cover minimum withholding taxes.Contents

A summary of RSU activity, including award grants, vesting and forfeitures is provided below:


	RSUs	Weighted Average Grant Date Fair Value
	(in thousands)
Nonvested, January 1, 2021	1,786	$	102.95
Granted	509	161.30
Vested	(446)	82.10
Forfeited	(12)	84.35
Nonvested, March 31, 2021	1,837	124.28

RSUs
Weighted Average Grant
Date Fair Value
(in thousands)
Nonvested, January 1, 2017 1,740
$ 76.54
Granted 877
79.68
Vested (362 ) 74.42
Forfeited (135 ) 76.76
Nonvested, September 30, 2017 2,120
78.19

~~Delphi~~Aptiv recognized share-based compensation expense of ~~$16~~$29 million ($1429 million, net of tax) and ~~$18~~a benefit from share-based compensation of $1 million ($161 million, net of tax) based on the Company’s best estimate of ultimate performance against the respective targets during the three months ended ~~September 30, 2017~~March 31, 2021 and ~~2016,~~2020, respectively. Delphi recognized compensation expense of $48 million ($42 million, net of tax) and $45 million ($39 million, net of tax) based on the Company’s best estimate of ultimate performance against the respective targets during the nine months ended September 30, 2017 and 2016, respectively. DelphiAptiv will continue to recognize compensation expense, based on the grant date fair value of the awards applied to the Company’s best estimate of ultimate performance against the respective targets, over the requisite vesting periods of the awards. Based on the grant date fair value of the awards and the Company’s best estimate of ultimate performance against the respective targets as of ~~September 30, 2017,~~March 31, 2021, unrecognized compensation expense on a pre-tax basis of approximately ~~$87~~$199 million is anticipated to be recognized over a weighted average period of approximately 2 years. For the ~~nine~~three months ended ~~September 30, 2017~~March 31, 2021 and ~~2016, respectively,~~2020, approximately ~~$33~~$45 million and ~~$40~~$32 million, respectively, of cash was paid and reflected as a financing activity in the statements of cash flows related to the ~~minimum statutory~~ tax withholding for vested RSUs.

~~Table of Contents~~

19. ~~SUPPLEMENTAL GUARANTOR AND NON-GUARANTOR CONDENSED CONSOLIDATING FINANCIAL STATEMENTS~~

~~Basis of Presentation~~

~~Notes Issued by the Subsidiary Issuer~~

As described in Note 8. Debt, Delphi Corporation (the "Subsidiary Issuer/Guarantor"), a 100% owned subsidiary of Delphi Automotive PLC (the "Parent"), issued the 2013 Senior Notes and the 2014 Senior Notes, both of which were registered under the Securities Act, and is the borrower of obligations under the Credit Agreement. The 2013 Senior Notes were subsequently redeemed and extinguished in September 2016. The 2014 Senior Notes and obligations under the Credit Agreement are, and prior to their redemption, the 2013 Senior Notes were, fully and unconditionally guaranteed by Delphi Automotive PLC and certain of Delphi Automotive PLC's direct and indirect subsidiary companies, which are directly or indirectly 100% owned by Delphi Automotive PLC (the “Subsidiary Guarantors”), on a joint and several basis, subject to customary release provisions (other than in the case of Delphi Automotive PLC). All other consolidated direct and indirect subsidiaries of Delphi Automotive PLC are not subject to the guarantees (“Non-Guarantor Subsidiaries”).

~~Notes Issued by the Parent~~

As described in Note 8. Debt, Delphi Automotive PLC issued the 2015 Senior Notes, the 2015 Euro-denominated Senior Notes, the 2016 Euro-denominated Senior Notes and the 2016 Senior Notes, each of which were registered under the Securities Act. Each series of these senior notes are fully and unconditionally guaranteed on a joint and several basis, subject to customary release provisions, by certain of Delphi Automotive PLC's direct and indirect subsidiary companies (the “Subsidiary Guarantors”), and Delphi Corporation, each of which are directly or indirectly 100% owned by Delphi Automotive PLC. All other consolidated direct and indirect subsidiaries of Delphi Automotive PLC are not subject to the guarantees (“Non-Guarantor Subsidiaries”).

~~Spin-Off Senior Notes~~

As described in Note 8. Debt, in September 2017, Delphi Technologies PLC, a wholly owned subsidiary of the Company, was formed in connection with the planned spin-off of the Powertrain Systems segment. Delphi Technologies PLC is a holding company established to directly, or indirectly, own substantially all of the operating subsidiaries of the spin-off, to issue debt securities and perform treasury operations of the spin-off entity. In September 2017, Delphi Technologies PLC issued $800 million in aggregate principal amount of 5.00% senior unsecured notes due 2025 in a transaction exempt from registration under the Securities Act. The net proceeds from the notes offering were deposited into escrow and are expected to be released in connection with the spin-off. The notes are not guaranteed until their release from escrow, and will not be guaranteed by the Company or any of its subsidiaries that will not be subsidiaries of Delphi Technologies PLC following the spin-off. As Delphi Technologies PLC is not a guarantor of the Company's other indebtedness, it is included in the Non-Guarantor Subsidiaries.

In lieu of providing separate audited financial statements for the Guarantors, the Company has included the accompanying condensed consolidating financial statements. These condensed consolidating financial statements are presented on the equity method. Under this method, the investments in subsidiaries are recorded at cost and adjusted for the parent’s share of the subsidiary’s cumulative results of operations, capital contributions and distributions and other equity changes. The Non-Guarantor Subsidiaries are combined in the condensed consolidating financial statements. The principal elimination entries are to eliminate the investments in subsidiaries and intercompany balances and transactions.

~~Table of Contents~~

~~Statement of Operations Three Months Ended September 30, 2017~~

Parent Subsidiary Guarantors Subsidiary Issuer/Guarantor Non-Guarantor Subsidiaries Eliminations Consolidated

(in millions)
Net sales $ —
$ —
$ —
$ 4,333
$ —
$ 4,333
Operating expenses:
Cost of sales —
—
—
3,450
—
3,450
Selling, general and administrative 37
—
—
280
—
317
Amortization —
—
—
34
—
34
Restructuring —
—
—
21
—
21
Total operating expenses 37
—
—
3,785
—
3,822
Operating (loss) income (37 ) —
—
548
—
511
Interest (expense) income (66 ) (10 ) (44 ) (3 ) 87
(36 )
Other income (expense), net —
39
1
38
(87 ) (9 )
(Loss) income from continuing operations before income taxes and equity income (103 ) 29
(43 ) 583
—
466
Income tax (expense) benefit (1 ) —
16
(75 ) —
(60 )
(Loss) income from continuing operations before equity income (104 ) 29
(27 ) 508
—
406
Equity in net income of affiliates —
—
—
7
—
7
Equity in net income (loss) of subsidiaries 499
452
40
—
(991 ) —
Income (loss) from continuing operations 395
481
13
515
(991 ) 413
Income from discontinued operations, net of tax —
—
—
—
—
—
Net income (loss) 395
481
13
515
(991 ) 413
Net income attributable to noncontrolling interest —
—
—
18
—
18
Net income (loss) attributable to Delphi $ 395
$ 481
$ 13
$ 497
$ (991 ) $ 395

~~Table of Contents~~

~~Statement of Operations Nine Months Ended September 30, 2017~~

Parent Subsidiary Guarantors Subsidiary Issuers/Guarantor Non-Guarantor Subsidiaries Eliminations Consolidated

(in millions)
Net sales $ —
$ —
$ —
$ 12,943
$ —
$ 12,943
Operating expenses:
Cost of sales —
—
—
10,314
—
10,314
Selling, general and administrative 72
—
—
834
—
906
Amortization —
—
—
100
—
100
Restructuring —
—
—
180
—
180
Total operating expenses 72
—
—
11,428
—
11,500
Operating (loss) income (72 ) —
—
1,515
—
1,443
Interest (expense) income (188 ) (14 ) (130 ) (9 ) 236
(105 )
Other income (expense), net —
105
2
100
(236 ) (29 )
(Loss) income from continuing operations before income taxes and equity income (260 ) 91
(128 ) 1,606
—
1,309
Income tax benefit (expense) —
—
47
(230 ) —
(183 )
(Loss) income from continuing operations before equity income (260 ) 91
(81 ) 1,376
—
1,126
Equity in net income of affiliates —
—
—
25
—
25
Equity in net income (loss) of subsidiaries 1,359
1,221
59
—
(2,639 ) —
Income (loss) from continuing operations 1,099
1,312
(22 ) 1,401
(2,639 ) 1,151
Income from discontinued operations, net of tax —
—
—
—
—
—
Net income (loss) 1,099
1,312
(22 ) 1,401
(2,639 ) 1,151
Net income attributable to noncontrolling interest —
—
—
52
—
52
Net income (loss) attributable to Delphi $ 1,099
$ 1,312
$ (22 ) $ 1,349
$ (2,639 ) $ 1,099

~~Table of Contents~~

~~Statement of Operations Three Months Ended September 30, 2016~~

Parent Subsidiary Guarantors Subsidiary Issuer/Guarantor Non-Guarantor Subsidiaries Eliminations Consolidated

(in millions)
Net sales $ —
$ —
$ —
$ 4,091
$ —
$ 4,091
Operating expenses:
Cost of sales —
—
—
3,253
—
3,253
Selling, general and administrative 44
—
—
234
—
278
Amortization —
—
—
34
—
34
Restructuring —
—
—
63
—
63
Total operating expenses 44
—
—
3,584
—
3,628
Operating (loss) income (44 ) —
—
507
—
463
Interest (expense) income (54 ) (4 ) (52 ) (19 ) 88
(41 )
Other (expense) income, net (5 ) 34
(51 ) 41
(88 ) (69 )
(Loss) income from continuing operations before income taxes and equity income (103 ) 30
(103 ) 529
—
353
Income tax benefit (expense) —
—
38
(95 ) —
(57 )
(Loss) income from continuing operations before equity income (103 ) 30
(65 ) 434
—
296
Equity in net income of affiliates —
—
—
10
—
10
Equity in net income (loss) of subsidiaries 396
347
111
—
(854 ) —
Income from continuing operations 293
377
46
444
(854 ) 306
Income from discontinued operations, net of tax —
—
—
—
—
—
Net income (loss) 293
377
46
444
(854 ) 306
Net income attributable to noncontrolling interest —
—
—
13
—
13
Net income (loss) attributable to Delphi $ 293
$ 377
$ 46
$ 431
$ (854 ) $ 293

~~Statement of Operations Nine Months Ended September 30, 2016~~

Parent Subsidiary Guarantors Subsidiary Issuers/Guarantor Non-Guarantor Subsidiaries Eliminations Consolidated

(in millions)
Net sales $ —
$ —
$ —
$ 12,348
$ —
$ 12,348
Operating expenses:
Cost of sales —
—
—
9,861
—
9,861
Selling, general and administrative 108
—
—
725
—
833
Amortization —
—
—
101
—
101
Restructuring —
—
—
252
—
252
Total operating expenses 108
—
—
10,939
—
11,047
Operating (loss) income (108 ) —
—
1,409
—
1,301
Interest (expense) income (150 ) (20 ) (153 ) (58 ) 258
(123 )
Other (expense) income, net (5 ) 96
(18 ) 112
(258 ) (73 )
(Loss) income from continuing operations before income taxes and equity income (263 ) 76
(171 ) 1,463
—
1,105
Income tax benefit (expense) —
—
63
(279 ) —
(216 )
(Loss) income from continuing operations before equity income (263 ) 76
(108 ) 1,184
—
889
Equity in net income of affiliates —
—
—
23
—
23
Equity in net income (loss) of subsidiaries 1,239
1,147
362
—
(2,748 ) —
Income from continuing operations 976
1,223
254
1,207
(2,748 ) 912
Income from discontinued operations, net of tax —
—
—
108
—
108
Net income (loss) 976
1,223
254
1,315
(2,748 ) 1,020
Net income attributable to noncontrolling interest —
—
—
44
—
44
Net income (loss) attributable to Delphi $ 976
$ 1,223
$ 254
$ 1,271
$ (2,748 ) $ 976

~~Table of Contents~~

~~Statement of Comprehensive Income Three Months Ended September 30, 2017~~

Parent Subsidiary Guarantors Subsidiary Issuer/Guarantor Non-Guarantor Subsidiaries Eliminations Consolidated

(in millions)
Net income (loss) $ 395
$ 481
$ 13
$ 515
$ (991 ) $ 413
Other comprehensive income (loss):
Currency translation adjustments (44 ) —
—
131
—
87
Net change in unrecognized gain (loss) on derivative instruments, net of tax —
—
—
(9 ) —
(9 )
Employee benefit plans adjustment, net of tax —
—
—
(6 ) —
(6 )
Other comprehensive (loss) income (44 ) —
—
116
—
72
Equity in other comprehensive income (loss) of subsidiaries 113
(74 ) (7 ) —
(32 ) —
Comprehensive income (loss) 464
407
6
631
(1,023 ) 485
Comprehensive income attributable to noncontrolling interests —
—
—
21
—
21
Comprehensive income (loss) attributable to Delphi $ 464
$ 407
$ 6
$ 610
$ (1,023 ) $ 464

~~Statement of Comprehensive Income Nine Months Ended September 30, 2017~~

Parent Subsidiary Guarantors Subsidiary Issuers/Guarantor Non-Guarantor Subsidiaries Eliminations Consolidated

(in millions)
Net income (loss) $ 1,099
$ 1,312
$ (22 ) $ 1,401
$ (2,639 ) $ 1,151
Other comprehensive income (loss):
Currency translation adjustments (147 ) —
—
423
—
276
Net change in unrecognized gain (loss) on derivative instruments, net of tax —
—
—
34
—
34
Employee benefit plans adjustment, net of tax —
—
—
(1 ) —
(1 )
Other comprehensive (loss) income (147 ) —
—
456
—
309
Equity in other comprehensive income (loss) of subsidiaries 449
(85 ) 54
—
(418 ) —
Comprehensive income (loss) 1,401
1,227
32
1,857
(3,057 ) 1,460
Comprehensive income attributable to noncontrolling interests —
—
—
59
—
59
Comprehensive income (loss) attributable to Delphi $ 1,401
$ 1,227
$ 32
$ 1,798
$ (3,057 ) $ 1,401

~~Table of Contents~~

~~Statement of Comprehensive Income Three Months Ended September 30, 2016~~

Parent Subsidiary Guarantors Subsidiary Issuer/Guarantor Non-Guarantor Subsidiaries Eliminations Consolidated

(in millions)
Net income (loss) $ 293
$ 377
$ 46
$ 444
$ (854 ) $ 306
Other comprehensive income (loss):
Currency translation adjustments (9 ) —
—
36
—
27
Net change in unrecognized gain (loss) on derivative instruments, net of tax —
—
—
6
—
6
Employee benefit plans adjustment, net of tax —
—
—
6
—
6
Other comprehensive (loss) income (9 ) —
—
48
—
39
Equity in other comprehensive income (loss) of subsidiaries 47
(85 ) —
—
38
—
Comprehensive income (loss) 331
292
46
492
(816 ) 345
Comprehensive income attributable to noncontrolling interests —
—
—
14
—
14
Comprehensive income (loss) attributable to Delphi $ 331
$ 292
$ 46
$ 478
$ (816 ) $ 331

~~Statement of Comprehensive Income Nine Months Ended September 30, 2016~~

Parent Subsidiary Guarantors Subsidiary Issuers/Guarantor Non-Guarantor Subsidiaries Eliminations Consolidated

(in millions)
Net income (loss) $ 976
$ 1,223
$ 254
$ 1,315
$ (2,748 ) $ 1,020
Other comprehensive income (loss):
Currency translation adjustments (18 ) —
—
26
—
8
Net change in unrecognized gain (loss) on derivative instruments, net of tax —
—
—
55
—
55
Employee benefit plans adjustment, net of tax —
—
—
28
—
28
Other comprehensive (loss) income (18 ) —
—
109
—
91
Equity in other comprehensive income (loss) of subsidiaries 110
(210 ) 11
—
89
—
Comprehensive income (loss) 1,068
1,013
265
1,424
(2,659 ) 1,111
Comprehensive income attributable to noncontrolling interests —
—
—
43
—
43
Comprehensive income (loss) attributable to Delphi $ 1,068
$ 1,013
$ 265
$ 1,381
$ (2,659 ) $ 1,068

~~Table of Contents~~

~~Balance Sheet as of September 30, 2017~~

Parent Subsidiary Guarantors Subsidiary Issuers/Guarantor Non-Guarantor Subsidiaries Eliminations Consolidated

(in millions)
ASSETS
Current assets:
Cash and cash equivalents $ 1
$ —
$ —
$ 556
$ —
$ 557
Cash in escrow related to Powertrain Spin-Off senior notes offering (Note 8) —
—
—
796
—
796
Restricted cash —
—
—
1
—
1
Accounts receivable, net —
—
—
3,225
—
3,225
Intercompany receivables, current —
1,914
201
7,903
(10,018 ) —
Inventories —
—
—
1,642
—
1,642
Other current assets —
—
—
489
—
489
Total current assets 1
1,914
201
14,612
(10,018 ) 6,710
Long-term assets:
Intercompany receivables, long-term —
1,114
768
449
(2,331 ) —
Property, net —
—
—
3,819
—
3,819
Investments in affiliates —
—
—
130
—
130
Investments in subsidiaries 12,642
10,265
3,322
—
(26,229 ) —
Intangible assets, net —
—
—
2,883
—
2,883
Other long-term assets 60
—
8
556
—
624
Total long-term assets 12,702
11,379
4,098
7,837
(28,560 ) 7,456
Total assets $ 12,703
$ 13,293
$ 4,299
$ 22,449
$ (38,578 ) $ 14,166
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Short-term debt $ —
$ —
$ 10
$ 5
$ —
$ 15
Accounts payable 2
—
—
2,743
—
2,745
Intercompany payables, current 6,314
1,708
998
998
(10,018 ) —
Accrued liabilities 28
—
2
1,353
—
1,383
Total current liabilities 6,344
1,708
1,010
5,099
(10,018 ) 4,143
Long-term liabilities:
Long-term debt 2,986
—
1,083
815
—
4,884
Intercompany payables, long-term 170
—
1,340
821
(2,331 ) —
Pension benefit obligations —
—
—
1,004
—
1,004
Other long-term liabilities —
—
12
509
—
521
Total long-term liabilities 3,156
—
2,435
3,149
(2,331 ) 6,409
Total liabilities 9,500
1,708
3,445
8,248
(12,349 ) 10,552
Total Delphi shareholders’ equity 3,203
11,585
854
13,790
(26,229 ) 3,203
Noncontrolling interest —
—
—
411
—
411
Total shareholders’ equity 3,203
11,585
854
14,201
(26,229 ) 3,614
Total liabilities and shareholders’ equity $ 12,703
$ 13,293
$ 4,299
$ 22,449
$ (38,578 ) $ 14,166

~~Table of Contents~~

~~Balance Sheet as of~~ ~~December 31, 2016~~

Parent Subsidiary Guarantors Subsidiary Issuers/Guarantor Non-Guarantor Subsidiaries Eliminations Consolidated

(in millions)
ASSETS
Current assets:
Cash and cash equivalents $ 2
$ —
$ —
$ 836
$ —
$ 838
Restricted cash —
—
—
1
—
1
Accounts receivable, net —
—
—
2,938
—
2,938
Intercompany receivables, current 47
1,843
436
5,285
(7,611 ) —
Inventories —
—
—
1,232
—
1,232
Other current assets —
—
—
410
—
410
Total current assets 49
1,843
436
10,702
(7,611 ) 5,419
Long-term assets:
Intercompany receivables, long-term —
1,070
768
1,767
(3,605 ) —
Property, net —
—
—
3,515
—
3,515
Investments in affiliates —
—
—
101
—
101
Investments in subsidiaries 10,833
8,722
3,090
—
(22,645 ) —
Intangible assets, net —
—
—
2,748
—
2,748
Other long-term assets 60
—
10
439
—
509
Total long-term assets 10,893
9,792
3,868
8,570
(26,250 ) 6,873
Total assets $ 10,942
$ 11,635
$ 4,304
$ 19,272
$ (33,861 ) $ 12,292
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Short-term debt $ —
$ —
$ 3
$ 9
$ —
$ 12
Accounts payable 3
—
—
2,560
—
2,563
Intercompany payables, current 5,504
68
974
1,065
(7,611 ) —
Accrued liabilities 31
300
30
1,212
—
1,573
Total current liabilities 5,538
368
1,007
4,846
(7,611 ) 4,148
Long-term liabilities:
Long-term debt 2,837
—
1,090
32
—
3,959
Intercompany payables, long-term 166
1,317
1,296
826
(3,605 ) —
Pension benefit obligations —
—
—
955
—
955
Other long-term liabilities —
—
10
457
—
467
Total long-term liabilities 3,003
1,317
2,396
2,270
(3,605 ) 5,381
Total liabilities 8,541
1,685
3,403
7,116
(11,216 ) 9,529
Total Delphi shareholders’ equity 2,401
9,950
901
11,794
(22,645 ) 2,401
Noncontrolling interest —
—
—
362
—
362
Total shareholders’ equity 2,401
9,950
901
12,156
(22,645 ) 2,763
Total liabilities and shareholders’ equity $ 10,942
$ 11,635
$ 4,304
$ 19,272
$ (33,861 ) $ 12,292

~~Table of Contents~~

~~Statement of Cash Flows for the Nine Months Ended September 30, 2017~~

Parent Subsidiary Guarantors Subsidiary Issuers/Guarantor Non-Guarantor Subsidiaries Eliminations Consolidated

(in millions)
Net cash (used in) provided by operating activities from continuing operations $ (73 ) $ (255 ) $ —
$ 1,368
$ —
$ 1,040
Net cash provided by operating activities from discontinued operations —
—
—
—
—
—
Net cash (used in) provided by operating activities (73 ) (255 ) —
1,368
—
1,040
Cash flows from investing activities:
Capital expenditures —
—
—
(591 ) —
(591 )
Proceeds from sale of property / investments —
—
—
12
—
12
Cost of business acquisitions, net of cash acquired —
—
—
(40 ) —
(40 )
Cost of technology investments —
—
—
(51 ) —
(51 )
Settlement of derivatives —
—
—
(12 ) —
(12 )
Loans to affiliates —
(55 ) —
(960 ) 1,015
—
Repayments of loans from affiliates —
—
—
17
(17 ) —
Net cash (used in) provided by investing activities from continuing operations —
(55 ) —
(1,625 ) 998
(682 )
Net cash provided by investing activities from discontinued operations —
—
—
—
—
—
Net cash (used in) provided by investing activities —
(55 ) —
(1,625 ) 998
(682 )
Cash flows from financing activities:
Net repayments under other short- and long-term debt agreements —
—
—
(8 ) —
(8 )
Proceeds from issuance of senior notes, net of issuance costs —
—
—
796
—
796
Escrow of proceeds from Powertrain Spin-off senior notes issuance —
—
—
(796 ) —
(796 )
Contingent consideration and deferred acquisition purchase price payments —
—
—
(24 ) —
(24 )
Dividend payments of consolidated affiliates to minority shareholders —
—
—
(10 ) —
(10 )
Proceeds from borrowings from affiliates 705
310
—
—
(1,015 ) —
Payments on borrowings from affiliates (17 ) —
—
—
17
—
Repurchase of ordinary shares (383 ) —
—
—
—
(383 )
Distribution of cash dividends (233 ) —
—
—
—
(233 )
Taxes withheld and paid on employees' restricted share awards —
—
—
(33 ) —
(33 )
Net cash provided by (used in) financing activities 72
310
—
(75 ) (998 ) (691 )
Effect of exchange rate fluctuations on cash and cash equivalents —
—
—
52
—
52
Decrease in cash and cash equivalents (1 ) —
—
(280 ) —
(281 )
Cash and cash equivalents at beginning of period 2
—
—
836
—
838
Cash and cash equivalents at end of period $ 1
$ —
$ —
$ 556
$ —
$ 557

~~Table of Contents~~

~~Statement of Cash Flows for the Nine Months Ended September 30, 2016~~

Parent Subsidiary Guarantors Subsidiary Issuers/Guarantor Non-Guarantor Subsidiaries Eliminations Consolidated

(in millions)
Net cash (used in) provided by operating activities from continuing operations $ (81 ) $ 33
$ —
$ 1,306
$ —
$ 1,258
Net cash provided by operating activities from discontinued operations —
—
—
—
—
—
Net cash (used in) provided by operating activities (81 ) 33
—
1,306
—
1,258
Cash flows from investing activities:
Capital expenditures —
—
—
(614 ) —
(614 )
Proceeds from sale of property / investments —
—
—
14
—
14
Net proceeds from divestiture of discontinued operations —
—
—
52
—
52
Cost of business acquisitions, net of cash acquired —
—
(15 ) —
—
(15 )
Cost of technology investments —
—
(3 ) —
—
(3 )
Settlement of derivatives —
—
—
(16 ) —
(16 )
Increase in restricted cash —
—
—
(1 ) —
(1 )
Loans to affiliates —
(887 ) —
(1,194 ) 2,081
—
Repayments of loans from affiliates —
—
—
353
(353 ) —
Investments in subsidiaries (854 ) —
(350 ) —
1,204
—
Net cash (used in) provided by investing activities from continuing operations (854 ) (887 ) (368 ) (1,406 ) 2,932
(583 )
Net cash used in investing activities from discontinued operations —
—
—
(4 ) —
(4 )
Net cash (used in) provided by investing activities (854 ) (887 ) (368 ) (1,410 ) 2,932
(587 )
Cash flows from financing activities:
Net repayments under other short-term debt agreements —
—
—
(14 ) —
(14 )
Repayment of senior notes —
—
(862 ) —
—
(862 )
Proceeds from issuance of senior notes, net of issuance costs 852
—
—
—
—
852
Contingent consideration and deferred acquisition purchase price payments —
—
—
(4 ) —
(4 )
Dividend payments of consolidated affiliates to minority shareholders —
—
—
(24 ) —
(24 )
Proceeds from borrowings from affiliates 851
—
1,230
—
(2,081 ) —
Payments on borrowings from affiliates (353 ) —
—
—
353
—
Investment from parent 350
854
—
—
(1,204 ) —
Repurchase of ordinary shares (530 ) —
—
—
—
(530 )
Distribution of cash dividends (238 ) —
—
—
—
(238 )
Taxes withheld and paid on employees' restricted share awards —
—
—
(40 ) —
(40 )
Net cash provided by (used in) financing activities 932
854
368
(82 ) (2,932 ) (860 )
Effect of exchange rate fluctuations on cash and cash equivalents —
—
—
5
—
5
Decrease in cash and cash equivalents (3 ) —
—
(181 ) —
(184 )
Cash and cash equivalents at beginning of period 4
—
—
575
—
579
Cash and cash equivalents at end of period $ 1
$ —
$ —
$ 394
$ —
$ 395

~~Table of Contents~~

~~20.~~ SEGMENT REPORTING

~~Delphi~~Aptiv operates its core business along the following operating segments, which are grouped on the basis of similar product, market and operating factors:

~~Electrical/Electronic Architecture,~~•Signal and Power Solutions, which includes complete electrical architecture and component products.

~~Powertrain Systems, which includes extensive systems integration expertise in gasoline, diesel~~•Advanced Safety and fuel handling and full end-to-end systems including fuel and air injection, combustion, electronics controls, exhaust handling, test and validation capabilities, electric and hybrid electric vehicle power electronics, aftermarket, and original equipment service. As described in Note 22. Separation of Powertrain Systems, the Company is pursuing a separation of the Powertrain Systems segment into a new, independent publicly traded company, through a transaction expected to be treated as a tax-free spin-off to its shareholders.

~~Electronics and Safety,~~User Experience, which includes component and systems integration expertise in ~~infotainment~~advanced safety, user experience and connectivity ~~body controls~~ and security ~~systems, displays and passive and active safety electronics,~~solutions, as well as advanced software development ~~of software.~~and autonomous driving technologies.

•Eliminations and Other, which includes i) the elimination of inter-segment transactions, and ii) certain other expenses and income of a non-operating or strategic nature.

The accounting policies of the segments are the same as those described in Note 2. Significant Accounting Policies, except that the disaggregated financial results for the segments have been prepared using a management approach, which is consistent with the basis and manner in which management internally disaggregates financial information for which ~~Delphi’s~~Aptiv’s chief operating decision maker regularly reviews financial results to assess performance of, and make internal operating decisions about allocating resources to, the segments.

Generally, ~~Delphi~~Aptiv evaluates segment performance based on stand-alone segment net income before interest expense, other income (expense), net, income tax expense, equity income (loss), net of tax, ~~income (loss) from discontinued operations, net of tax,~~ restructuring, ~~separation costs related to the planned spin-off of the Powertrain Systems segment,~~ other acquisition and portfolio project costs (which includes costs incurred to integrate acquired businesses and to plan and execute product portfolio transformation actions, including business and product acquisitions and divestitures), asset impairments, ~~and~~ gains (losses) on business divestitures and other transactions and deferred compensation related to acquisitions (“Adjusted Operating Income”) and accounts for inter-segment sales and transfers as if the sales or transfers were to third parties, at current market prices. ~~Delphi’s~~Aptiv’s management utilizes Adjusted Operating Income as the key performance measure of segment income or loss to evaluate segment performance, and for planning and forecasting purposes to allocate resources to the segments, as management believes this measure is most reflective of the operational profitability or loss of ~~Delphi's~~Aptiv’s operating segments. Segment Adjusted Operating Income should not be considered a substitute for results prepared in accordance with U.S. GAAP and should not be considered an alternative to net income attributable to ~~Delphi,~~Aptiv, which is the most directly comparable financial measure to Adjusted Operating Income that is prepared in accordance with U.S. GAAP. Segment Adjusted Operating Income, as determined and measured by ~~Delphi,~~Aptiv, should also not be compared to similarly titled measures reported by other companies.

As described in Note 21. Discontinued Operations, the Company's previously reported Thermal Systems segment has been classified as discontinued operations for all periods presented. No amounts for shared general and administrative operating expense or interest expense were allocated to discontinued operations.

Table of Contents

Included below are sales and operating data for ~~Delphi’s~~Aptiv’s segments for the three ~~and nine~~ months ended~~September 30, 2017~~ March 31, 2021 and ~~2016~~.2020.


	Signal and Power Solutions		Advanced Safety and User Experience		Eliminations and Other (1)		Total

	(in millions)
For the Three Months Ended March 31, 2021:
Net sales	$	3,022	$	1,011	$	(10)	$	4,023
Depreciation and amortization	$	149	$	44	$	0	$	193
Adjusted operating income	$	371	$	66	$	0	$	437
Operating income	$	372	$	57	$	0	$	429
Equity income (loss), net of tax	$	3	$	(45)	$	0	$	(42)
Net income attributable to noncontrolling interest	$	5	$	0	$	0	$	5

Electrical/
Electronic
Architecture Powertrain
Systems Electronics
and Safety Eliminations
and Other (1) Total

(in millions)
For the Three Months Ended September 30, 2017:
Net sales $ 2,317
$ 1,205
$ 845
$ (34 ) $ 4,333
Depreciation & amortization $ 107
$ 49
$ 27
$ —
$ 183
Adjusted operating income $ 336
$ 150
$ 80
$ —
$ 566
Operating income $ 317
$ 115
$ 79
$ —
$ 511
Equity income, net of tax $ 6
$ 1
$ —
$ —
$ 7
Net income attributable to noncontrolling interest $ 9
$ 9
$ —
$ —
$ 18


	Signal and Power Solutions		Advanced Safety and User Experience		Eliminations and Other (1)		Total

	(in millions)
For the Three Months Ended March 31, 2020:
Net sales	$	2,330	$	902	$	(6)	$	3,226
Depreciation and amortization	$	139	$	41	$	0	$	180
Adjusted operating income	$	225	$	6	$	0	$	231
Operating income (2)	$	199	$	1,420	$	0	$	1,619
Equity income (loss), net of tax	$	3	$	(1)	$	0	$	2
Net loss attributable to noncontrolling interest	$	(5)	$	0	$	0	$	(5)

~~Table~~(1)Eliminations and Other includes the elimination of ~~Contents~~inter-segment transactions.

(2)Includes a pre-tax gain of $1.4 billion within Advanced Safety and User Experience for the completion of the Motional autonomous driving joint venture. Refer to Note 17. Acquisitions and Divestitures for additional information.

Electrical/
Electronic
Architecture Powertrain
Systems Electronics
and Safety Eliminations
and Other (1) Total

(in millions)
For the Three Months Ended September 30, 2016:
Net sales $ 2,287
$ 1,077
$ 763
$ (36 ) $ 4,091
Depreciation & amortization $ 102
$ 47
$ 25
$ —
$ 174
Adjusted operating income $ 317
$ 122
$ 95
$ —
$ 534
Operating income (loss) $ 283
$ 98
$ 82
$ —
$ 463
Equity income, net of tax $ 10
$ —
$ —
$ —
$ 10
Net income attributable to noncontrolling interest $ 6
$ 7
$ —
$ —
$ 13

Electrical/
Electronic
Architecture Powertrain
Systems Electronics
and Safety Eliminations
and Other (1) Total

(in millions)
For the Nine Months Ended September 30, 2017:
Net sales $ 7,004
$ 3,560
$ 2,484
$ (105 ) $ 12,943
Depreciation & amortization $ 312
$ 151
$ 76
$ —
$ 539
Adjusted operating income $ 998
$ 472
$ 220
$ —
$ 1,690
Operating income $ 948
$ 335
$ 160
$ —
$ 1,443
Equity income, net of tax $ 24
$ 1
$ —
$ —
$ 25
Net income attributable to noncontrolling interest $ 27
$ 25
$ —
$ —
$ 52

Electrical/
Electronic
Architecture Powertrain
Systems Electronics
and Safety Eliminations
and Other (1) Total

(in millions)
For the Nine Months Ended September 30, 2016:
Net sales $ 6,916
$ 3,340
$ 2,208
$ (116 ) $ 12,348
Depreciation & amortization $ 297
$ 163
$ 66
$ —
$ 526
Adjusted operating income $ 969
$ 381
$ 276
$ —
$ 1,626
Operating income $ 868
$ 194
$ 239
$ —
$ 1,301
Equity income, net of tax $ 23
$ —
$ —
$ —
$ 23
Net income attributable to noncontrolling interest $ 19
$ 22
$ —
$ —
$ 41


~~(1)~~	~~Eliminations and Other includes the elimination of inter-segment transactions.~~

~~Table of Contents~~

The reconciliation of Adjusted Operating Income to ~~Operating Income~~operating income includes, as applicable, restructuring, ~~separation costs,~~ other acquisition and portfolio project costs (which includes costs incurred to integrate acquired businesses and to plan and execute product portfolio transformation actions, including business and product acquisitions and divestitures), asset impairments, ~~and~~ gains (losses) on business ~~divestitures.~~divestitures and other transactions and deferred compensation related to acquisitions. The ~~reconciliation~~reconciliations of Adjusted Operating Income to net income attributable to ~~Delphi~~Aptiv for the three ~~and nine~~ months ended~~September 30, 2017~~ March 31, 2021 and ~~2016~~2020 are as follows:


	Signal and Power Solutions		Advanced Safety and User Experience		Eliminations and Other		Total

	(in millions)
For the Three Months Ended March 31, 2021:
Adjusted operating income	$	371	$	66	$	0	$	437
Restructuring	2		(8)		0		(6)

Other acquisition and portfolio project costs	(1)		(1)		0		(2)


Operating income	$	372	$	57	$	0	429
Interest expense							(40)
Other income, net							1
Income before income taxes and equity loss							390
Income tax expense							(48)
Equity loss, net of tax							(42)


Net income							300
Net income attributable to noncontrolling interest							5
Net income attributable to Aptiv							$	295

Electrical/
Electronic
Architecture Powertrain
Systems Electronics
and Safety Eliminations
and Other Total

(in millions)
For the Three Months Ended September 30, 2017:
Adjusted operating income $ 336
$ 150
$ 80
$ —
$ 566
Restructuring (17 ) (4 ) —
—
(21 )
Separation costs —
(31 ) —
—
(31 )
Other acquisition and portfolio project costs (1 ) —
(1 ) —
(2 )
Asset impairments (1 ) —
—
—
(1 )
Operating income $ 317
$ 115
$ 79
$ —
511
Interest expense (36 )
Other expense, net (9 )
Income from continuing operations before income taxes and equity income 466
Income tax expense (60 )
Equity income, net of tax 7
Income from continuing operations 413
Income from discontinued operations, net of tax —
Net income 413
Net income attributable to noncontrolling interest 18
Net income attributable to Delphi $ 395

Table of Contents


	Signal and Power Solutions		Advanced Safety and User Experience		Eliminations and Other		Total

	(in millions)
For the Three Months Ended March 31, 2020:
Adjusted operating income	$	225	$	6	$	0	$	231
Restructuring	(19)		(9)		0		(28)

Other acquisition and portfolio project costs	(7)		(7)		0		(14)

Deferred compensation related to acquisitions	0		(4)		0		(4)
Gain on business divestitures and other transactions	0		1,434		0		1,434
Operating income	$	199	$	1,420	$	0	1,619
Interest expense							(43)
Other expense, net							(1)
Income before income taxes and equity income							1,575
Income tax expense							(10)
Equity income, net of tax							2


Net income							1,567
Net loss attributable to noncontrolling interest							(5)
Net income attributable to Aptiv							$	1,572

20. REVENUE

Revenue is recognized to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which we expect to be entitled in exchange for those goods or services. Accordingly, revenue is measured based on consideration specified in a contract with a customer. Customer contracts generally are represented by a combination of a current purchase order and a current production schedule issued by the customer. The Company recognizes revenue when it satisfies a performance obligation by transferring control over a product or service to a customer. From time to time, Aptiv enters into pricing agreements with its customers that provide for price reductions, some of which are conditional upon achieving certain joint cost savings targets. In these instances, revenue is recognized based on the agreed-upon price at the time of shipment.

Sales incentives and allowances are recognized as a reduction to revenue at the time of the related sale. Taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction that are collected by Aptiv from a customer are excluded from revenue. Shipping and handling fees billed to customers are included in net sales, while costs of shipping and handling are included in cost of sales.

Nature of Goods and Services

The principal activity from which the Company generates its revenue is the manufacturing of production parts for OEM customers. Aptiv recognizes revenue for production parts at a point in time, rather than over time, as the performance obligation is satisfied when customers obtain control of the product upon title transfer and not as the product is manufactured or developed.

Although production parts are highly customized with no alternative use, Aptiv does not have an enforceable right to payment as customers have the right to cancel a product program without a notification period. The amount of revenue recognized is based on the purchase order price and adjusted for revenue allocated to variable consideration (i.e. estimated rebates and price discounts), as applicable. Customers typically pay for production parts based on customary business practices with payment terms averaging 60 days.

Disaggregation of Revenue

Revenue generated from Aptiv’s operating segments is disaggregated by primary geographic market in the following tables for the three months ended March 31, 2021 and 2020. Information concerning geographic market reflects the manufacturing location.

Electrical/
Electronic
Architecture Powertrain
Systems Electronics
and Safety Eliminations
and Other Total

(in millions)
For the Three Months Ended September 30, 2016:
Adjusted operating income $ 317
$ 122
$ 95
$ —
$ 534
Restructuring (30 ) (22 ) (11 ) —
(63 )
Other acquisition and portfolio project costs (4 ) (2 ) (1 ) —
(7 )
Asset impairments —
—
(1 ) —
(1 )
Operating income $ 283
$ 98
$ 82
$ —
463
Interest expense (41 )
Other expense, net (69 )
Income from continuing operations before income taxes and equity income 353
Income tax expense (57 )
Equity income, net of tax 10
Income from continuing operations 306
Income from discontinued operations, net of tax —
Net income 306
Net income attributable to noncontrolling interest 13
Net income attributable to Delphi $ 293

Electrical/
Electronic
Architecture Powertrain
Systems Electronics
and Safety Eliminations
and Other Total

(in millions)
For the Nine Months Ended September 30, 2017:
Adjusted operating income $ 998
$ 472
$ 220
$ —
$ 1,690
Restructuring (43 ) (81 ) (56 ) —
(180 )
Separation costs —
(46 ) —
—
(46 )
Other acquisition and portfolio project costs (6 ) (2 ) (3 ) —
(11 )
Asset impairments (1 ) (8 ) (1 ) —
(10 )
Operating income $ 948
$ 335
$ 160
$ —
1,443
Interest expense (105 )
Other expense, net (29 )
Income from continuing operations before income taxes and equity income 1,309
Income tax expense (183 )
Equity income, net of tax 25
Income from continuing operations 1,151
Income from discontinued operations, net of tax —
Net income 1,151
Net income attributable to noncontrolling interest 52
Net income attributable to Delphi $ 1,099

Table of Contents


For the Three Months Ended March 31, 2021:	Signal and Power Solutions		Advanced Safety and User Experience		Eliminations and Other		Total

	(in millions)
Geographic Market

North America	$	1,070	$	313	$	(2)	$	1,381
Europe, Middle East and Africa	993		451		(3)		1,441
Asia Pacific	893		247		(5)		1,135
South America	66		0		0		66
Total net sales	$	3,022	$	1,011	$	(10)	$	4,023

Electrical/
Electronic
Architecture Powertrain
Systems Electronics
and Safety Eliminations
and Other Total

(in millions)
For the Nine Months Ended September 30, 2016:
Adjusted operating income $ 969
$ 381
$ 276
$ —
$ 1,626
Restructuring (65 ) (157 ) (30 ) —
(252 )
Other acquisition and portfolio project costs (36 ) (8 ) (6 ) —
(50 )
Asset impairments —
(22 ) (1 ) —
(23 )
Operating income $ 868
$ 194
$ 239
$ —
1,301
Interest expense (123 )
Other expense, net (73 )
Income from continuing operations before income taxes and equity income 1,105
Income tax expense (216 )
Equity income, net of tax 23
Income from continuing operations 912
Income from discontinued operations, net of tax 108
Net income 1,020
Net income attributable to noncontrolling interest 44
Net income attributable to Delphi $ 976


For the Three Months Ended March 31, 2020:	Signal and Power Solutions		Advanced Safety and User Experience		Eliminations and Other		Total

	(in millions)
Geographic Market

North America	$	1,005	$	292	$	0	$	1,297
Europe, Middle East and Africa	778		443		(3)		1,218
Asia Pacific	492		167		(3)		656
South America	55		0		0		55
Total net sales	$	2,330	$	902	$	(6)	$	3,226

Contract Balances

~~Table~~Consistent with the recognition of ~~Contents~~production parts revenue at a point in time as title transfers to the customer, Aptiv has no contract assets or contract liabilities balances as of March 31, 2021 or December 31, 2020.

Outstanding Performance Obligations

As customer contracts generally are represented by a combination of a current purchase order and a current production schedule issued by the customer for a production part, there are no contracts outstanding beyond one year. Aptiv does not enter into fixed long-term supply agreements.

~~21. DISCONTINUED OPERATIONS~~As permitted, Aptiv does not disclose information about remaining performance obligations that have original expected durations of one year or less.

~~During~~Costs to Obtain a Contract

From time to time, Aptiv makes payments to customers in conjunction with ongoing business. These payments to customers are generally recognized as a reduction to revenue at the ~~first quarter~~time of ~~2015,~~ the ~~Company determined that its previously reported Thermal Systems segment met~~commitment to make these payments. However, certain other payments to customers, or upfront fees, meet the criteria to be considered a cost to obtain a contract as they are directly attributable to a contract, are incremental and management expects the fees to be recoverable. As of March 31, 2021 and December 31, 2020, Aptiv has recorded $105 million (of which $31 million was classified ~~as a discontinued operation as a result of entering into a definitive agreement for the sale of substantially all of the~~within other current assets and ~~liabilities~~$74 million was classified within other long-term assets) and $116 million (of which $30 million was classified within other current assets and $86 million was classified within other long-term assets), respectively, related to these capitalized upfront fees.

Capitalized upfront fees are amortized to revenue based on the transfer of goods and services to the ~~Company's wholly owned Thermal Systems business and a commitment~~customer for which the upfront fees relate, which typically range from three to ~~a plan~~five years. There have been no impairment losses in relation to ~~dispose~~the costs capitalized. The amount of ~~the Company's interests in two joint ventures which were previously reported within the Thermal Systems segment.~~

~~On June 30, 2015 the Company closed the sale of its wholly owned Thermal Systems business~~amortization to ~~MAHLE GmbH ("MAHLE"). The Company received cash proceeds of approximately $670~~net sales was $6 million and ~~recognized a gain on the divestiture within income from discontinued operations of $271~~$4 million (approximately $0.95 per diluted share), net of tax expense of $52 million, transaction costs of $10 million and $18 million of pre-tax post-closing adjustments recorded during the year ended December 31, 2015 primarily related to settlement of working capital items and contingent liabilities. Additional post-closing adjustments of $3 million, primarily related to the settlement of contingent liabilities, were recorded as a reduction to the gain on the divestiture during the year ended December 31, 2016. In conjunction with the sale, Delphi and MAHLE also entered into a transition services agreement under which Delphi provided certain administrative and other services, as well as a supply agreement under which Delphi supplied certain products, primarily for a period of up to eighteen months following the closing of the transaction. Delphi recorded $2 million and $7 million to other income (expense), net during the three and nine months ended September 30, 2016, respectively, for certain fees earned pursuant to the transition services agreement.

On September 24, 2015 the Company closed the sale of its 50 percent interest in its Korea Delphi Automotive Systems Corporation ("KDAC") joint venture, which was accounted for under the equity method and was principally reported as part of the Thermal Systems segment, to the joint venture partner. The Company received cash proceeds of $70 million and recognized a gain on the divestiture of $47 million, net of tax expense, within income from discontinued operations during the three months ended September 30, 2015. During the year ended December 31, 2015, the Company recorded a net loss of $41 million (approximately $0.14 per diluted share) on the KDAC divestiture within income from discontinued operations, which includes an impairment loss of $88 million recorded on this investment in the first quarter of 2015 based on the evaluation of the estimated fair value of the Company's interest in KDAC as of March 31, ~~2015 in relation to its carrying value.~~2021 and 2020, respectively.

On March 31, 2016, the Company closed the sale of its 50 percent interest in its Shanghai Delphi Automotive Air Conditioning ("SDAAC") joint venture to one of the Company's joint venture partners, Shanghai Aerospace Automobile Electromechanical Co., Ltd ("SAAE"). The Company received cash proceeds of $62 million, net of tax, transaction costs and $29 million of cash divested, and recognized a gain on the divestiture of $104 million (approximately $0.38 per diluted share), net of tax expense of $10 million and transaction costs, within income from discontinued operations during the nine months ended September 30, 2016. The financial results of SDAAC, which were consolidated by Delphi, were historically reported as part of the Thermal Systems segment.

As the divestiture of the Thermal Systems segment, including the Company's interests in SDAAC and KDAC and the thermal original equipment service business, represents a strategic shift that will have a major effect on the Company's operations and financial results, the assets and liabilities, operating results, and operating and investing cash flows for the former Thermal Systems segment are presented as discontinued operations separate from the Company’s continuing operations for all periods presented. Discontinued operations also includes the Company's thermal original equipment service business, which was included in the sale of the wholly owned Thermal Systems business, the results of which were previously reported within the Powertrain Systems segment. Certain operations, primarily related to contract manufacturing services, which were previously included within the Thermal Systems reporting segment, were excluded from the scope of the divestiture, and are reported in continuing operations within the Electronics and Safety segment for all periods presented. No amounts for shared general and administrative operating expense or interest expense were allocated to discontinued operations. Delphi has not had significant continuing involvement with the divested Thermal Systems business following the closing of the transactions.

Table of Contents

A reconciliation of the major classes of line items constituting pre-tax profit or loss of discontinued operations to income from discontinued operations, net of tax as presented in the consolidated statements of operations is as follows:

Three Months Ended September 30, Nine Months Ended September 30,
2017 2016 2017 2016

(in millions)
Net sales $ —
$ —
$ —
$ 78
Cost of sales —
—
—
67
Selling, general and administrative —
—
—
4
Income from discontinued operations before income taxes and equity income —
—
—
7
Gain on divestiture of discontinued operations, net of tax —
—
—
104
Adjustment to prior period gain on divestiture, net of tax —
—
—
(3 )
Income from discontinued operations, net of tax —
—
—
108
Income from discontinued operations attributable to noncontrolling interests —
—
—
3
Net income from discontinued operations attributable to Delphi $ —
$ —
$ —
$ 105

Income from discontinued operations before income taxes attributable to Delphi was $0 and $115 million for the nine months ended September 30, 2017 and 2016, respectively. No assets or liabilities were classified as held for sale as of September 30, 2017 or December 31, 2016.

~~22. SEPARATION OF POWERTRAIN SYSTEMS~~

On May 3, 2017, the Company announced its intention to pursue a separation of its Powertrain Systems segment into a new, independent publicly traded company, through a transaction expected to be treated as a tax-free spin-off to its shareholders (the "Separation"). The Company plans to complete the Separation by March 2018, subject to customary closing conditions. The new publicly traded Powertrain spin-off company will be named Delphi Technologies PLC, and will trade on the New York Stock Exchange ("NYSE") under the symbol "DLPH" following the distribution date.

As described in Note 8. Debt, in September 2017 Delphi Technologies PLC, the holding company formed in connection with the Separation, completed the offering of $800 million aggregate principal amount of 5.00% senior unsecured notes due 2025, and entered into the Spin-Off Credit Agreement, which will provide a secured five-year $750 million term loan facility and a $500 million five-year senior secured revolving credit facility in connection with the Separation.

During the three and nine months ended September 30, 2017, the Company incurred costs of $31 million and $46 million, respectively, related to the Separation. These costs, which are included in selling, general and administrative expense within the consolidated statement of operations, were primarily related to third party professional fees associated with planning the Separation.

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION

This Quarterly Report on Form 10-Q, including the exhibits being filed as part of this report, as well as other statements made by ~~Delphi Automotive~~Aptiv PLC (“~~Delphi,~~Aptiv,” the “Company,” “we,” “us” and “our”), contain forward-looking statements that reflect, when made, the Company’s current views with respect to current events and financial performance. Such forward-looking statements are subject to many risks, uncertainties and factors relating to the Company’s operations and business environment, which may cause the actual results of the Company to be materially different from any future results, express or implied, by such forward-looking statements. All statements that address future operating, financial or business performance or the Company’s strategies or expectations are forward-looking statements. In some cases, you can identify these statements by forward-looking words such as “may,” “might,” “will,” “should,” “expects,” “plans,” “intends,” “anticipates,” “believes,” “estimates,” “predicts,” “projects,” “potential,” “outlook” or “continue,” and other comparable terminology. Factors that could cause actual results to differ materially from these forward-looking statements include, but are not limited to, the following: global and regional economic conditions, including conditions affecting the credit market and resulting from the United ~~Kingdom referendum held on June 23, 2016 in which voters approved an~~Kingdom’s exit from the European Union, commonly referred to as ~~"Brexit"~~“Brexit”; uncertainties posed by the novel coronavirus (COVID-19) pandemic and the difficulty in predicting its future course and its impact on the global economy and the Company’s future operations; fluctuations in interest rates and foreign currency exchange rates; the cyclical nature of global automotive sales and production; the potential disruptions in the supply of and changes in the competitive environment for raw material and other components integral to the Company’s ~~products;~~products, including the current semiconductor supply shortage; the Company’s ability to maintain contracts that are critical to its operations; potential changes to beneficial free trade laws and regulations such as the ~~North American Free Trade~~United States-Mexico-Canada Agreement; the ability of the Company to integrate and realize the expected benefits of recent ~~acquisitions; the ability of the Company to achieve the intended benefits from, or to complete, the proposed separation of its Powertrain Systems segment;~~transactions; the ability of the Company to attract, motivate and/or retain key executives; the ability of the Company to avoid or continue to operate during a strike, or partial work stoppage or slow down by any of its unionized employees or those of its principal customers; and the ability of the Company to attract and retain customers. Additional factors are discussed under the captions “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the Company’s filings with the Securities and Exchange Commission, including those set forth in the ~~Company's~~Company’s Annual Report on Form 10-K for fiscal year ended December 31, ~~2016~~2020 and within ~~the Quarterly Report on~~this Form 10-Q ~~for the quarter ended March 31, 2017.~~filing. New risks and uncertainties arise from time to time, and it is impossible for us to predict these events or how they may affect the Company. It should be remembered that the price of the ordinary shares and any income from them can go down as well as up. ~~Delphi~~Aptiv disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events and/or otherwise, except as may be required by law.

Table of Contents

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following management’s discussion and analysis of financial condition and results of operations (“MD&A”) is intended to help you understand the business operations and financial condition of the Company for the three ~~and nine~~ months ended~~September 30, 2017~~. March 31, 2021. This discussion should be read in conjunction with Item 1. Financial Statements. Our MD&A is presented in eight sections:

•Executive Overview

•Consolidated Results of Operations

•Results of Operations by Segment

•Liquidity and Capital Resources

•Off-Balance Sheet Arrangements

•Contingencies and Environmental Matters

•Recently Issued Accounting Pronouncements

•Critical Accounting Estimates

Within the MD&A, ~~“Delphi,~~“Aptiv,” the “Company,” “we,” “us” and “our” refer to ~~Delphi Automotive~~Aptiv PLC, a public limited company ~~which was~~ formed under the laws of Jersey on May 19, 2011 together with its subsidiaries, including Delphi Automotive LLP, a limited liability partnership incorporated under the laws of England and Wales which was formed on August 19, 2009 for the purpose of acquiring certain assets and subsidiaries of the former Delphi Corporation (now known as ~~DPH Holdings Corp. (“DPHH”)), and became a subsidiary of~~ Delphi Automotive PLC, ~~in connection with the completion of the Company’s~~which completed an initial public offering on November 22, 2011. On December 4, 2017, the Company completed the separation (the “Separation”) of its former Powertrain Systems segment by distributing to Aptiv shareholders on a pro rata basis all of the issued and outstanding ordinary shares of Delphi Technologies PLC, a public limited company formed to hold the spun-off business. Following the Separation, the remaining company changed its name to Aptiv PLC and New York Stock Exchange (“NYSE”) symbol to “APTV.” The completion of the Separation positioned Aptiv as a mobility architecture provider focused on solving the complex challenges associated with safer, greener and more connected transportation. At the core of our capabilities is the power, data, software and compute expertise that are enabling a more sustainable future of mobility.

Executive Overview

Our Business

We are a leading global technology and mobility architecture company primarily serving the automotive sector. We design and manufacture vehicle components and provide electrical, electronic and ~~electronic, powertrain and~~active safety technology solutions to the global automotive market, creating the software and ~~commercial~~hardware foundation for vehicle ~~markets.~~ features and functionality. We deliver end-to-end mobility solutions enabling our customers’ transition to more electrified, software-defined vehicles. Our Advanced Safety and User Experience segment is focused on providing the necessary software and advanced computing platforms, and our Signal and Power Solutions segment is focused on providing the requisite networking architecture required to support the integrated systems in today’s complex vehicles. Together, our businesses develop the ‘brain’ and the ‘nervous system’ of increasingly complex vehicles, providing integration of the vehicle into its operating environment.

We are one of the largest vehicle component manufacturers and our customers include ~~all~~23 of the 25 of the largest automotive original equipment manufacturers ~~("OEMs"~~(“OEMs”) in the world.

On May 3, 2017, we announced our intention to pursue a separation of our Powertrain Systems segment through a transaction expected to be treated as a tax-free spin-off to Delphi’s shareholders (the "Separation"). The Company plans to complete the Separation by March 2018, subject to customary closing conditions. The new publicly traded company will be named Delphi Technologies PLC and will trade on the New York Stock Exchange ("NYSE") under the symbol "DLPH" following the distribution date. Upon completion of the Separation, the remaining company will change its name to Aptiv PLC. Following the distribution date, Aptiv PLC will trade on the NYSE under the ticker symbol "APTV." During the three and nine months ended September 30, 2017, the Company incurred costs of $31 million and $46 million, respectively, related to the Separation. These costs, which are included in selling, general and administrative expense within the consolidated statement of operations, primarily related to third party professional fees associated with planning the Separation. The Company expects to continue to incur additional expenses related to the Separation during 2017.

As described in Note 21. Discontinued Operations, in the first quarter of 2016 we completed the final step of our strategy to divest our former Thermal Systems business through the sale of our ownership interest in the Shanghai Delphi Automotive Air Conditioning ("SDAAC") joint venture, positioning us with a strategically focused product portfolio in high-growth spaces to meet consumer preferences for products that address the industry mega-trends of Safe, Green and Connected. Proceeds from the sale of the Thermal Systems business were used to fund growth initiatives, including acquisitions, as well as share repurchases. As the disposal of the Thermal Systems business represents a strategic shift that will have a major effect on the Company's operations and financial results, the assets and liabilities, operating results, and operating and investing cash flows for the previously reported Thermal Systems segment are presented as discontinued operations separate from the Company’s continuing operations for all periods presented. This Management’s Discussion and Analysis reflects the results of continuing operations, unless otherwise noted.

Our total net sales during the three ~~and nine~~ months ended ~~September 30, 2017~~March 31, 2021 were ~~$4.3 billion and $12.9~~$4.0 billion, an increase of ~~6% and 5%~~25% compared to the same ~~periods~~period of ~~2016, respectively. The increase in our total net~~2020. Our overall volumes increased 21% for the three months ended March 31, 2021, reflecting higher global automotive production levels despite the adverse impacts of the current global supply chain disruptions on vehicle production schedules, as well as the adverse impacts of the COVID-19 pandemic on sales ~~is primarily attributable to continued increased~~ volumes in the Europe and Asia Pacific regions. Our overall lean cost structure, along with above-market sales growth, enabled us to improve gross margins in the nine months ended September 30, 2017 as compared to the prior year, ~~period.~~

~~Table of Contents~~

particularly in China.

We are focused on maintaining a low fixed cost structure that ~~we believe~~ provides us flexibility to remain profitable ~~throughout~~at all points of the traditional vehicle industry production cycle, including during periods of reduced industry volumes. Accordingly, we will continue to adjust our cost structure and optimize our manufacturing footprint in response to changes in the global and regional automotive ~~markets.~~markets and in order to increase investment in advanced technologies and engineering as conditions permit. As we operate in a cyclical industry that is impacted by movements in the global and regional economies, we continually evaluate opportunities to further ~~adjust~~refine our cost structure, as evidenced by ~~the~~our ongoing restructuring programs ~~we have implemented in order to continue~~focused on the continued rotation of our manufacturing footprint to best cost locations and ~~to reduce~~on reducing our global overhead costs, as described in Note 7. ~~Restructuring.~~Restructuring to the consolidated financial statements contained herein. We believe our strong balance sheet coupled with our flexible cost structure will position us to capitalize on improvements in OEM production ~~volumes.~~volumes as economic and pandemic conditions improve.

Table of Contents

Trends, Uncertainties and Opportunities

COVID-19 pandemic. The global spread of COVID-19, which originated in late 2019 and was later declared a pandemic by the World Health Organization in March 2020, negatively impacted the global economy, disrupted supply chains and created significant volatility in global financial markets throughout much of 2020 with various indirect adverse impacts continuing in 2021. During 2020, the adverse impacts of the COVID-19 pandemic included extended work stoppages in China during the first quarter of 2020, where we have a major manufacturing base, and the subsequent suspension of vehicle production by our OEM customers in North America and Europe, which combined accounted for approximately 70% of our annual net sales during the year ended December 31, 2020, as the pandemic spread to those regions and governmental authorities initiated “lock-down” orders for all non-essential activities. The work stoppages began to abate in China in March 2020, and North America and Europe OEM production restarted sporadically in the second quarter of 2020. During 2020, we took decisive actions to enhance our financial flexibility and minimize the impact on our business, such as the ramping down of certain production facilities in response to customer plant closures and changes in vehicle production schedules, imposing certain travel restrictions, suspending our ordinary share cash dividend and our ordinary share repurchase program, issuing $2.3 billion combined of preferred and ordinary shares, extending substantially all of our existing Credit Agreement’s maturity to August 2022, and actively managing costs, capital spending and working capital to further strengthen our liquidity. As of March 31, 2021, our ordinary share dividend and ordinary share repurchase program remain suspended.

Despite our ongoing efforts to minimize the pandemic’s direct and indirect adverse impacts, we are unable to predict the ultimate impact to our business due to a number of evolving factors, including the duration and spread of the pandemic, the impact of the pandemic on economic activity and our supply chain, consumer demand and vehicle production schedules, and the actions of governmental authorities across the globe. We will continue to actively monitor all direct and indirect potential impacts of COVID-19, and will seek to aggressively mitigate and minimize their impact on our business.

Global supply chain disruptions. Due to various factors, there are currently global supply chain disruptions, including a worldwide semiconductor supply shortage. The semiconductor supply shortage, due in part to increased demand across multiple industries, is impacting production in automotive and other industries. We anticipate these supply chain disruptions will persist throughout much of the remainder of 2021. We, along with most automotive component supply companies that use semiconductors, have been unable to fully meet the vehicle production demands of OEMs because of events which are outside our control, including but not limited to, the COVID-19 pandemic, the global semiconductor shortage, recent fires in our suppliers’ facilities, unprecedented weather events in the southwestern United States, and other extraordinary events. Although we are working closely with suppliers and customers to minimize any potential adverse impacts of these events, some of our customers have indicated that they expect us to bear at least some responsibility for their lost production. While no assurances can be made as to the ultimate outcome of these customer expectations or any other future claims, we do not currently believe a loss is probable. We will continue to actively monitor all direct and indirect potential impacts of these supply chain disruptions, and will seek to aggressively mitigate and minimize their impact on our business.

Commercializing the high-tech evolution of the automotive industry. The automotive industry is increasingly evolving towards the implementation of software-dependent components and solutions. In particular, the industry is focused on the development of advanced driver assistance technologies, with the goal of developing and introducing a commercially-viable, fully automated driving experience. We expect automated driving technologies will provide strong societal benefit as well as the opportunity for long-term growth for our product offerings in this space. We are focused on enabling and delivering end-to-end smart mobility solutions, enabling our customers’ transition to more electrified, software-defined vehicles, and accelerating the commercialization of active safety and autonomous driving technologies and providing enhanced user experience and connected services.

We are continuing to invest in the automated driving space, and have continued to develop market-leading automated driving platform solutions such as automated driving software, key active safety sensing technologies and our multi-domain controller, which fuses information from sensing systems as well as mapping and navigation data to make driving decisions. We believe we are well-aligned with industry technology trends that will result in sustainable future growth in this space, and have partnered with leaders in their respective fields to advance the pace of development and commercialization of these emerging technologies.

In an effort to further our leadership position in the automated driving space, in March 2020 we completed the transaction with Hyundai Motor Group (“Hyundai”) to form a joint venture focused on the design, development and commercialization of autonomous driving technologies. The joint venture operates globally under the Motional brand name, and brings together one of the industry’s most innovative vehicle technology providers with one of the world’s largest OEMs. We expect this partnership to accelerate the path towards the development of production-ready autonomous driving systems for commercialization in the new mobility space.

We believe that substantial strategic value will be created from our partnership with Hyundai through our commitment to a shared mission of making driverless vehicles a safe, reliable, and accessible reality. Furthermore, we anticipate Motional’s

Table of Contents

presence in both North America and Asia, along with the global presence of both Aptiv and Hyundai, to generate economies of scale to support the development of a complete autonomous driving platform, as well as to facilitate mobility infrastructure advancements.

The Motional joint venture began testing fully driverless systems in 2020 and anticipates it will have a production-ready autonomous driving platform available for robotaxi providers, fleet operators and automotive manufacturers to test at prototype scale in 2022, with higher volumes available for deployment in 2023. In addition, Motional is involved in collaborative arrangements with mobility providers and with smart cities such as Boston and Singapore as solutions are developed for the evolving nature of the mobility industry. As a result of our substantial investments and strategic partnerships, we believe we are well-aligned with industry technology trends that will result in sustainable future growth in these evolving areas.

However, there are many risks associated with these evolving areas, including the high development costs of active safety and autonomous driving technologies, the uncertain timing of customer and consumer adoption of these technologies, increased competition from entrants outside the traditional automotive industry and new and emerging regulations, such as the recently released federal guidance for automated driving systems published by the U.S. Department of Transportation. While we believe we are well-positioned in these markets, the high development cost of active safety and autonomous driving technologies may result in a higher risk of exposure to the success of new or disruptive technologies different than those being developed by us or our partners.

Economic ~~Conditions.~~ conditions. Our business is directly related to automotive sales and automotive vehicle production by our customers. Automotive sales depend on a number of factors, including global and regional economic conditions. ~~Although global~~Global automotive vehicle production ~~increased 5%~~decreased 16% (19% on an Aptiv weighted market basis, which represents global vehicle production weighted to the geographic regions in which the Company generates its revenue, “AWM”) from ~~2015~~2019 to ~~2016, economic conditions and the resultant levels of~~2020, representing automotive vehicle production ~~were uneven from a regional perspective. Vehicle~~declines across all major regions during 2020, primarily due to the adverse global economic impacts and uncertainty caused by the worldwide spread of the COVID-19 pandemic. Compared to 2019, vehicle production ~~increased~~in 2020 decreased by 2%22% in Europe, 21% in North America, ~~and~~ 3% in ~~Europe in 2016, as consumer demand for vehicles increased. Both the North American~~China and European economies are expected to continue to experience moderate growth in 2017, which is expected to result in a 3% increase in European production. However, after several years of increases, consumer demand for vehicles in North America is expected to recede, resulting in a 3% decrease in North American production in 2017 as compared to the increased volumes experienced in 2016. Automotive production in China increased by 15% in 2016 as compared to 2015, benefiting in part from a consumer vehicle tax reduction program. Following a partial increase in the consumer vehicle tax in 2017, vehicle production in China is expected to increase by 1% in 2017 as compared to 2016. Additionally, vehicle production31% in South America, our smallest ~~region, decreased~~region. Compared to 2020, vehicle production in the first three months of 2021 increased by ~~12% in 2016 as compared to 2015, with volumes expected~~14% (5% on an AWM basis) and is currently anticipated to increase ~~by 20% in 2017~~modestly for the full year of 2021, reflecting the continued recovery of the industry from the ~~reduced volumes experienced in 2016.~~adverse impacts of the COVID-19 pandemic.

Economic volatility or weakness in North America, Europe, or China or ~~continued weakness in~~ South America could result in a significant reduction in automotive sales and production by our customers, which would have an adverse effect on our business, results of operations and financial condition. There is also potential that geopolitical factors could adversely impact the U.S. and other economies, and specifically the automotive sector. In particular, changes to international trade agreements such as the ~~North American Free Trade~~United States-Mexico-Canada Agreement, or other political pressures could affect the operations of our OEM customers, resulting in reduced automotive production in certain regions or shifts in the mix of production to higher cost regions. Increases in interest rates could also negatively impact automotive production as a result of increased consumer borrowing costs or reduced credit availability. Additionally, economic weakness may result in shifts in the mix of future automotive sales (from vehicles with more content such as luxury vehicles, trucks and sport utility vehicles toward smaller passenger cars). While our diversified customer and geographic revenue base, along with our flexible cost structure, have well positioned us to withstand the impact of industry downturns and benefit from industry upturns, shifts in the mix of global automotive production to higher cost regions or to vehicles with less content could adversely impact our profitability.

There have also been periods of increased market volatility and currency exchange rate fluctuations, both globally and most specifically within the United Kingdom (“U.K.”) and Europe, as a result of the U.K. referendum held on June 23, 2016 in which voters approved an exit from the European Union (“E.U.”), commonly referred to as “Brexit.” As a result of the referendum, the British government formally initiated the process for withdrawal in March 2017. The terms of any withdrawal are subject to a negotiation period that could last at least two years from the initiation date. Nevertheless, the proposed withdrawal has created significant uncertainty about the future relationship between the U.K. and the E.U. These developments, or the perception that any of them could occur, may adversely affect European and worldwide economic and market conditions, significantly reduce global market liquidity and restrict the ability of key market participants to operate in certain financial markets and could contribute to instability in global financial and foreign exchange markets, including increased volatility in interest rates and foreign exchange rates. Although we are actively monitoring the ongoing potential impacts of Brexit and will seek to minimize its impact on our business, any of these effects of Brexit, among others, could adversely affect our business, business opportunities, results of operations, financial condition and cash flows. Approximately 5% of our annual net sales are generated in the U.K., and approximately 3% are denominated in British pounds.

Key growth markets. There have been periods of increased market volatility and ~~moderations~~moderation in the level of economic growth in China, which resulted in periods of lower automotive production growth rates in China than those previously ~~experienced.~~experienced, as evidenced by the reduction in volumes in the region during the years ended December 31, 2020 and 2019. Despite these ~~recent moderations~~vehicle production declines, which in 2020 were primarily driven by the adverse impacts of the COVID-19 pandemic, and the moderation in the level of economic growth in China, rising income levels in China and other ~~emerging~~key growth markets ~~have resulted and~~ are expected to result in stronger growth rates in these markets over the ~~long term.~~long-term. Our strong global presence, and presence in these markets, has positioned us to experience above-market growth rates over the ~~long term.~~long-term. We continue to expand our established presence in ~~emerging~~key growth markets, positioning us to benefit from the expected ~~long term~~long-term growth opportunities in these regions. We are capitalizing on our long-standing relationships with the global OEMs and further enhancing our positions with the ~~emerging~~key growth market OEMs to continue expanding our worldwide leadership. We continue to build upon our extensive geographic reach to capitalize on fast-growing automotive markets. We believe that our

~~Table of Contents~~

presence in best cost countries positions us to realize incremental margin improvements as the global balance of automotive production shifts towards the ~~emerging~~key growth markets.

We have a strong local presence in China, including a major manufacturing base and well-established customer relationships. ~~All~~Each of our business segments have operations and sales in China. Our business in China remains sensitive to economic and market conditions that impact automotive sales volumes in China, and may be affected if the pace of growth slows as the Chinese market matures or if there are reductions in vehicle demand in ~~China.~~China, as have recently been experienced as a result of the COVID-19 pandemic. However, we continue to believe ~~there is long term growth potential in~~ this market ~~based on increasing long term automotive~~will benefit from long-term demand for new

Table of Contents

vehicles and stringent governmental regulation driving increased vehicle content, ~~demand.~~including accelerated demand for electrified vehicles.

Market driven products. Our product offerings satisfy the OEMs’ needs to meet increasingly stringent government regulations and meet consumer preferences for products that address the mega-trends of Safe, Green and Connected, leading to increased content per vehicle, greater profitability and higher margins. With these offerings, we believe we are well-positioned to benefit from the growing demand for vehicle content and technology related to safety, ~~fuel efficiency, emissions control,~~ electrification, high speed data, connectivity to the global information network and automated driving technologies. ~~Our Electrical/Electronic Architecture and Electronics and Safety segments~~We are benefiting from the substantial increase in vehicle content, software and electrification ~~requiring~~that requires a complex and reliable electrical architecture and systems to operate, such as automated advanced driver assistance technologies, electrical vehicle monitoring, active safety systems, lane departure warning systems, integrated vehicle cockpit displays, navigation systems and technologies that enable connected infotainment in vehicles. Our ability to design a reliable electrical architecture that optimizes power distribution and/or consumption is key to satisfying the OEMs’ needs to reduce emissions while continuing to meet consumer demand for increased vehicle content and technology. ~~In 2016 we introduced our 48-volt mild hybrid vehicle solution, which maximizes the use of 48-volt electrification to minimize the demand on the engine, improving performance while lowering CO~~2 emissions by more than 10%. Additionally, our Powertrain Systems segment is also focused on addressing the demand for increased fuel efficiency and emission control through products such as gasoline direct injection ("GDi") fuel systems and variable valve actuation technology such as dynamic skip fire software.

Global capabilities. Many OEMs are continuing to adopt global vehicle platforms to increase standardization, reduce per unit cost and increase capital efficiency and profitability. As a result, OEMs are selecting suppliers that have the capability to manufacture products on a worldwide basis, as well as the flexibility to adapt to regional variations. Suppliers with global scale and strong design, engineering and manufacturing capabilities are best positioned to benefit from this trend. Our global footprint enables us to serve the global OEMs on a worldwide basis as we gain market share with the emerging market OEMs. This regional model ~~principally services~~is structured primarily to service the North American market ~~out of~~from Mexico, the South American market ~~out of~~from Brazil, the European market ~~out of~~from Eastern Europe and North Africa and the Asia Pacific market ~~out of~~from China, and we have continued to rotate our manufacturing footprint to best cost locations within these regions.

Our global operations are subject to certain risks inherent in doing business abroad, including unexpected changes in laws or regulations governing trade, or other monetary or tax fiscal policy changes, including tariffs, quotas, customs and other import or export restrictions or trade barriers. We are also subject to risks associated with actions taken by governmental authorities to impose changes in laws or regulations that restrict certain business operations, trade or travel in response to a pandemic or widespread outbreak of an illness. For instance, the worldwide spread of the COVID-19 pandemic in 2020 has had various direct and indirect adverse impacts on our global operations, the automotive industry and economies around the world. Most notably, the pandemic resulted in extended work stoppages and travel restrictions at our facilities and those of our customers and suppliers, decreases in consumer demand and vehicle production schedules, disruptions to our supply chain and other ~~trade barriers. Existing~~adverse global economic impacts, particularly those resulting from temporary governmental “lock-down” orders for all non-essential activities, initially in the first quarter in China and subsequently in Europe, North America and South America. Although certain of the adverse impacts of the pandemic abated during the second half of 2020, other direct and indirect adverse impacts continue, such as the overall supply chain disruptions and the global semiconductor supply shortage. These impacts continue to negatively affect the global economy and automotive industry, and we anticipate they will persist throughout much of the remainder of 2021. As a result, we are unable to predict the ultimate impact to our business due to a number of evolving factors, including the duration and spread of the pandemic, the impact of the pandemic on economic activity, our supply chain, consumer demand and vehicle production schedules, and the actions of governmental authorities across the globe.

In addition, existing free trade laws and regulations, such as the ~~North American Free Trade~~United States-Mexico-Canada Agreement, provide certain beneficial duties and tariffs for qualifying imports and exports, subject to compliance with the applicable classification and other requirements. Changes in laws or policies governing the terms of foreign trade, and in particular increased trade restrictions, tariffs or taxes on imports from countries where we manufacture products, such as China and Mexico, could have a material adverse ~~affect~~effect on our business and financial results. For instance, beginning in 2018, the U.S. and Chinese governments have imposed a series of significant incremental retaliatory tariffs to certain imported products. Most notably with respect to the automotive industry, the U.S. imposed tariffs on imports of certain steel, aluminum and automotive components, and China imposed retaliatory tariffs on imports of U.S. vehicles and certain automotive components. While these tariffs could have potentially adverse economic impacts, particularly with respect to the automotive industry and vehicle production levels, we do not anticipate a significant impact to our operations, as we have developed and implemented strategies to mitigate adverse tariff impacts, such as production localization and relocation, contract review and renegotiation and working with the appropriate governmental agencies. Further, our global footprint and regional model serves to minimize our exposure to cross-border transactions. However, despite recent trade negotiations between the U.S. and Chinese governments, the scope and duration of the imposed tariffs remain uncertain.

Product development. The automotive ~~component supply~~technology and components industry is highly competitive, both domestically and internationally, and is characterized by rapidly changing technology, evolving industry standards and changes in customer needs. Our ability to anticipate changes in technology and regulatory standards and to successfully develop and introduce new and enhanced products on a timely and cost competitive basis will be a significant factor in our ability to remain competitive.

Table of Contents

To compete effectively in the automotive ~~supply~~technology and components industry, we must be able to develop and launch new products to meet our customers’ demands in a timely manner. Our innovative technologies and robust global engineering and development capabilities have us well positioned us to meet the increasingly stringent vehicle manufacturer demands and consumer preferences for high-technology content in automobiles.

OEMs are increasingly looking to their suppliers to simplify vehicle design and assembly processes to reduce costs and weight. As a result, suppliers that sell vehicle components directly to manufacturers (Tier I suppliers) have assumed many of the design, engineering, research and development and assembly functions traditionally performed by vehicle manufacturers. Suppliers that can provide fully-engineered solutions, systems and pre-assembled combinations of component parts are positioned to leverage the trend toward system sourcing.

Engineering, design &and development. Our history and culture of innovation have enabled us to develop significant intellectual property and design and development expertise to provide advanced technology solutions that meet the demands of our customers. We have a team of ~~more than 20,000~~approximately 18,200 scientists, engineers and technicians focused on developing leading product solutions for our key markets, located at 1512 major technical centers in ~~Brazil,~~ China, ~~France,~~ Germany, India,

~~Table of Contents~~

~~Luxembourg,~~ Mexico, Poland, ~~South Korea, the United Kingdom~~Singapore and the United States. We invest approximately ~~$1.5~~$1.3 billion (which includes approximately $300 million co-investment by customers and government agencies) annually in research and development, including engineering, to maintain our portfolio of innovative products, and ~~owned/held~~own/hold approximately ~~8,500~~7,700 patents and protective ~~rights as of December 31, 2016.~~rights. We also encourage “open innovation” and collaborate extensively with peers in the industry, government agencies and academic institutions. For example, we have entered into a collaborative arrangement with Mobileye N.V. to jointly develop a complete turn-key fully autonomous driving platform for our OEM customers, with the goal of being production ready for 2019. Our technology competencies are recognized by both customers and government agencies, who ~~have co-invested~~co-invest approximately $300 million annually in new product development, accelerating the pace of innovation and reducing the risk associated with successful commercialization of technological breakthroughs.

In the past, suppliers often incurred the initial cost of engineering, designing and developing automotive component parts, and recovered their investments over time by including a cost recovery component in the price of each part based on expected volumes. Recently, we and many other suppliers have negotiated for cost recovery payments independent of volumes. This trend reduces our economic risk.

Pricing. Cost-cutting initiatives adopted by our customers result in increased downward pressure on pricing. Our customer supply agreements generally require step-downs in component pricing over the periods of production and OEMs have historically possessed significant leverage over their outside suppliers because the automotive component supply industry is fragmented and serves a limited number of automotive OEMs. Our profitability depends in part on our ability to generate sufficient production cost savings in the future to offset price reductions.

We are focused on maintaining a low fixed cost structure that provides us flexibility to remain profitable at all points of the traditional vehicle industry production cycle. As a result, approximately ~~95%~~97% of our hourly workforce is located in best cost countries. Furthermore, we have substantial operational flexibility by leveraging a large workforce of temporary workers, which represented approximately ~~14%~~21% of the hourly workforce as of ~~September 30, 2017.~~March 31, 2021. However, we will continue to adjust our cost structure and optimize our manufacturing footprint in response to changes in the global and regional automotive markets and in order to increase investment in advanced technologies and engineering, as evidenced by our ~~on-going~~ongoing restructuring programs focused on the continued rotation of our manufacturing footprint to best cost locations in Europe and on reducing our global overhead costs. As we continue to operate in a cyclical industry that is impacted by movements in the global and regional economies, we continually evaluate opportunities to further refine our cost structure.

We have a strong balance sheet with gross debt of approximately ~~$4.1~~$4.0 billion ~~(excluding the senior notes issued by our Powertrain Spin-Off subsidiary)~~ and substantial available liquidity of approximately ~~$2.6~~$5.4 billion ~~of cash and cash equivalents and available financing under our Revolving Credit Facility~~ as of ~~September 30, 2017~~,March 31, 2021, and no significant U.S. defined benefit or workforce postretirement health care benefits and employer-paid postretirement basic life insurance benefits (“OPEB”) liabilities. As further described in Note 8. Debt to the consolidated financial statements contained herein, we extended substantially all of our existing Credit Agreement’s maturity to August 2022, primarily to provide additional available liquidity and financial flexibility to mitigate the impacts on our business resulting from the uncertainty caused by the global spread of the COVID-19 pandemic. As further described in Note 12. Shareholders’ and Net Income Per Share to the audited consolidated financial statements included herein, we also issued $2.3 billion combined of preferred and ordinary shares during 2020. We intend to maintain strong financial discipline by targeting industry-leading earnings growth, cash flow generation and return on invested capital and to maintain sufficient liquidity to sustain our financial flexibility throughout the industry cycle.

Table of Contents

OEM product recalls. The number of vehicles recalled globally by OEMs has increased above historical levels. These recalls can either be initiated by the OEMs or influenced by regulatory agencies. Although there are differing rules and regulations across countries governing recalls for safety issues, the overall transition towards global vehicle platforms may also contribute to increased recalls outside of the U.S., as automotive components are increasingly standardized across regions. Given the sensitivity to safety issues in the automotive industry, including increased focus from regulators and consumers, we anticipate the number of automotive recalls may remain above historical levels in the near future. Although we engage in extensive product quality programs and processes, it is possible that we may be adversely affected in the future if the pace of these recalls continues.

For example, in September 2016, one of our OEM customers initiated a recall of approximately 3.64 million vehicles in the United States to enhance the airbag deployment system. Delphi supplied sensors and related control modules for the airbags in the affected vehicles. Although Delphi believes it supplied these components in compliance with the customer's product specifications and validation criteria, we assisted with our customer's efforts surrounding its recall, and during the first quarter of 2017, reached an agreement with our customer to share costs associated with the recall. Accordingly, during the nine months ended September 30, 2017 we recognized an incremental $43 million charge in addition to our previously recorded reserve estimate related to this matter.

Efficient use of capital. The global vehicle components industry is generally capital intensive and a portion of a supplier’s capital equipment is frequently utilized for specific customer programs. Lead times for procurement of capital equipment are long and typically exceed start of production by one to two years. Substantial advantages exist for suppliers that can leverage their prior investments in capital equipment or amortize the investment over higher volume global customer programs.

~~Table of Contents~~

Industry consolidation. Consolidation among worldwide OEMs and suppliers is expected to continue as ~~suppliers~~these companies seek to achieve operating synergies and value stream efficiencies, acquire complementary technologies and build stronger customer ~~relationships as OEMs continue~~relationships. For example, in January 2021, Fiat Chrysler Automobiles N.V. and PSA Peugeot Citroën executed a merger agreement to ~~expand globally.~~form a new, combined company, (“Stellantis”) which will represent the world’s fourth largest OEM. Additionally, new entrants from outside the traditional automotive industry may seek to gain access to certain vehicle component ~~markets, as evidenced by the acquisition of Harman International Industries, Incorporated by Samsung Electronics Co., Ltd. and the acquisition of Mobileye N.V. by Intel Corporation.~~markets. We believe companies with strong balance sheets and financial discipline are in the best position to take advantage of the industry consolidation trend.

~~High-Tech evolution of the automotive industry~~. The automotive industry is increasingly evolving towards the implementation of high-technology, software-dependent components and solutions. In particular, the industry is focused on the development of advanced driver assistance technologies, with the goal of developing and introducing a commercially-viable, fully automated driving experience. We expect automated driving technologies will provide strong societal benefit as well as the opportunity for long term growth for our product offerings in this space. We are continuing to invest in the automated driving space, and have continued to develop market-leading automated driving platform solutions such as automated driving software, key active safety sensing technologies and our Multi-Domain Controller, which fuses information from sensing systems as well as mapping and navigation data to make driving decisions. We have also entered into a collaborative arrangement with Mobileye to jointly develop the Centralized Sensing, Localization and Planning ("CSLP") platform, a complete turn-key fully autonomous driving platform for our OEM customers, with the goal of being production ready for 2019. There has also been increasing societal demand for mobility on demand ("MoD") services, such as car- and ride-sharing, and an increasing number of traditional automotive companies have made investments in the MoD space. We believe the increasing societal demand for MoD services will accelerate the development of autonomous driving technologies, strongly benefiting the MoD space. We recently entered into agreements to develop fully-autonomous vehicles and associated infrastructure as part of automated MoD pilots for the government of Singapore, the city of Boston and with Transdev, a leading global provider of mobility services, in France. As a result of our substantial investments and strategic partnerships, we believe we are well-aligned with industry technology trends that will result in sustainable future growth in these evolving areas.

Following the completion of the Powertrain spin-off, the remaining company will focus on enabling and delivering end-to-end smart mobility solutions, accelerating the commercialization of active safety and autonomous driving technologies and providing enhanced user experience and connected services. The Company's Electronics and Safety segment is focused on providing the necessary software and advanced computing platforms, and the Electrical/Electronic Architecture segment is focused on providing the requisite networking architecture required to support the integrated systems in today's complex vehicles. Together, our businesses develop the ‘brain’ and the ‘nervous system’ of increasingly complex vehicles, providing integration of the vehicle into its operating environment.

Consolidated Results of Operations

~~Delphi~~Aptiv typically experiences fluctuations in revenue due to changes in OEM production schedules, vehicle sales mix and the net of new and lost business (which we refer to collectively as volume), increased prices attributable to escalation clauses in our supply contracts for recovery of increased commodity costs (which we refer to as commodity pass-through), fluctuations in foreign currency exchange rates (which we refer to as ~~FX)~~“FX”), contractual reductions of the sales price to the OEM (which we refer to as contractual price reductions) and engineering changes. Changes in sales mix can have either favorable or unfavorable impacts on revenue. Such changes can be the result of shifts in regional growth, shifts in OEM sales demand, as well as shifts in consumer demand related to vehicle segment purchases and content penetration. For instance, a shift in sales demand favoring a particular OEM’s vehicle model for which we do not have a supply contract may negatively impact our revenue. A shift in regional sales demand toward certain markets could favorably impact the sales of those of our customers that have a large market share in those regions, which in turn would be expected to have a favorable impact on our revenue.

We typically experience (as described below) fluctuations in operating income due to:

•Volume, net of contractual price reductions—changes in volume offset by contractual price reductions (which typically range from 1% to 3% of net sales) and changes in mix;

•Operational performance—changes to costs for materials and commodities or manufacturing and engineering variances; and

~~Table of Contents~~

•Other—including restructuring costs and any remaining variances not included in Volume, net of contractual price reductions or Operational performance.

The automotive technology and component supply industry is traditionally subject to inflationary pressures with respect to raw materials and labor which may place operational and profitability burdens on the entire supply chain. Due to various factors, the industry is also facing increased operating and logistics challenges from certain global supply chain disruptions, including a worldwide semiconductor supply shortage. We will continue to work with our customers and suppliers to mitigate the impact of these inflationary and other pressures in the future. In addition, we expect commodity cost volatility, particularly related to copper and petroleum-based resin products, to have a continual impact on future earnings and/or operating cash flows. As such, we continually seek to mitigate both inflationary pressures and our material-related cost exposures using a number of approaches, including combining purchase requirements with customers and/or other suppliers, using alternate suppliers or product designs, negotiating cost reductions and/or commodity cost contract escalation clauses into our vehicle manufacturer supply contracts and hedging.

Table of Contents

Three ~~and Nine~~ Months Ended ~~September 30, 2017~~March 31, 2021 versus Three ~~and Nine~~ Months Ended ~~September 30, 2016~~March 31, 2020

The results of operations for the three ~~and nine~~ months ended~~September 30, 2017~~ March 31, 2021 and ~~2016~~2020 were as follows:


	Three Months Ended March 31,
		2021			2020			Favorable/(unfavorable)

		(dollars in millions)
Net sales		$	4,023		$	3,226		$	797
Cost of sales		3,296			2,725			(571)
Gross margin		727		18.1%	501		15.5%	226
Selling, general and administrative		255			252			(3)
Amortization		37			36			(1)
Restructuring		6			28			22
Gain on autonomous driving joint venture		—			(1,434)			(1,434)
Operating income		429			1,619			(1,190)
Interest expense		(40)			(43)			3
Other income (expense), net		1			(1)			2
Income before income taxes and equity (loss) income		390			1,575			(1,185)
Income tax expense		(48)			(10)			(38)
Income before equity (loss) income		342			1,565			(1,223)
Equity (loss) income, net of tax		(42)			2			(44)


Net income		300			1,567			(1,267)
Net income (loss) attributable to noncontrolling interest		5			(5)			10
Net income attributable to Aptiv		295			1,572			(1,277)
Mandatory convertible preferred share dividends		(16)			—			(16)
Net income attributable to ordinary shareholders		$	279		$	1,572		$	(1,293)

Three Months Ended September 30, Nine Months Ended September 30,
2017 2016 Favorable/(unfavorable) 2017 2016 Favorable/(unfavorable)

(dollars in millions)
Net sales $ 4,333
$ 4,091
$ 242
$ 12,943
$ 12,348
$ 595
Cost of sales 3,450
3,253
(197 ) 10,314
9,861
(453 )
Gross margin 883
20.4% 838
20.5% 45
2,629
20.3% 2,487
20.1% 142
Selling, general and administrative 317
278
(39 ) 906
833
(73 )
Amortization 34
34
—
100
101
1
Restructuring 21
63
42
180
252
72
Operating income 511
463
48
1,443
1,301
142
Interest expense (36 ) (41 ) 5
(105 ) (123 ) 18
Other expense, net (9 ) (69 ) 60
(29 ) (73 ) 44
Income from continuing operations before income taxes and equity income 466
353
113
1,309
1,105
204
Income tax expense (60 ) (57 ) (3 ) (183 ) (216 ) 33
Income from continuing operations before equity income 406
296
110
1,126
889
237
Equity income, net of tax 7
10
(3 ) 25
23
2
Income from continuing operations 413
306
107
1,151
912
239
Income from discontinued operations, net of tax —
—
—
—
108
(108 )
Net income 413
306
107
1,151
1,020
131
Net income attributable to noncontrolling interest 18
13
5
52
44
8
Net income attributable to Delphi $ 395
$ 293
$ 102
$ 1,099
$ 976
$ 123

Total Net Sales

Below is a summary of our total net sales for the three months ended ~~September 30, 2017~~March 31, 2021 versus ~~September 30, 2016.~~2020.


	Three Months Ended March 31,						Variance Due To:
	2021		2020		Favorable/(unfavorable)		Volume, net of contractual price reductions		FX		Commodity pass-through		Other		Total

	(in millions)						(in millions)
Total net sales	$	4,023	$	3,226	$	797	$	629	$	122	$	46	$	—	$	797

Total net sales for the three months ended ~~September 30, 2017~~March 31, 2021 increased 6%25% compared to the three months ended ~~September 30, 2016. We experienced volume growth of 7%~~March 31, 2020. Our overall volumes increased 21% for the period, ~~primarily as a result~~reflecting higher global automotive production levels despite the adverse impacts of ~~increased sales in Europe and Asia Pacific,~~the current global supply chain disruptions on vehicle production schedules, as well as the adverse impacts of the COVID-19 pandemic on sales volumes during the three months ended March 31, 2020, particularly in China. Our total net sales also reflect favorable foreign currency impacts, primarily related to the Euro ~~partially offset by contractual price~~

~~Table of Contents~~

~~reductions. Net sales also decreased by a net $63 million as a result of acquisitions~~ and divestitures, reflected in Other above, primarily due to the divestiture of our Mechatronics business in the fourth quarter of 2016, partially offset by our acquisition of Movimento in 2017. Refer to Note 17. Acquisitions and Divestitures to the consolidated financial statements for additional information regarding acquisitions and divestitures.

~~Below is a summary of our total net sales for the nine months ended~~ ~~September 30, 2017~~ ~~versus~~ ~~September 30, 2016~~.

Total net sales for the nine months ended September 30, 2017 increased 5% compared to the nine months ended September 30, 2016. We experienced volume growth of 9% for the period, primarily as a result of increased sales in Europe and Asia Pacific, which was partially offset by decreases due to unfavorable currency impacts, primarily related to the Chinese Yuan Renminbi, and ~~British Pound, and~~ contractual price reductions. Net sales also decreased by a net $208 million as a result of acquisitions and divestitures, reflected in Other above, primarily due to the divestiture of our Mechatronics business in the fourth quarter of 2016, partially offset by our acquisition of Movimento in 2017. Refer to Note 17. Acquisitions and Divestitures to the consolidated financial statements for additional information regarding acquisitions and divestitures.

Cost of Sales

Cost of sales is primarily comprised of material, labor, manufacturing overhead, freight, fluctuations in foreign currency exchange rates, product engineering, design and development expenses, depreciation and amortization, warranty costs and other operating expenses. Gross margin is revenue less cost of sales and gross margin percentage is gross margin as a percentage of net sales.

Cost of sales increased ~~$197~~$571 million for the three months ended ~~September 30, 2017~~March 31, 2021 compared to the three months ended ~~September 30, 2016,~~March 31, 2020, as summarized below. The ~~Company's~~Company’s material cost of sales was approximately 50% of net sales in both the three months ended ~~September 30, 2017~~March 31, 2021 and ~~September 30, 2016.~~2020.

Table of Contents


	Three Months Ended September 30,									Variance Due To:															Three Months Ended March 31,								Variance Due To:
	2017			2016			Favorable/(unfavorable)			Volume (a)			FX			Operational performance		Other			Total				2021			2020			Favorable/(unfavorable)		Volume (a)		FX		Operational performance		Other		Total

	(dollars in millions)									(in millions)															(dollars in millions)								(in millions)
Cost of sales	$	3,450		$	3,253		$	(197	)	$	(235	)	$	(28	)	$	69	$	(3	)	$	(197	)	Cost of sales	$	3,296		$	2,725		$	(571)	$	(406)	$	(109)	$	26	$	(82)	$	(571)
Gross margin	$	883		$	838		$	45		$	(24	)	$	39		$	69	$	(39	)	$	45		Gross margin	$	727		$	501		$	226	$	223	$	13	$	26	$	(36)	$	226
Percentage of net sales	20.4		%	20.5		%																		Percentage of net sales	18.1		%	15.5		%


~~(a)~~	~~Presented net of contractual price reductions for gross margin variance.~~

(a)Presented net of contractual price reductions for gross margin variance.

The increase in cost of sales reflects increased volumes and the impacts from currency exchange, ~~for the three month period,~~ partially offset by ~~improved~~ operational ~~performance.~~performance improvements. Cost of sales was also impacted by the following items in Other above:

Net decreased costs of $44 million resulting from the operations of the businesses acquired and divested, primarily as a result of the divestiture of our Mechatronics business in the fourth quarter of 2016, partially offset by the acquisition of Movimento in 2017, as further described in Note 17. Acquisitions and Divestitures, offset by

~~Increased commodity costs of $27 million; and~~

$9•Approximately $45 million of ~~increased depreciation and amortization, primarily as a result of a higher fixed asset base.~~

~~Cost of sales increased $453 million for the nine months ended September 30, 2017 compared~~costs related to the ~~nine months ended September 30, 2016, as summarized below. The Company's material cost of sales was approximately 50% of net sales in both the~~ ~~nine months endedSeptember 30, 2017~~ ~~and~~ ~~September 30, 2016~~.

~~Table of Contents~~

Nine Months Ended September 30, Variance Due To:
2017 2016 Favorable/(unfavorable) Volume (a) FX Operational performance Other Total

(dollars in millions) (in millions)
Cost of sales $ 10,314
$ 9,861
$ (453 ) $ (787 ) $ 117
$ 221
$ (4 ) $ (453 )
Gross margin $ 2,629
$ 2,487
$ 142
$ 51
$ 23
$ 221
$ (153 ) $ 142
Percentage of net sales 20.3 % 20.1 %


~~(a)~~	~~Presented net of contractual price reductions for gross margin variance.~~

The increase in cost of sales reflects increased volumes, partially offset by improved operational performance and the impacts from currency exchange for the nine month period. Cost of sales was also impacted by the following items in Other above:

Net decreased costs of $146 million resulting from the operations of the businesses acquired and divested, primarily as a result of the divestiture of our Mechatronics business in the fourth quarter of 2016, partially offset by the acquisition of Movimento in 2017, as further described in Note 17. Acquisitions and Divestitures, offset by

~~$61 million of increased warranty costs,~~global supply chain disruptions, primarily due to the accrual of $43 million during the nine months ended September 30, 2017 as a result of an agreement reached with one of our customers for a specific warranty matter, as further described in Note 6. Warranty Obligations;worldwide semiconductor supply shortage; and

•$5946 million of increased commodity pass-through costs; and

•$13 million of increased depreciation and amortization, primarily as a result of a higher fixed asset ~~base.~~base; partially offset by

•Decreased expense of approximately $35 million, primarily due to decreased engineering expenses as a result of the formation of the Motional autonomous driving joint venture with Hyundai in March 2020, which is now accounted for under the equity method of accounting.

Selling, General and Administrative Expense


	Three Months Ended September 30,										Three Months Ended March 31,
	2017			2016			Favorable/ (unfavorable)				2021			2020			Favorable/ (unfavorable)

	(dollars in millions)										(dollars in millions)
Selling, general and administrative expense	$	317		$	278		$	(39	)	Selling, general and administrative expense	$	255		$	252		$	(3)
Percentage of net sales	7.3		%	6.8		%				Percentage of net sales	6.3		%	7.8		%

	Nine Months Ended September 30,
	2017			2016			Favorable/ (unfavorable)

	(dollars in millions)
Selling, general and administrative expense	$	906		$	833		$	(73	)
Percentage of net sales	7.0		%	6.7		%

Selling, general and administrative expense ("(“SG~~&A"~~&A”) includes administrative expenses, information technology costs and incentive compensation related ~~costs, and increased~~costs. SG&A decreased as a percentage of net sales for the three ~~and nine~~ months ended ~~September 30, 2017~~March 31, 2021 as compared to ~~2016,~~2020, primarily due to ~~$31 million~~decreased SG&A expenses as a result of the March 2020 formation of the Motional autonomous driving joint venture with Hyundai, which is now accounted for under the equity method of accounting and ~~$46 million~~the adverse impacts of ~~separation costs recorded~~the COVID-19 pandemic during the three ~~and nine~~ months ended ~~September 30, 2017, respectively, related to the planned spin-off of our Powertrain Systems segment. These increases were~~March 31, 2020, partially offset by ~~the impact of cost reduction initiatives, including our continuing rotation to best cost manufacturing locations in Europe and initiatives focused on reducing global overhead~~increased incentive compensation costs.

~~Table of Contents~~

Amortization

Three Months Ended September 30,
2017 2016 Favorable/
(unfavorable)

(in millions)
Amortization $ 34
$ 34
$ —

Nine Months Ended September 30,
2017 2016
Favorable/
(unfavorable)

(in millions)
Amortization $ 100
$ 101
$ 1








	Three Months Ended March 31,
	2021		2020		Favorable/ (unfavorable)

	(in millions)
Amortization	$	37	$	36	$	(1)

Amortization expense reflects the non-cash charge related to definite-lived intangible assets. The consistency in amortization during the three ~~and nine~~ months ended ~~September 30, 2017~~March 31, 2021 compared to ~~2016~~2020 reflects the continued amortization of our definite-lived intangible assets, which resulted primarily from our acquisitions, over their estimated useful lives. Refer to Note 17. Acquisitions and Divestitures to the consolidated financial statements contained herein for further detail of our business acquisitions, including details of the intangible assets recorded in each transaction.

Table of Contents

Restructuring


	Three Months Ended September 30,									Three Months Ended March 31,
	2017			2016			Favorable/ (unfavorable)			2021			2020			Favorable/ (unfavorable)

	(dollars in millions)									(dollars in millions)
Restructuring	$	21		$	63		$	42	Restructuring	$	6		$	28		$	22
Percentage of net sales	0.5		%	1.5		%			Percentage of net sales	0.1		%	0.9		%

	Nine Months Ended September 30,
	2017			2016			Favorable/ (unfavorable)

	(dollars in millions)
Restructuring	$	180		$	252		$	72
Percentage of net sales	1.4		%	2.0		%

The ~~decrease in~~Company recorded employee-related and other restructuring expense recorded during the three and nine months ended September 30, 2017 as compared to the three and nine months ended September 30, 2016 is primarily attributable to a decrease in costs recognized for plant closures as compared to the prior periods.

~~Restructuring costs recorded~~charges totaling approximately $6 million during the three months ended ~~September 30, 2017 included $9 million for programs focused on the continued rotation of our manufacturing footprint~~March 31, 2021. We expect to best cost locations in Europe, as well as $6 million for programs implemented to reduce global overhead costs. The charges recorded during the nine months ended September 30, 2017 included the recognitionmake cash payments of approximately ~~$54~~$60 million ofover the next twelve months pursuant to currently implemented restructuring programs.

The Company recorded employee-related and other costs related to the initiation of the closure of a Western European manufacturing site within the Powertrain Systems segment pursuant to the Company's on-going European footprint rotation strategy, for which payments are expected to be principally completed by 2020. Therestructuring charges ~~recorded during the nine months ended September 30, 2017 also included $36~~totaling approximately $28 million ~~of costs related to the closure of an Electronics and Safety Western European manufacturing site.~~

~~Restructuring costs of approximately $63 million and $252 million were recorded during the three and nine months ended September 30, 2016, respectively. These charges included $50 million recorded~~ during the three months ended ~~September 30, 2016~~March 31, 2020, of which $11 million was recognized for programs implemented ~~to reduce global overhead costs, as well as $152 million recorded during~~in the ~~nine months ended September 30, 2016 for programs focused on the continued rotation of our manufacturing footprint to low cost locations in Europe, $90 million of which related~~European region, pursuant to the initiation of the closure of a European manufacturing site within the Powertrain Systems segment. Cash payments for this restructuring action are expected to be principally completed in 2017. Additionally, Delphi recognized non-cash asset impairment charges of $19 million during the nine months ended~~September 30, 2016 related to this plant closure, which were recorded within~~Company’s ongoing overhead cost ~~of sales.~~

~~Table of Contents~~

reduction strategy.

We expect to continue to incur additional restructuring expense in ~~2017,~~2021 and beyond, primarily related to programs focused on the continued rotation of our manufacturing footprint to best cost locations in Europe and ~~to reduce~~on reducing global overhead costs, ~~including realignment~~which includes approximately $30 million (of which approximately $15 million relates to the Signal and Power Solutions segment and approximately $15 million relates to the Advanced Safety and User Experience segment) for programs approved as of ~~the Company's organizational structure due to changes in roles and workforce resulting from the planned spin-off of the Powertrain Systems segment.~~March 31, 2021. Additionally, as we continue to operate in a cyclical industry that is impacted by movements in the global and regional economies, we continually evaluate opportunities to further adjust our cost structure and optimize our manufacturing footprint. The Company plans to implement additional restructuring activities in the future, if necessary, in order to align manufacturing capacity and other costs with prevailing regional automotive production levels and locations, to improve the efficiency and utilization of other locations and in order to increase investment in advanced technologies and engineering. Such future restructuring actions are dependent on market conditions, customer actions and other factors.

Refer to Note 7. Restructuring to the consolidated financial statements ~~included~~contained herein for additional information.

Interest Expense

Three Months Ended September 30,
2017 2016 Favorable/
(unfavorable)

(in millions)
Interest expense $ 36
$ 41
$ 5

Nine Months Ended September 30,
2017 2016
Favorable/
(unfavorable)

(in millions)
Interest expense $ 105
$ 123
$ 18

The decrease in interest expense compared to the prior year period primarily reflects the redemption of $800 million of 5.00% senior unsecured notes, partially offset by the issuance of €500 million of 1.60% Euro-denominated senior unsecured notes and $300 million of 4.40% senior unsecured notes, in September 2016.








	Three Months Ended March 31,
	2021		2020		Favorable/ (unfavorable)

	(in millions)
Interest expense	$	40	$	43	$	3

Refer to Note 8. Debt to the consolidated financial statements ~~included~~contained herein for additional information.

Other Income, ~~(Expense),~~ Net








	Three Months Ended March 31,
	2021		2020		Favorable/ (unfavorable)

	(in millions)
Other income (expense), net	$	1	$	(1)	$	2

Three Months Ended September 30,
2017 2016 Favorable/
(unfavorable)

(in millions)
Other expense, net $ (9 ) $ (69 ) $ 60

Nine Months Ended September 30,
2017 2016
Favorable/
(unfavorable)

(in millions)
Other expense, net $ (29 ) $ (73 ) $ 44

~~As further discussed in~~Refer to Note ~~10. Commitments and Contingencies, during the nine months ended September 30, 2017, the Company recorded a~~16. Other Income, net ~~charge of $10 million to other expense due~~ to the ~~settlement of the Unsecured Creditors litigation.~~

~~As further discussed in Note 8. Debt, during the three and nine months ended September 30, 2016, Delphi redeemed~~consolidated financial statements contained herein for cash the entire $800 million aggregate principal amount outstanding of the 2013 Senior Notes, resulting in a loss on debt extinguishment of approximately $70 million. Delphi also recorded a loss on debt extinguishment of $3 million during the three and nine months ended September 30, 2016 in conjunction with the 2016 amendment to the Credit Agreement, as further discussed in Note 8. Debt. Additionally, as further discussed in Note 21. Discontinued Operations, during the three and nineadditional information.

Table of Contents

months ended September 30, 2016, Delphi recorded $2 million and $7 million for certain fees earned pursuant to the transition services agreement in connection with the sale of the Company's wholly owned Thermal Systems business.

Income Taxes








	Three Months Ended March 31,
	2021		2020		Favorable/ (unfavorable)

	(in millions)
Income tax expense	$	48	$	10	$	(38)

Three Months Ended September 30,
2017 2016 Favorable/
(unfavorable)

(in millions)
Income tax expense $ 60
$ 57
$ (3 )

Nine Months Ended September 30,
2017 2016
Favorable/
(unfavorable)

(in millions)
Income tax expense $ 183
$ 216
$ 33

The Company’s tax rate is affected by the fact that its parent entity is an Irish resident taxpayer, the tax rates in Ireland and other jurisdictions in which the Company operates, the relative amount of income earned by jurisdiction and the relative amount of losses or income for which no tax benefit or expense was recognized due to a valuation allowance. The Company’s effective tax rate ~~was~~is also impacted by ~~favorable changes in geographic income mix in 2017 as compared to 2016 primarily due to changes in the underlying business operations,~~ the receipt of certain tax incentives and holidays that ~~reduced~~reduce the effective tax rate for certain subsidiaries below the statutory ~~rate and the impact of losses recorded during the nine months ended September 30, 2016 in foreign jurisdictions for which no tax benefit was recognized due to a valuation allowance.~~rate.

The Company’s effective tax rate for the three months ended ~~September 30, 2017~~March 31, 2021 also includes net discrete tax benefits of ~~$11~~$1 million, primarily related to changes in accruals for unremitted earnings and provision to return adjustments. The effective tax rate for the three months ended March 31, 2020 includes net discrete tax benefits of $3 million, primarily related to changes in reserves, changes in accruals for unremitted earnings and provision to return adjustments. ~~The Company’s effective tax rate for~~Also included as a discrete item in the nine months ended September 30, 2017 includes net discrete tax benefits of $22 million primarily related to provision to return adjustments, net of related changes in valuation allowances and reserves. The effective tax rate for the three ~~and nine~~ months ended ~~September 30, 2016 includes net discrete~~March 31, 2020 is the beneficial impact from the gain on the formation of the Motional autonomous driving joint venture. The tax ~~benefits~~expense associated with the gain was insignificant as Aptiv’s aggregate autonomous driving assets were exempt from capital gains tax in the jurisdiction from which they were sold. The aggregate autonomous driving assets had been acquired, purchased or developed in taxable transactions in prior periods and reflect changes made to the corporate entity operating structure for intellectual property following the Separation of ~~$4 million and $3 million, respectively, primarily related~~its former Powertrain Systems segment. Refer to ~~provision~~Note 11. Income Taxes to ~~return adjustments.~~the consolidated financial statements contained herein for additional information.

Equity Income

Three Months Ended September 30,
2017 2016 Favorable/
(unfavorable)

(in millions)
Equity income, net of tax $ 7
$ 10
$ (3 )

Nine Months Ended September 30,
2017 2016
Favorable/
(unfavorable)

(in millions)
Equity income, net of tax $ 25
$ 23
$ 2








	Three Months Ended March 31,
	2021		2020		Favorable/ (unfavorable)

	(in millions)
Equity (loss) income, net of tax	$	(42)	$	2	$	(44)

Equity (loss) income, net of tax reflects ~~Delphi’s~~the Company’s interest in the results of ongoing operations of entities accounted for as ~~equity-method~~equity method investments. Equity income was consistent for the nine months ended September 30, 2017 as compared to the nine months ended September 30, 2016 as a result of the consistent performance of our joint ventures as compared to the prior period.

~~Table of Contents~~

~~Income from Discontinued Operations~~

Three Months Ended September 30,
2017 2016 Favorable/
(unfavorable)

(in millions)
Income from discontinued operations, net of tax $ —
$ —
$ —

Nine Months Ended September 30,
2017 2016
Favorable/
(unfavorable)

(in millions)
Income from discontinued operations, net of tax $ —
$ 108
$ (108 )

~~Income from discontinued operations,~~The equity loss, net of tax, ~~reflects~~recognized by Aptiv during the ~~results of~~three months ended March 31, 2021 includes $45 million attributable to the ~~Company's previously reported Thermal Systems segment, which has been reclassified to discontinued operations~~Motional autonomous driving joint venture formed in March 2020 with Hyundai, as ~~a result of the divestiture of this business. As~~ further described in Note ~~21. Discontinued Operations, Delphi completed the divestitures of the wholly owned Thermal Systems business on June 30, 2015, of its 50 percent interest in KDAC on September 24, 2015~~17. Acquisitions and of its 50 percent interest in SDAAC on March 31, 2016. No amounts were recorded to discontinued operations for the three and nine months ended September 30, 2017, or for the three months ended September 30, 2016. Income from discontinued operations, net of tax for the nine months ended September 30, 2016 was primarily attributable to the recognition of an after-tax gain of $104 million from the sale of the Company's interest in its SDAAC joint venture on March 31, 2016.

~~Refer to Note 21. Discontinued Operations~~Divestitures to the consolidated financial statements ~~included herein for additional information.~~contained herein.

Results of Operations by Segment

We operate our core business along the following operating segments, which are grouped on the basis of similar product, market and operating factors:

~~Electrical/Electronic Architecture,~~•Signal and Power Solutions, which includes complete electrical architecture and component products.

~~Powertrain Systems, which includes extensive systems integration expertise in gasoline, diesel~~•Advanced Safety and fuel handling and full end-to-end systems including fuel and air injection, combustion, electronic controls, test and validation capabilities, electric and hybrid electric vehicle power electronics, aftermarket and original equipment service. As described in Note 22. Separation of Powertrain Systems, the Company is pursuing a separation of the Powertrain Systems segment into a new, independent publicly traded company, through a transaction expected to be treated as a tax-free spin-off to its shareholders.

•Eliminations and Other, which includes i) the elimination of inter-segment transactions, and ii) certain other expenses and income of a non-operating or strategic nature.

As described in Note 21. Discontinued Operations to the consolidated financial statements contained herein, the Company's previously reported Thermal Systems segment has been classified as discontinued operations for all periods presented. No amounts for shared general and administrative operating expense or interest expense were allocated to discontinued operations.

Our management utilizes segment Adjusted Operating Income as the key performance measure of segment income or loss to evaluate segment performance, and for planning and forecasting purposes to allocate resources to the segments, as management believes this measure is most reflective of the operational profitability or loss of our operating segments. Segment Adjusted Operating Income should not be considered a substitute for results prepared in accordance with U.S. GAAP and should not be considered an alternative to net income attributable to ~~Delphi,~~Aptiv, which is the most directly comparable financial measure to Adjusted Operating Income that is prepared in accordance with U.S. GAAP. Segment Adjusted Operating Income, as determined and measured by ~~Delphi,~~Aptiv, should also not be compared to similarly titled measures reported by other companies.

Table of Contents

The reconciliation of Adjusted Operating Income to ~~Operating Income~~operating income includes, as applicable, restructuring, ~~separation costs related to the planned spin-off of the Powertrain Systems segment,~~ other acquisition and portfolio project costs (which includes costs incurred to integrate acquired businesses and to plan and execute product portfolio transformation actions,

~~Table of Contents~~

including business and product acquisitions and divestitures), asset impairments, ~~and~~ gains (losses) on business ~~divestitures.~~divestitures and other transactions and deferred compensation related to acquisitions. The ~~reconciliation~~reconciliations of Adjusted Operating Income to net income attributable to ~~Delphi~~Aptiv for the three ~~and nine~~ months ended ~~September 30, 2017~~ March 31, 2021 and ~~2016~~2020 are as follows:


	Signal and Power Solutions		Advanced Safety and User Experience		Eliminations and Other		Total

	(in millions)
For the Three Months Ended March 31, 2021:
Adjusted operating income	$	371	$	66	$	—	$	437
Restructuring	2		(8)		—		(6)

Other acquisition and portfolio project costs	(1)		(1)		—		(2)



Operating income	$	372	$	57	$	—	429
Interest expense							(40)
Other income, net							1
Income before income taxes and equity loss							390
Income tax expense							(48)
Equity loss, net of tax							(42)


Net income							300
Net income attributable to noncontrolling interest							5
Net income attributable to Aptiv							$	295


	Signal and Power Solutions		Advanced Safety and User Experience		Eliminations and Other		Total

	(in millions)
For the Three Months Ended March 31, 2020:
Adjusted operating income	$	225	$	6	$	—	$	231
Restructuring	(19)		(9)		—		(28)

Other acquisition and portfolio project costs	(7)		(7)		—		(14)

Deferred compensation related to acquisitions	—		(4)		—		(4)
Gain on business divestitures and other transactions	—		1,434		—		1,434
Operating income	$	199	$	1,420	$	—	1,619
Interest expense							(43)
Other expense, net							(1)
Income before income taxes and equity income							1,575
Income tax expense							(10)
Equity income, net of tax							2


Net income							1,567
Net loss attributable to noncontrolling interest							(5)
Net income attributable to Aptiv							$	1,572

Table of Contents

~~Table of Contents~~

Net sales, gross margin as a percentage of net sales and Adjusted Operating Income by segment for the three ~~and nine~~ months ended~~September 30, 2017~~ March 31, 2021 and ~~2016~~2020 are as follows:

Net Sales by Segment












	Three Months Ended March 31,						Variance Due To:
	2021		2020		Favorable/(unfavorable)		Volume, net of contractual price reductions		FX		Commodity pass-through		Other		Total

	(in millions)						(in millions)
Signal and Power Solutions	$	3,022	$	2,330	$	692	$	544	$	102	$	46	$	—	$	692
Advanced Safety and User Experience	1,011		902		109		88		21		—		—		109
Eliminations and Other	(10)		(6)		(4)		(3)		(1)		—		—		(4)
Total	$	4,023	$	3,226	$	797	$	629	$	122	$	46	$	—	$	797

Three Months Ended September 30, Variance Due To:
2017 2016
Favorable/
(unfavorable)
Volume, net of contractual price reductions FX Commodity pass-through Other Total

(in millions) (in millions)
Electrical/Electronic Architecture $ 2,317
$ 2,287
$ 30
$ (32 ) $ 35
$ 27
$ —
$ 30
Powertrain Systems 1,205
1,077
128
112
19
—
(3 ) 128
Electronics and Safety 845
763
82
131
15
—
(64 ) 82
Eliminations and Other (34 ) (36 ) 2
—
(2 ) —
4
2
Total $ 4,333
$ 4,091
$ 242
$ 211
$ 67
$ 27
$ (63 ) $ 242

Nine Months Ended September 30, Variance Due To:
2017 2016
Favorable/
(unfavorable)
Volume, net of contractual price reductions FX Commodity pass-through Other Total

(in millions) (in millions)
Electrical/Electronic Architecture $ 7,004
$ 6,916
$ 88
$ 68
$ (39 ) $ 59
$ —
$ 88
Powertrain Systems 3,560
3,340
220
273
(41 ) —
(12 ) 220
Electronics and Safety 2,484
2,208
276
500
(11 ) —
(213 ) 276
Eliminations and Other (105 ) (116 ) 11
(3 ) (3 ) —
17
11
Total $ 12,943
$ 12,348
$ 595
$ 838
$ (94 ) $ 59
$ (208 ) $ 595

Gross Margin Percentage by Segment


	Three Months Ended March 31,
		2021		2020
Signal and Power Solutions		20.0	%	18.6	%

Advanced Safety and User Experience		12.2	%	7.4	%
Eliminations and Other		—	%	—	%
Total		18.1	%	15.5	%

Three Months Ended September 30, Nine Months Ended September 30,
2017 2016 2017 2016
Electrical/Electronic Architecture 22.5 % 22.0 % 22.2 % 21.6 %
Powertrain Systems 19.1 % 18.4 % 19.9 % 17.7 %
Electronics and Safety (1) 15.6 % 18.1 % 14.7 % 18.3 %
Eliminations and Other — % — % — % — %
Total 20.4 % 20.5 % 20.3 % 20.1 %


~~(1)~~	~~Includes the accrual of $43 million for a specific warranty matter during the nine months ended September 30, 2017, as further described in Note 6. Warranty Obligations.~~

~~Table of Contents~~

Adjusted Operating Income by Segment

Three Months Ended September 30, Variance Due To:
2017 2016
Favorable/
(unfavorable)
Volume, net of contractual price reductions Operational performance Other Total

(in millions) (in millions)
Electrical/Electronic Architecture $ 336
$ 317
$ 19
$ (50 ) $ 43
$ 26
$ 19
Powertrain Systems 150
122
28
21
15
(8 ) 28
Electronics and Safety 80
95
(15 ) 5
11
(31 ) (15 )
Eliminations and Other —
—
—
—
—
—
—
Total $ 566
$ 534
$ 32
$ (24 ) $ 69
$ (13 ) $ 32


	Three Months Ended March 31,						Variance Due To:
	2021		2020		Favorable/(unfavorable)		Volume, net of contractual price reductions		Operational performance		Other		Total

	(in millions)						(in millions)
Signal and Power Solutions	$	371	$	225	$	146	$	201	$	2	$	(57)	$	146

Advanced Safety and User Experience	66		6		60		22		20		18		60
Eliminations and Other	—		—		—		—		—		—		—
Total	$	437	$	231	$	206	$	223	$	22	$	(39)	$	206

As noted in the table above, Adjusted Operating Income for the three months ended ~~September 30, 2017~~March 31, 2021 as compared to the three months ended ~~September 30, 2016~~March 31, 2020 was impacted by volume and contractual price reductions, including product mix, and operational performance improvements, as well as the following items included within Other in the table above:

•Approximately $45 million of costs related to the global supply chain disruptions, primarily due to the worldwide semiconductor supply shortage; and

•$913 million of increased depreciation and amortization, not including the impact of asset impairments, primarily as a result of a higher fixed asset base; and

•$87 million of increased SG&A expense, not including ~~separation costs recorded during the three months ended September 30, 2017, primarily attributable to increased incentive compensation accruals; and~~

Net reductions of $19 million resulting from the operations of the businesses acquired and divested, primarily resulting from the divestiture of our Mechatronics business in the fourth quarter of 2016, partially offset by the acquisition of Movimento in 2017.

~~These decreases in Adjusted Operating Income were partially offset by favorable foreign currency impacts of $33 million.~~

Nine Months Ended September 30, Variance Due To:
2017 2016
Favorable/
(unfavorable)
Volume, net of contractual price reductions Operational performance Other Total

(in millions) (in millions)
Electrical/Electronic Architecture $ 998
$ 969
$ 29
$ (74 ) $ 118
$ (15 ) $ 29
Powertrain Systems 472
381
91
52
72
(33 ) 91
Electronics and Safety 220
276
(56 ) 74
31
(161 ) (56 )
Eliminations and Other —
—
—
—
—
—
—
Total $ 1,690
$ 1,626
$ 64
$ 52
$ 221
$ (209 ) $ 64

~~As noted in the table above, Adjusted Operating Income for the~~ ~~nine months endedSeptember 30, 2017~~ ~~as compared to the~~ ~~nine months endedSeptember 30, 2016~~ ~~was impacted by volume and contractual price reductions, including product mix, and operational performance improvements, as well as the following items included within Other in the table above:~~

~~$26 million of increased depreciation and amortization, not including~~ the impact of ~~asset impairments,~~other acquisition and portfolio project costs, primarily as a result of ~~a higher fixed asset base;~~

~~$27 million of increased SG&A expenses, not including separation costs recorded during the three months ended September 30, 2017, primarily attributable to~~ increased incentive compensation ~~accruals;~~costs; partially offset by

~~$61~~•Decreased expense of approximately $40 million, ~~of increased warranty costs,~~ primarily due to ~~the accrual of $43 million during the nine months ended September 30, 2017 within the Electronics~~decreased engineering and ~~Safety segment~~SG&A expenses as a result of ~~an agreement reached with one of our customers for a specific warranty matter, as further described in Note 6. Warranty Obligations; and~~

~~Net reductions of $70 million resulting from~~ the ~~operations~~formation of the ~~businesses acquired and divested, primarily resulting from~~Motional autonomous driving joint venture with Hyundai in March 2020, which is now accounted for under the ~~divestiture~~equity method of ~~our Mechatronics business in the fourth quarter of 2016, partially offset by the acquisition of Movimento in 2017.~~accounting.

~~These decreases in Adjusted Operating Income were partially offset by favorable foreign currency impacts of $24 million.~~

Table of Contents

Liquidity and Capital Resources

Overview of Capital Structure

Our liquidity requirements are primarily to fund our business operations, including capital expenditures and working capital requirements, as well as to fund debt service requirements and operational restructuring ~~activities, separation activities and dividends on share capital.~~activities. Our primary sources of liquidity are cash flows from operations, our existing cash balance, and as necessary and available, borrowings under ~~available~~ credit facilities and issuance of long-term ~~debt.~~debt and equity. To the extent we generate discretionary cash flow we may consider using this additional cash flow for optional prepayments of existing indebtedness, strategic acquisitions or investments, ~~additional share repurchases~~ and/or general corporate purposes. We will also continually explore ways to enhance our capital structure.

As of ~~September 30, 2017,~~March 31, 2021, we had cash and cash equivalents of ~~$0.6~~$2.8 billion and net debt (defined as outstanding debt less cash and cash ~~equivalents, excluding the senior notes issued by our Powertrain Spin-Off subsidiary as described below)~~equivalents) of ~~$3.6~~$1.2 billion. ~~We also have access to additional liquidity pursuant to the terms of the $2.0 billion Revolving Credit Facility, as described below.~~

The following table summarizes our available liquidity, which includes cash, cash equivalents and funds available under our significant committed credit facilities, as of ~~September 30, 2017.~~March 31, 2021. The amounts disclosed as available under the Company’s significant committed credit facilities are available without violating our existing debt covenants, which are described below.


	March 31, 2021

	(in millions)
Cash and cash equivalents	$	2,830
Revolving Credit Facility, unutilized portion (1)	2,000
Committed European accounts receivable factoring facility, unutilized portion (2)	529
Total available liquidity	$	5,359

September 30,
2017

(in millions)
Cash and cash equivalents $ 557
Revolving Credit Facility, unutilized portion (1) 1,993
Total available liquidity $ 2,550

(1)Availability reduced by $7less than $1 million in letters of credit issued under the Credit Agreement as of ~~September 30, 2017.~~March 31, 2021.

We(2)Based on March 31, 2021 foreign currency rates, subject to the availability of eligible accounts receivable.

Despite the current global economic impacts and uncertainty resulting from the ongoing COVID-19 pandemic and its direct and indirect impacts on global vehicle production, we currently expect existing cash, available liquidity and cash flows from operations to continue to be sufficient to fund our global operating activities, including restructuring payments, any mandatory payments required under the Credit Agreement as described below, dividends on ~~ordinary~~preferred shares and capital expenditures. ~~In addition, we expect to continue to repurchase outstanding common shares pursuant to our authorized common share repurchase program, as further described below.~~

We also continue to expect to be able to move funds between different countries to manage our global liquidity needs without material adverse tax implications, subject to current monetary policies and to the terms of the Credit Agreement. While a substantial portion of our operating income is generated by our non-U.S. subsidiaries, and as of September 30, 2017, the Company's cash and cash equivalents held by our non-U.S. subsidiaries totaled $544 million, weWe utilize a combination of strategies, including dividends, cash pooling arrangements, intercompany loan repayments and other distributions and advances to provide the funds necessary to meet our global liquidity needs. There are no significant restrictions on the ability of our subsidiaries to pay dividends or make other distributions to ~~Delphi.~~Aptiv. As of March 31, 2021, the Company’s cash and cash equivalents held by our non-U.S. subsidiaries totaled approximately $2.8 billion. If additional non-U.S. cash was needed for our U.S. operations, we ~~would~~may be required to accrue and pay ~~U.S. taxes~~withholding if we were to ~~repatriate~~distribute such ~~funds;~~funds from non-U.S. subsidiaries to the U.S.; however, based on our current liquidity needs and ~~repatriation~~ strategies, we do not anticipate a need to ~~repatriate~~accrue and pay such additional amounts. ~~Additionally,~~

2020 Public Equity Offering

In June 2020, the Company iscompleted the underwritten public offering of approximately 15.1 million ordinary shares at a ~~U.K. resident taxpayer~~price of $75.91 per share (the “Ordinary Share Offering”), resulting in net proceeds of approximately $1,115 million, after deducting expenses and ~~as such is not generally subject to U.K. tax on remitted foreign earnings.~~

~~Based on these factors, we believe we possess sufficient liquidity to fund our global operations and capital investments in 2017 and beyond.~~

~~Spin-Off~~the underwriters’ discount of ~~Powertrain Systems segment into Delphi Technologies~~

~~As described above,~~$35 million. Simultaneously, the Company ~~is pursuing~~completed the Separation of its Powertrain Systems segment into a new, independent publicly traded company, through a transaction expected to be treated as a tax-free spin-off to its shareholders. The Company plans to complete the Separation by March 2018, subject to customary closing conditions. The new publicly traded Powertrain spin-off company will be named Delphi Technologies PLC.

~~As described in the Spin-Off Financing section below, in September 2017 the financing for the spin-off entity was completed, which consisted of the~~underwritten public offering of ~~$800~~11.5 million 5.50% Mandatory Convertible Preferred Shares, Series A, $0.01 par value per share (the “MCPS”) with a liquidation preference of ~~5.00% senior notes due 2025~~$100 per share (the “MCPS Offering”), resulting in net proceeds of approximately $1,115 million, after deducting expenses and the ~~execution~~underwriters’ discount of a senior secured credit agreement which will provide a $750 million five-year term loan and a $500 million five-year revolving credit facility to Delphi Technologies PLC no later than the date of the Separation, subject to the satisfaction of certain conditions customary for financings of this type, including the spin-off.

~~Table of Contents~~

~~Upon completion of the Separation, the Company expects to receive a cash dividend of approximately $1.2 billion from Delphi Technologies.~~$35 million. The Company intends to use the net proceeds ~~received~~ from the ~~dividend to fund growth initiatives, including increased investment in advanced technologies~~Ordinary Share Offering and ~~engineering. The amount~~MCPS Offering for general corporate purposes, which may include funding potential future investments (including acquisitions), capital expenditures, working capital, repayment of outstanding indebtedness, and the satisfaction of other obligations. Each share of MCPS will mandatorily convert on the mandatory conversion date of June 15, 2023, into between 1.0754 and 1.3173 shares of the ~~dividend~~Company’s ordinary shares, subject to ~~be received from Delphi Technologies will depend on a number of factors, including the timing~~customary anti-dilution adjustments.

Holders of the ~~completion~~MCPS will be entitled to receive, when and if declared by the Company’s Board of Directors, cumulative dividends at the annual rate of 5.50% of the ~~Separation~~liquidation preference of $100 per share (equivalent to $5.50 annually per share), payable in cash or, subject to certain limitations, by delivery of the Company’s ordinary shares or any combination of cash and ~~certain internal restructuring transactions related~~the Company’s ordinary shares, at the Company’s election. If declared, dividends on the MCPS will be payable quarterly on

Table of Contents

March 15, June 15, September 15 and December 15 of each year (commencing on September 15, 2020 to, and including June 15, 2023), to the ~~Separation.~~holders of record of the MCPS as they appear on the Company’s share register at the close of business on the immediately preceding March 1, June 1, September 1 or December 1, respectively. Refer to Note 12. Shareholders’ Equity and Net Income Per Share to the consolidated financial statements contained herein for further detail on the June 2020 public equity offering.

Share Repurchases




Total number of shares repurchased	1,059,075
Average price paid per share	$	53.73
Total (in millions)	$	57

~~Dividends~~Although both the April 2016 and the additional share repurchase program remain authorized, the Company is restricted from executing further share repurchases under the terms of the May 2020 Amendment to ~~Holders of Ordinary Shares~~

~~The Company has declared and paid cash dividends per ordinary share~~the Credit Agreement for as long as the Covenant Relief Period remains in effect, as further described in Note 8. Debt. Furthermore, in order to preserve liquidity during the ~~periods presented~~COVID-19 pandemic crisis, the Company does not anticipate executing further share repurchases until such time as ~~follows:~~the global economic uncertainties and business impacts resulting from the pandemic have abated.

In ~~addition, in October 2017,~~the first quarter of 2021, the Board of Directors declared and paid a ~~regular~~ quarterly cash dividend of ~~$0.29~~approximately $1.38 per MCPS.

Under the terms of the May 2020 Amendment to the Credit Agreement, the Company is restricted from the payment of further ordinary share ~~payable November 22, 2017 to shareholders of record at~~cash dividends for as a long as the ~~close of~~Covenant Relief Period remains in effect (all as defined below). Additionally, the Company does not anticipate making further ordinary share cash dividend payments, until such time as the global economic uncertainties and business ~~on November 8, 2017.~~

~~Table of Contents~~

~~Acquisitions~~

~~nuTonomy~~—On October 20, 2017, Delphi agreed to acquire nuTonomy, Inc. ("nuTonomy"), a leading provider of autonomous driving software and technology, for total consideration of $454 million. Of the total consideration, $290 million is due at closing, subject to certain post-closing adjustments, and approximately $110 million is payable to certain selling shareholders in annual installments over 3 yearsimpacts resulting from the acquisition date, subject to those selling shareholders' compliance with certain service conditions. Additionally, the total consideration includes a cash payment of up to $54 million contingent upon the achievement of certain performance metrics over a future 3-year period. The acquisition is subject to the satisfaction of customary closing conditionsCOVID-19 pandemic have abated.

Acquisitions and the receipt of regulatory and other approvals, and is expected to close in the fourth quarter of 2017. The Company intends to acquire nuTonomy utilizing cash on hand. Upon completion, nuTonomy will become part of the Electronics and Safety segment.Other Transactions

~~Movimento~~Dynawave—On ~~January 3, 2017, Delphi~~August 4, 2020, Aptiv acquired 100% of the equity interests of ~~Movimento Group ("Movimento"~~Dynawave Inc. (“Dynawave”), a ~~leading provider~~specialized manufacturer of ~~Over-the-Air software and data management for the automotive sector,~~custom-engineered interconnect solutions for a ~~purchase price~~wide range of ~~$40 million at closing and an additional cash payment~~industries, for total consideration of ~~up to $10 million contingent upon the achievement of certain performance metrics over a future 2-year period. As further described in Note 17. Acquisitions and Divestitures, the~~$22 million. The acquisition was accounted for as a business combination, with the operating results of ~~Movimento~~Dynawave included within the ~~Company's Electronics~~Company’s Signal and ~~Safety segment from the date of acquisition.~~Power Solutions segment. The Company acquired ~~Movimento~~Dynawave utilizing cash on hand.

~~PureDepth~~Ulti-Mate—On ~~March 23, 2016, Delphi~~April 30, 2021, Aptiv acquired 100% of the equity interests of ~~PureDepth,~~Ulti-Mate Connector, Inc. ("~~PureDepth"~~Ulti-Mate"), a ~~leading provider~~manufacturer of ~~3D display technology,~~miniature and micro-miniature connectors and cable assemblies, for approximately ~~$15 million. As further described in Note 17. Acquisitions~~$45 million, subject to customary post-closing adjustments, which will primarily be allocated to goodwill and ~~Divestitures, the~~other intangible assets. The acquisition ~~was~~will be accounted for as a business combination, with the operating results of ~~PureDepth~~Ulti-Mate included within the Company's ~~Electronics~~Signal and ~~Safety~~Power Solutions segment from the date of acquisition. The Company acquired ~~PureDepth~~Ulti-Mate utilizing cash on hand.

Technology ~~investments~~Investments—~~During~~In April 2021, Innoviz Technologies (“Innoviz”) merged with a publicly traded Special Purpose Acquisition Company (“SPAC”) and shares of Innoviz began trading on the ~~third quarter~~Nasdaq Capital Market under the symbol INVZ. As part of ~~2017,~~ the ~~Company's Electronics and Safety segment made investments in two leading developers of Light Detection and Ranging (“LIDAR”) technology, a $15 million investment~~SPAC merger, our preferred shares in Innoviz Technologies and a $10 million investment in LeddarTech, Inc. The Company's Powertrain Systems segment also made an additional $1 million investment in Tula Technology Inc., an engine control software company in whichwere converted into Innoviz ordinary shares. Following this conversion, the Company ~~made an initial $20 million~~will measure the fair value of the Innoviz investment on a recurring basis, with changes in ~~2015.~~fair value recorded to other income (expense), net.

During the second quarter of 2017, Delphi's Electrical/Electronic Architecture segment made a $10 million investment in Valens Semiconductor Ltd., a leading provider of signal processing technology for high frequency data transmission of connected car content. During the first quarter of 2017, Delphi's Electronics and Safety segment made a $15 million investment in Otonomo Technologies Ltd., the developer of a connected car data marketplace. As further described inRefer to Note 17. Acquisitions and Divestitures to the consolidated financial statements contained herein for further detail of the Company’s business acquisitions and technology investments.

Table of Contents

Autonomous Driving Joint Venture

~~Divestitures~~

~~Mechatronics—On December 30, 2016, Delphi completed the sale of its Mechatronics business,~~and expenses, which was previously reported within the Company's Electronics and Safety segment, for net cash proceeds of approximately $197 million. The net sales of this business in 2016 prior to divestiture were approximately $290approximated $180 million for the year ended December 31, ~~2016. Delphi~~2019 prior to the joint venture formation. Upon closing of the transaction, Aptiv deconsolidated the carrying value of the associated assets and liabilities contributed to the joint venture, previously classified as held for sale, and recognized an asset of approximately $2.0 billion within Investments in affiliates in the consolidated balance sheet, based on the preliminary fair value of its investment in the newly formed joint venture. The Company recognized a pre-tax gain of approximately $1.4 billion in the consolidated statement of operations (approximately $5.63 per diluted share during the three months ended March 31, 2020), net of transaction costs of $22 million, based on the ~~divestiture~~difference between the carrying value of ~~$141 million within cost~~its contribution to the joint venture and the preliminary fair value of ~~sales~~its investment in the ~~fourth~~newly formed entity. The estimated fair value of Aptiv’s ownership interest in the joint venture was determined primarily based on third-party valuations and management estimates, generally utilizing income and market approaches. Determining the fair value of the joint venture and the underlying assets requires the use of management's judgment and involves significant estimates and assumptions with respect to the timing and amount of future cash flows, market rate assumptions, projected growth rates and margins, and appropriate discount rates, among other items. The estimated fair value was determined on a preliminary basis using information available in the first quarter of ~~2016.~~2020 and was finalized in the first quarter of 2021. The effects of this transaction would not materially impact the Company’s reported results for any period presented, and the transaction did not meet the criteria to be reflected as a discontinued operation.

~~Thermal Systems—On March 31, 2016, Delphi closed~~In connection with the ~~sale~~closing of ~~its 50 percent interest in its Shanghai Delphi Automotive Air Conditioning ("SDAAC")~~the transaction, Aptiv and the entity entered into various agreements to facilitate an orderly transition and to provide a framework for their relationship going forward, which included a transition services agreement. The transition services primarily involve Aptiv providing certain administrative services to the joint venture for a period of up to ~~one of Delphi's~~24 months after the closing date. These agreements are not material to Aptiv.

The Company’s investment in the joint venture ~~partners, Shanghai Aerospace Automobile Electromechanical Co., Ltd ("SAAE"). The Company received cash proceeds~~is accounted for using the equity method of ~~$62~~accounting and Aptiv recognized an equity loss of $45 million and $1 million, net of tax, ~~transaction costs and $29 million of cash divested, and recognized an after-tax gain on the divestiture of $104 million within income from discontinued operations~~ during the ~~year~~three months ended ~~December~~March 31, 2016. The financial results of SDAAC, which were consolidated by Delphi, were historically reported as part of the Thermal Systems segment. The Company had previously completed the sale of its wholly owned Thermal Systems business on June 30, 2015,2021 and ~~of its interest in its Korea Delphi Automotive Systems Corporation ("KDAC") joint venture on September 24, 2015.~~

Accordingly, the Thermal Systems business has been classified as discontinued operations. Refer to Note 21. Discontinued Operations for further disclosure related to the Company's discontinued operations. The disposal of the Thermal Systems business did not have a material impact on our liquidity or capital resources, and we have not had significant continuing involvement with the divested Thermal Systems business following the closing of the transactions.2020, respectively.

Credit Agreement

~~Table of Contents~~

subsequently amended and restated on several occasions, most recently on ~~August 17, 2016.~~May 1, 2020 (the “May 2020 Amendment”) and June 8, 2020 (the “June 2020 Amendment”). The ~~2016 amendment~~May 2020 Amendment extended the maturity of $1,779 million in principal amount of the Revolving Credit Facility and $298 million in principal amount of the Tranche A Term Loan from ~~2018~~August 17, 2021 to ~~2021,~~August 17, 2022 and increased the ~~capacity~~leverage ratio maintenance covenant until July 1, 2021 (the “Covenant Relief Period”), unless Aptiv elects to terminate the Covenant Relief Period at an earlier date. Under the terms of the May 2020 Amendment, Aptiv’s consolidated leverage ratio (the ratio of Consolidated Total Indebtedness to Consolidated EBITDA, each as defined in the May 2020 Amendment) is increased from not more than 3.5 to 1.0 to not more than 4.5 to 1.0 during the Covenant Relief Period, and Aptiv is subject to certain additional covenant restrictions during the Covenant Relief Period, including restrictions on Aptiv’s ability to execute repurchases of or pay dividends on its outstanding ordinary shares. The maturity date of the remaining portions of the Revolving Credit Facility ~~from $1.5 billion~~and Tranche A Term Loan were not extended and will mature on August 17, 2021.

The June 2020 Amendment amended the dividends and distributions covenant set forth in the Credit Agreement to ~~$2.0 billion~~permit the payment of dividends on convertible preferred shares in connection with the preferred equity offering as further discussed in Note 12. Shareholders’ Equity and ~~permitted Delphi Automotive~~Net Income Per Share to the consolidated financial statements contained herein. During the year ended December 31, 2020, Aptiv Global Financing Limited (“AGFL”), a wholly-owned Irish subsidiary of Aptiv PLC, executed a joinder agreement to the Credit Agreement, which allows it to act as a borrower onunder the ~~Revolving~~ Credit ~~Facility. A loss on debt extinguishment of $3 million was recorded within other income (expense), net~~Agreement, and a guaranty supplement, under which AGFL guarantees the obligations under the Credit Agreement, subject to certain exceptions set forth in the ~~consolidated statement of operations during the year ended December 31, 2016 in conjunction with the 2016 amendment.~~Credit Agreement.

Table of Contents

to increase, from time to time, the aggregate borrowing capacity under the Credit Agreement by up to an additional $1 billion ~~(or a greater amount based~~ upon ~~a formula set forth in the Credit Agreement) upon Delphi's~~Aptiv’s request, the agreement of the lenders participating in the increase, and the approval of the Administrative Agent and existing lenders.

As of ~~September 30, 2017,~~March 31, 2021, there were no amounts drawn on the Revolving Credit Facility and ~~approximately $7~~less than $1 million in letters of credit were issued under the Credit Agreement. Letters of credit issued under the Credit Agreement reduce availability under the Revolving Credit Facility. No amounts were drawn on the Revolving Credit Facility during the ~~nine~~three months ended ~~September 30, 2017.~~March 31, 2021.


	March 31, 2021				December 31, 2020
	LIBOR plus		ABR plus		LIBOR plus		ABR plus
Revolving Credit Facility (1)	1.10	%	0.10	%	1.10	%	0.10	%
Revolving Credit Facility (2)	1.40	%	0.40	%	1.40	%	0.40	%
Tranche A Term Loan (1)	1.25	%	0.25	%	1.25	%	0.25	%
Tranche A Term Loan (2)	1.75	%	0.75	%	1.75	%	0.75	%

September 30, 2017 December 31, 2016
LIBOR plus ABR plus LIBOR plus ABR plus
Revolving Credit Facility 1.10 % 0.10 % 1.10 % 0.10 %
Tranche A Term Loan 1.25 % 0.25 % 1.25 % 0.25 %
(1)Applicable to principal balances under the Credit Agreement which were not extended as part of the May 2020 Amendment as described above.

(2)Applicable to principal balances under the Credit Agreement which were extended as part of the May 2020 Amendment as described above.

The interest rate period with respect to LIBOR interest rate options can be set at one-, two-, three-, or six-months as selected by ~~Delphi~~Aptiv in accordance with the terms of the Credit Agreement (or other period as may be agreed by the applicable lenders). ~~Delphi~~Aptiv may elect to change the selected interest rate option in accordance with the provisions of the Credit Agreement. As of ~~September 30, 2017, Delphi~~March 31, 2021, Aptiv selected the one-month LIBOR interest rate option on the Tranche A Term Loan, and the ~~rate~~rates effective as of ~~September 30, 2017,~~March 31, 2021, as detailed in the table below, ~~was~~were based on the ~~Company's~~Company’s current credit rating and the Applicable Rate for the Credit Agreement:


		Borrowings as of
		March 31, 2021		Rates effective as of
	Applicable Rate	(in millions)		March 31, 2021




Tranche A Term Loan (1)	LIBOR plus 1.25%	$	49	1.375	%
Tranche A Term Loan (2)	LIBOR plus 1.75%	$	264	1.875	%

(2)Applicable to principal balances under the Credit Agreement which were extended as part of the May 2020 Amendment as described above.

Borrowings under the Credit Agreement are prepayable at ~~Delphi's~~Aptiv’s option without premium or penalty.

The Credit Agreement contains certain covenants that limit, among other things, the Company’s (and the Company’s subsidiaries’) ability to incur certain additional indebtedness or liens or to dispose of substantially all of its assets. In addition, the Credit Agreement requires that the Company maintain a consolidated leverage ratio (the ratio of Consolidated Total Indebtedness to Consolidated EBITDA, each as defined in the Credit Agreement) of ~~less~~not more than ~~3.50~~3.5 to ~~1.0.~~1.0, which was increased to not more than 4.5 to 1.0 until July 1, 2021 under the May 2020 Amendment. The Credit Agreement also contains events of default customary for financings of this type. The Company was in compliance with the Credit Agreement covenants as of ~~September 30, 2017.~~March 31, 2021.

Table of Contents

Senior Unsecured Notes

~~On February 14, 2013, Delphi Corporation issued $800 million~~As of ~~5.00%~~March 31, 2021, the Company had the following senior unsecured notes ~~due 2023 (the “2013 Senior Notes”) in a transaction registered under Rule 144A~~issued and ~~Regulation S of the Securities Act of 1933 (the “Securities Act”). The proceeds were primarily utilized to prepay our term loan indebtedness under the Credit Agreement. Delphi paid approximately~~ ~~$12 million~~ of issuance costs in connection with the 2013 Senior Notes. Interest was payable semi-annually on February 15 and August 15 of each year to holders of record at the close of business on February 1 or August 1 immediately preceding the interest payment date. In September 2016, Delphi redeemed for cash the entire $800 million aggregate principal amount outstanding of the 2013 Senior Notes, primarily financed by the proceeds from the issuance of the 2016 Euro-denominated Senior Notes and the 2016 Senior Notes, each as defined below. As a result of the redemption of the 2013 Senior Notes, Delphi recognized a loss on debt extinguishment of approximately $70 million during the year ended December 31, 2016 within other income (expense), net in the consolidated statement of operations.outstanding:

On March 3, 2014, Delphi Corporation issued $700 million in aggregate principal amount of 4.15% senior unsecured notes due 2024 (the “2014 Senior Notes”) in a transaction registered under the Securities Act. The 2014 Senior Notes were priced at 99.649% of par, resulting in a yield to maturity of 4.193%. The proceeds were primarily utilized to redeem $500 million of 5.875% senior unsecured notes due 2019 and to repay a portion of the Tranche A Term Loan. Delphi paid approximately $6 million of issuance costs in connection with the 2014 Senior Notes. Interest is payable semi-annually on March 15 and September 15 of each year to holders of record at the close of business on March 1 or September 1 immediately preceding the interest payment date.

On March 10, 2015, Delphi Automotive PLC issued €700 million in aggregate principal amount of 1.50% Euro-denominated senior unsecured notes due 2025 (the “2015 Euro-denominated Senior Notes”) in a transaction registered under the Securities Act. The 2015 Euro-denominated Senior Notes were priced at 99.54% of par, resulting in a yield to maturity of 1.55%. The proceeds were primarily utilized to redeem $500 million of 6.125% senior unsecured notes due 2021, and to fund growth initiatives, such as acquisitions, and share repurchases. Delphi incurred approximately $5 million of issuance costs in connection with the 2015 Euro-denominated Senior Notes. Interest is payable annually on March 10. The Company has designated the 2015 Euro-denominated Senior Notes as a net investment hedge of the foreign currency exposure of its investments in certain Euro-denominated wholly-owned subsidiaries. Refer to Note. 14. Derivatives and Hedging Activities for further information.

On November 19, 2015, Delphi Automotive PLC issued $1.3 billion in aggregate principal amount of senior unsecured notes in a transaction registered under the Securities Act, comprised of $650 million of 3.15% senior unsecured notes due 2020 (the "3.15% Senior Notes") and $650 million of 4.25% senior unsecured notes due 2026 (the "4.25% Senior Notes") (collectively, the "2015 Senior Notes"). The 3.15% Senior Notes were priced at 99.784% of par, resulting in a yield to maturity of 3.197%, and the 4.25% Senior Notes were priced at 99.942% of par, resulting in a yield to maturity of 4.256%. The proceeds were primarily utilized to fund a portion of the cash consideration for the acquisition of HellermannTyton, as further described in Note. 17. Acquisitions and Divestitures, and for general corporate purposes, including the payment of fees and expenses associated with the HellermannTyton acquisition and the related financing transaction. Delphi incurred approximately $8 million of issuance costs in connection with the 2015 Senior Notes. Interest on the 3.15% Senior Notes is payable semi-annually on May 19 and November 19 of each year to holders of record at the close of business on May 4 or November 4 immediately preceding the interest payment date. Interest on the 4.25% Senior Notes is payable semi-annually on January 15 and July 15 of each year to holders of record at the close of business on January 1 or July 1 immediately preceding the interest payment date.

On September 15, 2016, Delphi Automotive PLC issued €500 million in aggregate principal amount of 1.60% Euro-denominated senior unsecured notes due 2028 (the “2016 Euro-denominated Senior Notes”) in a transaction registered under the Securities Act. The 2016 Euro-denominated Senior Notes were priced at 99.881% of par, resulting in a yield to maturity of 1.611%. The proceeds, together with proceeds from the 2016 Senior Notes described below, were utilized to redeem the 2013 Senior Notes. Delphi incurred approximately $4 million of issuance costs in connection with the 2016 Euro-denominated Senior Notes. Interest is payable annually on September 15. The Company has designated the 2016 Euro-denominated Senior Notes as a net investment hedge of the foreign currency exposure of its investments in certain Euro-denominated wholly-owned subsidiaries. Refer to Note. 14. Derivatives and Hedging Activities for further information.

On September 20, 2016, Delphi Automotive PLC issued $300 million in aggregate principal amount of 4.40% senior unsecured notes due 2046 (the “2016 Senior Notes”) in a transaction registered under the Securities Act. The 2016 Senior Notes were priced at 99.454% of par, resulting in a yield to maturity of 4.433%. The proceeds, together with proceeds from the 2016 Euro-denominated Senior Notes, were utilized to redeem the 2013 Senior Notes. Delphi incurred approximately $3 million of issuance costs in connection with the 2016 Senior Notes. Interest is payable semi-annually on April 1 and October 1 of each year to holders of record at the close of business on March 15 or September 15 immediately preceding the interest payment date.

~~Table of Contents~~

Aggregate Principal Amount
(in millions)

Stated Coupon Rate

Issuance Date

Maturity Date

Interest Payment Date

700

4.15%

March 2014

March 2024

March 15 and September 15

823

1.50%

March 2015

March 2025

March 10

650

4.25%

November 2015

January 2026

January 15 and July 15

588

1.60%

September 2016

September 2028

September 15

300

4.35%

March 2019

March 2029

March 15 and September 15

300

4.40%

September 2016

October 2046

April 1 and October 1

350

5.40%

March 2019

March 2049

March 15 and September 15

~~The 2013 Senior Notes and~~Guarantor Summarized Financial Information

As further described in Note 8. Debt to the consolidated financial statements contained herein, Aptiv Corporation issued the 2014 Senior Notes ~~were issued by Delphi Corporation. The 2014 Senior Notes~~and is the borrower of obligations under the Credit Agreement, which are ~~and prior to their redemption, the 2013 Senior Notes were,~~ fully and unconditionally guaranteed ~~jointly and severally,~~ by ~~Delphi Automotive~~Aptiv PLC and by certain of ~~Delphi Automotive PLC's~~Aptiv PLC’s direct and indirect subsidiaries ~~which are directly or indirectly 100% owned by Delphi Automotive~~(the “Obligor Group”). Aptiv PLC ~~subject to customary release provisions (other than in~~issued the ~~case of Delphi Automotive PLC). The~~ 2015 Euro-denominated Senior Notes, ~~2015~~4.25% Senior Notes, 2016 Euro-denominated Senior Notes, ~~and~~ 2016 Senior Notes ~~issued by Delphi Automotive PLC~~and 2019 Senior Notes, which are fully and unconditionally guaranteed ~~jointly and severally,~~ by ~~certain of Delphi Automotive PLC's~~the Obligor Group. All other consolidated direct and indirect subsidiaries ~~(including Delphi Corporation), which~~of Aptiv PLC are ~~directly or indirectly 100% owned by Delphi Automotive PLC,~~not subject to ~~customary release provisions. Refer to Note 19. Supplemental Guarantor and Non-Guarantor Condensed Consolidating Financial Statements for additional information.~~

~~Spin-off Financing~~

~~Delphi Technologies PLC, a wholly owned subsidiary~~the guarantees (the “Non-Guarantors”). The guarantees rank equally in right of ~~the Company, was formed in connection~~payment with ~~the Separation as a holding company to directly or indirectly own substantially~~ all of the operating subsidiaries of the spin-off, to issue debt securities and perform treasury operations of the spin-off, which prior to October 10, 2017 was named Delphi Jersey Holdings plc. Delphi Powertrain Corporation (“DPC”), a wholly owned U.S. subsidiary of the Company that will become a wholly owned subsidiary of Delphi Technologies PLC upon completion of the separation, was also formed for the same purposes.

~~Spin-off Credit Agreement~~

The Spin-Off Credit Facilities are expected to become available to Delphi Technologies PLC no later than the date of the separation, subject to the satisfaction of certain conditions customary for financings of this type, including the spin-off. Accordingly, no amounts were drawn or available to be drawn under the Spin-Off Credit Facilities as of September 30, 2017. Prior to the date of the Separation, Delphi Technologies PLC is required to pay a 0.30% per annum commitment fee on the committed loans under the Spin-Off Credit Facilities. The Company incurred approximately $9 million of debt issuance costs in connection with the Spin-Off Credit Agreement.

The borrowers under the Spin-Off Credit Agreement will comprise Delphi Technologies PLC and DPC. Additional subsidiaries of Delphi Technologies PLC may be added as co-borrowers or guarantors under the Spin-Off Credit Agreement from time to time on the terms and conditions set forth in the Spin-Off Credit Agreement. The obligations of each borrower under the Spin-Off Credit Agreement will be jointly and severally guaranteed by each other borrower and by certain of Delphi Technologies PLC'sguarantors’ existing and future ~~direct~~senior indebtedness, are effectively subordinated to any of their existing and ~~indirect subsidiaries, subject~~future secured indebtedness to ~~certain exceptions customary for financings of this type. All obligations~~the extent of the ~~borrowers and the guarantors will be secured by certain assets of such borrowers and guarantors, including a perfected first-priority pledge of all~~value of the ~~capital stock~~collateral securing such indebtedness and are structurally subordinated to the indebtedness of each of their existing and future subsidiaries that is not a guarantor.

The below summarized financial information is presented on a combined basis after the elimination of intercompany balances and transactions among the Obligor Group and equity in ~~DPC.~~

~~Spin-Off Senior Notes~~

~~On September 28, 2017, Delphi Technologies PLC issued $800 million~~earnings from and investments in ~~aggregate principal amount of 5.00% senior unsecured notes due 2025~~the Non-Guarantors. The below summarized financial information should be read in a transaction exempt from registration under the Securities Act (the "Spin-Off Senior Notes"). The Spin-Off Senior Notes were priced at 99.50% of par, resulting in a yield to maturity of 5.077%. Approximately $14 million of issuance costs were incurred in connectionconjunction with the ~~Spin-Off Senior Notes offering. Interest is payable semi-annually on April 1 and October 1~~Company’s consolidated financial statements contained herein, as the financial information may not necessarily be indicative of ~~each year to holders~~results of ~~record at~~operations or financial position had the close of business on March 15 or September 15 immediately preceding the interest payment date. The proceeds received from the Spin-Off Senior Notes offering were deposited into escrow for release to Delphi Technologies PLC upon satisfaction of certain conditions, including completion of the Separation. If the conditions for the release of the proceeds of this offering from escrow are not satisfied by June 30, 2018, the Spin-Off Senior Notes will be subject to mandatory redemption. The Spin-Off Senior Notes have not been, and are not expected to be, guaranteed by the Company or any of its subsidiaries that will not be subsidiaries of Delphi Technologies PLC following the spin-off. Upon completion of the Separation, Delphi Technologies PLC will use the proceeds from the Spin-Off Senior Notes together with the proceeds from the Spin-Off Term Loan A Facility to fund a dividend to Delphi, fund operating cash and pay taxes and related fees and expenses.operated as independent entities.

Table of Contents


	Obligor Group

Three Months Ended March 31, 2021	(in millions)
Net sales	$	—
Gross margin	$	—
Operating income	$	34
Net loss	$	(6)
Net loss attributable to Aptiv	$	(6)

As of March 31, 2021:
Current assets (1)	$	219
Long-term assets	$	1
Current liabilities (2)	$	955
Long-term liabilities (2)	$	4,160
Noncontrolling interest	$	—

As of December 31, 2020
Current assets (1)	$	377
Long-term assets	$	1
Current liabilities (2)	$	913
Long-term liabilities (2)	$	4,223
Noncontrolling interest	$	—

(1)Includes current assets of $217 million and $370 million as of March 31, 2021 and December 31, 2020, respectively, due from Non-Guarantors, which includes amounts due from affiliates of $1 million and $6 million, respectively.

(2)Includes current liabilities of $864 million and $785 million, and long-term liabilities of $226 million and $226 million, due to Non-Guarantors as of March 31, 2021 and December 31, 2020, respectively.

Other Financing

Receivable factoring—~~Delphi~~Aptiv maintains a ~~€400~~€450 million European accounts receivable factoring facility ~~which~~that is available on a ~~non-committed basis.~~committed basis and allows for factoring of receivables denominated in both Euros and U.S. dollars (“USD”). This facility became effective on January 1, 2021 and replaced Aptiv’s previous €300 million European accounts receivable factoring facility. This facility is accounted for as short-term debt and borrowings are subject to the availability of eligible accounts receivable. Collateral is not required related to these trade accounts receivable. ~~This~~The program ~~automatically renews on~~is for a ~~non-committed, indefinite basis unless terminated by~~term of three years, subject to Aptiv’s right to terminate at any time with three months’ notice. After expiration of the three year term, either ~~party.~~party can terminate with three months’ notice. Borrowings denominated in Euros under the facility bear interest at ~~LIBOR plus 1.05% for borrowings denominated in pounds sterling and~~the three-month Euro Interbank Offered Rate ~~("EURIBOR"~~(“EURIBOR”) plus ~~0.80% for~~0.50% and USD borrowings ~~denominated in Euros.~~bear interest at two-month LIBOR plus 0.50%, with borrowings under either denomination carrying a minimum interest rate of 0.20%. As of March 31, 2021, Aptiv had no amounts drawn on the new European accounts receivable factoring facility and as of December 31, 2020, Aptiv had no amounts outstanding on the previous European accounts receivable factoring facility. No amounts were ~~outstanding on~~drawn under the European accounts receivable factoring facility ~~as of September 30, 2017 or December 31, 2016. The maximum amount drawn under the European facility~~ during the ~~nine~~three months ended ~~September 30, 2017 to manage working capital requirements was $199 million.~~March 31, 2021.

~~Government programs~~—Delphi commonly seeks manufacturing development and financial assistance incentive programs that may be awarded by government entities. Delphi has numerous technology development programs that are competitively awarded from agenciesLetter of credit facilities—In addition to the ~~U.S. Federal Government, primarily from~~letters of credit issued under the ~~U.S. Department of Energy (“DOE”). We received~~Credit Agreement, Aptiv had approximately $3 million ~~from Federal agencies during the nine months ended September 30, 2017 for work performed. These programs supplement our internal research~~ and ~~development funds~~$2 million outstanding through other letter of credit facilities as of March 31, 2021 and ~~directly~~December 31, 2020, respectively, primarily to support ~~our product focus~~arrangements and other obligations at certain of Safe, Green and Connected. We continue to pursue many technology development programs by bidding on competitively procured programs from DOE, as well as the U.S. Department of Transportation (“DOT”). Some of these programs were bid with us being the lead or “Prime Contractor”, and some were bid with us as a “Subrecipient” to the Prime Contractor.its subsidiaries.

Cash Flows

Intra-month cash flow cycles vary by region, but in general we are users of cash through the first half of a typical month and we generate cash during the latter half of a typical month. Due to this cycle of cash flows, we may utilize short-term financing, including our Revolving Credit Facility and European accounts receivable factoring facility, to manage our intra-month working capital needs. Our cash balance typically peaks at month end.

We utilize a combination of strategies, including dividends, cash pooling arrangements, intercompany loan structures and other distributions and advances, to provide the funds necessary to meet our global liquidity needs. We utilize a global cash

Table of Contents

pooling arrangement to consolidate and manage our global cash balances, which enables us to efficiently move cash into and out of a number of the countries in which we operate.

Operating activities—Net cash provided by operating activities ~~from continuing operations~~ totaled ~~$1,040~~$252 million and ~~$1,258~~$161 million for the ~~nine~~three months ended ~~September 30, 2017~~March 31, 2021 and ~~2016,~~2020, respectively. Cash ~~flow from~~flows provided by operating activities ~~from continuing operations~~ for the ~~nine~~three months ended ~~September 30, 2017~~March 31, 2021 consisted primarily of net earnings ~~from continuing operations~~ of ~~$1,151~~$300 million, increased by ~~$605~~$203 million for non-cash charges for depreciation, amortization and pension costs partially offset by $755 million related to changes in operating assets and liabilities, including $310 million paid to settle the Unsecured Creditors litigation, net of restructuring and pension contributions. Cash flow from operating activities from continuing operations for the nine months ended September 30, 2016 consisted primarily of net earnings from continuing operations of $912 million increased by $644 million for non-cash charges for depreciation, amortization, pension costs and debt extinguishment, partially offset by $354$328 million related to changes in operating assets and liabilities, net of restructuring and pension contributions. Cash flows provided by operating activities for the three months ended March 31, 2020 consisted primarily of net earnings of $1,567 million, increased by $190 million for non-cash charges for depreciation, amortization and pension costs, offset by $1,434 million for the non-cash gain resulting from the formation of the Motional autonomous driving joint venture and $142 million related to changes in operating assets and liabilities, net of restructuring and pension contributions.

Investing activities—Net cash used in investing activities ~~from continuing operations~~ totaled ~~$682~~$134 million for the ~~nine~~three months ended ~~September 30, 2017,~~March 31, 2021, as compared to ~~$583~~$207 million for the ~~nine~~three months ended ~~September 30, 2016.~~March 31, 2020. The ~~increase~~decrease in usage is primarily attributable to ~~the net proceeds~~decreased capital expenditures of ~~$52~~$71 million ~~that were received from the sale of our SDAAC joint venture~~ during the ~~nine~~three months ended September 30, 2016. Additionally, during the nine months ended September 30, 2017 the Company paid $91 million for business acquisitions and technology investments, as compared to $18 million paid for acquisitions and investments during the nine months ended September 30, 2016. These increases were partially offset by $23 million of reduced capital expenditures during the nine months ended September 30, 2017March 31, 2021 as compared to the ~~nine~~three months ended ~~September 30, 2016.~~March 31, 2020.

~~Table of Contents~~

Financing activities—Net cash used in financing activities totaled ~~$691 million and $860~~$77 million for the ~~nine~~three months ended ~~September 30, 2017~~March 31, 2021 and ~~2016, respectively.~~net cash provided by financing activities totaled $1,720 million for the three months ended March 31, 2020. Cash flows used in financing activities for the ~~nine~~three months ended ~~September 30, 2017~~March 31, 2021 primarily included ~~$383~~$16 million ~~paid to repurchase ordinary shares, $233~~in repayments under debt agreements and $16 million of MCPS dividend payments and $22 million of contingent consideration paid for Delphi's prior year acquisitions of Control-Tec and Ottomatika. The proceeds received from the offering of the Spin-Off Senior Notes and the subsequent deposit of these proceeds into escrow are reflected withinpayments. Cash flows provided by financing activities for the ~~nine~~three months ended ~~September 30, 2017. Cash flows used in financing activities for the nine months ended September 30, 2016,~~March 31, 2020 primarily included ~~net~~$1,900 million in proceeds ~~of $852 million received from~~under other long-term debt agreements, as the ~~issuance of~~Company drew down all remaining availability under its existing Revolving Credit Facility in response to the ~~2016 Euro-denominated Senior Notes and the 2016 Senior Notes, which were primarily utilized to redeem the $800 million 2023 Senior Notes, as well as $530~~COVID-19 pandemic, partially offset by $57 million paid to repurchase ordinary shares and ~~$238~~$56 million of ordinary dividend payments.

Off-Balance Sheet Arrangements

We do not engage in any off-balance sheet financial arrangements that have or are reasonably likely to have a material current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

Contingencies and Environmental Matters

The information concerning contingencies, including environmental contingencies and the amount currently held in reserve for environmental matters, contained in Note 10. Commitments and Contingencies to the unaudited consolidated financial statements included in Part I, Item 1 of this report is incorporated herein by reference.

Recently Issued Accounting Pronouncements

The information concerning recently issued accounting pronouncements contained in Note 2. Significant Accounting Policies to the unaudited consolidated financial statements included in Part 1,I, Item 1 of this report is incorporated herein by reference.

Critical Accounting Estimates

There have been no significant changes in our critical accounting estimates during the three ~~and nine~~ months ended~~September 30, 2017~~. March 31, 2021.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

There have been no material changes to the information concerning our exposures to market risk as stated in the Company’s Annual Report on Form 10-K for the year ended December 31, ~~2016.~~2020. As described in the Form 10-K, we have currency exposures related to buying, selling and financing in currencies other than the local functional currencies in which we operate ("(“transactional ~~exposure"~~exposure”). We also have currency exposures related to the translation of the financial statements of our non-U.S. subsidiaries that use the local currency as their functional currency into U.S. dollars, the ~~Company's~~Company’s reporting currency ("(“translational ~~exposure"~~exposure”). As described in ~~Note.~~Note 14. Derivatives and Hedging Activities to the unaudited consolidated financial statements included in Part I, Item 1 of this report, to manage this risk the Company designates certain qualifying instruments as net investment hedges of certain non-U.S. subsidiaries. The effective portion of the gains or losses on instruments designated as net investment hedges are recognized within the cumulative translation adjustment component of OCI to offset changes in the value of the net investment in these foreign currency-denominated operations.

Table of Contents

ITEM 4. CONTROLS AND PROCEDURES

A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been detected.

Disclosure Controls and Procedures

Management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rules 13a-15(f) and 15d-15(f) under the U.S. Securities Exchange Act of ~~1934.~~1934, as amended (the “Exchange Act”). The Company maintains disclosure controls and procedures that are designed to provide reasonable assurance of achieving their objectives.

As of ~~September 30, 2017~~,March 31, 2021, the Company’s management, with the participation of the Chief Executive Officer and the Chief Financial Officer, has evaluated, for disclosure purposes, the effectiveness of the Company’s disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the ~~Securities~~ Exchange Act, ~~of 1934,~~ as of the end of the period

~~Table of Contents~~

covered by this report. Based on that evaluation, the Chief Executive Officer and the Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective to provide reasonable assurance that the desired control objectives were achieved as of ~~September 30, 2017~~.March 31, 2021.

Changes in Internal Control over Financial Reporting

There were no material changes in the Company’s internal controls over financial reporting during the ~~nine~~three months ended~~September 30, 2017~~ March 31, 2021 that have materially affected, or are reasonably likely to materially affect, the Company’s internal controls over financial reporting.

Table of Contents

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

We are from time to time subject to various actions, claims, suits, government investigations, and other proceedings incidental to our business, including those arising out of alleged defects, breach of contracts, competition and antitrust matters, product warranties, intellectual property matters, personal injury claims and employment-related matters. For a description of risks related to various legal proceedings and claims, see Item 1A, “Risk Factors,” in our Annual Report on Form 10-K for the year ended December 31, ~~2016.~~2020. For a description of our outstanding material legal proceedings, see Note 10. Commitments and Contingencies to the unaudited consolidated financial statements included in this report.

ITEM 1A. RISK FACTORS

~~Other than as described in the Company's Form 10-Q for the quarter ended March 31, 2017, there~~There have been no material changes toin risk factors for the Company in the period covered by this report. For information regarding factors that could affect the Company’s results of operations, financial condition and liquidity, see the risk factors ~~described~~discussed in Part I, “Item 1A. Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, ~~2016.~~2020.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

~~A summary~~There were no repurchases of ~~our ordinary shares repurchased~~equity securities during the three months ended ~~September 30, 2017, is shown below:~~March 31, 2021. In January 2019, the Board of Directors authorized a share repurchase program of up to $2.0 billion. This program will commence following the completion of the previously announced share repurchase program of $1.5 billion, which was approved by the Board of Directors in April 2016. As of March 31, 2021, approximately $2,013 million remained available for repurchases pursuant to these programs.

Period Total Number of Shares Purchased (1) Average Price Paid per Share (2) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Approximate Dollar Value of Shares that May Yet be Purchased Under the Program (in millions) (3)
July 1, 2017 to July 31, 2017 —
—
—
$ 1,084
August 1, 2017 to August 31, 2017 1,018,930
$ 92.99
1,018,930
989
September 1, 2017 to September 30, 2017 —
—
—
989
Total 1,018,930
92.99
1,018,930



~~(1)~~	The total number of shares purchased under the plans authorized by the Board of Directors are described below. The number of shares purchased excludes the 8,169 shares granted for vested RSUs during the three months ended September 30, 2017 that were withheld to cover minimum withholding taxes.



~~(2)~~	~~Excluding commissions.~~



~~(3)~~	In April 2016, the Board of Directors authorized a share repurchase program of up to $1.5 billion. This program follows the completion of the previously announced share repurchase program of $1.5 billion, which was approved by the Board of Directors in January 2015. The timing of repurchases is dependent on price, market conditions and applicable regulatory requirements.

~~Table of Contents~~

ITEM 6. EXHIBITS



Exhibit Number						Description
~~31.1~~22						List of Guarantor Subsidiaries*
31.1						Rule 13a-14(a)/15d-14(a) Certification of Principal Executive Officer*
31.2						Rule 13a-14(a)/15d-14(a) Certification of Principal Financial Officer*
32.1						Certification by Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002*
32.2						Certification by Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002*
101.INS						Inline XBRL Instance Document# - The instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCH						Inline XBRL Taxonomy Extension Schema Document#
101.CAL						Inline XBRL Taxonomy Extension Calculation Linkbase Document#
101.DEF						Inline XBRL Taxonomy Extension Definition Linkbase Document#
101.LAB						Inline XBRL Taxonomy Extension Label Linkbase Document#
101.PRE						Inline XBRL Taxonomy Extension Presentation Linkbase Document#
104						Cover Page Interactive Data File# - The cover page interactive data file does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

* Filed herewith.

# Filed electronically with the Report.

Table of Contents

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.



						APTIV PLC
						~~DELPHI AUTOMOTIVE PLC~~

		/s/ Joseph R. Massaro
						By: Joseph R. Massaro
						Chief Financial Officer and
		Senior Vice President, Business Operations

Dated: ~~November 2, 2017~~

May 6, 2021



	Percentage of Total Net Sales								Accounts and Other Receivables
	Three Months Ended September 30,				Nine Months Ended September 30,				September 30, 2017		December 31, 2016
	2017		2016		2017		2016		September 30, 2017		December 31, 2016

									(in millions)
GM	11	%	15	%	13	%	14	%	$	291	$	370
VW	8	%	8	%	8	%	8	%	205		150



	September 30, 2017		December 31, 2016
��
	(in millions)
Productive material	$	855	$	649
Work-in-process	152		113
Finished goods	635		470
Total	$	1,642	$	1,232



	September 30, 2017				December 31, 2016
	LIBOR plus		ABR plus		LIBOR plus		ABR plus
Revolving Credit Facility	1.10	%	0.10	%	1.10	%	0.10	%
Tranche A Term Loan	1.25	%	0.25	%	1.25	%	0.25	%



		Borrowings as of
		September 30, 2017		Rate effective as of
	Applicable Rate	(in millions)		September 30, 2017
Tranche A Term Loan	LIBOR plus 1.25%	$	400	2.50	%



Three Months Ended September 30, 2016	Gain (loss) Recognized in OCI (Effective Portion)			Loss Reclassified from OCI into Income (Effective Portion)			Gain Recognized in Income (Ineffective Portion Excluded from Effectiveness Testing)

	(in millions)
Derivatives designated as cash flow hedges:
Commodity derivatives	$	1		$	(10	)	$	—
Foreign currency derivatives	(26		)	(20		)	—
Derivatives designated as net investment hedges:
Foreign currency derivatives	(1		)	—			—
Total	$	(26	)	$	(30	)	$	—



	Gain Recognized in Income

	(in millions)
Derivatives not designated:
Foreign currency derivatives	$	1
Total	$	1



Nine Months Ended September 30, 2016	Gain (loss) Recognized in OCI (Effective Portion)			Loss Reclassified from OCI into Income (Effective Portion)			Gain Recognized in Income (Ineffective Portion Excluded from Effectiveness Testing)

	(in millions)
Derivatives designated as cash flow hedges:
Commodity derivatives	$	5		$	(35	)	$	—
Foreign currency derivatives	(46		)	(65		)	—
Derivatives designated as net investment hedges:
Foreign currency derivatives	3			—			—
Total	$	(38	)	$	(100	)	$	—



	Contingent Consideration Liability

	(in millions)
Fair value at beginning of period	$	35
Additions	8
Payments	(22		)
Interest accretion	1
Fair value at end of period	$	22



Purchase price, cash consideration, net of cash acquired	$	40
Purchase price, fair value of contingent consideration	8
Total purchase price, net of cash acquired	$	48

Intangible assets	$	22
Other assets, net	4
Identifiable net assets acquired	26
Goodwill resulting from purchase	22
Total purchase price allocation	$	48



Purchase price, cash consideration	$	15

Intangible assets	$	10
Goodwill resulting from purchase	5
Total purchase price allocation	$	15



Purchase price, cash consideration, net of cash acquired	$	1,534
Debt and pension liabilities assumed	258
Total consideration, net of cash acquired	$	1,792

Property, plant and equipment	$	326
Indefinite-lived intangible assets	128
Definite-lived intangible assets	554
Other liabilities, net	(82		)
Identifiable net assets acquired	926
Goodwill resulting from purchase	866
Total purchase price allocation	$	1,792



Metric	2016 - 2017 Grants	2013 - 2015 Grants
Average return on net assets (1)	50%	50%
Cumulative net income	25%	N/A
Cumulative earnings per share (2)	N/A	30%
Relative total shareholder return (3)	25%	20%



	RSUs		Weighted Average Grant Date Fair Value
	(in thousands)
Nonvested, January 1, 2017	1,740		$	76.54
Granted	877		79.68
Vested	(362	)	74.42
Forfeited	(135	)	76.76
Nonvested, September 30, 2017	2,120		78.19



	Parent			Subsidiary Guarantors			Subsidiary Issuer/Guarantor			Non-Guarantor Subsidiaries			Eliminations			Consolidated

	(in millions)
Net sales	$	—		$	—		$	—		$	4,333		$	—		$	4,333
Operating expenses:
Cost of sales	—			—			—			3,450			—			3,450
Selling, general and administrative	37			—			—			280			—			317
Amortization	—			—			—			34			—			34
Restructuring	—			—			—			21			—			21
Total operating expenses	37			—			—			3,785			—			3,822
Operating (loss) income	(37		)	—			—			548			—			511
Interest (expense) income	(66		)	(10		)	(44		)	(3		)	87			(36		)
Other income (expense), net	—			39			1			38			(87		)	(9		)
(Loss) income from continuing operations before income taxes and equity income	(103		)	29			(43		)	583			—			466
Income tax (expense) benefit	(1		)	—			16			(75		)	—			(60		)
(Loss) income from continuing operations before equity income	(104		)	29			(27		)	508			—			406
Equity in net income of affiliates	—			—			—			7			—			7
Equity in net income (loss) of subsidiaries	499			452			40			—			(991		)	—
Income (loss) from continuing operations	395			481			13			515			(991		)	413
Income from discontinued operations, net of tax	—			—			—			—			—			—
Net income (loss)	395			481			13			515			(991		)	413
Net income attributable to noncontrolling interest	—			—			—			18			—			18
Net income (loss) attributable to Delphi	$	395		$	481		$	13		$	497		$	(991	)	$	395



	Parent			Subsidiary Guarantors			Subsidiary Issuers/Guarantor			Non-Guarantor Subsidiaries			Eliminations			Consolidated

	(in millions)
Net sales	$	—		$	—		$	—		$	12,943		$	—		$	12,943
Operating expenses:
Cost of sales	—			—			—			10,314			—			10,314
Selling, general and administrative	72			—			—			834			—			906
Amortization	—			—			—			100			—			100
Restructuring	—			—			—			180			—			180
Total operating expenses	72			—			—			11,428			—			11,500
Operating (loss) income	(72		)	—			—			1,515			—			1,443
Interest (expense) income	(188		)	(14		)	(130		)	(9		)	236			(105		)
Other income (expense), net	—			105			2			100			(236		)	(29		)
(Loss) income from continuing operations before income taxes and equity income	(260		)	91			(128		)	1,606			—			1,309
Income tax benefit (expense)	—			—			47			(230		)	—			(183		)
(Loss) income from continuing operations before equity income	(260		)	91			(81		)	1,376			—			1,126
Equity in net income of affiliates	—			—			—			25			—			25
Equity in net income (loss) of subsidiaries	1,359			1,221			59			—			(2,639		)	—
Income (loss) from continuing operations	1,099			1,312			(22		)	1,401			(2,639		)	1,151
Income from discontinued operations, net of tax	—			—			—			—			—			—
Net income (loss)	1,099			1,312			(22		)	1,401			(2,639		)	1,151
Net income attributable to noncontrolling interest	—			—			—			52			—			52
Net income (loss) attributable to Delphi	$	1,099		$	1,312		$	(22	)	$	1,349		$	(2,639	)	$	1,099



	Electrical/ Electronic Architecture		Powertrain Systems		Electronics and Safety		Eliminations and Other (1)			Total

	(in millions)
For the Three Months Ended September 30, 2017:
Net sales	$	2,317	$	1,205	$	845	$	(34	)	$	4,333
Depreciation & amortization	$	107	$	49	$	27	$	—		$	183
Adjusted operating income	$	336	$	150	$	80	$	—		$	566
Operating income	$	317	$	115	$	79	$	—		$	511
Equity income, net of tax	$	6	$	1	$	—	$	—		$	7
Net income attributable to noncontrolling interest	$	9	$	9	$	—	$	—		$	18



Period	Total Number of Shares Purchased (1)	Average Price Paid per Share (2)		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Approximate Dollar Value of Shares that May Yet be Purchased Under the Program (in millions) (3)
July 1, 2017 to July 31, 2017	—	—		—	$	1,084
August 1, 2017 to August 31, 2017	1,018,930	$	92.99	1,018,930	989
September 1, 2017 to September 30, 2017	—	—		—	989
Total	1,018,930	92.99		1,018,930