Allison Transmission (ALSN) 10-Q 28 Apr 23 2023 Q1 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2023	Apr. 13, 2023
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Transition Report	false
Document Period End Date	Mar. 31, 2023
Entity File Number	001-35456
Entity Registrant Name	ALLISON TRANSMISSION HOLDINGS, INC.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	26-0414014
Entity Address, Address Line One	One Allison Way
Entity Address, City or Town	Indianapolis
Entity Address, State or Province	IN
Entity Address, Postal Zip Code	46222
City Area Code	317
Local Phone Number	242-5000
Title of 12(b) Security	Common Stock, $0.01 par value
Trading Symbol	ALSN
Security Exchange Name	NYSE
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		91,055,228
Entity Central Index Key	0001411207
Current Fiscal Year End Date	--12-31
Amendment Flag	false
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q1

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022
Current Assets
Cash and cash equivalents	$ 344	$ 232
Accounts receivable - net of allowance for doubtful accounts of $5	394	363
Inventories	257	224
Other current assets	48	47
Total Current Assets	1,043	866
Property, plant and equipment, net	757	763
Intangible assets, net	867	878
Goodwill	2,075	2,075
Marketable securities	25	22
Other non-current assets	66	67
TOTAL ASSETS	4,833	4,671
Current Liabilities
Accounts payable	221	195
Product warranty liability	27	33
Current portion of long-term debt	6	6
Deferred revenue	45	38
Other current liabilities	227	208
Total Current Liabilities	526	480
Product warranty liability	32	24
Deferred revenue	94	93
Long-term debt	2,500	2,501
Deferred income taxes	525	536
Other non-current liabilities	168	163
TOTAL LIABILITIES	3,845	3,797
Commitments and contingencies (see NOTE P)
STOCKHOLDERS’ EQUITY
Preferred stock, $0.01 par value, 100,000,000 shares authorized, none issued and outstanding	0	0
Paid in capital	1,857	1,848
Accumulated deficit	(845)	(953)
Accumulated other comprehensive loss, net of tax	(25)	(22)
TOTAL STOCKHOLDERS’ EQUITY	988	874
TOTAL LIABILITIES & STOCKHOLDERS’ EQUITY	4,833	4,671
Voting Common Stock
STOCKHOLDERS’ EQUITY
Common stock	1	1
Non-voting Common Stock
STOCKHOLDERS’ EQUITY
Common stock	$ 0	$ 0

Condensed Consolidated Balanc_2

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022
Allowance for doubtful accounts receivable	$ 5	$ 5
Preferred stock, par value (USD per share)	$ 0.01	$ 0.01
Preferred stock, shares authorized (in shares)	100,000,000	100,000,000
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0
Voting Common Stock
Common stock, par value (USD per share)	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	1,880,000,000	1,880,000,000
Common stock, shares issued (in shares)	91,413,567	91,788,885
Common stock, shares outstanding (in shares)	91,413,567	91,788,885
Non-voting Common Stock
Common stock, par value (USD per share)	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	20,000,000	20,000,000
Common stock, shares issued (in shares)	0	0
Common stock, shares outstanding (in shares)	0	0

Condensed Consolidated Statemen

Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Statement of Comprehensive Income [Abstract]
Net sales	$ 741	$ 677
Cost of sales	380	357
Gross profit	361	320
Selling, general and administrative	87	75
Engineering — research and development	44	43
Operating income	230	202
Interest expense, net	(28)	(29)
Other income (expense), net	10	(10)
Income before income taxes	212	163
Income tax expense	(42)	(34)
Net income	$ 170	$ 129
Basic earnings per share attributable to common stockholders	$ 1.85	$ 1.32
Diluted earnings per share attributable to common stockholders	$ 1.85	$ 1.30
Comprehensive income, net of tax	$ 167	$ 146

Condensed Consolidated Statem_2

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$ 170	$ 129
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation of property, plant and equipment	26	27
Amortization of intangible assets	11	11
Deferred income taxes	(8)	5
Stock-based compensation	5	3
Unrealized (gain) loss on marketable securities	(3)	15
Technology-related investments gain	(3)	(6)
Other	1	2
Changes in assets and liabilities:
Accounts receivable	(30)	(44)
Inventories	(32)	(6)
Accounts payable	30	43
Other assets and liabilities	26	(17)
Net cash provided by operating activities	193	162
CASH FLOWS FROM INVESTING ACTIVITIES:
Additions of long-lived assets	(24)	(20)
Proceeds from technology-related investments	2	6
Business acquisitions	0	(23)
Investment in equity method investee	0	(1)
Net cash used for investing activities	(22)	(38)
CASH FLOWS FROM FINANCING ACTIVITIES:
Repurchases of common stock	(40)	(81)
Dividend payments	(22)	(20)
Proceeds from exercise of stock options	9	0
Taxes paid related to net share settlement of equity awards	(5)	(3)
Payments on long-term debt	(1)	(2)
Borrowings on revolving credit facility	0	95
Payments on revolving credit facility	0	(95)
Net cash used for financing activities	(59)	(106)
Effect of exchange rate changes on cash	0	0
Net increase in cash and cash equivalents	112	18
Cash and cash equivalents at beginning of period	232	127
Cash and cash equivalents at end of period	344	145
Cash paid during period for:
Interest	29	26
Income taxes	2	1
Non-cash investing activities:
Capital expenditures in liabilities	$ 6	$ 15

Condensed Consolidated Statem_3

Condensed Consolidated Statements of Stockholders' Equity - USD ($) $ in Millions	Total	Common Stock Voting Common Stock	Paid-in Capital	Accumulated (Deficit) Income	Accumulated Other Comprehensive (Loss) Income, net of tax
Balance at Dec. 31, 2021	$ 634	$ 1	$ 1,832	$ (1,126)	$ (73)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation	3		3
Pension and OPEB liability adjustment	(2)				(2)
Interest rate swaps	19				19
Issuance of common stock	(3)		(3)
Repurchase of common stock	(81)			(81)
Dividends on common stock	(20)			(20)
Net income	129			129
Balance at Mar. 31, 2022	679	1	1,832	(1,098)	(56)
Balance at Dec. 31, 2022	874	1	1,848	(953)	(22)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation	5		5
Pension and OPEB liability adjustment	(2)				(2)
Foreign currency translation adjustment	2				2
Interest rate swaps	(3)				(3)
Issuance of common stock	4		4
Repurchase of common stock	(40)			(40)
Dividends on common stock	(22)			(22)
Net income	170			170
Balance at Mar. 31, 2023	$ 988	$ 1	$ 1,857	$ (845)	$ (25)

Overview

Overview	3 Months Ended
	Mar. 31, 2023
Accounting Policies [Abstract]
Overview	NOTE A. OVERVIEW Overview Allison Transmission Holdings, Inc. and its subsidiaries (“Allison” or the “Company”) design and manufacture vehicle propulsion solutions, including commercial-duty on-highway, off-highway and defense fully automatic transmissions and electric hybrid and fully electric systems. The business was founded in 1915 and has been headquartered in Indianapolis, Indiana since inception. Allison is traded on the New York Stock Exchange under the symbol, “ALSN”. Although approximately 74 % of revenues were generated in North America in 2022, the Company has a global presence by serving customers in Asia, Europe, South America and Africa. The Company serves customers through an independent network of approximately 1,600 independent distributor and dealer locations worldwide.

Summary of Significant Accounti

Summary of Significant Accounting Policies	3 Months Ended
	Mar. 31, 2023
Accounting Policies [Abstract]
Summary of Significant Accounting Policies	NOTE B. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation and Principles of Consolidation The condensed consolidated financial statements have been prepared in accordance with accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, the condensed consolidated financial statements do not include all information and footnotes required by accounting principles generally accepted in the United States of America (“GAAP”) for complete financial statements. The information herein reflects all normal recurring material adjustments, which are, in the opinion of management, necessary for the fair statement of the results for the periods presented. The condensed consolidated financial statements herein consist of all wholly-owned domestic and foreign subsidiaries with all significant intercompany transactions eliminated. These condensed consolidated financial statements present the financial position, results of comprehensive income, cash flows and statements of stockholders’ equity of the Company. Certain immaterial reclassifications have been made in the condensed consolidated financial statements of prior periods to conform to the current period presentation. These reclassifications had no material impact on previously reported net income, total stockholders’ equity or cash flows. The condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2022 as filed with the Securities and Exchange Commission on February 16, 2023 . The interim period financial results for the three-month periods presented are not necessarily indicative of results to be expected for any other interim period or for the entire year. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities and the reported amounts of revenue and expenses. Estimates include, but are not limited to, sales incentives, government price adjustments, fair market values and future cash flows associated with goodwill, indefinite-lived intangibles, definite-lived intangibles, long-lived asset impairment tests, useful lives for depreciation and amortization, warranty liabilities, core deposit liabilities, environmental liabilities, determination of discount rate and other assumptions for pension and other post-retirement benefit ("OPEB") expense, determination of discount rate and period for leases, income taxes and deferred tax valuation allowances, derivative valuation, assumptions for business combinations and contingencies. The Company’s accounting policies involve the application of judgments and assumptions made by management that include inherent risks and uncertainties. Due to the uncertainty surrounding global economic conditions, including as a result of government actions to control inflation, the war in Ukraine and the ongoing effects of the COVID-19 pandemic, and the resulting impacts on the Company's supply chain, demand for its products, foreign exchange rates, interest rates and the cost and availability of raw materials, labor, energy and transport, actual results could differ materially from these estimates and assum ptions used in preparation of the financial statements including, but not limited to, future cash flows associated with goodwill, indefinite-lived intangibles, definite-lived intangibles, long-lived asset impairment tests, determination of discount rate and other assumptions for pension and OPEB expense and income taxes. Changes in estimates are recorded in results of operations in the period that the events or circumstances giving rise to such changes occur.

Revenue

Revenue	3 Months Ended
	Mar. 31, 2023
Revenue from Contract with Customer [Abstract]
Revenue	NOTE C. REVENUE Revenue is recognized as each distinct performance obligation within a contract is satisfied. A performance obligation is a promise in a contract to transfer a distinct good or service to the customer. The Company enters into long-term agreements (“LTAs”) and distributor agreements with certain customers. The LTAs and distributor agreements do not include committed volumes until underlying purchase orders are issued; therefore, the Company determined that purchase orders are the contract with a customer. A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue when the performance obligation is satisfied, as there is no right of return. Some of the Company's contracts include multiple performance obligations, most commonly the sale of both a transmission and extended transmission coverage ("ETC"). The Company allocates the contract’s transaction price to each performance obligation based on the standalone selling price of each distinct good or service in the contract. The Company may also use volume-based discounts and rebates as marketing incentives in the sales of both vehicle propulsion solutions and service parts, which are accounted for as variable consideration. The Company records the impact of the incentives as a reduction to revenue when it is determined that the adjustment is not likely to reverse, historically on a quarterly basis. The Company estimates the impact of all other incentives based on the related sales and market conditions in the end market vocation. The Company recorded no material adjustments based on variable consideration for either of the three months ended March 31, 2023 or 2022. Net sales are made on credit terms, generally 30 days , based on an assessment of the customer’s creditworthiness. For certain goods or services, the Company receives consideration prior to satisfying the related performance obligation. Such consideration is recorded as a contract liability in current and non-current deferred revenue as of March 31, 2023 and December 31, 2022. See "Note J. Deferred Revenue” for more information, including the amount of revenue earned during each of the three months ended March 31, 2023 and 2022 that had been previously deferred. The Company had no material contract assets as of either March 31, 2023 or December 31, 2022. The Company has one ope rating segment and reportable segment. The Company is in one line of business, which is the manufacture and distribution of vehicle propulsion solutions. The following presents disaggregated revenue by categories that best depict how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors (dollars in millions): Three Months Ended March 31, 2023 2022 North America On-Highway $ 376 $ 346 North America Off-Highway 24 18 Defense 27 35 Outside North America On-Highway 108 109 Outside North America Off-Highway 23 30 Service Parts, Support Equipment and Other 183 139 Total Net Sales $ 741 $ 677 NOTE J. DEFERRED REVENUE As of March 31, 2023, current and non-current deferred revenue was $ 45 million and $ 94 million, respectively. As of March 31, 2022, current and non-current deferred revenue was $ 35 million and $ 97 million, respectively. Deferred revenue activity consists of the following (dollars in millions): Three Months Ended 2023 2022 Beginning balance $ 131 $ 136 Increases 17 7 Revenue earned ( 9 ) ( 11 ) Ending balance $ 139 $ 132 Deferred revenue recorded in current and non-current liabilities related to ETC as of March 31, 2023 was $ 30 million and $ 84 million, respectively. Deferred revenue recorded in current and non-current liabilities related to ETC as of March 31, 2022 was $ 29 million and $ 84 million, respectively.

Inventories

Inventories	3 Months Ended
	Mar. 31, 2023
Inventory Disclosure [Abstract]
Inventories	NOTE D. INVENTORIES Inventories consisted of the following components (dollars in millions): March 31, December 31, Purchased parts and raw materials $ 128 $ 115 Work in progress 12 7 Service parts 53 53 Finished goods 64 49 Total inventories $ 257 $ 224 Inventory components shipped to third parties, primarily cores, parts to re-manufacturers, and parts to contract manufacturers, which the Company has an obligation to buy back, are included in purchased parts and raw materials, with an offsetting liability in Other current liabilities . See "Note L. Other Current Liabilities” for more information.

Goodwill and Other Intangible A

Goodwill and Other Intangible Assets	3 Months Ended
	Mar. 31, 2023
Goodwill and Intangible Assets Disclosure [Abstract]
Goodwill and Other Intangible Assets	NOTE E. GOODWILL AND OTHER INTANGIBLE ASSETS As of both March 31, 2023 and December 31, 2022, the carrying value of the Company’s Goodwill was $ 2,075 million. The following presents a summary of other intangible assets (dollars in millions): March 31, 2023 December 31, 2022 Intangible Accumulated Intangible Intangible Accumulated Intangible Other intangible assets: Trade name $ 791 $ — $ 791 $ 791 $ — $ 791 In-process research and development 25 — 25 25 — 25 Customer relationships — commercial 839 ( 802 ) 37 839 ( 793 ) 46 Proprietary technology 484 ( 478 ) 6 484 ( 477 ) 7 Customer relationships — defense 62 ( 54 ) 8 62 ( 53 ) 9 Non-compete agreements 1 ( 1 ) — 1 ( 1 ) — Total $ 2,202 $ ( 1,335 ) $ 867 $ 2,202 $ ( 1,324 ) $ 878 As of March 31, 2023 and December 31, 2022, the carrying value of the Company’s Goodwill and Intangible assets, net was $ 2,942 million and $ 2,953 million, respectively. Amortization expense related to other intangible assets for the next five fiscal years is expected to be (dollars in millions): 2024 2025 2026 2027 2028 Amortization expense $ 9 $ 5 $ 2 $ 1 $ 1

Fair Value of Financial Instrum

Fair Value of Financial Instruments	3 Months Ended
	Mar. 31, 2023
Fair Value Disclosures [Abstract]
Fair Value of Financial Instruments	NOTE F. FAIR VALUE OF FINANCIAL INSTRUMENTS Fair value is the price (exit price) that would be received to sell an asset or paid to transfer a liability in an orderly tran saction between market participants at the measurement date. The Company utilizes market data or assumptions that market participants would use in pricing the asset or liability, including assumptions about risk and the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market corroborated, or generally unobservable. The accounting guidance establishes a fair value hierarchy that prioritizes the inputs used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3 measurement). The three levels of the fair value hierarchy defined by the relevant guidance are as follows: Level 1 — Quoted prices are available in active markets for identical assets or liabilities as of the reporting date. Level 2 — Inputs are other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date. Level 2 includes financial instruments that are valued using quoted prices in markets that are not active and those financial instruments that are valued using models or other valuation methodologies in which all significant value-drivers are observable in active markets or are supported by observable levels at which transactions are executed in the marketplace. Level 3 — Certain inputs are unobservable or have little or no market data available. These inputs may be used with internally developed methodologies that result in management’s best estimate of fair value. At each balance sheet date, the Company performs an analysis of all instruments subject to authoritative accounting guidance and includes, in Level 3, all of those whose fair value is based on significant unobservable inputs. As of March 31, 2023 and December 31, 2022, the Company did no t have any L evel 3 financial assets or liabilities. The Company’s assets and liabilities that are measured at fair value include cash equivalents, marketable securities, derivative instruments, assets held in a rabbi trust and a deferred compensation obligation. The Company’s cash equivalents consist of short-term U.S. government backed securities. The Company's marketable securities consist of publicly traded stock of Jing-Jin Electric Technologies Co. Ltd., which has a readily determinable fair value. The Company’s derivative instruments consist of interest rate swaps. The Company’s assets held in the rabbi trust consist principally of publicly available mutual funds and target date retirement funds. The Company’s deferred compensation obligation is directly related to the fair value of assets held in the rabbi trust. The Company’s valuation techniques used to calculate the fair value of cash equivalents, marketable securities, assets held in the rabbi trust and the deferred compensation obligation represent a market approach in active markets for identical assets that qualify as Level 1 in the fair value hierarchy. The Company’s valuation techniques used to calculate the fair value of derivative instruments represent a market approach with observable inputs that qualify as Level 2 in the fair value hierarchy. The Company uses valuations from the issuing financial institutions for the fair value measurement of interest rate swaps. The floating-to-fixed interest rate swaps are based on the London Interbank Offered Rate ("LIBOR"), which is observable at commonly quoted intervals. The fair values are included in other current and non-current assets and liabilities in the Condensed Consolidated Balance Sheets. See "Note H. Derivatives” for more information regarding the Company's interest rate swaps. The following table summarizes the fair value of the Company’s financial assets and (liabilities) as of March 31, 2023 and December 31, 2022 (dollars in millions): Fair Value Measurements Using Quoted Prices in Active Significant Other TOTAL March 31, December 31, March 31, December 31, March 31, December 31, Cash equivalents $ 202 $ 111 $ — $ — $ 202 $ 111 Marketable securities 25 22 — — 25 22 Derivative assets — — 14 18 14 18 Rabbi trust assets 17 15 — — 17 15 Deferred compensation obligation ( 17 ) ( 15 ) — — ( 17 ) ( 15 ) Total $ 227 $ 133 $ 14 $ 18 $ 241 $ 151

Debt

Debt	3 Months Ended
	Mar. 31, 2023
Debt Disclosure [Abstract]
Debt	NOTE G. DEBT Long-term debt and maturities are as follows (dollars in millions): March 31, December 31, Long-term debt: Senior Secured Credit Facility Term Loan, variable, due 2026 $ 623 $ 625 Senior Notes, fixed 4.75 %, due 2027 400 400 Senior Notes, fixed 5.875 %, due 2029 500 500 Senior Notes, fixed 3.75 %, due 2031 1,000 1,000 Total long-term debt $ 2,523 $ 2,525 Less: current maturities of long-term debt 6 6 deferred financing costs, net 17 18 Total long-term debt, net $ 2,500 $ 2,501 As of March 31, 2023, the Company had $ 2,523 million of indebtedness associated with Allison Transmission, Inc.’s (“ATI”), the Company’s wholly-owned subsidiary, 4.75 % Senior Notes due October 2027 (“4.75% Senior Notes”), ATI’s 5.875 % Senior Notes due June 2029 (“5.875% Senior Notes”), ATI’s 3.75 % Senior Notes due January 2031 (“3.75% Senior Notes” and, together with the 4.75% Senior Notes and 5.875% Senior Notes, the “Senior Notes”) and the Second Amended and Restated Credit Agreement dated as of March 29, 2019, as amended (the “Credit Agreement”), governing ATI’s term loan facility in the amount of $ 623 million due March 2026 (“Term Loan”) and ATI’s revolving credit facility with commitments in the amount of $ 650 million d ue September 2025 (“Revolving Credit Facility” and, together with the Term Loan, the “Senior Secured Credit Facility”). The fair value of the Company’s long-term debt obligations as of March 31, 2023 was $ 2,341 million. The fair value is based on quoted Level 2 market prices of the Company’s debt as of March 31, 2023. The difference between the fair value and carrying value of the long-term debt is driven primarily by trends in the financial markets. Senior Secured Credit Facility In February 2023, the Company and ATI entered into Amendment No. 3 (the "Amendment") to the Credit Agreement. The Amendment replaced the LIBOR interest rate benchmark with the Secured Overnight Financing Rate ("SOFR") and included a 0.1 % credit spread adjustment to the SOFR benchmark for all available interest periods. Other than the foregoing, the material terms of the Credit Agreement remained unchanged. The amendment was treated as a modification to the Senior Secured Credit Facility through a practical expedient provided through reference rate reform accounting guidance. The borrowings under the Senior Secured Credit Facility are collateralized by a lien on substantially all assets of the Company, ATI and certain existing and future U.S. subsidiary guarantors, as provided in the Credit Agreement. Interest on the Term Loan, as of March 31, 2023 , is either (a) 1.75 % over a SOFR rate on deposits in U.S. dollars for one-, three- or six-month periods (or a twelve-month period if, at the time of the borrowing, consented to by all relevant lenders and the administrative agent) plus a 0.1 % credit spread adjustment for all interest periods ("Adjusted Term SOFR"), or (b) 0.75 % over the greater of the prime lending rate as quoted by the administrative agent, the Adjusted Term SOFR Rate for an interest period of one month plus 1.00 % and the federal funds effective rate published by the Federal Reserve Bank of New York plus 0.50 %, subject to a 1.00 % floor (the "Base Rate"). As of March 31, 2023, the Company elected to pay the lowest all-in rate of Adjusted Term SOFR plus the applicable margin, or 6.61 %, on the Term Loan. The Credit Agreement requires minimum quarterly principal payments on the Term Loan, as well as prepayments from certain net cash proceeds of non-ordinary course asset sales and casualty and condemnation events, the incurrence of certain debt and from a percentage of excess cash flow, if applicabl e. The minimum required quarterly principal payment on the Term Loan through its maturity date of March 2026 is $ 2 million. A s of March 31, 2023, there had been no payments required for certain net cash proceeds of non-ordinary course asset sales and casualty and condemnation events. The remaining principal balance is due upon maturity. The Senior Secured Credit Facility also provides a Revolving Credit Facility, net of an allowance for up to $ 75 million in outstanding letters of credit commitments. During the three months ended March 31, 2023, the Company made no withdrawals on the Revolving Credit Facility. As of March 31, 2023, the Company had $ 644 million available under the Revolving Credit Facility, net of $ 6 million in letters of credit. Borrowings under the Revolving Credit Facility bear interest at a variable base rate plus a n applicable margin based on the Company’s first lien net leverage ratio. When the Company’s first lien net leverage ratio is above 4.00 x, interest on the Revolving Credit Facility is (a) 0.75 % over the Base Rate or (b) 1.75 % over the Adjusted Term SOFR Rate; when the Company’s first lien net leverage ratio is equal to or less than 4.00 x and above 3.50 x, interest on the Revolving Credit Facility is (i) 0.50 % over the Base Rate or (ii) 1.50 % over the Adjusted Term SOFR Rate; and when the Company’s first lien net leverage ratio is equal to or below 3.50 x, interest on the Revolving Credit Facility is (y) 0.25 % over the Base Rate or (z) 1.25 % over the Adjusted Term SOFR Rate. As of March 31, 2023, the applicable margin for the Revolving Credit Facility was 1.25 %. In addition, there is an annual commitment fee, based on the Company’s first lien net leverage ratio, on the average unused revolving credit borrowings available under the Revolving Credit Facility. As of March 31, 2023, the commitment fee was 0.25 %. Borrowings under the Revolving Credit Facility are payable at the option of the Company throughout the term of the Senior Secured Credit Facility with the balance due in September 2025. The Senior Secured Credit Facility requires the Company to maintain a specified maximum first lien net leverage ratio of 5.50 x when revolving loan commitments remain outstanding on the Revolving Credit Facility at the end of a fiscal quarter. As of March 31, 2023, the Company had no amounts outstanding under the Revolving Credit Facility; however, the Company would have been in compliance with the maximum first lien net leverage ratio, achieving a 0.28 x ratio. Additionally, within the terms of the Senior Secured Credit Facility, a first lien net leverage ratio at or below 4.00 x results in the elimination of excess cash flow payments on the Senior Secured Credit Facility for the applicable year. In addition, the Credit Agreement, among other things, includes customary restrictions (subject to certain exceptions) on the Company’s ability to incur certain indebtedness, grant certain liens, make certain investments, engage in acquisitions, consolidations and mergers, declare or pay certain dividends or repurchase shares of the Company’s common stock. As of March 31, 2023, the Company was in compliance with all covenants under the Credit Agreement. Senior Notes Each series of the Senior Notes is unsecured and is guaranteed by each of ATI’s domestic subsidiaries that is a borrower under or guarantees the Senior Secured Credit Facility and is unconditionally guaranteed, jointly and severally, by any of ATI’s future domestic subsidiaries that are borrowers under or guarantee the Senior Secured Credit Facility. None of ATI’s domestic subsidiaries currently guarantee its obligations under the Senior Secured Credit Facility, and therefore none of ATI’s domestic subsidiaries currently guarantee any series of the Senior Notes. The indentures governing the Senior Notes contain negative covenants restricting or limiting the Company’s ability to, among other things: incur or guarantee additional indebtedness, incur liens, pay dividends on, redeem or repurchase the Company’s capital stock, make certain investments, permit payment or dividend restrictions on certain of the Company’s subsidiaries, sell assets, engage in certain transactions with affiliates, and consolidate or merge or sell all or substantially all of the Company’s assets. As of March 31, 2023, the Company was in compliance with all covenants under the indentures governing the Senior Notes. ATI may from time to time seek to retire its Senior Notes through cash purchases, exchanges for equity securities, open market purchases, privately negotiated transactions, contractual redemptions or otherwise. Such repurchases or exchanges, if any, will depend on prevailing market conditions, liquidity requirements, contractual restrictions and other factors and will be in accordance with the respective indenture governing such notes. The amounts involved may be material. Some or all of the 4.75 % Senior Notes may be redeemed at any time at redemption prices specified in the indenture governing such notes. Some or all of the 5.875 % Senior Notes may be redeemed prior to June 1, 2024 by paying a price equal to 100.00 % of the principal amount being redeemed, plus an “applicable premium”. At any time on or after June 1, 2024 , ATI may redeem some or all of the 5.875 % Senior Notes at redemption prices specified in the indenture governing such notes. ATI may redeem up to 40 % of the 3.75 % Senior Notes prior to January 30, 2024 by paying a price equal to 103.750 % of the principal amount being redeemed. On or after January 30, 2024 and prior to January 30, 2026 , ATI may redeem some or all of the 3.75 % Senior Notes by paying a price equal to 100.00 % of the principal amount being redeemed, plus an “applicable premium”. At any time on or after January 30, 2026 , ATI may redeem some or all of the 3.75 % Senior Notes at redemption prices specified in the indenture governing such notes.

Derivatives

Derivatives	3 Months Ended
	Mar. 31, 2023
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Derivatives	NOTE H. DERIVATIVES The Company is subject to interest rate risk related to the Senior Secured Credit Facility and entered into interest rate swaps that are based on LIBOR t o manage a portion of this exposure. The interest rate swaps are designated as cash flow hedges that qualify for hedge accounting under the hypothetical derivative method. Fair value adjustments are recorded as a component of Accumulated other comprehensive loss, net of tax (“AOCL”) in the Condensed Consolidated Balance Sheets. Balances in AOCL are reclassified to earnings when transactions related to the underlying risk are settled. See "Note F. Fair Value of Financial Instruments” for information regarding the fair value of the Company’s interest rate swaps. As of March 31, 2023, the reference rates for the Company's Senior Secured Credit Facility and interest rate swaps were Adjusted Term SOFR and LIBOR, respectively. Although there is a mismatch in reference rates, the Company continues to qualify for hedge accounting through temporary relief provided through reference rate reform accounting guidance. The Company plans to transition the interest rate swaps' reference rates to Adjusted Term SOFR prior to the December 31, 2024 sunset date of the temporary relief period. As of March 31, 2023, the Company held interest rate swaps as follows (dollars in millions): Effective Dates Notional Amount Weighted Average LIBOR Fixed Rate September 2019 - September 2025 $ 250 3.04 % September 2022 - September 2025 $ 250 2.82 % The following tabular disclosures further describe the Company’s interest rate derivatives qualifying and designated for hedge accounting and their impact on the financial condition of the Company (dollars in millions): Fair Value Balance Sheet Location March 31, December 31, Derivative Assets: Interest rate swaps Other current assets $ 6 $ 7 Other non-current assets 8 11 Total derivative assets $ 14 $ 18 The balance of net derivative gains recorded in AOCL as of March 31, 2023 and December 31, 2022 was $ 14 million and $ 18 million, respectively. See "Note O. Accumulated Other Comprehensive Loss” for information regarding activity recorded as a component of AOCL during the three months ended March 31, 2023 and 2022. As of March 31, 2023, the Company had $ 9 million of derivative gains recorded in AOCL expected to be reclassified to earnings within the next twelve months.

Product Warranty Liabilities

Product Warranty Liabilities	3 Months Ended
	Mar. 31, 2023
Guarantees and Product Warranties [Abstract]
Product Warranty Liabilities	NOTE I. PRODUCT WARRANTY LIABILITIES As of March 31, 2023, current and non-current product warranty liabilities were $ 27 million and $ 32 million, respectively. As of March 31, 2022, current and non-current product warranty liabilities were $ 30 million and $ 23 million, respectively. Product warranty liability activities consist of the following (dollars in millions): Three Months Ended 2023 2022 Beginning balance $ 57 $ 53 Payments ( 8 ) ( 7 ) Increase in liability (warranty issued during period) 6 4 Net adjustments to liability 4 3 Ending balance $ 59 $ 53

Deferred Revenue

Deferred Revenue	3 Months Ended
	Mar. 31, 2023
Revenue Recognition and Deferred Revenue [Abstract]
Deferred Revenue	NOTE C. REVENUE Revenue is recognized as each distinct performance obligation within a contract is satisfied. A performance obligation is a promise in a contract to transfer a distinct good or service to the customer. The Company enters into long-term agreements (“LTAs”) and distributor agreements with certain customers. The LTAs and distributor agreements do not include committed volumes until underlying purchase orders are issued; therefore, the Company determined that purchase orders are the contract with a customer. A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue when the performance obligation is satisfied, as there is no right of return. Some of the Company's contracts include multiple performance obligations, most commonly the sale of both a transmission and extended transmission coverage ("ETC"). The Company allocates the contract’s transaction price to each performance obligation based on the standalone selling price of each distinct good or service in the contract. The Company may also use volume-based discounts and rebates as marketing incentives in the sales of both vehicle propulsion solutions and service parts, which are accounted for as variable consideration. The Company records the impact of the incentives as a reduction to revenue when it is determined that the adjustment is not likely to reverse, historically on a quarterly basis. The Company estimates the impact of all other incentives based on the related sales and market conditions in the end market vocation. The Company recorded no material adjustments based on variable consideration for either of the three months ended March 31, 2023 or 2022. Net sales are made on credit terms, generally 30 days , based on an assessment of the customer’s creditworthiness. For certain goods or services, the Company receives consideration prior to satisfying the related performance obligation. Such consideration is recorded as a contract liability in current and non-current deferred revenue as of March 31, 2023 and December 31, 2022. See "Note J. Deferred Revenue” for more information, including the amount of revenue earned during each of the three months ended March 31, 2023 and 2022 that had been previously deferred. The Company had no material contract assets as of either March 31, 2023 or December 31, 2022. The Company has one ope rating segment and reportable segment. The Company is in one line of business, which is the manufacture and distribution of vehicle propulsion solutions. The following presents disaggregated revenue by categories that best depict how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors (dollars in millions): Three Months Ended March 31, 2023 2022 North America On-Highway $ 376 $ 346 North America Off-Highway 24 18 Defense 27 35 Outside North America On-Highway 108 109 Outside North America Off-Highway 23 30 Service Parts, Support Equipment and Other 183 139 Total Net Sales $ 741 $ 677 NOTE J. DEFERRED REVENUE As of March 31, 2023, current and non-current deferred revenue was $ 45 million and $ 94 million, respectively. As of March 31, 2022, current and non-current deferred revenue was $ 35 million and $ 97 million, respectively. Deferred revenue activity consists of the following (dollars in millions): Three Months Ended 2023 2022 Beginning balance $ 131 $ 136 Increases 17 7 Revenue earned ( 9 ) ( 11 ) Ending balance $ 139 $ 132 Deferred revenue recorded in current and non-current liabilities related to ETC as of March 31, 2023 was $ 30 million and $ 84 million, respectively. Deferred revenue recorded in current and non-current liabilities related to ETC as of March 31, 2022 was $ 29 million and $ 84 million, respectively.

Leases

Leases	3 Months Ended
	Mar. 31, 2023
Leases [Abstract]
Leases	NOTE K. LEASES Contracts are assessed by the Company to determine if the contract conveys the right to control an identified asset in exchange for consideration during a period of time. The Company classifies all identified leases as either operating or finance leases. As of March 31, 2023, the Company was not a party t o any finance leases. Contracts that contain leases are assessed to determine if the consideration in the contract is related to a lease component, non-lease component or other components not related to the lease. Lease components are recorded as right-of-use (“ROU”) assets and lease liabilities while any non-lease component is expensed as incurred. The consideration in the contract related to other components not related to the lease is allocated among the lease component and the non-lease component, as applicable, based on the stand-alone selling price of the lease and non-lease components. Certain lease contracts may contain an option to extend or terminate the lease. The Company considers the economic impact of extension and termination options by contract. If the Company concludes it is reasonably certain an option will be exercised, that option is included in the lease term and impacts the amount recorded as an ROU asset and lease liability at inception of the contract. The Company's lease liability is determined by discounting the future cash flows over the lease period. The Company determines its discount rates utilizing current secured financing rates based on the length of the lease period plus the Company's margin over Adjusted Term SOFR on the Term Loan. The Company believes this rate effectively represents a borrowing rate the Company could obtain on a debt instrument possessing similar terms as the lease. Lease liabilities are classified between current and non-current liabilities based on the terms of the underlying leases. The weighted average discount rate on operating leases as of March 31, 2023 and December 31, 2022 was 4.53 % and 4.43 %, respectively. As of March 31, 2023 , the Company recorded current and non-current operating lease liabilities of $ 4 million and $ 12 million, respectively. As of December 31, 2022 , the Company recorded current and non-current operating lease liabilities of $ 4 million and $ 13 million, respectively. The following table reconciles future undiscounted cash flows for operating leases as of March 31, 2023 to total operating lease liabilities: March 31, 2023 $ 5 2024 3 2025 3 2026 2 2027 2 Thereafter 4 Total lease payments $ 19 Less: Interest 3 Present value of lease liabilities $ 16 ROU assets are calculated as the related lease liability adjusted for lease incentives, prepayments and the effect of escalating lease payments on period expense. The below table depicts the ROU assets held by the Company based on the underlying asset: March 31, December 31, Buildings $ 15 $ 15 Land 1 1 Equipment 1 — Vehicles — 1 Total ROU assets $ 17 $ 17 The weighted average remaining lease term as of March 31, 2023 and March 31, 2022 was 6.1 years and 6.8 years , respectively. Operating lease expense was $ 1 million for each of the three months ended March 31, 2023 and 2022, and was recorded within Selling, general and administrative expense and Engineering — research and development on the Company's Condensed Consolidated Statements of Comprehensive Income. There was no material short-term operating lease expense for either of the three months ended March 31, 2023 or 2022. The calculation of the Company's ROU assets and lease liabilities did not include cash consideration as of either March 31, 2023 or December 31, 2022. During the three months ended March 31, 2023, there were $ 1 million in new ROU assets obtained in exchange for lease obligations. During the three months ended March 31, 2022 , there were no new ROU assets obtained in exchange for lease obligations.

Other Current Liabilities

Other Current Liabilities	3 Months Ended
	Mar. 31, 2023
Other Liabilities Disclosure [Abstract]
Other Current Liabilities	NOTE L. OTHER CURRENT LIABILITIES Other current liabilities consist of the following (dollars in millions): March 31, December 31, Taxes payable $ 80 $ 31 Sales incentives 41 42 Payroll and related costs 35 72 Accrued interest payable 27 24 Vendor buyback obligation 17 16 OPEB liability 4 4 Construction holdback 4 4 Lease liability 4 4 Other accruals 15 11 Total $ 227 $ 208

Employee Benefit Plans

Employee Benefit Plans	3 Months Ended
	Mar. 31, 2023
Retirement Benefits [Abstract]
Employee Benefit Plans	NOTE M. EMPLOYEE BENEFIT PLANS Components of net periodic benefit cost (credit) consist of the following (dollars in millions): Pension Plans Post-retirement Benefits For the Three Months For the Three Months 2023 2022 2023 2022 Net periodic benefit cost (credit): Service cost $ 1 $ 2 $ — $ — Interest cost 2 1 1 1 Expected return on assets ( 2 ) ( 2 ) — — Prior service credit — — ( 2 ) ( 3 ) Recognized actuarial gain — — ( 1 ) — Net periodic benefit cost (credit) $ 1 $ 1 $ ( 2 ) $ ( 2 ) The components of net periodic benefit cost (credit) other than the service cost component are included in Other income (expense), net in the Condensed Consolidated Statements of Comprehensive Income.

Income Taxes

Income Taxes	3 Months Ended
	Mar. 31, 2023
Income Tax Disclosure [Abstract]
Income Taxes	NOTE N. INCOME TAXES For the three months ended March 31, 2023 and 2022, the Company recorded total income tax expense of $ 42 million and $ 34 million, respectively. The effective tax rate for the three months ended March 31, 2023 and 2022 was 20 % and 21 %, respectively. The need to establish a valuation allowance against the deferred tax assets is assessed periodically based on a more-likely-than-not realization threshold, in accordance with authoritative accounting guidance. Appropriate consideration is given to all positive and negative evidence related to that realization. This assessment considers, among other matters, the nature, frequency and severity of recent losses, forecasts of future profitability, the duration of statutory carry-forward periods, experience with tax attributes expiring unused, and tax planning alternatives. The weight given to these considerations depends upon the degree to which they can be objectively verified. The Company continues to provide for a valuation allowance on certain of its foreign deferred tax assets. The Company has determined, based on the evaluation of both objective and subjective evidence available, that this valuation allowance is necessary and that it is more likely than not that the deferred tax assets are not fully realizable.

Accumulated Other Comprehensive

Accumulated Other Comprehensive Loss	3 Months Ended
	Mar. 31, 2023
Equity [Abstract]
Accumulated Other Comprehensive Loss	NOTE O. ACCUMULATED OTHER COMPREHENSIVE LOSS The following tables reconcile changes in AOCL by component (net of tax, dollars in millions): Three months ended Pension Interest Foreign Total AOCL as of December 31, 2021 $ ( 17 ) $ ( 24 ) $ ( 32 ) $ ( 73 ) Other comprehensive income before reclassifications — 22 — 22 Amounts reclassified from AOCL ( 3 ) 3 — — Income tax benefit (expense) 1 ( 6 ) — ( 5 ) Net current period other comprehensive (loss) income $ ( 2 ) $ 19 $ — $ 17 AOCL as of March 31, 2022 $ ( 19 ) $ ( 5 ) $ ( 32 ) $ ( 56 ) AOCL as of December 31, 2022 $ 5 $ 15 $ ( 42 ) $ ( 22 ) Other comprehensive (loss) income before reclassifications — ( 2 ) 2 — Amounts reclassified from AOCL ( 3 ) ( 2 ) — ( 5 ) Income tax expense 1 1 — 2 Net current period other comprehensive (loss) income $ ( 2 ) $ ( 3 ) $ 2 $ ( 3 ) AOCL as of March 31, 2023 $ 3 $ 12 $ ( 40 ) $ ( 25 ) Amounts reclassified from AOCL AOCL Components Three months ended Three months ended Affected line item in the Condensed Interest rate swaps $ 2 $ ( 3 ) Interest expense, net Prior service credit 2 3 Other income (expense), net Recognized actuarial gain 1 — Other income (expense), net Total reclassifications, before tax $ 5 $ — Income before income taxes Income tax expense ( 1 ) — Income tax expense Total reclassifications, net of tax $ 4 $ — Prior service cost and actuarial loss are included in the computation of the Company’s net periodic benefit cost (credit). See "Note M. Employee Benefit Plans” for additional details.

Commitments and Contingencies

Commitments and Contingencies	3 Months Ended
	Mar. 31, 2023
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	NOTE P. COMMITMENTS AND CONTINGENCIES The Company is party to various legal actions and administrative proceedings and subject to various claims arising in the ordinary course of business. These proceedings primarily involve commercial claims, product liability claims, personal injury claims and workers’ compensation claims. The Company believes that the ultimate liability, if any, in excess of amounts already provided for in the condensed consolidated financial statements or covered by insurance on the disposition of these matters will not have a material adverse effect on the financial position, results of operations or cash flows of the Company.

Earnings Per Share

Earnings Per Share	3 Months Ended
	Mar. 31, 2023
Earnings Per Share [Abstract]
Earnings Per Share	NOTE Q. EARNINGS PER SHARE The following table reconciles the numerators and denominators used to calculate basic EPS and diluted EPS (dollars in millions, except per share data): Three Months Ended 2023 2022 Net income $ 170 $ 129 Weighted average shares of common stock outstanding 92 98 Dilutive effect of stock-based awards — 1 Diluted weighted average shares of common stock outstanding 92 99 Basic earnings per share attributable to common stockholders $ 1.85 $ 1.32 Diluted earnings per share attributable to common stockholders $ 1.85 $ 1.30 The dilutive impact of stock-based compensation is calculated using the treasury stock method. The treasury stock method assumes that the Company uses the proceeds from the exercise of awards to repurchase common stock at the average market price during the period. For each of the three months ended March 31, 2023 and 2022, 1 million of outstanding stock options were excluded from the diluted EPS calculation because they were anti-dilutive. Basic and diluted EPS for the full-year is calculated using the weighted average shares of common stock outstanding during the year while quarterly basic and diluted EPS is calculated using the weighted average shares of common stock outstanding during the quarter; therefore, the sum of the four quarters’ EPS may not equal full-year EPS.

Common Stock

Common Stock	3 Months Ended
	Mar. 31, 2023
Equity [Abstract]
Common Stock	NOTE R. COMMON STOCK The Company's Board of Directors has authorized the Company to repurchase up to $ 4,000 million of its common stock pursuant to a stock repurchase program (the "Repurchase Program"). During the three months ended March 31, 2023, the Company repurchased $ 40 million of its common stock under the Repurchase Program, leaving $ 995 million of authorized repurchases remaining under the Repurchase Program as of March 31, 2023. The Repurchase Program has n o termination date, and the timing and amount of stock purchases are subject to market conditions and corporate needs. The Repurchase Program may be modified, suspended or discontinued at any time at the Company’s discretion.

Summary of Significant Accoun_2

Summary of Significant Accounting Policies (Policies)	3 Months Ended
	Mar. 31, 2023
Accounting Policies [Abstract]
Basis of Presentation and Principles of Consolidation	Basis of Presentation and Principles of Consolidation The condensed consolidated financial statements have been prepared in accordance with accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, the condensed consolidated financial statements do not include all information and footnotes required by accounting principles generally accepted in the United States of America (“GAAP”) for complete financial statements. The information herein reflects all normal recurring material adjustments, which are, in the opinion of management, necessary for the fair statement of the results for the periods presented. The condensed consolidated financial statements herein consist of all wholly-owned domestic and foreign subsidiaries with all significant intercompany transactions eliminated. These condensed consolidated financial statements present the financial position, results of comprehensive income, cash flows and statements of stockholders’ equity of the Company. Certain immaterial reclassifications have been made in the condensed consolidated financial statements of prior periods to conform to the current period presentation. These reclassifications had no material impact on previously reported net income, total stockholders’ equity or cash flows. The condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2022 as filed with the Securities and Exchange Commission on February 16, 2023 . The interim period financial results for the three-month periods presented are not necessarily indicative of results to be expected for any other interim period or for the entire year.
Use of Estimates	Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities and the reported amounts of revenue and expenses. Estimates include, but are not limited to, sales incentives, government price adjustments, fair market values and future cash flows associated with goodwill, indefinite-lived intangibles, definite-lived intangibles, long-lived asset impairment tests, useful lives for depreciation and amortization, warranty liabilities, core deposit liabilities, environmental liabilities, determination of discount rate and other assumptions for pension and other post-retirement benefit ("OPEB") expense, determination of discount rate and period for leases, income taxes and deferred tax valuation allowances, derivative valuation, assumptions for business combinations and contingencies. The Company’s accounting policies involve the application of judgments and assumptions made by management that include inherent risks and uncertainties. Due to the uncertainty surrounding global economic conditions, including as a result of government actions to control inflation, the war in Ukraine and the ongoing effects of the COVID-19 pandemic, and the resulting impacts on the Company's supply chain, demand for its products, foreign exchange rates, interest rates and the cost and availability of raw materials, labor, energy and transport, actual results could differ materially from these estimates and assum ptions used in preparation of the financial statements including, but not limited to, future cash flows associated with goodwill, indefinite-lived intangibles, definite-lived intangibles, long-lived asset impairment tests, determination of discount rate and other assumptions for pension and OPEB expense and income taxes. Changes in estimates are recorded in results of operations in the period that the events or circumstances giving rise to such changes occur.

Revenue (Tables)

Revenue (Tables)	3 Months Ended
	Mar. 31, 2023
Revenue from Contract with Customer [Abstract]
Disaggregated Revenue by Categories	The following presents disaggregated revenue by categories that best depict how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors (dollars in millions): Three Months Ended March 31, 2023 2022 North America On-Highway $ 376 $ 346 North America Off-Highway 24 18 Defense 27 35 Outside North America On-Highway 108 109 Outside North America Off-Highway 23 30 Service Parts, Support Equipment and Other 183 139 Total Net Sales $ 741 $ 677

Inventories (Tables)

Inventories (Tables)	3 Months Ended
	Mar. 31, 2023
Inventory Disclosure [Abstract]
Schedule of Components of Inventories	Inventories consisted of the following components (dollars in millions): March 31, December 31, Purchased parts and raw materials $ 128 $ 115 Work in progress 12 7 Service parts 53 53 Finished goods 64 49 Total inventories $ 257 $ 224

Goodwill and Other Intangible_2

Goodwill and Other Intangible Assets (Tables)	3 Months Ended
	Mar. 31, 2023
Goodwill and Intangible Assets Disclosure [Abstract]
Schedule of Other Intangible Assets	The following presents a summary of other intangible assets (dollars in millions): March 31, 2023 December 31, 2022 Intangible Accumulated Intangible Intangible Accumulated Intangible Other intangible assets: Trade name $ 791 $ — $ 791 $ 791 $ — $ 791 In-process research and development 25 — 25 25 — 25 Customer relationships — commercial 839 ( 802 ) 37 839 ( 793 ) 46 Proprietary technology 484 ( 478 ) 6 484 ( 477 ) 7 Customer relationships — defense 62 ( 54 ) 8 62 ( 53 ) 9 Non-compete agreements 1 ( 1 ) — 1 ( 1 ) — Total $ 2,202 $ ( 1,335 ) $ 867 $ 2,202 $ ( 1,324 ) $ 878
Schedule of Amortization Expense Related to Other Intangible Assets for Next Five Fiscal Years	Amortization expense related to other intangible assets for the next five fiscal years is expected to be (dollars in millions): 2024 2025 2026 2027 2028 Amortization expense $ 9 $ 5 $ 2 $ 1 $ 1

Fair Value of Financial Instr_2

Fair Value of Financial Instruments (Tables)	3 Months Ended
	Mar. 31, 2023
Fair Value Disclosures [Abstract]
Summary of Fair Value of Financial Assets and (Liabilities)	The following table summarizes the fair value of the Company’s financial assets and (liabilities) as of March 31, 2023 and December 31, 2022 (dollars in millions): Fair Value Measurements Using Quoted Prices in Active Significant Other TOTAL March 31, December 31, March 31, December 31, March 31, December 31, Cash equivalents $ 202 $ 111 $ — $ — $ 202 $ 111 Marketable securities 25 22 — — 25 22 Derivative assets — — 14 18 14 18 Rabbi trust assets 17 15 — — 17 15 Deferred compensation obligation ( 17 ) ( 15 ) — — ( 17 ) ( 15 ) Total $ 227 $ 133 $ 14 $ 18 $ 241 $ 151

Debt (Tables)

Debt (Tables)	3 Months Ended
	Mar. 31, 2023
Debt Disclosure [Abstract]
Summary of Long-Term Debt and Maturities	Long-term debt and maturities are as follows (dollars in millions): March 31, December 31, Long-term debt: Senior Secured Credit Facility Term Loan, variable, due 2026 $ 623 $ 625 Senior Notes, fixed 4.75 %, due 2027 400 400 Senior Notes, fixed 5.875 %, due 2029 500 500 Senior Notes, fixed 3.75 %, due 2031 1,000 1,000 Total long-term debt $ 2,523 $ 2,525 Less: current maturities of long-term debt 6 6 deferred financing costs, net 17 18 Total long-term debt, net $ 2,500 $ 2,501

Derivatives (Tables)

Derivatives (Tables)	3 Months Ended
	Mar. 31, 2023
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Schedule of Interest Rate Swaps	As of March 31, 2023, the Company held interest rate swaps as follows (dollars in millions): Effective Dates Notional Amount Weighted Average LIBOR Fixed Rate September 2019 - September 2025 $ 250 3.04 % September 2022 - September 2025 $ 250 2.82 %
Derivative Instruments and their Impact on Financial Condition	The following tabular disclosures further describe the Company’s interest rate derivatives qualifying and designated for hedge accounting and their impact on the financial condition of the Company (dollars in millions): Fair Value Balance Sheet Location March 31, December 31, Derivative Assets: Interest rate swaps Other current assets $ 6 $ 7 Other non-current assets 8 11 Total derivative assets $ 14 $ 18

Product Warranty Liabilities (T

Product Warranty Liabilities (Tables)	3 Months Ended
	Mar. 31, 2023
Guarantees and Product Warranties [Abstract]
Product Warranty Liability Activities	Product warranty liability activities consist of the following (dollars in millions): Three Months Ended 2023 2022 Beginning balance $ 57 $ 53 Payments ( 8 ) ( 7 ) Increase in liability (warranty issued during period) 6 4 Net adjustments to liability 4 3 Ending balance $ 59 $ 53

Deferred Revenue (Tables)

Deferred Revenue (Tables)	3 Months Ended
	Mar. 31, 2023
Revenue Recognition and Deferred Revenue [Abstract]
Summary of Deferred Revenue Activity	Deferred revenue activity consists of the following (dollars in millions): Three Months Ended 2023 2022 Beginning balance $ 131 $ 136 Increases 17 7 Revenue earned ( 9 ) ( 11 ) Ending balance $ 139 $ 132

Leases (Tables)

Leases (Tables)	3 Months Ended
	Mar. 31, 2023
Leases [Abstract]
Schedule of Lease Maturity, Current Guidance	The following table reconciles future undiscounted cash flows for operating leases as of March 31, 2023 to total operating lease liabilities: March 31, 2023 $ 5 2024 3 2025 3 2026 2 2027 2 Thereafter 4 Total lease payments $ 19 Less: Interest 3 Present value of lease liabilities $ 16
Schedule of Right of Use Assets	The below table depicts the ROU assets held by the Company based on the underlying asset: March 31, December 31, Buildings $ 15 $ 15 Land 1 1 Equipment 1 — Vehicles — 1 Total ROU assets $ 17 $ 17

Other Current Liabilities (Tabl

Other Current Liabilities (Tables)	3 Months Ended
	Mar. 31, 2023
Other Liabilities Disclosure [Abstract]
Summary of Other Current Liabilities	Other current liabilities consist of the following (dollars in millions): March 31, December 31, Taxes payable $ 80 $ 31 Sales incentives 41 42 Payroll and related costs 35 72 Accrued interest payable 27 24 Vendor buyback obligation 17 16 OPEB liability 4 4 Construction holdback 4 4 Lease liability 4 4 Other accruals 15 11 Total $ 227 $ 208

Employee Benefit Plans (Tables)

Employee Benefit Plans (Tables)	3 Months Ended
	Mar. 31, 2023
Retirement Benefits [Abstract]
Components of Net Periodic Benefit Cost (Credit)	Components of net periodic benefit cost (credit) consist of the following (dollars in millions): Pension Plans Post-retirement Benefits For the Three Months For the Three Months 2023 2022 2023 2022 Net periodic benefit cost (credit): Service cost $ 1 $ 2 $ — $ — Interest cost 2 1 1 1 Expected return on assets ( 2 ) ( 2 ) — — Prior service credit — — ( 2 ) ( 3 ) Recognized actuarial gain — — ( 1 ) — Net periodic benefit cost (credit) $ 1 $ 1 $ ( 2 ) $ ( 2 )

Accumulated Other Comprehensi_2

Accumulated Other Comprehensive Loss (Tables)	3 Months Ended
	Mar. 31, 2023
Equity [Abstract]
Changes in Accumulated Other Comprehensive Loss by Component	The following tables reconcile changes in AOCL by component (net of tax, dollars in millions): Three months ended Pension Interest Foreign Total AOCL as of December 31, 2021 $ ( 17 ) $ ( 24 ) $ ( 32 ) $ ( 73 ) Other comprehensive income before reclassifications — 22 — 22 Amounts reclassified from AOCL ( 3 ) 3 — — Income tax benefit (expense) 1 ( 6 ) — ( 5 ) Net current period other comprehensive (loss) income $ ( 2 ) $ 19 $ — $ 17 AOCL as of March 31, 2022 $ ( 19 ) $ ( 5 ) $ ( 32 ) $ ( 56 ) AOCL as of December 31, 2022 $ 5 $ 15 $ ( 42 ) $ ( 22 ) Other comprehensive (loss) income before reclassifications — ( 2 ) 2 — Amounts reclassified from AOCL ( 3 ) ( 2 ) — ( 5 ) Income tax expense 1 1 — 2 Net current period other comprehensive (loss) income $ ( 2 ) $ ( 3 ) $ 2 $ ( 3 ) AOCL as of March 31, 2023 $ 3 $ 12 $ ( 40 ) $ ( 25 )
Reclassification out of Accumulated Other Comprehensive Loss	Amounts reclassified from AOCL AOCL Components Three months ended Three months ended Affected line item in the Condensed Interest rate swaps $ 2 $ ( 3 ) Interest expense, net Prior service credit 2 3 Other income (expense), net Recognized actuarial gain 1 — Other income (expense), net Total reclassifications, before tax $ 5 $ — Income before income taxes Income tax expense ( 1 ) — Income tax expense Total reclassifications, net of tax $ 4 $ —

Earnings Per Share (Tables)

Earnings Per Share (Tables)	3 Months Ended
	Mar. 31, 2023
Earnings Per Share [Abstract]
Schedule of Reconciliation of Numerators and Denominators Used to Calculate Basic EPS and Diluted EPS	The following table reconciles the numerators and denominators used to calculate basic EPS and diluted EPS (dollars in millions, except per share data): Three Months Ended 2023 2022 Net income $ 170 $ 129 Weighted average shares of common stock outstanding 92 98 Dilutive effect of stock-based awards — 1 Diluted weighted average shares of common stock outstanding 92 99 Basic earnings per share attributable to common stockholders $ 1.85 $ 1.32 Diluted earnings per share attributable to common stockholders $ 1.85 $ 1.30

Overview - Additional Informati

Overview - Additional Information (Details)	12 Months Ended
	Dec. 31, 2022 Customer
Organization, Consolidation and Presentation of Financial Statements Disclosure [Line Items]
Worldwide independent distributor and dealer locations	1,600
Sales Revenue, Net | North America | Geographic Concentration Risk
Organization, Consolidation and Presentation of Financial Statements Disclosure [Line Items]
Concentration of risk, percentage	74%

Revenue - Additional Informatio

Revenue - Additional Information (Details)	3 Months Ended
	Mar. 31, 2023 USD ($) Segment	Mar. 31, 2022 USD ($)	Dec. 31, 2022 USD ($)
Revenue from Contract with Customer [Abstract]
Material adjustments based on variable consideration | $	$ 0	$ 0
Credit term period	30 days
Contract assets | $	$ 0		$ 0
Number of operating segment | Segment	1
Number of reportable segment | Segment	1

Revenue - Disaggregated Revenue

Revenue - Disaggregated Revenue by Categories (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Disaggregation of Revenue [Line Items]
Total Net Sales	$ 741	$ 677
North America On-Highway
Disaggregation of Revenue [Line Items]
Total Net Sales	376	346
North America Off-Highway
Disaggregation of Revenue [Line Items]
Total Net Sales	24	18
Defense
Disaggregation of Revenue [Line Items]
Total Net Sales	27	35
Outside North America On-Highway
Disaggregation of Revenue [Line Items]
Total Net Sales	108	109
Outside North America Off-Highway
Disaggregation of Revenue [Line Items]
Total Net Sales	23	30
Service Parts, Support Equipment and Other
Disaggregation of Revenue [Line Items]
Total Net Sales	$ 183	$ 139

Inventories - Schedule of Compo

Inventories - Schedule of Components of Inventories (Details) - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022
Inventory Disclosure [Abstract]
Purchased parts and raw materials	$ 128	$ 115
Work in progress	12	7
Service parts	53	53
Finished goods	64	49
Total inventories	$ 257	$ 224

Goodwill And Other Intangible_3

Goodwill And Other Intangible Assets - Additional Information (Details) - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022
Goodwill and Intangible Assets Disclosure [Abstract]
Goodwill	$ 2,075	$ 2,075
Net carrying value of Goodwill and intangible assets	$ 2,942	$ 2,953

Goodwill and Other Intangible_4

Goodwill and Other Intangible Assets - Schedule of Other Intangible Assets (Details) - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022
Goodwill and Intangible Assets Disclosure [Line Items]
Intangible assets, gross, Total	$ 2,202	$ 2,202
Accumulated amortization	(1,335)	(1,324)
Intangible assets, net, Total	867	878
Trade name
Goodwill and Intangible Assets Disclosure [Line Items]
Indefinite lived intangible assets	791	791
In process research and development
Goodwill and Intangible Assets Disclosure [Line Items]
Indefinite lived intangible assets	25	25
Customer relationships - commercial
Goodwill and Intangible Assets Disclosure [Line Items]
Intangible assets, gross	839	839
Accumulated amortization	(802)	(793)
Intangible assets, net	37	46
Proprietary technology
Goodwill and Intangible Assets Disclosure [Line Items]
Intangible assets, gross	484	484
Accumulated amortization	(478)	(477)
Intangible assets, net	6	7
Customer relationships - defense
Goodwill and Intangible Assets Disclosure [Line Items]
Intangible assets, gross	62	62
Accumulated amortization	(54)	(53)
Intangible assets, net	8	9
Non-compete agreements
Goodwill and Intangible Assets Disclosure [Line Items]
Intangible assets, gross	1	1
Accumulated amortization	$ (1)	$ (1)

Goodwill and Other Intangible_5

Goodwill and Other Intangible Assets - Schedule of Amortization Expense Related to Other Intangible Assets for Next Five Fiscal Years (Details) $ in Millions	Mar. 31, 2023 USD ($)
Goodwill and Intangible Assets Disclosure [Abstract]
2024	$ 9
2025	5
2026	2
2027	1
2028	$ 1

Fair Value of Financial Instr_3

Fair Value of Financial Instruments - Additional Information (Details) - USD ($)	3 Months Ended
	Mar. 31, 2023	Dec. 31, 2022
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Fair value measurement guidance and hierarchy levels, description	Fair value is the price (exit price) that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Company utilizes market data or assumptions that market participants would use in pricing the asset or liability, including assumptions about risk and the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market corroborated, or generally unobservable. The accounting guidance establishes a fair value hierarchy that prioritizes the inputs used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3 measurement). The three levels of the fair value hierarchy defined by the relevant guidance are as follows:Level 1 — Quoted prices are available in active markets for identical assets or liabilities as of the reporting date. Level 2 — Inputs are other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date. Level 2 includes financial instruments that are valued using quoted prices in markets that are not active and those financial instruments that are valued using models or other valuation methodologies in which all significant value-drivers are observable in active markets or are supported by observable levels at which transactions are executed in the marketplace.Level 3 — Certain inputs are unobservable or have little or no market data available. These inputs may be used with internally developed methodologies that result in management’s best estimate of fair value. At each balance sheet date, the Company performs an analysis of all instruments subject to authoritative accounting guidance and includes, in Level 3, all of those whose fair value is based on significant unobservable inputs. As of March 31, 2023 and December 31, 2022, the Company did not have any Level 3 financial assets or liabilities.
Fair Value, Inputs, Level 3
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Financial assets	$ 0	$ 0
Financial liabilities	$ 0	$ 0

Fair Value of Financial Instr_4

Fair Value of Financial Instruments - Summary of Fair Value of Financial Assets and (Liabilities) (Details) - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Cash equivalents	$ 202	$ 111
Marketable securities	$ 25	$ 22
Derivative Asset, Statement of Financial Position [Extensible Enumeration]	Assets	Assets
Rabbi trust assets	$ 17	$ 15
Deferred compensation obligation	(17)	(15)
Total	241	151
Derivatives Designated as Hedging Instruments
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Derivative assets	14	18
Quoted Prices in Active Markets for Identical Assets (Level 1)
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Cash equivalents	202	111
Marketable securities	25	22
Rabbi trust assets	17	15
Deferred compensation obligation	(17)	(15)
Total	227	133
Quoted Prices in Active Markets for Identical Assets (Level 1) | Derivatives Designated as Hedging Instruments
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Derivative assets	0	0
Significant Other Observable Inputs (Level 2)
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Cash equivalents	0	0
Marketable securities	0	0
Rabbi trust assets	0	0
Deferred compensation obligation	0	0
Total	14	18
Significant Other Observable Inputs (Level 2) | Derivatives Designated as Hedging Instruments
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Derivative assets	$ 14	$ 18

Debt - Summary of Long-Term Deb

Debt - Summary of Long-Term Debt and Maturities (Details) - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022
Debt Instrument [Line Items]
Total long-term debt	$ 2,523	$ 2,525
Current portion of long-term debt	6	6
deferred financing costs, net	17	18
Long-term debt	2,500	2,501
Senior Secured Credit Facility Term Loan, Variable, Due 2026
Debt Instrument [Line Items]
Total long-term debt	623	625
Senior Notes, Fixed 4.75%, Due 2027
Debt Instrument [Line Items]
Total long-term debt	400	400
Senior Notes, Fixed 5.875%, Due 2029
Debt Instrument [Line Items]
Total long-term debt	500	500
Senior Notes, Fixed 3.75%, Due 2031
Debt Instrument [Line Items]
Total long-term debt	$ 1,000	$ 1,000

Debt - Summary of Long-Term D_2

Debt - Summary of Long-Term Debt and Maturities (Parenthetical) (Details)	Mar. 31, 2023	Dec. 31, 2022
Senior Secured Credit Facility Term Loan, Variable, Due 2026
Debt Instrument [Line Items]
Debt instrument, due date	2026	2026
Senior Notes, Fixed 4.75%, Due 2027
Debt Instrument [Line Items]
Debt instrument, due date	2027	2027
Debt instrument, stated interest rate	4.75%	4.75%
Senior Notes, Fixed 5.875%, Due 2029
Debt Instrument [Line Items]
Debt instrument, due date	2029	2029
Debt instrument, stated interest rate	5.875%	5.875%
Senior Notes, Fixed 3.75%, Due 2031
Debt Instrument [Line Items]
Debt instrument, due date	2031	2031
Debt instrument, stated interest rate	3.75%	3.75%

Debt - Additional Information (

Debt - Additional Information (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Dec. 31, 2022
Debt Instrument [Line Items]
Long-term debt	$ 2,523	$ 2,525
Fair value of long-term debt obligations	2,341
Senior Notes, Fixed 4.75%, Due 2027
Debt Instrument [Line Items]
Long-term debt	$ 400	$ 400
Debt instrument, stated interest rate	4.75%	4.75%
Debt instrument, maturity month and year	2027-10
Senior Notes, Fixed 5.875%, Due 2029
Debt Instrument [Line Items]
Long-term debt	$ 500	$ 500
Debt instrument, stated interest rate	5.875%	5.875%
Debt instrument, maturity month and year	2029-06
Senior Notes, Fixed 3.75%, Due 2031
Debt Instrument [Line Items]
Long-term debt	$ 1,000	$ 1,000
Debt instrument, stated interest rate	3.75%	3.75%
Debt instrument, maturity month and year	2031-01
Senior Secured Credit Facility Term Loan, Variable, Due 2026
Debt Instrument [Line Items]
Long-term debt	$ 623	$ 625
Debt instrument, maturity month and year	2026-03
Debt Instrument, Redemption, Period One | Senior Notes, Fixed 3.75%, Due 2031
Debt Instrument [Line Items]
Debt instrument, redemption end date	Jan. 30, 2024
Percentage of principal amount redeemed	103.75%
Percentage of principal amount redeemable	40%
Debt Instrument, Redemption, Period Two | Senior Notes, Fixed 5.875%, Due 2029
Debt Instrument [Line Items]
Debt instrument, redemption end date	Jun. 01, 2024
Percentage of principal amount redeemed	100%
Debt Instrument, Redemption, Period Two | Senior Notes, Fixed 3.75%, Due 2031
Debt Instrument [Line Items]
Debt instrument redemption start date	Jan. 30, 2024
Debt instrument, redemption end date	Jan. 30, 2026
Percentage of principal amount redeemed	100%
Debt Instrument, Redemption, Period Three | Senior Notes, Fixed 5.875%, Due 2029
Debt Instrument [Line Items]
Debt instrument redemption start date	Jun. 01, 2024
Debt Instrument, Redemption, Period Three | Senior Notes, Fixed 3.75%, Due 2031
Debt Instrument [Line Items]
Debt instrument, redemption end date	Jan. 30, 2026
Revolving Credit Facility
Debt Instrument [Line Items]
Debt instrument, maturity month and year	2025-09
Credit facility, commitments amount	$ 650

Debt - Senior Secured Credit Fa

Debt - Senior Secured Credit Facility - Additional Information (Details) - USD ($)	1 Months Ended	3 Months Ended
	Feb. 28, 2023	Mar. 31, 2023
Letter of Credit
Debt Instrument [Line Items]
Available revolving credit facility		$ 6,000,000
Revolving Credit Facility
Debt Instrument [Line Items]
Credit facility, commitments amount		$ 650,000,000
Debt instrument, maturity month and year		2025-09
Available revolving credit facility		$ 644,000,000
Commitment fee percentage		0.25%
Amount outstanding		$ 0
Achieved senior secured leverage ratio		0.28
SOFR | Revolving Credit Facility
Debt Instrument [Line Items]
Applicable margin over base rate		1.25%
SOFR | First Lien Net Leverage Ratio is Above 4.00x | Revolving Credit Facility
Debt Instrument [Line Items]
Applicable margin over base rate		1.75%
SOFR | First Lien Net Leverage Ratio is Equal to or Less Than 4.00x and above 3.50x | Revolving Credit Facility
Debt Instrument [Line Items]
Applicable margin over base rate		1.50%
SOFR | First Lien Net Leverage Ratio is Equal to or Below 3.50x | Revolving Credit Facility
Debt Instrument [Line Items]
Applicable margin over base rate		1.25%
Base Rate | First Lien Net Leverage Ratio is Above 4.00x | Revolving Credit Facility
Debt Instrument [Line Items]
Applicable margin over base rate		0.75%
Base Rate | First Lien Net Leverage Ratio is Equal to or Less Than 4.00x and above 3.50x | Revolving Credit Facility
Debt Instrument [Line Items]
Applicable margin over base rate		0.50%
Base Rate | First Lien Net Leverage Ratio is Equal to or Below 3.50x | Revolving Credit Facility
Debt Instrument [Line Items]
Applicable margin over base rate		0.25%
Minimum | First Lien Net Leverage Ratio is Above 4.00x | Revolving Credit Facility
Debt Instrument [Line Items]
Net leverage ratio		4
Senior Secured Credit Facility
Debt Instrument [Line Items]
Required senior secured leverage ratio		5.50
Net leverage ratio		4
Senior Secured Credit Facility | Letter of Credit
Debt Instrument [Line Items]
Credit facility, commitments amount		$ 75,000,000
Credit facility, withdrawal amount		$ 0
Senior Secured Credit Facility | SOFR benchmark
Debt Instrument [Line Items]
Applicable margin over base rate	0.10%
Credit spread adjustment rate	0.10%
Senior Secured Credit Facility | Minimum | First Lien Net Leverage Ratio is Equal to or Less Than 4.00x and above 3.50x
Debt Instrument [Line Items]
Net leverage ratio		3.50
Senior Secured Credit Facility | Maximum | First Lien Net Leverage Ratio is Equal to or Less Than 4.00x and above 3.50x
Debt Instrument [Line Items]
Net leverage ratio		4
Senior Secured Credit Facility | Maximum | First Lien Net Leverage Ratio is Equal to or Below 3.50x
Debt Instrument [Line Items]
Net leverage ratio		3.50
Term Loan
Debt Instrument [Line Items]
Debt instrument effective interest rate		6.61%
Debt instrument, maturity month and year		2026-03
Principal payments on term loans		$ 2,000,000
Term Loan | SOFR
Debt Instrument [Line Items]
Applicable margin over base rate		0.75%
Term Loan | Base Rate
Debt Instrument [Line Items]
Applicable margin over base rate		0.50%
Term Loan | Minimum | SOFR
Debt Instrument [Line Items]
Applicable margin over base rate		1.75%
Term Loan | Minimum | Base Rate
Debt Instrument [Line Items]
Applicable margin over base rate		1%
Floor rate		1%

Derivatives - Additional Inform

Derivatives - Additional Information (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Dec. 31, 2022
Derivative [Line Items]
Derivative, description of terms	The Company is subject to interest rate risk related to the Senior Secured Credit Facility and entered into interest rate swaps that are based on LIBOR to manage a portion of this exposure. The interest rate swaps are designated as cash flow hedges that qualify for hedge accounting under the hypothetical derivative method. Fair value adjustments are recorded as a component of Accumulated other comprehensive loss, net of tax (“AOCL”) in the Condensed Consolidated Balance Sheets. Balances in AOCL are reclassified to earnings when transactions related to the underlying risk are settled. See "Note F. Fair Value of Financial Instruments” for information regarding the fair value of the Company’s interest rate swaps.
Sunset date of temporary relief period	Dec. 31, 2024
Derivative gains in AOCL expected to be reclassified within next twelve months	$ 9
Available-for-sale securities and interest rate swaps
Derivative [Line Items]
Accumulated other comprehensive loss, net of tax	$ 14	$ 18

Derivatives - Schedule of Inter

Derivatives - Schedule of Interest Rate Swaps (Details)	Mar. 31, 2023 USD ($)
Interest Rate Swaps A
Derivative [Line Items]
Notional Amount	$ 250,000,000
Interest Rate Swaps A | LIBOR
Derivative [Line Items]
Weighted Average LIBOR Fixed Rate	3.04%
Interest Rate Swaps B
Derivative [Line Items]
Notional Amount	$ 250,000,000
Interest Rate Swaps B | LIBOR
Derivative [Line Items]
Weighted Average LIBOR Fixed Rate	2.82%

Derivatives - Derivative Instru

Derivatives - Derivative Instruments and their Impact on Financial Condition (Details) - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022
Derivative [Line Items]
Derivative Asset, Statement of Financial Position [Extensible Enumeration]	Assets	Assets
Derivatives Designated as Hedging Instruments
Derivative [Line Items]
Total derivative assets	$ 14	$ 18
Derivatives Designated as Hedging Instruments | Interest Rate Swaps
Derivative [Line Items]
Total derivative assets	14	18
Derivatives Designated as Hedging Instruments | Interest Rate Swaps | Other current assets
Derivative [Line Items]
Interest rate swaps, assets	6	7
Derivatives Designated as Hedging Instruments | Interest Rate Swaps | Other non-current assets
Derivative [Line Items]
Interest rate swaps, assets	$ 8	$ 11

Product Warranty Liabilities -

Product Warranty Liabilities - Additional Information (Details) - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022	Mar. 31, 2022
Guarantees [Abstract]
Product warranty liability, current	$ 27	$ 33	$ 30
Product warranty liability, non-current	$ 32	$ 24	$ 23

Product Warranty Liabilities _2

Product Warranty Liabilities - Product Warranty Liability Activities (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Guarantees [Abstract]
Beginning balance	$ 57	$ 53
Payments	(8)	(7)
Increase in liability (warranty issued during period)	6	4
Net adjustments to liability	4	3
Ending balance	$ 59	$ 53

Deferred Revenue - Additional I

Deferred Revenue - Additional Information (Details) - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022	Mar. 31, 2022
Disaggregation of Revenue [Line Items]
Deferred revenue current liabilities	$ 45	$ 38	$ 35
Deferred revenue non-current liabilities	94	$ 93	97
ETC contracts
Disaggregation of Revenue [Line Items]
Deferred revenue current liabilities	30		29
Deferred revenue non-current liabilities	$ 84		$ 84

Deferred Revenue - Summary of D

Deferred Revenue - Summary of Deferred Revenue Activity (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Revenue Recognition and Deferred Revenue [Abstract]
Beginning balance	$ 131	$ 136
Increases	17	7
Revenue earned	(9)	(11)
Ending balance	$ 139	$ 132

Leases - Additional Information

Leases - Additional Information (Details) - USD ($)	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Dec. 31, 2022
Leases [Abstract]
Lessee lease description	Contracts are assessed by the Company to determine if the contract conveys the right to control an identified asset in exchange for consideration during a period of time. The Company classifies all identified leases as either operating or finance leases. As of March 31, 2023, the Company was not a party to any finance leases. Contracts that contain leases are assessed to determine if the consideration in the contract is related to a lease component, non-lease component or other components not related to the lease. Lease components are recorded as right-of-use (“ROU”) assets and lease liabilities while any non-lease component is expensed as incurred. The consideration in the contract related to other components not related to the lease is allocated among the lease component and the non-lease component, as applicable, based on the stand-alone selling price of the lease and non-lease components.
Discount rate	4.53%		4.43%
Current lease liabilities	$ 4,000,000		$ 4,000,000
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List]	Other current liabilities		Other current liabilities
Non-current lease liabilities	$ 12,000,000		$ 13,000,000
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List]	Other non-current liabilities		Other non-current liabilities
Remaining lease term	6 years 1 month 6 days	6 years 9 months 18 days
Operating expense	$ 1,000,000	$ 1,000,000
Material short term operating lease expense	0	0
New ROU assets	$ 1,000,000	$ 0

Leases - Schedule of Lease Matu

Leases - Schedule of Lease Maturity, Current Guidance (Details) $ in Millions	Mar. 31, 2023 USD ($)
Leases [Abstract]
2023	$ 5
2024	3
2025	3
2026	2
2027	2
Thereafter	4
Total lease payments	19
Less: Interest	3
Present value of lease liabilities	$ 16
Operating Lease, Liability, Statement of Financial Position [Extensible List]	us-gaap:OtherLiabilities

Leases - Schedule of Right of U

Leases - Schedule of Right of Use Assets (Details) - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022
Lessee, Lease, Description [Line Items]
Total ROU assets	$ 17	$ 17
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration]	Property, Plant and Equipment, Net	Property, Plant and Equipment, Net
Buildings
Lessee, Lease, Description [Line Items]
Total ROU assets	$ 15	$ 15
Land
Lessee, Lease, Description [Line Items]
Total ROU assets	1	1
Equipment
Lessee, Lease, Description [Line Items]
Total ROU assets	1	0
Vehicles
Lessee, Lease, Description [Line Items]
Total ROU assets	$ 0	$ 1

Other Current Liabilities - Sum

Other Current Liabilities - Summary of Other Current Liabilities (Details) - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022
Payables and Accruals [Abstract]
Taxes payable	$ 80	$ 31
Sales incentives	41	42
Payroll and related costs	35	72
Accrued interest payable	27	24
Vendor buyback obligation	17	16
OPEB liability	4	4
Construction holdback	4	4
Lease liability	4	4
Other accruals	15	11
Total	$ 227	$ 208

Employee Benefit Plans - Compon

Employee Benefit Plans - Components of Net Periodic Benefit Cost (Credit) (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Net Periodic Benefit Cost (Credit) Excluding Service Cost, Statement of Income or Comprehensive Income [Extensible Enumeration]	Other Comprehensive (Income) Loss, Defined Benefit Plan, after Reclassification Adjustment, after Tax	Other Comprehensive (Income) Loss, Defined Benefit Plan, after Reclassification Adjustment, after Tax
Pension Plans
Defined Benefit Plan Disclosure [Line Items]
Service cost	$ 1	$ 2
Interest cost	2	1
Expected return on assets	(2)	(2)
Prior service credit	0	0
Recognized actuarial gain	0	0
Net periodic benefit cost (credit)	1	1
Post-retirement Benefits
Defined Benefit Plan Disclosure [Line Items]
Service cost	0	0
Interest cost	1	1
Expected return on assets	0	0
Prior service credit	(2)	(3)
Recognized actuarial gain	(1)	0
Net periodic benefit cost (credit)	$ (2)	$ (2)

Income Taxes - Additional Infor

Income Taxes - Additional Information (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Income Tax Disclosure [Abstract]
Income tax expense	$ 42	$ 34
Effective tax rate	20%	21%
Valuation allowance, description	The need to establish a valuation allowance against the deferred tax assets is assessed periodically based on a more-likely-than-not realization threshold, in accordance with authoritative accounting guidance. Appropriate consideration is given to all positive and negative evidence related to that realization. This assessment considers, among other matters, the nature, frequency and severity of recent losses, forecasts of future profitability, the duration of statutory carry-forward periods, experience with tax attributes expiring unused, and tax planning alternatives. The weight given to these considerations depends upon the degree to which they can be objectively verified.

Accumulated Other Comprehensi_3

Accumulated Other Comprehensive Loss - Changes in Accumulated Other Comprehensive Loss by Component (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Accumulated Other Comprehensive Income Loss [Line Items]
Balance	$ 874	$ 634
Balance	988	679
Pension and OPEB liability adjustments
Accumulated Other Comprehensive Income Loss [Line Items]
Balance	5	(17)
Amounts reclassified from AOCL	(3)	(3)
Income tax benefit (expense)	1	1
Net current period other comprehensive (loss) income	(2)	(2)
Balance	3	(19)
Interest rate swaps
Accumulated Other Comprehensive Income Loss [Line Items]
Balance	15	(24)
Other comprehensive (loss) income before reclassifications	(2)	22
Amounts reclassified from AOCL	(2)	3
Income tax benefit (expense)	1	(6)
Net current period other comprehensive (loss) income	(3)	19
Balance	12	(5)
Foreign currency items
Accumulated Other Comprehensive Income Loss [Line Items]
Balance	(42)	(32)
Other comprehensive (loss) income before reclassifications	2
Net current period other comprehensive (loss) income	2
Balance	(40)	(32)
Accumulated Other Comprehensive (Loss) Income, net of tax
Accumulated Other Comprehensive Income Loss [Line Items]
Balance	(22)	(73)
Other comprehensive (loss) income before reclassifications		22
Amounts reclassified from AOCL	(5)
Income tax benefit (expense)	2	(5)
Net current period other comprehensive (loss) income	(3)	17
Balance	$ (25)	$ (56)

Accumulated Other Comprehensi_4

Accumulated Other Comprehensive Loss - Amounts reclassified from AOCL (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Accumulated Other Comprehensive Income Loss [Line Items]
Interest expense, net	$ (28)	$ (29)
Other income (expense), net	10	(10)
Income before income taxes	212	163
Income tax expense	(42)	(34)
Net income	170	129
Reclassified from AOCL | Interest rate swaps
Accumulated Other Comprehensive Income Loss [Line Items]
Interest expense, net	2	(3)
Reclassified from AOCL | Prior service cost
Accumulated Other Comprehensive Income Loss [Line Items]
Other income (expense), net	2	$ 3
Reclassified from AOCL | Recognized actuarial gain
Accumulated Other Comprehensive Income Loss [Line Items]
Other income (expense), net	1
Reclassified from AOCL | Pension and OPEB liability adjustment
Accumulated Other Comprehensive Income Loss [Line Items]
Income before income taxes	5
Income tax expense	(1)
Net income	$ 4

Earnings Per Share - Additional

Earnings Per Share - Additional Information (Details) - shares shares in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Earnings Per Share [Abstract]
Shares excluded from diluted EPS calculation (in shares)	1	1

Earnings Per Share - Schedule o

Earnings Per Share - Schedule of Reconciliation of Numerators and Denominators Used to Calculate Basic EPS and Diluted EPS (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Earnings Per Share [Abstract]
Net income	$ 170	$ 129
Weighted average shares of common stock outstanding	92	98
Dilutive effect of stock-based awards	0	1
Diluted weighted average shares of common stock outstanding	92	99
Basic earnings per share attributable to common stockholders	$ 1.85	$ 1.32
Diluted earnings per share attributable to common stockholders	$ 1.85	$ 1.30

Common Stock - Additional Infor

Common Stock - Additional Information (Details) - Repurchase Program	3 Months Ended
	Mar. 31, 2023 USD ($)
Common Stock Disclosure [Line Items]
Common stock, repurchased during the period	$ 40,000,000
Stock repurchase program, remaining amount	995,000,000
Maximum
Common Stock Disclosure [Line Items]
Stock repurchase program, authorized amount	$ 4,000,000,000