Document and Entity Information
Document and Entity Information Document - USD ($) $ in Billions | 12 Months Ended | ||
Dec. 31, 2016 | Feb. 03, 2017 | Jun. 30, 2016 | |
DEI Information [Abstract] | |||
Entity Registrant Name | BORGWARNER INC. | ||
Entity Central Index Key | 908,255 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2016 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Document Fiscal Year Focus | 2,016 | ||
Document Fiscal Period Focus | FY | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Public Float | $ 6.3 | ||
Entity Common Stock, Shares Outstanding | 212,690,967 |
BorgWarner Inc. and Consolidate
BorgWarner Inc. and Consolidated Subsidiaries Consolidated Balance Sheets - USD ($) $ in Millions | Dec. 31, 2016 | Dec. 31, 2015 |
ASSETS | ||
Cash | $ 443.7 | $ 577.7 |
Receivables, net | 1,689.3 | 1,665 |
Inventories, net | 641.2 | 723.6 |
Prepayments and other current assets | 137.4 | 168.9 |
Total current assets | 2,911.6 | 3,135.2 |
Property, plant and equipment, net | 2,501.8 | 2,448.1 |
Investments and other long-term receivables | 502.2 | 460.9 |
Goodwill | 1,702.2 | 1,757.7 |
Other intangible assets, net | 463.5 | 543.8 |
Other non-current assets | 753.4 | 480 |
Total assets | 8,834.7 | 8,825.7 |
LIABILITIES AND EQUITY | ||
Notes payable and other short-term debt | 175.9 | 441.4 |
Accounts payable and accrued expenses | 1,847.3 | 1,866.4 |
Income taxes payable | 68.6 | 49.4 |
Total current liabilities | 2,091.8 | 2,357.2 |
Long-term debt | 2,043.6 | 2,108.9 |
Other non-current liabilities: | ||
Asbestos-related liabilities | 827.6 | 60.8 |
Retirement-related liabilities | 294.1 | 312.9 |
Other | 275.7 | 354.4 |
Total other non-current liabilities | 1,397.4 | 728.1 |
Capital stock: | ||
Common stock | 2.5 | 2.5 |
Capital in excess of par value | 1,104.3 | 1,109.7 |
Retained earnings | 4,215.2 | 4,210.1 |
Accumulated other comprehensive loss | (722.1) | (610.2) |
Common stock held in treasury | (1,381.6) | (1,158.4) |
Total BorgWarner Inc. stockholders’ equity | 3,218.3 | 3,553.7 |
Noncontrolling interest | 83.6 | 77.8 |
Total equity | 3,301.9 | 3,631.5 |
Total liabilities and equity | $ 8,834.7 | $ 8,825.7 |
Preferred Stock, Par or Stated Value Per Share | $ 0.01 | $ 0.01 |
Preferred Stock, Shares Authorized | 5,000,000 | 5,000,000 |
Preferred Stock, Shares Issued | 0 | 0 |
Common Stock, Par or Stated Value Per Share | $ 0.01 | $ 0.01 |
Common Stock, Shares Authorized | 390,000,000 | 390,000,000 |
Common Stock, Shares, Issued | 246,387,057 | 246,387,057 |
Common Stock, Shares, Outstanding | 212,262,965 | 219,324,821 |
Treasury Stock, Shares | 34,124,092 | 27,062,236 |
Nonvoting Common Stock [Member] | ||
Capital stock: | ||
Common Stock, Par or Stated Value Per Share | $ 0.01 | $ 0.01 |
Common Stock, Shares Authorized | 25,000,000 | 25,000,000 |
Common Stock, Shares, Issued | 0 | 0 |
Common Stock, Shares, Outstanding | 0 | 0 |
BorgWarner Inc. and Consolidat3
BorgWarner Inc. and Consolidated Subsidiaries Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Income Statement [Abstract] | |||
Net sales | $ 9,071 | $ 8,023.2 | $ 8,305.1 |
Cost of sales | 7,137.9 | 6,320.1 | 6,548.7 |
Gross profit | 1,933.1 | 1,703.1 | 1,756.4 |
Selling, general and administrative expenses | 817.5 | 662 | 698.9 |
Other expense, net | 889.7 | 101.4 | 93.8 |
Operating income | 225.9 | 939.7 | 963.7 |
Equity in affiliates’ earnings, net of tax | (42.9) | (40) | (47.3) |
Interest income | (6.3) | (7.5) | (5.5) |
Interest expense and finance charges | 84.6 | 60.4 | 36.4 |
Earnings before income taxes and noncontrolling interest | 190.5 | 926.8 | 980.1 |
Provision for income taxes | 30.3 | 280.4 | 292.6 |
Net earnings | 160.2 | 646.4 | 687.5 |
Net earnings attributable to the noncontrolling interest, net of tax | 41.7 | 36.7 | 31.7 |
Net earnings attributable to BorgWarner Inc. | $ 118.5 | $ 609.7 | $ 655.8 |
Earnings per share — basic | $ 0.55 | $ 2.72 | $ 2.89 |
Earnings per share — diluted | $ 0.55 | $ 2.70 | $ 2.86 |
Weighted average shares outstanding (thousands): | |||
Basic | 214,374 | 224,414 | 227,150 |
Diluted | 215,328 | 225,648 | 228,924 |
Dividends declared per share | $ 0.53 | $ 0.52 | $ 0.51 |
BorgWarner Inc. and Consolidat4
BorgWarner Inc. and Consolidated Subsidiaries Statements of Comprehensive Income - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | ||
Statement of Comprehensive Income [Abstract] | ||||
Net earnings attributable to BorgWarner Inc. | $ 118.5 | $ 609.7 | $ 655.8 | |
Foreign currency translation adjustments | (109.1) | (260.5) | (341.8) | |
Hedge instruments | [1] | 7 | (3.7) | 17.7 |
Defined benefit postretirement plans | [1] | (8.2) | 37.4 | (45.8) |
Other | [1] | (1.6) | 0.2 | 0.3 |
Total other comprehensive (loss) income attributable to BorgWarner Inc. | (111.9) | (226.6) | (369.6) | |
Comprehensive income attributable to BorgWarner Inc. | 6.6 | 383.1 | 286.2 | |
Comprehensive loss attributable to the noncontrolling interest | (5.1) | (5.1) | (3.9) | |
Comprehensive Income (Loss), Net of Tax, Including Portion Attributable to Noncontrolling Interest | $ 1.5 | $ 378 | $ 282.3 | |
[1] | *Net of income taxes. |
BorgWarner Inc. and Consolidat5
BorgWarner Inc. and Consolidated Subsidiaries Consolidated Statements of Cash Flows - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | ||
OPERATING | ||||
Net earnings | $ 160.2 | $ 646.4 | $ 687.5 | |
Adjustments to reconcile net earnings to net cash flows from operations: | ||||
Asbestos-related charge | 703.6 | 0 | 0 | |
Loss on divestiture | 127.1 | 0 | 0 | |
Depreciation and amortization | 391.4 | 320.2 | 330.4 | |
Restructuring expense, net of cash paid | 12 | 36.3 | 45.8 | |
Gain on previously held equity interest | 0 | (10.8) | 0 | |
Pension settlement loss | 0 | 25.7 | 3.1 | |
Stock-based compensation expense | 43.6 | 40.2 | 32.1 | |
Deferred income tax (benefit) provision | (268.9) | 13.3 | 42.3 | |
Equity in affiliates’ earnings, net of dividends received, and other | (17) | (21.9) | (5.2) | |
Net earnings adjusted for non-cash charges to operations | 1,152 | 1,049.4 | 1,136 | |
Changes in assets and liabilities: | ||||
Receivables | (137.5) | (81.8) | (248.7) | |
Inventories | (36.5) | (52.9) | (39.7) | |
Prepayments and other current assets | 8.8 | (9.4) | 12.7 | |
Accounts payable and accrued expenses | 134.9 | 23.1 | 129.1 | |
Income taxes payable | (14.2) | 34.6 | (28.7) | |
Other assets and liabilities | (71.8) | (95.1) | (158.9) | |
Net cash provided by operating activities | 1,035.7 | 867.9 | 801.8 | |
INVESTING | ||||
Capital expenditures, including tooling outlays | [1] | (500.6) | (577.3) | (563) |
Proceeds from divestiture of businesses, net of cash divested | 85.8 | 0 | 0 | |
Proceeds from asset disposals and other | 10.6 | 4.7 | 8.4 | |
Payments for businesses acquired, including restricted cash, net of cash acquired | 0 | (1,199.6) | (110.5) | |
Proceeds from settlement of net investment hedges | 0 | 13.1 | 0 | |
Net cash used in investing activities | (404.2) | (1,759.1) | (665.1) | |
FINANCING | ||||
Net (decrease) increase in notes payable | (129.1) | (316.7) | 493.2 | |
Additions to long-term debt, net of debt issuance costs | 4.6 | 1,569.2 | 130.5 | |
Repayments of long-term debt, including current portion | (193.6) | (29.8) | (431.6) | |
Repayments of accounts receivable securitization facility | 0 | 0 | (110) | |
Proceeds from interest rate swap termination | 8.9 | 0 | 0 | |
Payments for purchase of treasury stock | (288) | (349.8) | (139.9) | |
Proceeds from (payments for) stock-based compensation items | 6.7 | 3.7 | (6.7) | |
Dividends paid to BorgWarner stockholders | (113.4) | (116.7) | (116.1) | |
Dividends paid to noncontrolling stockholders | (29.9) | (23.3) | (21.1) | |
Net cash (used in) provided by financing activities | (733.8) | 736.6 | (201.7) | |
Effect of exchange rate changes on cash | (31.7) | (65.5) | (76.7) | |
Net decrease in cash | (134) | (220.1) | (141.7) | |
Cash at beginning of year | 577.7 | 797.8 | 939.5 | |
Cash at end of year | 443.7 | 577.7 | 797.8 | |
Net Cash Paid During Period For [Abstract] | ||||
Interest | 100.3 | 70.2 | 49.5 | |
Income taxes, net of refunds | 300.5 | 183.8 | 229.7 | |
Non Cash Investing Transactions [Abstract] | ||||
Liabilities assumed from business acquired | 0 | 31.1 | 3.2 | |
Non-cash financing transactions [Abstract] | ||||
Debt assumed from business acquired | $ 0 | $ 10.9 | $ 40.3 | |
[1] | Long-lived asset expenditures include capital expenditures and tooling outlays. |
BorgWarner Inc. and Consolidat6
BorgWarner Inc. and Consolidated Subsidiaries Consolidated Statements of Equity - USD ($) $ in Millions | Total | Issued common stock | Capital in excess of par value | Common stock held in treasury | Retained earnings | Accumulated other comprehensive income (loss) | Noncontrolling interests | Employee Stock Option [Member]Common stock held in treasury | Performance Shares [Member]Common stock held in treasury | Restricted Stock [Member]Common stock held in treasury |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Treasury Stock, Common, Shares | (18,489,037) | |||||||||
Beginning Balance at Dec. 31, 2013 | $ 2.5 | $ 1,121.9 | $ (727.2) | $ 3,177.4 | $ (14) | $ 71.8 | ||||
Beginning Balance, shares at Dec. 31, 2013 | 246,421,893 | |||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Dividends declared | (116.1) | (24.9) | ||||||||
Stock incentive plans | 5.4 | $ 11.5 | ||||||||
Stock incentive plans, shares | 283,000 | |||||||||
Net issuance for executive stock plan | (13.3) | $ 24.7 | ||||||||
Net issuance of restricted stock | (1.6) | $ (1.3) | ||||||||
Net issuance of restricted stock, shares | (31,273) | |||||||||
Treasury stock reissued, shares | 283,090 | 336,883 | 326,074 | |||||||
Purchase of treasury stock | $ (139.9) | |||||||||
Purchases of treasury stock, shares | (2,417,547) | |||||||||
Net earnings attributable to BorgWarner Inc. | $ 655.8 | 655.8 | ||||||||
Net earnings attributable to the noncontrolling interest, net of tax | 31.7 | 31.7 | ||||||||
Other comprehensive income (loss) | (369.6) | (369.6) | ||||||||
Comprehensive loss attributable to the noncontrolling interest | $ (3.9) | (3.9) | ||||||||
Ending Balance at Dec. 31, 2014 | $ 2.5 | 1,112.4 | $ (832.2) | 3,717.1 | (383.6) | 74.7 | ||||
Ending Balance, shares at Dec. 31, 2014 | 246,390,620 | |||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Treasury Stock, Common, Shares | (19,960,537) | |||||||||
Dividends declared | (116.7) | (28.5) | ||||||||
Stock incentive plans | (1.8) | $ 18.6 | ||||||||
Stock incentive plans, shares | 440,000 | |||||||||
Net issuance for executive stock plan | 2.4 | $ 0 | ||||||||
Net issuance of restricted stock | (3.3) | $ 18.2 | ||||||||
Net issuance of restricted stock, shares | (3,563) | |||||||||
Treasury stock reissued, shares | 439,653 | 532,951 | ||||||||
Purchase of treasury stock | $ (363) | |||||||||
Purchases of treasury stock, shares | (8,074,303) | |||||||||
Net earnings attributable to BorgWarner Inc. | $ 609.7 | 609.7 | ||||||||
Net earnings attributable to the noncontrolling interest, net of tax | 36.7 | 36.7 | ||||||||
Other comprehensive income (loss) | (226.6) | (226.6) | ||||||||
Comprehensive loss attributable to the noncontrolling interest | (5.1) | (5.1) | ||||||||
Ending Balance at Dec. 31, 2015 | $ 3,631.5 | $ 2.5 | 1,109.7 | $ (1,158.4) | 4,210.1 | (610.2) | 77.8 | |||
Ending Balance, shares at Dec. 31, 2015 | 246,387,057 | |||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Treasury Stock, Common, Shares | (27,062,236) | |||||||||
Dividends declared | (113.4) | (26) | ||||||||
Stock incentive plans | (19.4) | $ 32.4 | ||||||||
Stock incentive plans, shares | 794,000 | |||||||||
Net issuance for executive stock plan | 12.8 | $ 0 | ||||||||
Net issuance of restricted stock | 1.2 | $ 19.2 | ||||||||
Treasury stock reissued, shares | 793,230 | 0 | 414,464 | |||||||
Purchase of treasury stock | $ 274.8 | |||||||||
Noncontrolling Interest, Decrease from Deconsolidation | $ 4.8 | |||||||||
Purchases of treasury stock, shares | (8,269,550) | |||||||||
Net earnings attributable to BorgWarner Inc. | 118.5 | 118.5 | ||||||||
Net earnings attributable to the noncontrolling interest, net of tax | 41.7 | 41.7 | ||||||||
Other comprehensive income (loss) | (111.9) | (111.9) | ||||||||
Comprehensive loss attributable to the noncontrolling interest | (5.1) | (5.1) | ||||||||
Ending Balance at Dec. 31, 2016 | $ 3,301.9 | $ 2.5 | $ 1,104.3 | $ (1,381.6) | $ 4,215.2 | $ (722.1) | $ 83.6 | |||
Ending Balance, shares at Dec. 31, 2016 | 246,387,057 | |||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Treasury Stock, Common, Shares | (34,124,092) |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Summary of significant accounting policies | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The following paragraphs briefly describe the Company's significant accounting policies. Basis of presentation In the first quarter of 2016, the Company retrospectively adopted Accounting Standard Update ("ASU") No. 2015-03, " Simplifying the Presentation of Debt Issuance Costs, " which resulted in the reduction of assets and liabilities by approximately $16 million in the Company's Condensed Consolidated Balance Sheet as of December 31, 2015. Certain prior period amounts have been reclassified to conform to current period presentation. Use of estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the accompanying notes, as well as, the amounts of revenues and expenses reported during the periods covered by these financial statements and accompanying notes. Actual results could differ from those estimates. Principles of consolidation The Consolidated Financial Statements include all majority-owned subsidiaries with a controlling financial interest. All inter-company accounts and transactions have been eliminated in consolidation. Investments in 20% to 50% owned affiliates are accounted for under the equity method when the Company does not have a controlling financial interest. Revenue recognition The Company recognizes revenue when title and risk of loss pass to the customer, which is usually upon shipment of product. Although the Company may enter into long-term supply agreements with its major customers, each shipment of goods is treated as a separate sale and the prices are not fixed over the life of the agreements. Cost of sales The Company includes materials, direct labor and manufacturing overhead within cost of sales. Manufacturing overhead is comprised of indirect materials, indirect labor, factory operating costs and other such costs associated with manufacturing products for sale. Cash Cash is valued at fair market value. It is the Company's policy to classify all highly liquid investments with original maturities of three months or less as cash. Cash is maintained with several financial institutions. Deposits held with banks may exceed the amount of insurance provided on such deposits. Generally, these deposits may be redeemed upon demand and are maintained with financial institutions of reputable credit and therefore bear minimal risk. Restricted cash Restricted cash as of December 31, 2015 related to amounts deposited with the paying agent to settle shares of Remy International Inc. ("Remy") stock in connection with the acquisition of Remy on November 10, 2015, that was not paid to the shareholders until the first half of 2016. Receivables, net The Company factors certain receivables through third party financial institutions without recourse. These are treated as a sale. The transactions are accounted for as a reduction in accounts receivable as the agreements transfer effective control over and risk related to the receivables to the buyers. The Company does not service any domestic accounts after the factoring has occurred. The Company does not have any servicing assets or liabilities. See the Balance Sheet Information footnote to the Consolidated Financial Statements for more information on receivables, net. Inventories, net Inventories are valued at the lower of cost or market. Cost of certain U.S. inventories is determined using the last-in, first-out (“LIFO”) method, while other U.S. and foreign operations use the first-in, first-out (“FIFO”) or average-cost methods. Inventory held by U.S. operations using the LIFO method was $131.4 million and $122.2 million at December 31, 2016 and 2015, respectively. Such inventories, if valued at current cost instead of LIFO, would have been greater by $15.2 million and $14.2 million at December 31, 2016 and 2015, respectively. See the Balance Sheet Information footnote to the Consolidated Financial Statements for more information on inventories, net. Pre-production costs related to long-term supply arrangements Engineering, research and development and other design and development costs for products sold on long-term supply arrangements are expensed as incurred unless the Company has a contractual guarantee for reimbursement from the customer. Costs for molds, dies and other tools used to make products sold on long-term supply arrangements for which the Company either has title to the assets or has the non-cancelable right to use the assets during the term of the supply arrangement are capitalized in property, plant and equipment and amortized to cost of sales over the shorter of the term of the arrangement or over the estimated useful lives of the assets, typically three to five years. Costs for molds, dies and other tools used to make products sold on long-term supply arrangements for which the Company has a contractual guarantee for lump sum reimbursement from the customer are capitalized in prepayments and other current assets. Property, plant and equipment, net Property, plant and equipment is valued at cost less accumulated depreciation. Expenditures for maintenance, repairs and renewals of relatively minor items are generally charged to expense as incurred. Renewals of significant items are capitalized. Depreciation is generally computed on a straight-line basis over the estimated useful lives of the assets. Useful lives for buildings range from 15 to 40 years and useful lives for machinery and equipment range from three to 12 years. For income tax purposes, accelerated methods of depreciation are generally used. See the Balance Sheet Information footnote to the Consolidated Financial Statements for more information on property, plant and equipment, net. Impairment of long-lived assets, including definite-lived intangible assets The Company reviews the carrying value of its long-lived assets, whether held for use or disposal, including other amortizing intangible assets, when events and circumstances warrant such a review under Accounting Standards Codification ("ASC") Topic 360. In assessing long-lived assets for an impairment loss, assets are grouped with other assets and liabilities at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. In assessing long-lived assets for impairment, management generally considers individual facilities the lowest level for which identifiable cash flows are largely independent. A recoverability review is performed using the undiscounted cash flows if there is a triggering event. If the undiscounted cash flow test for recoverability identifies a possible impairment, management will perform a fair value analysis. Management determines fair value under ASC Topic 820 using the appropriate valuation technique of market, income or cost approach. If the carrying value of a long-lived asset is considered impaired, an impairment charge is recorded for the amount by which the carrying value of the long-lived asset exceeds its fair value. Management believes that the estimates of future cash flows and fair value assumptions are reasonable; however, changes in assumptions underlying these estimates could affect the valuations. Long-lived assets held for sale are recorded at the lower of their carrying amount or fair value less cost to sell. Significant judgments and estimates used by management when evaluating long-lived assets for impairment include: (i) an assessment as to whether an adverse event or circumstance has triggered the need for an impairment review; (ii) undiscounted future cash flows generated by the asset; and (iii) fair valuation of the asset. Goodwill and other indefinite-lived intangible assets During the fourth quarter of each year, the Company qualitatively assesses its goodwill and indefinite-lived intangible assets assigned to each of its reporting units. This qualitative assessment evaluates various events and circumstances, such as macro economic conditions, industry and market conditions, cost factors, relevant events and financial trends, that may impact a reporting unit's fair value. Using this qualitative assessment, the Company determines whether it is more-likely-than-not the reporting unit's fair value exceeds its carrying value. If it is determined that it is not more-likely-than-not the reporting unit's fair value exceeds the carrying value, or upon consideration of other factors, including recent acquisition or divestiture activity, the Company performs a quantitative, "step one," goodwill impairment analysis. In addition, the Company may test goodwill in between annual test dates if an event occurs or circumstances change that could more-likely-than-not reduce the fair value of a reporting unit below its carrying value. See the Goodwill and Other Intangibles footnote to the Consolidated Financial Statements for more information on goodwill and other indefinite-lived intangible assets. Product warranties The Company provides warranties on some, but not all, of its products. The warranty terms are typically from one to three years. Provisions for estimated expenses related to product warranty are made at the time products are sold. These estimates are established using historical information about the nature, frequency and average cost of warranty claim settlements as well as product manufacturing and industry developments and recoveries from third parties. Management actively studies trends of warranty claims and takes action to improve product quality and minimize warranty claims. Management believes that the warranty accrual is appropriate; however, actual claims incurred could differ from the original estimates, requiring adjustments to the accrual. The product warranty accrual is allocated to current and non-current liabilities in the Consolidated Balance Sheets. See the Product Warranty footnote to the Consolidated Financial Statements for more information on product warranties. Other loss accruals and valuation allowances The Company has numerous other loss exposures, such as customer claims, workers' compensation claims, litigation and recoverability of assets. Establishing loss accruals or valuation allowances for these matters requires the use of estimates and judgment in regard to the risk exposure and ultimate realization. The Company estimates losses under the programs using consistent and appropriate methods, however, changes to its assumptions could materially affect the recorded accrued liabilities for loss or asset valuation allowances. Asbestos The Company and certain of its subsidiaries along with numerous other companies are named as defendants in personal injury lawsuits based on alleged exposure to asbestos-containing materials. With the assistance of third party consultants, the Company estimates the liability and corresponding insurance recovery for pending and future claims not yet asserted through December 31, 2059 with a runoff through 2067 and defense costs. This estimate is based on the Company's historical claim experience and estimates of the number and resolution cost of potential future claims that may be filed based on anticipated levels of unique plaintiff asbestos-related claims in the U.S. tort system against all defendants. This estimate is not discounted to present value. The Company currently believes that December 31, 2067 is a reasonable assumption as to the last date on which it is likely to have resolved all asbestos-related claims, based on the nature and useful life of the Company’s products and the likelihood of incidence of asbestos-related disease in the U.S. population generally. The Company assesses the sufficiency of its estimated liability for pending and future claims and defense costs on an ongoing basis by evaluating actual experience regarding claims filed, settled and dismissed, and amounts paid in settlements. In addition to claims and settlement experience, the Company considers additional quantitative and qualitative factors such as changes in legislation, the legal environment, and the Company's defense strategy. The Company continues to have additional excess insurance coverage available for potential future asbestos-related claims. In connection with the Company’s ongoing review of its asbestos-related claims, the Company also reviewed the amount of its potential insurance coverage for such claims, taking into account the remaining limits of such coverage, the number and amount of claims on our insurance from co-insured parties, ongoing litigation against the Company’s insurers, potential remaining recoveries from insolvent insurers, the impact of previous insurance settlements, and coverage available from solvent insurers not party to the coverage litigation. See the Contingencies footnote to the Consolidated Financial Statements for more information regarding management's judgments applied in the recognition and measurement of asbestos-related assets and liabilities. Environmental contingencies The Company accounts for environmental costs in accordance with ASC Topic 450. Costs related to environmental assessments and remediation efforts at operating facilities are accrued when it is probable that a liability has been incurred and the amount of that liability can be reasonably estimated. Estimated costs are recorded at undiscounted amounts, based on experience and assessments and are regularly evaluated. The liabilities are recorded in accounts payable and accrued expenses and other non-current liabilities in the Company's Consolidated Balance Sheets. See the Contingencies footnote to the Consolidated Financial Statements for more information regarding environmental contingencies. Derivative financial instruments The Company recognizes that certain normal business transactions generate risk. Examples of risks include exposure to exchange rate risk related to transactions denominated in currencies other than the functional currency, changes in commodity costs and interest rates. It is the objective and responsibility of the Company to assess the impact of these transaction risks and offer protection from selected risks through various methods, including financial derivatives. Virtually all derivative instruments held by the Company are designated as hedges, have high correlation with the underlying exposure and are highly effective in offsetting underlying price movements. Accordingly, gains and losses from changes in qualifying hedge fair values are matched with the underlying transactions. All hedge instruments are carried at their fair value based on quoted market prices for contracts with similar maturities. The Company does not engage in any derivative transactions for purposes other than hedging specific risks. See the Financial Instruments footnote to the Consolidated Financial Statements for more information on derivative financial instruments. Foreign currency The financial statements of foreign subsidiaries are translated to U.S. dollars using the period-end exchange rate for assets and liabilities and an average exchange rate for each period for revenues, expenses and capital expenditures. The local currency is the functional currency for substantially all of the Company's foreign subsidiaries. Translation adjustments for foreign subsidiaries are recorded as a component of accumulated other comprehensive income (loss) in equity. The Company recognizes transaction gains and losses arising from fluctuations in currency exchange rates on transactions denominated in currencies other than the functional currency in earnings as incurred. See the Accumulated Other Comprehensive Loss footnote to the Consolidated Financial Statements for more information on accumulated other comprehensive loss. Pensions and other postretirement employee defined benefits The Company's defined benefit pension and other postretirement employee benefit plans are accounted for in accordance with ASC Topic 715. Disability, early retirement and other postretirement employee benefits are accounted for in accordance with ASC Topic 712. Pensions and other postretirement employee benefit costs and related liabilities and assets are dependent upon assumptions used in calculating such amounts. These assumptions include discount rates, expected returns on plan assets, health care cost trends, compensation and other factors. In accordance with GAAP, actual results that differ from the assumptions used are accumulated and amortized over future periods, and accordingly, generally affect recognized expense in future periods. See the Retirement Benefit Plans footnote to the Consolidated Financial Statements for more information regarding the Company's pension and other postretirement employee defined benefit plans. Income taxes In accordance with ASC Topic 740, the Company's income tax expense is calculated based on expected income and statutory tax rates in the various jurisdictions in which the Company operates and requires the use of management's estimates and judgments. See the Income Taxes footnote to the Consolidated Financial Statements for more information regarding income taxes. New Accounting Pronouncements In January 2017, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2017-04, "Simplifying the Test for Goodwill Impairment." It eliminates Step 2 from the goodwill impairment test and an entity should recognize an impairment charge for the amount by which the carrying amount of goodwill exceeds the reporting unit's fair value, not to exceed the carrying amount of goodwill. This guidance is effective for annual and any interim impairment tests in fiscal years beginning after December 15, 2019. The Company does not expect this guidance to have any impact on its Consolidated Financial Statements. In January 2017, the FASB issued Accounting Standards Update ("ASU") No. 2017-01, "Clarifying the Definition of a Business." It revises the definition of a business and provides a framework to evaluate when an input and a substantive process are present in an acquisition to be considered a business. This guidance is effective for annual periods beginning after December 15, 2017. The Company does not expect this guidance to have any impact on its Consolidated Financial Statements. In November 2016, the FASB issued ASU No. 2016-18, "Restricted Cash." It requires that amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. This guidance is effective for interim and annual reporting periods beginning after December 15, 2017. The Company does not expect this guidance to have a material impact on its Consolidated Financial Statements. In August 2016, the FASB issued ASU No. 2016-15, "Classification of Certain Cash Receipts and Cash Payments." It provides guidance on eight specific cash flow issues with the objective of reducing the existing diversity in practice in how they are classified in the statement of cash flows. This guidance is effective for interim and annual reporting periods beginning after December 15, 2017. Early adoption is permitted, provided that all of the amendments are adopted in the same period. The Company does not expect this guidance to have a material impact on its Consolidated Financial Statements. In March 2016, the FASB issued ASU No. 2016-09, "Improvements to Employee Share-Based Payment Accounting." Under this guidance, the areas of simplification involve several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, impact on earnings per share and classification on the statement of cash flows. This guidance is effective for interim and annual reporting periods beginning after December 15, 2016 and the Company will adopt this guidance in the first quarter of 2017. Upon the adoption of the guidance, all of the tax effects of share-based payments will be recorded in the income statement. The impact to the Consolidated Financial Statements will be dependent upon the underlying vesting or exercise activity and related future stock prices. The Company is currently evaluating the other impacts this guidance will have on its Consolidated Financial Statements. In February 2016, the FASB issued ASU No. 2016-02, "Leases (Topic 842)." Under this guidance, lessees will be required to recognize a right-of-use asset and a lease liability for all operating leases defined under previous GAAP. This guidance is effective for interim and annual reporting periods beginning after December 15, 2018. The Company is currently evaluating the impact this guidance will have on its Consolidated Financial Statements. In September 2015, the FASB issued ASU No. 2015-16, "Simplifying the Accounting for Measurement-Period Adjustments." Under this guidance, an acquirer is required to recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. This guidance is effective for interim and annual reporting periods beginning after December 15, 2015. The Company adopted this guidance in the first quarter of 2016 and recorded fair value adjustments related to the Remy acquisition based on new information obtained during the measurement period primarily related to warranty, inventory, and deferred taxes. These adjustments have resulted in a decrease in goodwill of $12.1 million from the Company's initial estimate recorded in 2016. In August 2015, the FASB issued ASU No. 2015-15, "Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements." Under this guidance, debt issuance costs associated with line-of-credit arrangements would be deferred as an asset and amortized ratably over the term, regardless of whether there are any outstanding borrowings on the line-of-credit arrangement. This guidance is effective for interim and annual reporting periods beginning after December 15, 2015 and the Company adopted this guidance in the first quarter of 2016 with no impact on the Company's Consolidated Financial Statements. In July 2015, the FASB issued ASU No. 2015-11, "Simplifying the Measurement of Inventory." Under this guidance, inventory should be measured at the lower of cost and net realizable value. Subsequent measurement is unchanged for inventory measured using LIFO or the retail inventory method. This guidance is effective for interim and annual reporting periods beginning after December 15, 2016. The Company does not expect this guidance to have a material impact on its Consolidated Financial Statements. In May 2015, the FASB issued ASU No. 2015-07, "Disclosures for Investments in Certain Entities That Calculate Net Asset Value per Share (or Its Equivalent)." Under this guidance, investments measured at net asset value, as a practical expedient for fair value, are excluded from the fair value hierarchy. This guidance is effective for interim and annual reporting periods beginning after December 15, 2015 and the Company adopted this guidance in the first quarter of 2016. The pension asset disclosure has been updated retrospectively to reflect this guidance and there is no impact on the Company's Consolidated Financial Statements. In May 2014, the FASB amended the Accounting Standards Codification to add Topic 606, "Revenue from Contracts with Customers," outlining a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and superseding most current revenue recognition guidance. This guidance is effective for interim and annual reporting periods beginning after December 15, 2017. The Company anticipates changes to the revenue recognition of pre-production activities such as customer owned tooling and engineering design & development recoveries, including the potential recording of these items as revenue. Further, the Company is currently analyzing the impact of the new guidance on its contracts and customer arrangements that include various pricing structures and cancellation clauses, which could impact the timing of revenue recognition. The Company expects to adopt this guidance effective January 1, 2018 utilizing the Modified Retrospective approach and is currently evaluating the impact that the adoption of this guidance will have on its consolidated financial statements. |
Research and Development Costs
Research and Development Costs | 12 Months Ended |
Dec. 31, 2016 | |
Research and Development [Abstract] | |
Research and development costs | RESEARCH AND DEVELOPMENT COSTS The Company's net Research & Development ("R&D") expenditures are included in selling, general and administrative expenses of the Consolidated Statements of Operations. Customer reimbursements are netted against gross R&D expenditures as they are considered a recovery of cost. Customer reimbursements for prototypes are recorded net of prototype costs based on customer contracts, typically either when the prototype is shipped or when it is accepted by the customer. Customer reimbursements for engineering services are recorded when performance obligations are satisfied in accordance with the contract and accepted by the customer. Financial risks and rewards transfer upon shipment, acceptance of a prototype component by the customer or upon completion of the performance obligation as stated in the respective customer agreement. The following table presents the Company’s gross and net expenditures on R&D activities: Year Ended December 31, (millions of dollars) 2016 2015 2014 Gross R&D expenditures $ 417.8 $ 386.2 $ 392.8 Customer reimbursements (74.6 ) (78.8 ) (56.6 ) Net R&D expenditures $ 343.2 $ 307.4 $ 336.2 Net R&D expenditures as a percentage of net sales were 3.8% , 3.8% and 4.0% for the years ended December 31, 2016, 2015 and 2014, respectively. The Company has contracts with several customers at the Company's various R&D locations. No such contract exceeded 5% of net R&D expenditures in any of the years presented. |
Other Expense, Net
Other Expense, Net | 12 Months Ended |
Dec. 31, 2016 | |
Other Income and Expenses [Abstract] | |
Other expense, net | OTHER EXPENSE, NET Items included in other expense, net consist of: Year Ended December 31, (millions of dollars) 2016 2015 2014 Asbestos-related charge $ 703.6 $ — $ — Loss on divestiture 127.1 — — Restructuring expense 26.9 65.7 90.8 Merger and acquisition expense 23.7 21.8 — Intangible asset impairment 12.6 — 10.3 Pension settlement loss — 25.7 3.1 Gain on previously held equity interest — (10.8 ) — Other (4.2 ) (1.0 ) (10.4 ) Other expense, net $ 889.7 $ 101.4 $ 93.8 In the fourth quarter of 2016, the Company determined that its best estimate of the aggregate liability both for asbestos-related claims asserted but not yet resolved and potential asbestos-related claims not yet asserted, including an estimate for defense costs, is $879.3 million as of December 31, 2016. The Company recorded a charge of $703.6 million before tax ( $440.6 million after tax) in Other Expense, representing the difference in the total liability from what was previously accrued, consulting fees, less available insurance coverage. See the Contingencies footnote to the Consolidated Financial Statements for further discussion. During the fourth quarter of 2015, the Company acquired 100% of the equity interests in Remy. During the year ended December 31, 2016 and 2015, the Company incurred $23.7 million and $21.8 million of transition and realignment expenses and other professional fees associated with this transaction. Additionally, in October 2016, the Company entered into a definitive agreement to sell the light vehicle aftermarket business associated with Remy. This transaction closed in the fourth quarter of 2016 and the Company recorded loss on divestiture of $127.1 million in the year ended December 31, 2016. See the Recent Transactions footnote to the Consolidated Financial Statements for further discussion of this transaction. During the years ended December 31, 2016, 2015 and 2014, the Company recorded restructuring expense of $26.9 million , $65.7 million and $90.8 million , respectively, primarily related to Drivetrain and Engine segment actions designed to improve future profitability and competitiveness. The restructuring expense also includes amounts related to a global realignment plan intended to enhance treasury management flexibility. See the Restructuring footnote to the Consolidated Financial Statements for further discussion of these expenses. During the fourth quarter of 2016 and 2014, respectively, the Company recorded an intangible asset impairment loss of $12.6 million related to Engine segment Etatech’s ECCOS intellectual technology and $10.3 million related to Engine segment unamortized trade names. The ECCOS intellectual technology impairment is due to the discontinuance of interest from potential customers during the fourth quarter of 2016 that significantly lowered the commercial feasibility of the product line. During the fourth quarter of 2015, the Company settled approximately $48 million of its projected benefit obligation by transferring approximately $48 million in plan assets through a lump-sum pension de-risking disbursement made to an insurance company. This agreement unconditionally and irrevocably guarantees all future payments to certain participants that were receiving payments from the U.S. pension plan. The insurance company assumes all investment risk associated with the assets that were delivered as part of this transaction. As a result, the Company recorded a non-cash settlement loss of $25.7 million related to the accelerated recognition of unamortized losses . Additionally, during the third quarter of 2014, the Company discharged certain U.S. pension plan obligations by making lump-sum payments to former employees of the Company. As a result of this action, the Company recorded a settlement loss of $3.1 million in the U.S. pension plan. During the first quarter of 2015, the Company completed the purchase of the remaining 51% of BERU Diesel Start Systems Pvt. Ltd. ("BERU Diesel") by acquiring the shares of its former joint venture partner. As a result of this transaction, the Company recorded a $10.8 million gain on the previously held equity interest in this joint venture. See the Recent Transactions footnote to the Consolidated Financial Statements for further discussion of this acquisition. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Income taxes | INCOME TAXES Earnings before income taxes and the provision for income taxes are presented in the following table. Year Ended December 31, (millions of dollars) 2016 2015 2014 Earnings before income taxes: U.S. $ (724.7 ) $ 125.6 $ 218.8 Non-U.S. 915.2 801.2 761.3 Total $ 190.5 $ 926.8 $ 980.1 Provision for income taxes: Current: Federal $ 37.4 $ 32.5 $ 25.7 State 6.1 (4.3 ) 3.9 Foreign 251.7 228.3 220.8 Total current 295.2 256.5 250.4 Deferred: Federal (239.8 ) 31.8 66.2 State (13.2 ) 2.6 (1.2 ) Foreign (11.9 ) (10.5 ) (22.8 ) Total deferred (264.9 ) 23.9 42.2 Total provision for income taxes $ 30.3 $ 280.4 $ 292.6 The provision for income taxes resulted in an effective tax rate of 15.9% , 30.3% and 29.9% for the years ended December 31, 2016, 2015 and 2014, respectively. An analysis of the differences between the effective tax rate and the U.S. statutory rate for the years ended December 31, 2016, 2015 and 2014 is presented below. Year Ended December 31, (millions of dollars) 2016 2015 2014 Income taxes at U.S. statutory rate of 35% $ 66.7 $ 324.4 $ 343.0 Increases (decreases) resulting from: State taxes, net of federal benefit (10.6 ) 8.2 2.6 U.S. tax on non-U.S. earnings 40.7 31.5 18.8 Affiliates' earnings (15.0 ) (14.0 ) (16.2 ) Foreign rate differentials (93.3 ) (92.6 ) (84.1 ) Tax holidays (25.5 ) (21.2 ) (23.6 ) Withholding taxes 13.3 7.8 10.6 Tax credits (3.2 ) (3.2 ) (3.9 ) Reserve adjustments, settlements and claims 11.6 19.4 41.0 Valuation allowance adjustments (2.7 ) 8.3 5.5 Non-deductible transaction costs 8.3 8.1 5.4 Provision to return and other one-time tax adjustments 0.3 (5.1 ) (8.8 ) Impact of transactions 16.3 11.6 — Currency 10.0 0.1 (0.2 ) Other foreign taxes 12.9 9.0 7.4 Partnership income 3.4 3.1 (0.3 ) Other (2.9 ) (15.0 ) (4.6 ) Provision for income taxes, as reported $ 30.3 $ 280.4 $ 292.6 The Company's provision for income taxes for the year ended December 31, 2016, includes tax benefits of $263.0 million , $22.7 million , $8.6 million , $6.0 million and $4.4 million associated with an asbestos-related charge, loss on divestiture, other one-time adjustments, restructuring expense and intangible asset impairment loss, respectively, discussed in the Other Expense, Net footnote. Additionally, this rate includes a tax expense of $2.2 million related to a gain associated with the release of certain Remy light vehicle aftermarket liabilities due to the expiration of a customer contract. The Company's provision for income taxes for the year ended December 31, 2015, includes tax benefits of $9.0 million , $3.8 million and $3.7 million related to the pension settlement loss, merger and acquisition expense and restructuring expense, respectively, discussed in the Other Expense, Net footnote. Additionally, this rate includes a tax benefit of $9.9 million primarily related to foreign tax incentives and tax settlements. The Company's provision for income taxes for the year ended December 31, 2014, includes tax benefits of $15.3 million , $0.4 million and $1.1 million related to restructuring expense, intangible asset impairment losses and the pension settlement loss, respectively, discussed in the Other Expense, Net footnote. A roll forward of the Company's total gross unrecognized tax benefits for the years ended December 31, 2016 and 2015, respectively, is presented below. Of the total $88.6 million of unrecognized tax benefits as of December 31, 2016, approximately $69.9 million of the total represents the amount that, if recognized, would affect the Company's effective income tax rate in future periods. This amount differs from the gross unrecognized tax benefits presented in the table due to the decrease in the U.S. federal income taxes which would occur upon recognition of the state tax benefits and U.S. foreign tax credits included therein. (millions of dollars) 2016 2015 Balance, January 1 $ 127.3 $ 60.4 Additions based on tax positions related to current year 16.1 20.7 Additions for tax positions of prior years 1.6 6.7 Additions from acquisitions — 53.4 Reductions for closure of tax audits and settlements (45.7 ) (10.4 ) Reductions for lapse in statute of limitations (5.0 ) (0.3 ) Translation adjustment (3.2 ) (3.2 ) Balance, December 31 $ 91.1 $ 127.3 Remy applied for a bilateral Advance Pricing Agreement ("APA") between the U.S. Internal Revenue Service and South Korea National Tax Service covering the tax years 2007 through 2014. At December 31, 2015, the Company recorded an uncertain tax benefit and related U.S. foreign tax credits of approximately $44.0 million . In the second quarter of 2016, the Company received the signed APA from the tax authorities and reclassified the related uncertain tax benefit to a current tax payable, which the Company paid in the third quarter of 2016. The Company recognizes interest and penalties related to unrecognized tax benefits in income tax expense. The amount recognized in income tax expense for 2016 and 2015 is $3.2 million and $2.3 million , respectively. The Company has an accrual of approximately $16.0 million and $12.8 million for the payment of interest and penalties at December 31, 2016 and 2015, respectively. The Company estimates that payments of approximately $15.5 million will be made in the next 12 months for assessed tax liabilities from certain taxing jurisdictions and has reclassified this amount to current in the balance sheet as shown in the Balance Sheet Information footnote. Other possible changes within the next 12 months cannot be reasonably estimated at this time. The Company and/or one of its subsidiaries files income tax returns in the U.S. federal, various state jurisdictions and various foreign jurisdictions. In certain tax jurisdictions, the Company may have more than one taxpayer. The Company is no longer subject to income tax examinations by tax authorities in its major tax jurisdictions as follows: Tax jurisdiction Years no longer subject to audit Tax jurisdiction Years no longer subject to audit U.S. Federal 2012 and prior Japan 2015 and prior China 2010 and prior Mexico 2010 and prior France 2013 and prior Poland 2011 and prior Germany 2007 and prior South Korea 2010 and prior Hungary 2008 and prior In the U.S. , certain tax attributes created in years prior to 2012 were subsequently utilized. Even though the U.S. federal statute of limitations has expired for years prior to 2012, the years in which these tax attributes were created could still be subject to examination, limited to only the examination of the creation of the tax attribute . The gross components of deferred tax assets and liabilities as of December 31, 2016 and 2015 consist of the following: December 31, (millions of dollars) 2016 2015 Deferred tax assets: Foreign tax credits $ 139.5 $ 142.6 Employee compensation 41.3 34.6 Other comprehensive loss 66.3 79.7 Research and development capitalization 145.1 100.4 Net operating loss and capital loss carryforwards 71.5 81.8 Pension and other postretirement benefits 38.8 41.1 Asbestos-related 263.0 — Other 128.9 125.3 Total deferred tax assets $ 894.4 $ 605.5 Valuation allowance (71.2 ) (71.0 ) Net deferred tax asset $ 823.2 $ 534.5 Deferred tax liabilities: Goodwill and intangible assets (251.3 ) (259.2 ) Fixed assets (147.1 ) (115.5 ) Other (55.0 ) (66.4 ) Total deferred tax liabilities $ (453.4 ) $ (441.1 ) Net deferred taxes $ 369.8 $ 93.4 At December 31, 2016, certain non-U.S. subsidiaries have net operating loss carryforwards totaling $134.7 million available to offset future taxable income. Of the total $134.7 million , $96.6 million expire at various dates from 2017 through 2036 and the remaining $38.1 million have no expiration date. The Company has a valuation allowance recorded against $72.9 million of the $134.7 million of non-U.S. net operating loss carryforwards. Certain U.S. subsidiaries have state net operating loss carryforwards totaling $817.8 million which are partially offset by a valuation allowance of $632.3 million . The state net operating loss carryforwards expire at various dates from 2017 to 2037. Certain U.S. subsidiaries also have state tax credit carryforwards of $14.8 million which are fully offset by a valuation allowance of $14.8 million . Certain non-U.S. subsidiaries located in China, Korea and Poland had tax exemptions or tax holidays, which reduced tax expense approximately $25.5 million and $21.2 million in 2016 and 2015, respectively. The U.S. has foreign tax credit carryforwards of $139.5 million , which expire at various dates from 2018 through 2025. The Company is not required to provide U.S. federal or state income taxes on cumulative undistributed earnings of foreign subsidiaries when such earnings are considered permanently reinvested. The Company's policy is to evaluate this assertion on a quarterly basis. At December 31, 2016, the Company's deferred tax liability associated with unremitted foreign earnings was $38.5 million . In connection with the acquisition of Remy in 2015, management executed a legal restructuring plan to align the Remy and BorgWarner non-US businesses. This transaction resulted in a taxable gain in the U.S., which was partially offset by Remy tax attributes including a net operating loss carryforward of $68.4 million , foreign tax credits of $93.6 million , and research and development credits of $6.9 million . The net impact of this transaction with the filing of Remy’s final 2015 U.S. consolidated federal tax return resulted in a foreign tax credit carryforward of $47.0 million . The net U.S. cash tax liability resulting from the transaction was $8.4 million . The Company has not recorded deferred income taxes on the difference between the book and tax basis of investments in foreign subsidiaries or foreign equity affiliates totaling approximately $3.9 billion in 2016, as these amounts are essentially permanent in nature. The difference will become taxable upon repatriation of assets, sale or liquidation of the investment. Due to fluctuation in tax laws around the world and fluctuations in foreign exchange rates, it is not practicable to determine the unrecognized deferred tax liability on this difference because the actual tax liability, if any, is dependent on circumstances existing when the repatriation occurs. |
Balance Sheet Information
Balance Sheet Information | 12 Months Ended |
Dec. 31, 2016 | |
Balance Sheet Related Disclosures [Abstract] | |
Balance Sheet information | BALANCE SHEET INFORMATION Detailed balance sheet data is as follows: December 31, (millions of dollars) 2016 2015 Receivables, net: Customers $ 1,448.3 $ 1,423.6 Other 243.9 243.3 Gross receivables 1,692.2 1,666.9 Bad debt allowance(a) (2.9 ) (1.9 ) Total receivables, net $ 1,689.3 $ 1,665.0 Inventories, net: Raw material and supplies $ 378.6 $ 412.9 Work in progress 102.9 102.5 Finished goods 174.9 222.4 FIFO inventories 656.4 737.8 LIFO reserve (15.2 ) (14.2 ) Total inventories, net $ 641.2 $ 723.6 Prepayments and other current assets: Prepaid tooling $ 77.5 $ 98.5 Prepaid taxes 8.0 11.9 Restricted cash — 12.3 Other 51.9 46.2 Total prepayments and other current assets $ 137.4 $ 168.9 Property, plant and equipment, net: Land and land use rights $ 111.0 $ 118.2 Buildings 670.6 661.7 Machinery and equipment 2,371.2 2,154.3 Capital leases 3.9 7.2 Construction in progress 338.2 386.4 Property, plant and equipment, gross 3,494.9 3,327.8 Accumulated depreciation (1,137.5 ) (1,036.8 ) Property, plant & equipment, net, excluding tooling 2,357.4 2,291.0 Tooling, net of amortization 144.4 157.1 Property, plant & equipment, net $ 2,501.8 $ 2,448.1 Investments and other long-term receivables: Investment in equity affiliates $ 218.9 $ 200.1 Other long-term receivables 283.3 260.8 Total investments and other long-term receivables $ 502.2 $ 460.9 Other non-current assets: Deferred income taxes $ 424.0 $ 213.5 Asbestos insurance asset 178.7 108.5 Other 150.7 158.0 Total other non-current assets $ 753.4 $ 480.0 December 31, (millions of dollars) 2016 2015 Accounts payable and accrued expenses: Trade payables $ 1,323.3 $ 1,225.6 Payroll and employee related 206.4 201.1 Product warranties 63.9 70.6 Customer related 52.8 55.7 Asbestos-related liability 51.7 47.7 Interest 22.9 20.4 Retirement related 18.1 20.1 Dividends payable to noncontrolling shareholders 15.7 20.0 Unrecognized tax benefits 15.5 45.5 Insurance 7.8 — Severance 6.4 29.4 Derivatives 1.2 19.1 Other 61.6 111.2 Total accounts payable and accrued expenses $ 1,847.3 $ 1,866.4 Other non-current liabilities: Deferred income taxes $ 54.2 $ 120.1 Deferred revenue 33.5 36.6 Product warranties 31.4 37.3 Other 156.6 160.4 Total other non-current liabilities $ 275.7 $ 354.4 (a) Bad debt allowance: 2016 2015 2014 Beginning balance, January 1 $ (1.9 ) $ (2.3 ) $ (2.1 ) Provision (3.2 ) (0.5 ) (0.6 ) Write-offs 0.2 0.7 0.3 Business divestiture 2.0 — — Translation adjustment and other — 0.2 0.1 Ending balance, December 31 $ (2.9 ) $ (1.9 ) $ (2.3 ) As of December 31, 2016 and December 31, 2015, accounts payable of $85.3 million and $76.9 million , respectively, were related to property, plant and equipment purchases. Interest costs capitalized for the years ended December 31, 2016, 2015 and 2014 were $14.1 million , $16.5 million and $13.5 million , respectively. NSK-Warner KK ("NSK-Warner") The Company has a 50% interest in NSK-Warner, a joint venture based in Japan that manufactures automatic transmission components. The Company's share of the earnings reported by NSK-Warner is accounted for using the equity method of accounting. NSK-Warner is the joint venture partner with a 40% interest in the Drivetrain Segment's South Korean subsidiary, BorgWarner Transmission Systems Korea Ltd. Dividends from NSK-Warner were $34.3 million , $18.0 million and $45.1 million in calendar years ended December 31, 2016, 2015 and 2014, respectively. NSK-Warner has a fiscal year-end of March 31. The Company's equity in the earnings of NSK-Warner consists of the 12 months ended November 30. Following is summarized financial data for NSK-Warner, translated using the ending or periodic rates, as of and for the years ended November 30, 2016, 2015 and 2014 (unaudited): November 30, (millions of dollars) 2016 2015 Balance sheets: Cash and securities $ 98.6 $ 74.9 Current assets, including cash and securities 256.3 231.9 Non-current assets 194.5 167.5 Current liabilities 122.6 119.1 Non-current liabilities 48.2 39.3 Total equity 280.0 241.0 Year Ended November 30, (millions of dollars) 2016 2015 2014 Statements of operations: Net sales $ 601.8 $ 519.0 $ 546.4 Gross profit 134.1 118.6 124.5 Net earnings 71.7 73.3 80.3 NSK-Warner had no debt outstanding as of November 30, 2016 and 2015. Purchases by the Company from NSK-Warner were $23.9 million , $23.0 million and $21.3 million for the years ended December 31, 2016, 2015 and 2014, respectively. |
Goodwill and Other Intangibles
Goodwill and Other Intangibles | 12 Months Ended |
Dec. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and other intangibles | GOODWILL AND OTHER INTANGIBLES During the fourth quarter of each year, the Company qualitatively assesses its goodwill and indefinite-lived intangible assets assigned to each of its reporting units. This qualitative assessment evaluates various events and circumstances, such as macro economic conditions, industry and market conditions, cost factors, relevant events and financial trends, that may impact a reporting unit's fair value. Using this qualitative assessment, the Company determines whether it is more-likely-than-not the reporting unit's fair value exceeds its carrying value. If it is determined that it is not more-likely-than-not the reporting unit's fair value exceeds the carrying value, or upon consideration of other factors, including recent acquisition or divestiture activity, the Company performs a quantitative, "step one," goodwill impairment analysis. In addition, the Company may test goodwill in between annual test dates if an event occurs or circumstances change that could more-likely-than-not reduce the fair value of a reporting unit below its carrying value. During the fourth quarter of 2016, the Company performed a qualitative analysis on each reporting unit, except for the reporting unit with recent acquisition and divestiture activities, and determined it was more-likely-than-not the fair value exceeded the carrying value of these reporting units. For the reporting unit with acquisition and divestiture activities, the Company performed a quantitative, "step one," goodwill impairment analysis, which requires the Company to make significant assumptions and estimates about the extent and timing of future cash flows, discount rates and growth rates. The basis of this goodwill impairment analysis is the Company's annual budget and long-range plan (“LRP”). The annual budget and LRP includes a five year projection of future cash flows based on actual new products and customer commitments and assumes the last year of the LRP data is a fair indication of the future performance. Because the LRP is estimated over a significant future period of time, those estimates and assumptions are subject to a high degree of uncertainty. Further, the market valuation models and other financial ratios used by the Company require certain assumptions and estimates regarding the applicability of those models to the Company's facts and circumstances. The Company believes the assumptions and estimates used to determine the estimated fair value are reasonable. Different assumptions could materially affect the estimated fair value. The primary assumptions affecting the Company's December 31, 2016 goodwill quantitative, "step one," impairment review are as follows: • Discount rate: The Company used a 10% weighted average cost of capital (“WACC”) as the discount rate for future cash flows. The WACC is intended to represent a rate of return that would be expected by a market participant. • Operating income margin: The Company used historical and expected operating income margins, which may vary based on the projections of the reporting unit being evaluated. I n addition to the above primary assumptions, the Company notes the following risks to volume and operating income assumptions that could have an impact on the discounted cash flow models: • The automotive industry is cyclical and the Company's results of operations would be adversely affected by industry downturns. • The Company is dependent on market segments that use our key products and would be affected by decreasing demand in those segments. • The Company is subject to risks related to international operations. Based on the assumptions outlined above, the impairment testing conducted in the fourth quarter of 2016 indicated the Company's goodwill assigned to the reporting unit that was quantitatively assessed was not impaired and contained a fair value substantially higher than the reporting unit's carrying value. Additionally, sensitivity analyses were completed indicating a one percent increase in the discount rate or a one percent decrease in the operating margin assumptions would not result in the carrying value exceeding the fair value of the reporting unit quantitatively assessed. The changes in the carrying amount of goodwill for the years ended December 31, 2016 and 2015 are as follows: 2016 2015 (millions of dollars) Engine Drivetrain Engine Drivetrain Gross goodwill balance, January 1 $ 1,338.2 $ 921.5 $ 1,362.0 $ 345.7 Accumulated impairment losses, January 1 (501.8 ) (0.2 ) (501.8 ) (0.2 ) Net goodwill balance, January 1 $ 836.4 $ 921.3 $ 860.2 $ 345.5 Goodwill during the year: Acquisitions* — (12.1 ) 11.6 584.7 Divestitures** — (24.2 ) — — Translation adjustment and other (14.2 ) (5.0 ) (35.4 ) (8.9 ) Ending balance, December 31 $ 822.2 $ 880.0 $ 836.4 $ 921.3 ________________ * Acquisitions relate to the Company's 2015 purchases of Remy and BERU Diesel and fair value adjustments in 2016 based on new information obtained during the measurement period for Remy acquisition. ** Divestitures relate to the Company's 2016 disposition of Remy light vehicle aftermarket business and Divgi-Warner Private Limited. . The Company’s other intangible assets, primarily from acquisitions, consist of the following: December 31, 2016 December 31, 2015 (millions of dollars) Gross carrying amount Accumulated amortization Net carrying amount Gross carrying amount Accumulated amortization Net carrying amount Amortized intangible assets: Patented and unpatented technology $ 108.1 $ 41.5 $ 66.6 $ 128.7 $ 42.4 $ 86.3 Customer relationships 481.4 141.2 340.2 490.3 116.1 374.2 Miscellaneous 5.3 3.4 1.9 5.6 3.0 2.6 Total amortized intangible assets 594.8 186.1 408.7 624.6 161.5 463.1 In-process R&D 3.8 — 3.8 14.6 — 14.6 Unamortized trade names 51.0 — 51.0 66.1 — 66.1 Total other intangible assets $ 649.6 $ 186.1 $ 463.5 $ 705.3 $ 161.5 $ 543.8 Amortization of other intangible assets was $40.4 million , $19.2 million and $27.2 million for the years ended December 31, 2016, 2015 and 2014, respectively. The estimated useful lives of the Company's amortized intangible assets range from three to 15 years. The Company utilizes the straight line method of amortization recognized over the estimated useful lives of the assets. The estimated future annual amortization expense, primarily for acquired intangible assets, is as follows: $36.9 million in 2017, $35.7 million in 2018, $35.2 million in 2019, $34.8 million in 2020 and $34.8 million in 2021. A roll forward of the gross carrying amounts of the Company's other intangible assets is presented below: (millions of dollars) 2016 2015 Beginning balance, January 1 $ 705.3 $ 307.8 Acquisitions* — 423.8 Impairment** (23.9 ) — Divestitures*** (19.9 ) — Translation adjustment (11.9 ) (26.3 ) Ending balance, December 31 $ 649.6 $ 705.3 ________________ * Acquisitions relate to the Company's 2015 purchases of Remy and BERU Diesel. ** Relates to the impairment of the Company's Etatech ECCOS intellectual technology in 2016. *** Divestiture relates to the Company's sale of Remy light vehicle aftermarket business in 2016. A roll forward of the accumulated amortization associated with the Company's other intangible assets is presented below: (millions of dollars) 2016 2015 Beginning balance, January 1 $ 161.5 $ 156.7 Amortization 40.4 19.2 Impairment (8.2 ) — Divestitures (0.3 ) — Translation adjustment (7.3 ) (14.4 ) Ending balance, December 31 $ 186.1 $ 161.5 |
Product Warranty
Product Warranty | 12 Months Ended |
Dec. 31, 2016 | |
Product Warranties Disclosures [Abstract] | |
Product warranty | PRODUCT WARRANTY The changes in the carrying amount of the Company’s total product warranty liability for the years ended December 31, 2016 and 2015 were as follows: (millions of dollars) 2016 2015 Beginning balance, January 1 $ 107.9 $ 132.0 Provisions 62.2 28.6 Acquisitions 6.9 12.3 Dispositions (9.1 ) — Payments (70.1 ) (54.7 ) Translation adjustment (2.5 ) (10.3 ) Ending balance, December 31 $ 95.3 $ 107.9 Acquisition activity in 2016 of $6.9 million relates to the Company's accrual for product issues that pre-dated the Company's 2015 acquisition of Remy. Disposition activity in 2016 of $9.1 million relates to the sale of the Remy light vehicle aftermarket business. Acquisitions activity in 2015 of $12.3 million , relates to $29.4 million in warranty liability associated with the Company's purchase of Remy, partially offset by $17.1 million related to a significant settled warranty claim associated with a product issue that pre-dated the Company's 2014 acquisition of Gustav Wahler GmbH u. Co. KG and its general partner ("Wahler"). Including the impact of the reversal of a corresponding receivable, the Wahler settlement had an immaterial impact on the Consolidated Balance Sheet at December 31, 2015 and Consolidated Statement of Operations for the year ended December 31, 2015. The Company’s warranty provision as a percentage of net sales has increased from 0.4% as of December 31, 2015 to 0.7% as of December 31, 2016. This change is primarily related to the Company’s fourth quarter 2015 acquisition of Remy. Furthermore, the Company's 2016 provision includes a $5.2 million warranty reversal related to the expiration of a Remy light vehicle aftermarket customer contract. The product warranty liability is classified in the Consolidated Balance Sheets as follows: December 31, (millions of dollars) 2016 2015 Accounts payable and accrued expenses $ 63.9 $ 70.6 Other non-current liabilities 31.4 37.3 Total product warranty liability $ 95.3 $ 107.9 |
Notes Payable and Long-Term Deb
Notes Payable and Long-Term Debt | 12 Months Ended |
Dec. 31, 2016 | |
Debt Disclosure [Abstract] | |
Notes payable and long-term debt | NOTES PAYABLE AND LONG-TERM DEBT As of December 31, 2016 and 2015, the Company had short-term and long-term debt outstanding as follows: December 31, (millions of dollars) 2016 2015 Short-term debt Short-term borrowings $ 156.5 $ 280.7 Long-term debt 5.75% Senior notes due 11/01/16 ($150 million par value) $ — $ 152.2 8.00% Senior notes due 10/01/19 ($134 million par value) 139.1 138.5 4.625% Senior notes due 09/15/20 ($250 million par value) 251.9 245.6 1.80% Senior notes due 11/7/22 (€500 million par value) 520.7 536.8 3.375% Senior notes due 03/15/25 ($500 million par value) 495.6 495.1 7.125% Senior notes due 02/15/29 ($121 million par value) 118.8 118.7 4.375% Senior notes due 03/15/45 ($500 million par value) 493.3 493.0 Term loan facilities and other 43.6 89.7 Total long-term debt $ 2,063.0 $ 2,269.6 Less: current portion 19.4 160.7 Long-term debt, net of current portion $ 2,043.6 $ 2,108.9 In July 2016, the Company terminated interest rate swaps which had the effect of converting $384 million of fixed rate notes to variable rates. The gain on the termination is being amortized into interest expense over the remaining terms of the notes. The value related to these swap terminations as of December 31, 2016 was $3.9 million and $1.3 million on the 4.625% and 8.00% notes, respectively, as an increase to the notes. The value of these interest rate swaps as of December 31, 2015 was $1.9 million and $0.8 million on the 4.625% and 8.00% notes, respectively, as a decrease to the notes. The Company terminated fixed to floating interest rate swaps in 2009. The gain on the termination is being amortized into interest expense over the remaining term of the note. The value related to this swap termination at December 31, 2016 was $4.1 million on the 8.00% note as an increase to the note. The value related to these swap terminations at December 31, 2015 was $2.4 million and $5.5 million on the 5.75% and 8.00% notes, respectively, as an increase to the notes. The weighted average interest rate on short-term borrowings outstanding as of December 31, 2016 and 2015 was 2.3% and 1.3% , respectively. The weighted average interest rate on all borrowings outstanding, including the effects of outstanding swaps, as of December 31, 2016 and 2015 was 3.8% and 3.6% , respectively. Annual principal payments required as of December 31, 2016 are as follows : (millions of dollars) 2017 $ 175.9 2018 17.1 2019 136.1 2020 252.1 2021 2.1 After 2021 1,647.4 Total payments $ 2,230.7 Less: unamortized discounts 11.2 Total $ 2,219.5 The Company's long-term debt includes various covenants, none of which are expected to restrict future operations. The Company has a $1 billion multi-currency revolving credit facility which includes a feature that allows the Company's borrowings to be increased to $1.25 billion . The facility provides for borrowings through June 30, 2019. The Company has one key financial covenant as part of the credit agreement which is a debt to EBITDA ("Earnings Before Interest, Taxes, Depreciation and Amortization") ratio. The Company was in compliance with the financial covenant at December 31, 2016 and expects to remain compliant in future periods. At December 31, 2016 and December 31, 2015, the Company had no outstanding borrowings under this facility. The Company's commercial paper program allows the Company to issue short-term, unsecured commercial paper notes up to a maximum aggregate principal amount outstanding of $1 billion . Under this program, the Company may issue notes from time to time and will use the proceeds for general corporate purposes. At December 31, 2016 and 2015, the Company had outstanding borrowings of $50.8 million and $215.0 million , respectively, under this program, which is classified in the Consolidated Balance Sheets in Notes payable and other short-term debt. The total current combined borrowing capacity under the multi-currency revolving credit facility and commercial paper program cannot exceed $1 billion . As of December 31, 2016 and 2015, the estimated fair values of the Company's senior unsecured notes totaled $2,081.4 million and $2,197.6 million , respectively. The estimated fair values were $62.0 million and $17.7 million higher than their carrying value at December 31, 2016 and 2015, respectively. Fair market values of the senior unsecured notes are developed using observable values for similar debt instruments, which are considered Level 2 inputs as defined by ASC Topic 820. The carrying values of the Company's multi-currency revolving credit facility and commercial paper program approximates fair value. The fair value estimates do not necessarily reflect the values the Company could realize in the current markets. The Company had outstanding letters of credit of $32.3 million and $29.3 million at December 31, 2016 and 2015, respectively. The letters of credit typically act as guarantees of payment to certain third parties in accordance with specified terms and conditions. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair value measurements | FAIR VALUE MEASUREMENTS ASC Topic 820 emphasizes that fair value is a market-based measurement, not an entity specific measurement. Therefore, a fair value measurement should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering market participant assumptions in fair value measurements, ASC Topic 820 establishes a fair value hierarchy, which prioritizes the inputs used in measuring fair values as follows: Level 1: Observable inputs such as quoted prices for identical assets or liabilities in active markets; Level 2: Inputs, other than quoted prices in active markets, that are observable either directly or indirectly; and Level 3: Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions. Assets and liabilities measured at fair value are based on one or more of the following three valuation techniques noted in ASC Topic 820: A. Market approach: Prices and other relevant information generated by market transactions involving identical or comparable assets, liabilities or a group of assets or liabilities, such as a business. B. Cost approach: Amount that would be required to replace the service capacity of an asset (replacement cost). C. Income approach: Techniques to convert future amounts to a single present amount based upon market expectations (including present value techniques, option-pricing and excess earnings models). The following tables classify assets and liabilities measured at fair value on a recurring basis as of December 31, 2016 and 2015: Basis of fair value measurements Balance at December 31, 2016 Quoted prices in active markets for identical items Significant other observable inputs Significant unobservable inputs Valuation technique (millions of dollars) Assets: Commodity contracts $ 0.1 $ — $ 0.1 $ — A Foreign currency contracts $ 7.2 $ — $ 7.2 $ — A Other long-term receivables (insurance settlement agreement note receivable) $ 71.5 $ — $ 71.5 $ — C Liabilities: Foreign currency contracts $ 1.1 $ — $ 1.1 $ — A Basis of fair value measurements (millions of dollars) Balance at December 31, 2015 Quoted prices in active markets for identical items Significant other observable inputs Significant unobservable inputs Valuation technique Assets: Foreign currency contracts $ 2.7 $ — $ 2.7 $ — A Other long-term receivables (insurance settlement agreement note receivable) $ 81.2 $ — $ 81.2 $ — C Liabilities: Foreign currency contracts $ 8.7 $ — $ 8.7 $ — A Commodity contracts $ 10.4 $ — $ 10.4 $ — A Interest rate swap contracts $ 2.7 $ — $ 2.7 $ — A The following tables classify the Company's defined benefit plan assets measured at fair value on a recurring basis as of December 31, 2016 and 2015: Basis of fair value measurements (millions of dollars) Balance at December 31, 2016 Quoted prices in active markets for identical items Significant other observable inputs Significant unobservable inputs Valuation technique Assets measured at NAV (a) U.S. Plans: Fixed income securities $ 113.8 $ 15.3 $ — $ — A 98.5 Equity securities 94.2 37.2 — — A 57.0 Real estate and other 21.5 13.1 0.5 — A 7.9 $ 229.5 $ 65.6 $ 0.5 $ — $ 163.4 Non-U.S. Plans: Fixed income securities $ 183.4 $ — $ — $ — A 183.4 Equity securities 190.8 87.1 — — A 103.7 Real estate and other 19.6 — — — A 19.6 $ 393.8 $ 87.1 $ — $ — $ 306.7 Basis of fair value measurements (millions of dollars) Balance at December 31, 2015 Quoted prices in active markets for identical items Significant other observable inputs Significant unobservable inputs Valuation technique Assets measured at NAV (a) U.S. Plans: Fixed income securities $ 117.4 $ 14.3 $ — $ — A 103.1 Equity securities 94.2 36.9 — — A 57.3 Real estate and other 24.2 — 0.5 — A 23.7 $ 235.8 $ 51.2 $ 0.5 $ — $ 184.1 Non-U.S. Plans: Fixed income securities $ 181.0 $ — $ — $ — A 181.0 Equity securities 194.7 82.9 — — A 111.8 Real estate and other 19.4 — — — A 19.4 $ 395.1 $ 82.9 $ — $ — $ 312.2 ________________ (a) Certain assets that are measured at fair value using the NAV per share (or its equivalent) practical expedient have not been classified in the fair value hierarchy. These amounts represent investments in commingled and managed funds which have underlying assets in fixed income securities, equity securities, and other assets. Refer to the Retirement Benefit Plans footnote to the Consolidated Financial Statements for more detail surrounding the defined plan’s asset investment policies and strategies, target allocation percentages and expected return on plan asset assumptions. |
Financial Instruments
Financial Instruments | 12 Months Ended |
Dec. 31, 2016 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Financial instruments | FINANCIAL INSTRUMENTS The Company’s financial instruments include cash and marketable securities. Due to the short-term nature of these instruments, their book value approximates their fair value. The Company’s financial instruments may include long-term debt, interest rate and cross-currency swaps, commodity derivative contracts and foreign currency derivatives. All derivative contracts are placed with counterparties that have an S&P, or equivalent, investment grade credit rating at the time of the contracts’ placement. At December 31, 2016 and 2015, the Company had no derivative contracts that contained credit risk related contingent features. The Company uses certain commodity derivative contracts to protect against commodity price changes related to forecasted raw material and supplies purchases. The Company primarily utilizes forward and option contracts, which are designated as cash flow hedges. At December 31, 2016 and 2015, the following commodity derivative contracts were outstanding: Commodity derivative contracts Commodity Volume hedged December 31, 2016 Volume hedged December 31, 2015 Units of measure Duration Copper 213.8 6,273.2 Metric Tons Dec -17 The Company manages its interest rate risk by balancing its exposure to fixed and variable rates while attempting to optimize its interest costs. The Company selectively uses interest rate swaps to reduce market value risk associated with changes in interest rates (fair value hedges). In July 2016, the Company terminated the following interest swaps which were outstanding at December 31, 2015. Interest rate swap contracts (in millions) Hedge Type Notional Amount Duration Fixed to floating Fair value $ 250.0 Sept - 20 Fixed to floating Fair value $ 134.0 Oct - 19 The Company uses foreign currency forward and option contracts to protect against exchange rate movements for forecasted cash flows, including capital expenditures, purchases, operating expenses or sales transactions designated in currencies other than the functional currency of the operating unit. In addition, the Company uses foreign currency forward contracts to hedge exposure associated with our net investment in certain foreign operations (net investment hedges). The Company has also designated its Euro denominated debt as a net investment hedge of the Company's investment in a European subsidiary. Foreign currency derivative contracts require the Company, at a future date, to either buy or sell foreign currency in exchange for the operating units’ local currency. At December 31, 2016 and December 31, 2015, the following foreign currency derivative contracts were outstanding: Foreign currency derivatives (in millions) Functional currency Traded currency Notional in traded currency Notional in traded currency Duration Chinese renminbi Euro — 30.5 Dec - 16 Chinese renminbi US dollar 33.5 13.8 Dec - 17 Euro British pound 4.2 — Dec - 17 Euro Hungarian forint — 3,434.5 Dec - 16 Euro Japanese yen 1,004.8 487.1 Dec - 17 Euro Polish zloty 18.8 — Dec - 17 Euro US dollar 35.3 30.1 Dec - 17 Japanese yen Chinese renminbi 68.7 92.6 Dec - 17 Japanese yen Korean won 5,689.2 5,998.9 Dec - 17 Japanese yen US dollar 2.0 3.0 Dec - 17 Korean won Euro — 2.5 Dec - 16 Korean won Japanese yen 539.9 — Dec - 17 Korean won US dollar 14.2 77.9 Dec - 17 Mexican peso US dollar 10.5 — Dec - 17 Swedish krona Euro 48.2 — Dec - 17 US dollar Mexican peso — 469.0 Sept - 16 At December 31, 2016 and 2015, the following amounts were recorded in the Consolidated Balance Sheets as being payable to or receivable from counterparties under ASC Topic 815: Assets Liabilities (millions of dollars) Location December 31, 2016 December 31, 2015 Location December 31, 2016 December 31, 2015 Foreign currency Prepayments and other current assets $ 7.2 $ 2.7 Accounts payable and accrued expenses $ 1.1 $ 8.7 Commodity Prepayments and other current assets $ 0.1 $ — Accounts payable and accrued expenses $ — $ 10.4 Interest rate swaps Other non-current assets $ — $ — Other non-current liabilities $ — $ 2.7 Effectiveness for cash flow and net investment hedges is assessed at the inception of the hedging relationship and quarterly, thereafter. To the extent that derivative instruments are deemed to be effective, gains and losses arising from these contracts are deferred into accumulated other comprehensive income (loss) ("AOCI") and reclassified into income as the underlying operating transactions are recognized. These realized gains or losses offset the hedged transaction and are recorded on the same line in the statement of operations. To the extent that derivative instruments are deemed to be ineffective, gains or losses are recognized into income. The table below shows deferred gains (losses) reported in AOCI as well as the amount expected to be reclassified to income in one year or less. The amount expected to be reclassified to income in one year or less assumes no change in the current relationship of the hedged item at December 31, 2016 market rates. Deferred gain (loss) in AOCI at Gain (loss) expected to be reclassified to income in one year or less (millions of dollars) December 31, 2016 December 31, 2015 Foreign currency $ 5.6 $ (0.1 ) $ 5.6 Commodity (0.1 ) (2.1 ) (0.1 ) Net investment hedges 12.6 12.2 — Foreign currency denominated debt 16.9 $ 0.1 — Total $ 35.0 $ 10.1 $ 5.5 Derivative instruments designated as hedging instruments as defined by ASC Topic 815 held during the period resulted in the following gains and losses recorded in income: Gain (loss) reclassified from AOCI to income Gain (loss) recognized in income Year Ended December 31, Year Ended December 31, (millions of dollars) Location 2016 2015 Location 2016 2015 Foreign currency Sales $ (0.1 ) $ (1.4 ) SG&A expense $ 0.3 $ (0.5 ) Foreign currency Cost of goods sold $ 1.4 $ 7.2 SG&A expense $ — $ 0.2 Commodity Cost of goods sold $ (1.4 ) $ (0.1 ) Cost of goods sold $ (0.3 ) $ — Cross-currency swap Interest $ — $ 0.4 Interest expense $ — $ — Year Ended December 31, 2016 (millions of dollars) Gain (loss) on swaps Gain (loss) on borrowings Income Statement Classification Interest expense and finance charges $ 8.5 $ (8.5 ) At December 31, 2016, derivative instruments that were not designated as hedging instruments as defined by ASC Topic 815 were immaterial. |
Retirement Benefit Plans
Retirement Benefit Plans | 12 Months Ended |
Dec. 31, 2016 | |
Compensation and Retirement Disclosure [Abstract] | |
Retirement benefit plans | RETIREMENT BENEFIT PLANS The Company sponsors various defined contribution savings plans, primarily in the U.S., that allow employees to contribute a portion of their pre-tax and/or after-tax income in accordance with plan specified guidelines. Under specified conditions, the Company will make contributions to the plans and/or match a percentage of the employee contributions up to certain limits. Total expense related to the defined contribution plans was $28.3 million , $28.0 million and $27.6 million in the years ended December 31, 2016, 2015 and 2014, respectively. The Company has a number of defined benefit pension plans and other postretirement employee benefit plans covering eligible salaried and hourly employees and their dependents. The defined pension benefits provided are primarily based on (i) years of service and (ii) average compensation or a monthly retirement benefit amount. The Company provides defined benefit pension plans in France, Germany, Ireland, Italy, Japan, Mexico, Monaco, South Korea, Sweden, U.K. and the U.S. The other postretirement employee benefit plans, which provide medical benefits, are unfunded plans. All pension and other postretirement employee benefit plans in the U.S. have been closed to new employees. The measurement date for all plans is December 31. During the fourth quarter of 2015, the Company settled approximately $48 million of its projected benefit obligation by transferring approximately $48 million in plan assets through a lump-sum pension de-risking disbursement made to an insurance company. This agreement unconditionally and irrevocably guarantees all future payments to certain participants that were receiving payments from the U.S. pension plan. The insurance company assumes all investment risk associated with the assets that were delivered as part of this transaction. As a result, the Company recorded a non-cash settlement loss of $25.7 million related to the accelerated recognition of unamortized losses . During the third quarter of 2014, the Company discharged certain U.S. pension plan obligations by making lump-sum payments to former employees of the Company. As a result of this action, the Company recorded a settlement loss of $3.1 million in the U.S. pension plan. The following table summarizes the expenses for the Company's defined contribution and defined benefit pension plans and the other postretirement defined employee benefit plans. Year Ended December 31, (millions of dollars) 2016 2015 2014 Defined contribution expense $ 28.3 $ 28.0 $ 27.6 Defined benefit pension expense 10.1 35.5 18.6 Other postretirement employee benefit expense 1.4 3.3 3.3 Total $ 39.8 $ 66.8 $ 49.5 The following provides a roll forward of the plans’ benefit obligations, plan assets, funded status and recognition in the Consolidated Balance Sheets. Pension benefits Other postretirement Year Ended December 31, employee benefits 2016 2015 Year Ended December 31, (millions of dollars) US Non-US US Non-US 2016 2015 Change in projected benefit obligation: Projected benefit obligation, January 1 $ 300.7 $ 508.5 $ 306.2 $ 527.8 $ 145.3 $ 169.7 Service cost — 16.2 — 14.9 0.2 0.2 Interest cost 9.6 12.5 11.2 14.1 4.0 5.7 Plan participants’ contributions — 0.4 — 0.3 — — Plan amendments — 0.2 — — — — Settlement and curtailment — (1.3 ) (48.1 ) (4.7 ) — — Actuarial (gain) loss (5.7 ) 70.2 (12.1 ) (9.0 ) (14.4 ) (16.8 ) Currency translation — (45.3 ) — (42.9 ) — — (Divestiture) Acquisition — (12.8 ) 68.1 23.9 — 1.7 Benefits paid (22.1 ) (20.4 ) (24.6 ) (15.9 ) (15.2 ) (15.2 ) Projected benefit obligation, December 31 $ 282.5 $ 528.2 $ 300.7 $ 508.5 $ 119.9 $ 145.3 Change in plan assets: Fair value of plan assets, January 1 $ 235.8 $ 395.1 $ 265.6 $ 395.6 Actual return on plan assets 12.7 54.0 (0.6 ) 10.3 Employer contribution 2.7 17.0 — 19.3 Plan participants’ contribution — 0.4 — 0.3 Settlements — (1.3 ) (48.1 ) (2.5 ) Currency translation — (40.8 ) — (30.8 ) (Divestiture) Acquisition — (10.2 ) 43.5 18.8 Benefits paid (21.7 ) (20.4 ) (24.6 ) (15.9 ) Fair value of plan assets, December 31 $ 229.5 $ 393.8 $ 235.8 $ 395.1 Funded status $ (53.0 ) $ (134.4 ) $ (64.9 ) $ (113.4 ) $ (119.9 ) $ (145.3 ) Amounts in the Consolidated Balance Sheets consist of: Non-current assets $ — $ 4.9 $ — $ 9.4 $ — $ — Current liabilities (0.1 ) (3.5 ) (0.3 ) (3.0 ) (14.5 ) (16.8 ) Non-current liabilities (52.9 ) (135.8 ) (64.6 ) (119.8 ) (105.4 ) (128.5 ) Net amount $ (53.0 ) $ (134.4 ) $ (64.9 ) $ (113.4 ) $ (119.9 ) $ (145.3 ) Amounts in accumulated other comprehensive loss consist of: Net actuarial loss $ 116.9 $ 163.7 $ 125.4 $ 144.2 $ 19.9 $ 36.5 Net prior service (credit) cost (7.4 ) 0.8 (8.2 ) 0.7 (19.2 ) (24.0 ) Net amount* $ 109.5 $ 164.5 $ 117.2 $ 144.9 $ 0.7 $ 12.5 Total accumulated benefit obligation for all plans $ 282.5 $ 505.5 $ 300.7 $ 486.2 ________________ * AOCI shown above does not include our equity investee, NSK-Warner. NSK-Warner had an AOCI loss of $10.8 million and $7.1 million at December 31, 2016 and 2015, respectively. The funded status of pension plans with accumulated benefit obligations in excess of plan assets at December 31 is as follows: December 31, (millions of dollars) 2016 2015 Accumulated benefit obligation $ (594.0 ) $ (597.6 ) Plan assets 423.3 431.0 Deficiency $ (170.7 ) $ (166.6 ) Pension deficiency by country: United States $ (53.0 ) $ (64.9 ) Germany (77.5 ) (64.3 ) Other (40.2 ) (37.4 ) Total pension deficiency $ (170.7 ) $ (166.6 ) The weighted average asset allocations of the Company’s funded pension plans and target allocations by asset category are as follows: December 31, Target Allocation 2016 2015 U.S. Plans: Real estate and other 9 % 12 % 0% - 14% Fixed income securities 50 % 53 % 41% - 61% Equity securities 41 % 35 % 30% - 50% 100 % 100 % Non-U.S. Plans: Real estate and other 5 % 5 % 0% - 6% Fixed income securities 47 % 46 % 43% - 53% Equity securities 48 % 49 % 46% - 56% 100 % 100 % The Company's investment strategy is to maintain actual asset weightings within a preset range of target allocations. The Company believes these ranges represent an appropriate risk profile for the planned benefit payments of the plans based on the timing of the estimated benefit payments. In each asset category, separate portfolios are maintained for additional diversification. Investment managers are retained in each asset category to manage each portfolio against its benchmark. Each investment manager has appropriate investment guidelines. In addition, the entire portfolio is evaluated against a relevant peer group. The defined benefit pension plans did not hold any Company securities as investments as of December 31, 2016 and 2015. A portion of pension assets is invested in common and commingled trusts. In December 2014, the Company made a discretionary contribution of $30.2 million to its German pension plans. The Company expects to contribute a total of $15 million to $25 million into its defined benefit pension plans during 2017. Of the $15 million to $25 million in projected 2017 contributions, $3.2 million are contractually obligated, while any remaining payments would be discretionary. Refer to the Fair Value Measurements footnote to the Consolidated Financial Statements for more detail surrounding the fair value of each major category of plan assets as well as the inputs and valuation techniques used to develop the fair value measurements of the plans' assets at December 31, 2016 and 2015. See the table below for a breakout of net periodic benefit cost between U.S. and non-U.S. pension plans: Pension benefits Other postretirement employee benefits Year Ended December 31, 2016 2015 2014 Year Ended December 31, (millions of dollars) US Non-US US Non-US US Non-US 2016 2015 2014 Service cost $ — $ 16.2 $ — $ 14.9 $ — $ 12.8 $ 0.2 $ 0.2 $ 0.3 Interest cost 9.6 12.5 11.2 14.1 12.1 18.1 4.0 5.7 6.7 Expected return on plan assets (15.0 ) (24.3 ) (17.0 ) (24.8 ) (17.6 ) (21.1 ) — — — Settlements, curtailments and other — — 25.7 (0.8 ) 3.1 0.7 — — — Amortization of unrecognized prior service (credit) cost (0.8 ) 0.6 (0.8 ) 0.1 (0.8 ) — (4.9 ) (5.7 ) (6.4 ) Amortization of unrecognized loss 5.1 6.2 6.3 6.6 6.5 4.8 2.1 3.1 2.7 Net periodic (income) cost $ (1.1 ) $ 11.2 $ 25.4 $ 10.1 $ 3.3 $ 15.3 $ 1.4 $ 3.3 $ 3.3 The estimated net loss for the defined benefit pension plans that will be amortized from accumulated other comprehensive loss into net periodic benefit cost over the next fiscal year is $11.6 million . The estimated net loss and prior service credit for the other postretirement employee benefit plans that will be amortized from accumulated other comprehensive loss into net periodic benefit cost over the next fiscal year are $1.3 million and $4.1 million , respectively. The Company's weighted-average assumptions used to determine the benefit obligations for its defined benefit pension and other postretirement employee benefit plans as of December 31, 2016 and 2015 were as follows: December 31, (percent) 2016 2015 U.S. pension plans: Discount rate 3.94 4.15 Rate of compensation increase N/A N/A U.S. other postretirement employee benefit plans: Discount rate 3.61 3.84 Rate of compensation increase N/A N/A Non-U.S. pension plans: Discount rate 2.25 2.99 Rate of compensation increase 3.00 3.01 The Company’s weighted-average assumptions used to determine the net periodic benefit cost for its defined benefit pension and other postretirement employee benefit plans for the years ended December 31, 2016, 2015 and 2014 were as follows: Year Ended December 31, (percent) 2016 2015 2014 U.S. pension plans: Discount rate 4.15 3.89 4.41 Rate of compensation increase N/A N/A N/A Expected return on plan assets 6.70 6.71 6.75 U.S. other postretirement plans: Discount rate 3.84 3.50 4.00 Rate of compensation increase N/A N/A N/A Expected return on plan assets N/A N/A N/A Non-U.S. pension plans: Discount rate 2.99 2.84 3.90 Rate of compensation increase 3.01 2.84 2.77 Expected return on plan assets 6.41 6.53 6.24 The Company's approach to establishing the discount rate is based upon the market yields of high-quality corporate bonds, with appropriate consideration of each plan's defined benefit payment terms and duration of the liabilities. The Company determines its expected return on plan asset assumptions by evaluating estimates of future market returns and the plans' asset allocation. The Company also considers the impact of active management of the plans' invested assets. The estimated future benefit payments for the pension and other postretirement employee benefits are as follows: Pension benefits Other postretirement employee benefits (millions of dollars) Year U.S. Non-U.S. 2017 $ 22.8 $ 17.7 $ 14.8 2018 19.8 18.7 13.7 2019 19.7 17.3 12.6 2020 19.6 19.1 12.1 2021 19.3 19.5 11.0 2022-2026 89.8 110.7 39.6 The weighted-average rate of increase in the per capita cost of covered health care benefits is projected to be 6.79% in 2017 for pre-65 and post-65 participants, decreasing to 5.0% by the year 2022. A one-percentage point change in the assumed health care cost trend would have the following effects: One Percentage Point (millions of dollars) Increase Decrease Effect on other postretirement employee benefit obligation $ 7.9 $ (7.0 ) Effect on total service and interest cost components $ 0.3 $ (0.3 ) |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Dec. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock incentive plans | STOCK-BASED COMPENSATION Under the Company's 2004 Stock Incentive Plan ("2004 Plan"), the Company granted options to purchase shares of the Company's common stock at the fair market value on the date of grant. The options vested over periods up to three years and have a term of 10 years from date of grant. At its November 2007 meeting, the Company's Compensation Committee decided that restricted common stock awards and stock units ("restricted stock") would be awarded in place of stock options for long-term incentive award grants to employees. Restricted stock granted to employees generally vests 50% after two years and the remainder after three years from the date of grant. Restricted stock granted to non-employee directors generally vests on the first anniversary date of the grant. In February 2014, the Company's Board of Directors replaced the expired 2004 Plan by adopting the BorgWarner Inc. 2014 Stock Incentive Plan ("2014 Plan"). On April 30, 2014, the Company's stockholders approved the 2014 Plan. Under the 2014 Plan, approximately 8 million shares are authorized for grant, of which approximately 5.7 million shares are available for future issuance as of December 31, 2016. Stock Options A summary of the plans’ shares under option at December 31, 2016, 2015 and 2014 is as follows: Shares (thousands) Weighted average exercise price Weighted average remaining contractual life (in years) Aggregate intrinsic value (in millions) Outstanding at January 1, 2014 1,997 $ 15.82 2.6 $ 80.0 Exercised (283 ) $ 14.04 $ 13.8 Outstanding at December 31, 2014 1,714 $ 16.11 1.7 $ 66.5 Exercised (440 ) $ 14.76 $ 19.2 Forfeited (7 ) $ 14.52 Outstanding at December 31, 2015 1,267 $ 16.59 0.9 $ 33.7 Exercised (794 ) $ 16.07 $ 14.4 Outstanding at December 31, 2016 473 $ 17.47 0.1 $ 10.4 Options exercisable at December 31, 2016 473 $ 17.47 0.1 $ 10.4 Proceeds from stock option exercises for the years ended December 31, 2016, 2015 and 2014 were as follows: Year Ended December 31, (millions of dollars) 2016 2015 2014 Proceeds from stock options exercised — gross $ 12.7 $ 6.5 $ 4.0 Tax benefit 0.3 10.3 12.9 Proceeds from stock options exercised, net of tax $ 13.0 $ 16.8 $ 16.9 Restricted Stock The value of restricted stock is determined by the market value of the Company’s common stock at the date of grant. In 2016, restricted stock in the amount of 698,788 shares and 25,048 shares was granted to employees and non-employee directors, respectively. The value of the awards is recognized as compensation expense ratably over the restriction periods. As of December 31, 2016, there was $25.6 million of unrecognized compensation expense that will be recognized over a weighted average period of approximately 2 years . Restricted stock compensation expense recorded in the Consolidated Statements of Operations is as follows: Year Ended December 31, (millions of dollars, except per share data) 2016 2015 2014 Restricted stock compensation expense $ 26.7 $ 28.0 $ 20.7 Restricted stock compensation expense, net of tax $ 19.5 $ 20.4 $ 15.1 A summary of the status of the Company’s nonvested restricted stock for employees and non-employee directors at December 31, 2016, 2015 and 2014 is as follows: Shares subject to restriction Weighted average price Nonvested at January 1, 2014 1,411 $ 37.86 Granted 447 $ 54.36 Vested (530 ) $ 37.42 Forfeited (62 ) $ 41.14 Nonvested at December 31, 2014 1,266 $ 43.57 Granted 687 $ 58.45 Vested (588 ) $ 39.14 Forfeited (39 ) $ 50.85 Nonvested at December 31, 2015 1,326 $ 53.18 Granted 724 $ 30.07 Vested (551 ) $ 47.55 Forfeited (70 ) $ 43.05 Nonvested at December 31, 2016 1,429 $ 44.12 Total Shareholder Return Performance Share Plans The 2004 and 2014 Plans provide for awarding of performance shares to members of senior management at the end of successive three-year periods based on the Company's performance in terms of total shareholder relative to a peer group of automotive companies. The Company recognizes compensation expense relating to its performance share plans ratably over the performance period. Compensation expense associated with the performance share plans is calculated using a lattice model (Monte Carlo simulation). The amounts expensed under the plan and the common stock issuances for the three-year measurement periods ended December 31, 2016, 2015 and 2014 were as follows: Year Ended December 31, (millions of dollars, except share data) 2016 2015 2014 Expense $ 9.6 $ 12.2 $ 11.4 Number of shares — — — Relative Revenue Growth Performance Share Plans In the second quarter of 2016, the Company started a new performance share program to reward members of senior management based on the Company's performance in terms of revenue growth relative to the vehicle market over three-year performance periods. The value of this performance share is determined by the market value of the Company’s common stock at the date of grant. The Company recognizes compensation expense relating to its performance share plans over the performance period based on the number of shares expected to vest at the end of each reporting period. Total compensation expense was $7.1 million for the year ended December 31, 2016 with approximately 115,000 shares to be paid out in February 2017. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss | 12 Months Ended |
Dec. 31, 2016 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Comprehensive Income (Loss) Note | The following table summarizes the activity within accumulated other comprehensive loss during the years ended December 31, 2016, 2015 and 2014: (millions of dollars) Foreign currency translation adjustments Hedge instruments Defined benefit postretirement plans Other Total Beginning Balance, January 1, 2014 $ 181.1 $ (16.0 ) $ (181.5 ) $ 2.4 $ (14.0 ) Comprehensive (loss) income before reclassifications (341.8 ) 26.7 (73.8 ) 0.3 (388.6 ) Income taxes associated with comprehensive (loss) income before reclassifications — (9.6 ) 23.3 — 13.7 Reclassification from accumulated other comprehensive (loss) income — 0.6 6.8 — 7.4 Income taxes reclassified into net earnings — — (2.1 ) — (2.1 ) Ending Balance December 31, 2014 $ (160.7 ) $ 1.7 $ (227.3 ) $ 2.7 $ (383.6 ) Comprehensive (loss) income before reclassifications (260.5 ) 2.6 44.9 0.2 (212.8 ) Income taxes associated with comprehensive (loss) income before reclassifications — (1.6 ) (14.3 ) — (15.9 ) Reclassification from accumulated other comprehensive (loss) income — (6.1 ) 9.6 — 3.5 Income taxes reclassified into net earnings — 1.4 (2.8 ) — (1.4 ) Ending Balance December 31, 2015 $ (421.2 ) $ (2.0 ) $ (189.9 ) $ 2.9 $ (610.2 ) Comprehensive (loss) income before reclassifications (109.1 ) 8.0 (11.4 ) (1.6 ) (114.1 ) Income taxes associated with comprehensive (loss) income before reclassifications — (0.7 ) (2.6 ) — (3.3 ) Reclassification from accumulated other comprehensive (loss) income — 0.1 8.3 — 8.4 Income taxes reclassified into net earnings — (0.4 ) (2.5 ) — (2.9 ) Ending Balance December 31, 2016 $ (530.3 ) $ 5.0 $ (198.1 ) $ 1.3 $ (722.1 ) |
Contingencies
Contingencies | 12 Months Ended |
Dec. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies | CONTINGENCIES In the normal course of business, the Company is party to various commercial and legal claims, actions and complaints, including matters involving warranty claims, intellectual property claims, general liability and various other risks. It is not possible to predict with certainty whether or not the Company will ultimately be successful in any of these commercial and legal matters or, if not, what the impact might be. The Company's environmental and asbestos liability contingencies are discussed separately below. The Company's management does not expect that an adverse outcome in any of these commercial and legal claims, actions and complaints will have a material adverse effect on the Company's results of operations, financial position or cash flows, although it could be material to the results of operations in a particular quarter. Litigation In January 2006, BorgWarner Diversified Transmission Products Inc. ("DTP"), a subsidiary of the Company, filed a declaratory judgment action in United States District Court, Southern District of Indiana (Indianapolis Division) against the United Automobile, Aerospace, and Agricultural Implements Workers of America (“UAW”) Local No. 287 and Gerald Poor, individually and as the representative of a defendant class. DTP sought the Court's affirmation that DTP did not violate the Labor-Management Relations Act or the Employee Retirement Income Security Act (ERISA) by unilaterally amending certain medical plans effective April 1, 2006 and October 1, 2006, prior to the expiration of the then-current collective bargaining agreements. On September 10, 2008, the Court found that DTP's reservation of the right to make such amendments reducing the level of benefits provided to retirees was limited by its collectively bargained health insurance agreement with the UAW, which did not expire until April 24, 2009. Thus, the amendments were untimely. In 2008, the Company recorded a charge of $4.0 million as a result of the Court's decision. DTP filed a declaratory judgment action in the United States District Court, Southern District of Indiana (Indianapolis Division) against the UAW Local No. 287 and Jim Barrett and others, individually and as representatives of a defendant class, on February 26, 2009 again seeking the Court's affirmation that DTP did not violate the Labor - Management Relations Act or ERISA by modifying the level of benefits provided retirees to make them comparable to other Company retiree benefit plans after April 24, 2009. Certain retirees, on behalf of themselves and others, filed a mirror-image action in the United States District Court, Eastern District of Michigan (Southern Division) on March 11, 2009, for which a class has been certified. During the last quarter of 2009, the action pending in Indiana was dismissed, while the action in Michigan continued. On December 5, 2016, the Court granted the Company’s Motion for Summary Judgment and ordered dismissal of the retirees’ Complaint with prejudice. No appeal was filed on behalf of the retirees and the time to file an appeal has expired. Environmental The Company and certain of its current and former direct and indirect corporate predecessors, subsidiaries and divisions have been identified by the United States Environmental Protection Agency and certain state environmental agencies and private parties as potentially responsible parties (“PRPs”) at various hazardous waste disposal sites under the Comprehensive Environmental Response, Compensation and Liability Act (“Superfund”) and equivalent state laws and, as such, may presently be liable for the cost of clean-up and other remedial activities at 27 such sites. Responsibility for clean-up and other remedial activities at a Superfund site is typically shared among PRPs based on an allocation formula. The Company believes that none of these matters, individually or in the aggregate, will have a material adverse effect on its results of operations, financial position or cash flows. Generally, this is because either the estimates of the maximum potential liability at a site are not material or the liability will be shared with other PRPs, although no assurance can be given with respect to the ultimate outcome of any such matter. Based on information available to the Company (which in most cases includes: an estimate of allocation of liability among PRPs; the probability that other PRPs, many of whom are large, solvent public companies, will fully pay the cost apportioned to them; currently available information from PRPs and/or federal or state environmental agencies concerning the scope of contamination and estimated remediation and consulting costs; and remediation alternatives), the Company has an accrual for indicated environmental liabilities of $6.3 million and $5.4 million at December 31, 2016 and at December 31, 2015, respectively. The Company expects to pay out substantially all of the amounts accrued for environmental liability over the next five years. In connection with the sale of Kuhlman Electric Corporation (“Kuhlman Electric”), the Company agreed to indemnify the buyer and Kuhlman Electric for certain environmental liabilities, then unknown to the Company, relating to certain operations of Kuhlman Electric that pre-date the Company's 1999 acquisition of Kuhlman Electric. The Company previously settled or obtained dismissals of various lawsuits that were filed against Kuhlman Electric and others, including the Company, on behalf of plaintiffs alleging personal injury relating to alleged environmental contamination at its Crystal Springs, Mississippi plant. The Company filed a lawsuit against Kuhlman Electric and a related entity challenging the validity of the indemnity and the defendants filed counterclaims (the “Indemnity Action”) and a related lawsuit. On September 28, 2015, the parties entered into a confidential settlement agreement that, among other things, released and terminated all of BorgWarner’s indemnity obligations. Pursuant to the settlement agreement, the parties voluntarily dismissed the Indemnity Action on September 29, 2015 and the related lawsuit was dismissed on October 13, 2015. The Company continues to pursue insurance coverage actions for reimbursement of amounts it spent under the indemnity. The Company may in the future become subject to further legal proceedings. Asbestos-related Liability Like many other industrial companies that have historically operated in the United States, the Company, or parties that the Company is obligated to indemnify, continues to be named as one of many defendants in asbestos-related personal injury actions. We believe that the Company’s involvement is limited because these claims generally relate to a few types of automotive products that were manufactured over 30 years ago and contained encapsulated asbestos. The nature of the fibers, the encapsulation of the asbestos, and the manner of the products’ use all lead the Company to believe that these products were and are highly unlikely to cause harm. Furthermore, the useful life of nearly all of these products expired many years ago. As of December 31, 2016 and 2015, the Company had approximately 9,400 and 10,100 pending asbestos-related claims, respectively. The decrease in the number of pending claims is primarily a result of the Company’s continued efforts to obtain dismissal of dormant claims. It is probable that additional asbestos-related claims will be asserted against the Company in the future. The Company vigorously defends against these claims, and has been successful in obtaining the dismissal of the majority of the claims asserted against it without any payment. The Company likewise expects that the vast majority of the pending asbestos-related claims in which it has been named (or has an obligation to indemnify a party which has been named), and asbestos-related claims that may be asserted in the future, will result in no payment being made by the Company or its insurers. In 2016, of the approximately 2,800 claims resolved, 352 ( 13% ) resulted in payment being made to a claimant by or on behalf of the Company. In 2015, of the approximately 5,300 claims resolved, 349 ( 7% ) resulted in payment being made to a claimant by or on behalf of the Company. The comparatively large number of claims resolved in 2015 reflected the Company’s efforts to dismiss large numbers of inactive or otherwise unmeritorious claims in order to be better positioned to evaluate remaining and future claims, while the smaller number of total claims resolved in 2016 reflects in part the outcome of those efforts. Through December 31, 2016 and 2015, the Company had accrued and paid $477.7 million and $432.7 million in indemnity (including settlement payments) and defense costs in connection with asbestos-related claims, respectively. During 2016 and 2015, the Company had paid indemnity and related defense costs totaling $45.3 million and $54.7 million , respectively. These gross payments are before tax benefits and any insurance receipts. Indemnity and defense costs are incorporated into the Company's operating cash flows and will continue to be in the future. The Company reviews, on an ongoing basis, its own experience in handling asbestos-related claims and trends affecting asbestos-related claims in the U.S. tort system generally, for the purposes of assessing the value of pending asbestos-related claims and the number and value of those that may be asserted in the future, as well as potential recoveries from the Company’s insurers with respect to such claims and defense costs. As of December 31, 2015, the Company also recorded an estimated liability of $108.5 million for asbestos-related claims asserted but not yet resolved and their associated defense costs. The Company further stated that, as of that date, its ultimate liability could not be reasonably estimated in excess of the amounts it had then accrued for claims that had been resolved and the estimated liability for claims asserted but not yet resolved and their associated defense costs. The inability to arrive at a reasonable estimate of the liability for potential asbestos-related claims that may be asserted in the future was based on, among other factors, the volatility in the number and type of asbestos claims that may be asserted, changes in asbestos-related litigation in the United States, the significant number of co-defendants that have filed for bankruptcy, the magnitude and timing of co-defendant bankruptcy trust payments, the inherent uncertainty of future disease incidence and claiming patterns against the Company, and the impact of tort reform legislation that may be enacted at the state or federal levels. The Company has continued efforts to evaluate these factors and, if possible, arrive at a reasonable estimate of the number and value of potential future asbestos-related claims. In recent years, there have been more observable trends in the Company’s claims data that would indicate that claiming patterns against the Company have stabilized. Concurrently, in recent years, the Company has made enhancements to the management and analysis of asbestos-related claims, including specifically: the engagement of new National Coordinating Counsel with significant asbestos litigation experience and a global presence, the engagement of several new local counsel panels; outsourcing administration and claims handling to a third party; implementing various improvements in the processing of asbestos-related claims so as to allow the Company’s management to have greater real-time insight into the handling of individual asbestos-related claims; and increasing audits and compliance reviews of counsel handling asbestos-related claims. This process has as of the end of 2016 resulted in improvements in both the quantity and the quality of the information available to the Company’s management respecting individual asbestos-related claims and their handling and disposition. This process has also resulted, in the Company’s view, in an increased ability to reasonably forecast the aggregate number of potential future asbestos-related claims that may be asserted against the Company. The Company has further engaged in a sustained effort to obtain the dismissal of thousands of dormant asbestos-related product liability claims, which has resulted in a reduction in the number of its pending claims by 48 percent over the past few years. Legislative and judicial developments affecting the U.S. tort system generally, including medical criteria legislation, procedural reforms, and docket control measures relating to so-called unimpaired claims, have also stabilized certain aspects of the Company’s defense efforts respecting asbestos-related claims and allowed the Company greater insight into the number and value of potential future claims in recent years. As part of its review and assessment of asbestos-related claims, the Company hired a third party consultant in the third quarter of 2016 to further assist in the analysis of potential future asbestos-related claims. The consultant’s work utilized the updated data and analysis resulting from the Company’s claim review process and included the development of an estimate of the potential value of asbestos-related claims asserted but not yet resolved as well as the number and potential value of asbestos-related claims not yet asserted. The Company determined based on the factors described above, including the analysis and input of the consultant, that its best estimate of the aggregate liability both for asbestos-related claims asserted but not yet resolved and potential asbestos-related claims not yet asserted, including an estimate for defense costs, is $879.3 million as of December 31, 2016. This liability reflects the actuarial central estimate, which is intended to represent an expected value of the most probable outcome. This estimate is not discounted to present value and includes an estimate of liability for potential future claims not yet asserted through December 31, 2059 with a runoff through 2067. The Company currently believes that December 31, 2067 is a reasonable assumption as to the last date on which it is likely to have resolved all asbestos-related claims, based on the nature and useful life of the Company’s products and the likelihood of incidence of asbestos-related disease in the U.S. population generally. In developing the estimate of liability for potential future claims, the third-party consultant projected a potential number of future claims based on the Company’s historical claim filings and patterns and compared that to anticipated levels of unique plaintiff asbestos-related claims asserted in the U.S. tort system against all defendants. The consultant also utilized assumptions based on the Company’s historical proportion of claims resolved without payment, historical settlement costs for those claims that result in a payment, and historical defense costs. The liabilities were then estimated by multiplying the pending and projected future claim filings by projected payments rates and average settlement amounts and then adding an estimate for defense costs. The Company’s estimate of the indemnity and defense costs for asbestos-related claims asserted but not yet resolved and potential claims not yet asserted is its best estimate of such costs. That estimate is subject to numerous uncertainties. These include future legislative or judicial changes affecting the U.S. tort system, bankruptcy proceedings involving one or more co-defendants, the impact and timing of payments from bankruptcy trusts that presently exist and those that may exist in the future, disease emergence and associated claim filings, the impact of future settlements or significant judgments, changes in the medical condition of claimants, changes in the treatment of asbestos-related disease, and any changes in settlement or defense strategies. The amount recorded at December 31, 2016 for asbestos-related claims is based on currently available information and assumptions that the Company believes are reasonable. Any amounts that are reasonably possible of occurring in excess of amounts recorded are believed to not be significant. The various assumptions utilized in arriving at the Company’s estimate the number of future claims that may be asserted, the percentage of claims that may result in a payment, the average cost to resolve such claims, and potential defense costs - may also change over time, and the Company’s actual liability for asbestos-related claims asserted but not yet resolved and those not yet asserted may be higher or lower than the estimate provided herein as a result of such changes. The Company has certain insurance coverage applicable to asbestos-related claims. Prior to June 2004, the settlement and defense costs associated with all asbestos-related claims were paid by the Company's primary layer insurance carriers under a series of interim funding arrangements. In June 2004, primary layer insurance carriers notified the Company of the alleged exhaustion of their policy limits. A declaratory judgment action was filed in January 2004 in the Circuit Court of Cook County, Illinois by Continental Casualty Company and related companies against the Company and certain of its historical general liability insurers. The Cook County court has issued a number of interim rulings and discovery is continuing in this proceeding. The Company is vigorously pursuing the litigation against all carriers that are parties to it, as well as pursuing settlement discussions with its carriers where appropriate. The Company has entered into settlement agreements with certain of its insurance carriers, resolving such insurance carriers’ coverage disputes through the carriers’ agreement to pay specified amounts to the Company, either immediately or over a specified period. Through December 31, 2016 and 2015, the Company had received $270.0 million and $263.9 million in cash and notes from insurers, respectively, on account of indemnity and defense costs respecting asbestos-related claims. The Company additionally recorded assets as of December 31, 2015 in the amount of (i) $168.8 million , representing the difference between the $432.7 million in defense and indemnity costs paid by the Company as of December 31, 2015 for asbestos-related claims and the $263.9 million received from insurers prior to that date, and (ii) $108.5 million , representing the then-estimated amount of asbestos-related claims asserted but not yet resolved for which the Company believes it has insurance coverage. In each case, such amounts were expected to be fully recovered. The Company continues to have additional excess insurance coverage available for potential future asbestos-related claims. In connection with the Company’s ongoing review of its asbestos-related claims, the Company also reviewed the amount of its potential insurance coverage for such claims, taking into account the remaining limits of such coverage, the number and amount of claims on our insurance from co-insured parties, ongoing litigation against the Company’s insurers described above, potential remaining recoveries from insolvent insurers, the impact of previous insurance settlements, and coverage available from solvent insurers not party to the coverage litigation. Based on that review, the Company estimates as of December 31, 2016 that it has $386.4 million in aggregate insurance coverage available with respect to asbestos-related claims already satisfied by the Company but not yet reimbursed by the insurers, asbestos-related claims asserted but not yet resolved, and asbestos-related claims not yet asserted, in each case together with their associated defense costs. In each case, such amounts are expected to be fully recovered. However, the resolution of the insurance coverage litigation, and the number and amount of claims on our insurance from co-insured parties, may increase or decrease the amount of insurance coverage available to us for asbestos-related claims from the estimates discussed above. As a result of all of the foregoing estimates of asbestos-related liabilities and related insurance assets, the Company in the fourth quarter of 2016 recorded a charge of $703.6 million before tax, or $440.6 million after tax, resulting from the difference in the total liability from what was previously accrued, consulting fees, less available insurance coverage. The amounts recorded in the Consolidated Balance Sheets respecting asbestos-related claims are as follows: December 31, (millions of dollars) 2016 2015 Assets: Non-current assets $ 386.4 $ 277.3 Total insurance assets $ 386.4 $ 277.3 Liabilities: Accounts payable and accrued expenses $ 51.7 $ 47.7 Other non-current liabilities 827.6 60.8 Total accrued liabilities $ 879.3 $ 108.5 |
Restructuring
Restructuring | 12 Months Ended |
Dec. 31, 2016 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Related Activities Disclosure | RESTRUCTURING In the fourth quarter of 2013, the Company initiated actions primarily in the Drivetrain segment designed to improve future profitability and competitiveness. As a continuation of these actions, the Company finalized severance agreements with three labor unions at separate facilities in Western Europe for approximately 450 employees. The Company recorded restructuring expense related to these facilities of $8.2 million , $28.0 million and $61.8 million in the years ended December 31, 2016, 2015 and 2014, respectively. Included in this restructuring expense are employee termination benefits of $3.0 million , $20.1 million and $50.6 million , respectively, and other expense of $5.2 million , $7.9 million and $11.2 million , respectively. In the second quarter of 2014, the Company initiated actions to improve the future profitability and competitiveness of Gustav Wahler GmbH u. Co. KG and its general partner ("Wahler"). The Company recorded restructuring expense related to Wahler of $9.6 million , $11.6 million and $6.5 million in the years ended December 31, 2016, 2015 and 2014, respectively. These restructuring expenses are primarily related to employee termination benefits. These termination benefits relate to approximately 70 employees in Germany and Brazil in 2015 and 95 employees in Germany, Brazil, China and the U.S. in 2014. The Company recorded restructuring expense of $12.5 million and $12.0 million in the years ended December 31, 2015 and 2014, respectively, related to a global realignment plan intended to enhance treasury management flexibility by creating a legal entity structure that better aligns with the Company's business strategy. In the fourth quarter of 2015, the Company acquired 100% of the equity interests in Remy and initiated actions to improve future profitability and competitiveness. The Company recorded restructuring expense of $6.1 million and $10.1 million in the years ended December 31, 2016 and 2015, respectively. Included in this restructuring expense is $3.1 million in the year ended December 31, 2016 related to winding down certain operations in North America. Additionally, the Company recorded employee termination benefits of $2.0 million and $10.1 million in the years ended December 31, 2016 and 2015, respectively, primarily related to contractually required severance associated with Remy executive officers and other employee termination benefits in Mexico. Cash payments for these restructuring activities are expected to be complete by the end of 2017. Estimates of restructuring expense are based on information available at the time such charges are recorded. Due to the inherent uncertainty involved in estimating restructuring expenses, actual amounts paid for such activities may differ from amounts initially recorded. Accordingly, the Company may record revisions of previous estimates by adjusting previously established accruals. The following table displays a rollforward of the severance accruals recorded within the Company's Consolidated Balance Sheet and the related cash flow activity for the years ended December 31, 2016 and 2015: Severance Accruals (millions of dollars) Drivetrain Engine Total Balance at January 1, 2015 $ 41.9 $ 2.0 $ 43.9 Acquisition* 0.4 — 0.4 Provision 32.6 11.3 43.9 Cash payments (46.0 ) (9.0 ) (55.0 ) Translation adjustment (3.6 ) (0.2 ) (3.8 ) Balance at December 31, 2015 25.3 4.1 29.4 Provision 5.0 5.6 10.6 Cash payments (26.9 ) (6.9 ) (33.8 ) Translation adjustment 0.3 (0.1 ) 0.2 Balance at December 31, 2016 $ 3.7 $ 2.7 $ 6.4 ____________________________________ * Acquisition relates to the Company's 2015 purchase of Remy. |
Leases and Commitments
Leases and Commitments | 12 Months Ended |
Dec. 31, 2016 | |
Leases [Abstract] | |
Leases and commitments | LEASES AND COMMITMENTS Certain assets are leased under long-term operating leases, including rent for facilities and one airplane. Most leases contain renewal options for various periods. Leases generally require the Company to pay for insurance, taxes and maintenance of the leased property. The Company leases other equipment such as vehicles and certain office equipment under short-term leases. Total rent expense was $38.2 million , $31.9 million and $33.9 million in the years ended December 31, 2016, 2015 and 2014, respectively. The Company does not have any material capital leases. Future minimum operating lease payments at December 31, 2016 were as follows: (millions of dollars) 2017 $ 24.1 2018 8.0 2019 6.4 2020 6.5 2021 6.3 After 2021 3.8 Total minimum lease payments $ 55.1 |
Earnings Per Share
Earnings Per Share | 12 Months Ended |
Dec. 31, 2016 | |
Earnings Per Share [Abstract] | |
Earnings per share | EARNINGS PER SHARE The Company presents both basic and diluted earnings per share of common stock (“EPS”) amounts. Basic EPS is calculated by dividing net earnings attributable to BorgWarner Inc. by the weighted average shares of common stock outstanding during the reporting period. Diluted EPS is calculated by dividing net earnings attributable to BorgWarner Inc. by the weighted average shares of common stock and common equivalent stock outstanding during the reporting period. The dilutive impact of stock-based compensation is calculated using the treasury stock method. The treasury stock method assumes that the Company uses the assumed proceeds from the exercise of awards to repurchase common stock at the average market price during the period. The assumed proceeds under the treasury stock method include the purchase price that the grantee will pay in the future, compensation cost for future service that the Company has not yet recognized and any windfall/(shortfall) tax benefits that would be credited/(debited) to capital in excess of par value when the award generates a tax deduction. Options are only dilutive when the average market price of the underlying common stock exceeds the exercise price of the options. The following table reconciles the numerators and denominators used to calculate basic and diluted earnings per share of common stock: Year Ended December 31, (in millions except per share amounts) 2016 2015 2014 Basic earnings per share: Net earnings attributable to BorgWarner Inc. $ 118.5 $ 609.7 $ 655.8 Weighted average shares of common stock outstanding 214.374 224.414 227.150 Basic earnings per share of common stock $ 0.55 $ 2.72 $ 2.89 Diluted earnings per share: Net earnings attributable to BorgWarner Inc. $ 118.5 $ 609.7 $ 655.8 Weighted average shares of common stock outstanding 214.374 224.414 227.150 Effect of stock-based compensation 0.954 1.234 1.774 Weighted average shares of common stock outstanding including dilutive shares 215.328 225.648 228.924 Diluted earnings per share of common stock $ 0.55 $ 2.70 $ 2.86 |
Recent Transactions
Recent Transactions | 12 Months Ended |
Dec. 31, 2016 | |
Business Combinations [Abstract] | |
Recent transactions | RECENT TRANSACTIONS Divgi-Warner Private Limited. In August 2016, the Company sold its 60% ownership interest in Divgi-Warner Private Limited ("Divgi-Warner") to the joint venture partner. This former joint venture was formed in 1995 to develop and manufacture transfer cases and synchronizer rings in India. As a result of the sale, the Company received cash proceeds of approximately $5.4 million , net of capital gains tax and cash divested, which is classified as an investing activity within the Condensed Consolidated Statement of Cash Flows. Furthermore, the Company wrote off noncontrolling interest of $4.8 million as result of the sale and recognized a negligible gain in the year ended December 31, 2016. Remy International, Inc. On November 10, 2015, the Company acquired 100% of the equity interests in Remy for $29.50 per share in cash. The Company also settled approximately $361 million of outstanding debt. Remy was a global market leading producer of rotating electrical components that had key technologies and operations in 10 countries. The cash paid, net of cash acquired, was $1,187.0 million . The Remy acquisition is expected to strengthen the Company's position in the rapidly developing powertrain electrification trend, with a complementary combination of technologies and global operations. The operating results and assets are reported within the Company's Drivetrain reporting segment as of the date of the acquisition. Remy's results from the date of acquisition through December 31, 2015 were insignificant to the Company's Consolidated Statement of Operations. The Company paid $1,187.0 million , which is recorded as an investing activity in the Company's Consolidated Statement of Cash Flows. Additionally, the Company assumed retirement-related liabilities of $31.1 million and assumed debt of $10.9 million , which are reflected in the supplemental cash flow information on the Company's Consolidated Statement of Cash Flows. The following table summarizes the aggregated estimated fair value of the assets acquired and liabilities assumed on November 10, 2015, the date of acquisition: (millions of dollars) Receivables, net $ 222.8 Inventories, net 195.3 Property, plant and equipment, net 196.6 Goodwill 572.6 Other intangible assets 412.6 Other assets and liabilities (207.8 ) Accounts payable and accrued expenses (163.1 ) Total consideration, net of cash acquired 1,229.0 Less: Assumed retirement-related liabilities 31.1 Less: Assumed debt 10.9 Cash paid, net of cash acquired $ 1,187.0 In connection with the acquisition, the Company capitalized $303.3 million for customer relationships, $46.4 million for developed technology, $59.0 million for the Delco Remy, Remy and Maval trade names, $3.8 million for in-process R&D and $0.1 million for leasehold interests. These intangible assets, excluding the indefinite-lived trade names, will be amortized over a period of 5 to 15 years. Various valuation techniques were used to determine the fair value of the intangible assets, with the primary techniques being forms of the income approach, specifically, the relief-from-royalty and excess earnings valuation methods, which use significant unobservable inputs, or Level 3 inputs, as defined by the fair value hierarchy. Under these valuation approaches, the Company is required to make estimates and assumptions about sales, operating margins, growth rates, royalty rates and discount rates based on budgets, business plans, economic projections, anticipated future cash flows and marketplace data. Due to the nature of the transaction, goodwill is not deductible for tax purposes. In the fourth quarter of 2016, the Company finalized all purchase accounting adjustments related to the Remy acquisition. The Company has recorded fair value adjustments based on new information obtained during the measurement period primarily related to warranty, inventory, and deferred taxes. These adjustments have resulted in a decrease in goodwill of $12.1 million from the Company's initial estimate. In October 2016, the Company entered into a definitive agreement to sell the light vehicle aftermarket business associated with the Company’s acquisition of Remy for approximately $80 million in cash, subject to customary adjustment. The Remy light vehicle aftermarket business sells remanufactured and new starters, alternators and multi-line products to aftermarket customers, mainly retailers in North America, and warehouse distributors in North America, South America and Europe. The sale of this business allows the Company to focus on the rapidly developing original equipment manufacturer powertrain electrification trend. During the third quarter of 2016, the Company determined that assets and liabilities subject to the Remy light vehicle aftermarket business sale met the held for sale criteria and recorded an asset impairment expense of $106.5 million to adjust the net book value of this business to its fair value. During the fourth quarter of 2016, upon the closing of the transaction, the Company recorded an additional loss of $20.6 million related to the finalization of the sale proceeds, changes in working capital from the amounts originally estimated and costs associated with the winding down of an aftermarket related product line, resulting in a total loss on divestiture of $127.1 million in the year ended December 31, 2016. As a result of this transaction, total assets of $284.1 million including $94.7 million of inventory and $72.6 million of accounts receivable and total liabilities of $93.2 million were removed from the Company’s consolidated balance sheet. The loss on divestiture is subject to final working capital adjustments, which is expected to be completed in the first quarter of 2017. Supplemental Pro Forma Data (Unaudited) The following supplemental pro forma information for the years ended December 31, 2015 and 2014 is based on the assumption that the acquisition of Remy occurred on January 1, 2014. (millions of dollars, except per share amounts) 2015 2014 Net sales $ 8,977.7 $ 9,487.4 Net earnings $ 652.0 $ 653.9 Earnings per share: Basic $ 2.91 $ 2.88 Diluted $ 2.89 $ 2.86 The 2014 pro forma results include after-tax adjustments of $23.2 million of investment banker and other fees and accelerated stock compensation incurred by the Company and Remy related to the acquisition; $12.2 million net decrease in expense related to fair value adjustments; and $3.0 million net decrease in interest expense. These pro forma results of operations have been prepared for comparative purposes only, and do not purport to be indicative of the results of operations that actually would have resulted had the acquisition occurred on the date indicated or that may result in the future. BERU Diesel Start Systems Pvt. Ltd. In January 2015, the Company completed the purchase of the remaining 51% of BERU Diesel by acquiring the shares of its former joint venture partner. The former joint venture was formed in 1996 to develop and manufacture glow plugs in India. After this transaction, the Company owns 100% of the entity. The cash paid, net of cash acquired, was $12.6 million ( 783.1 million Indian rupees). The operating results are reported within the Company's Engine reporting segment. The Company paid $12.6 million , which is recorded as an investing activity in the Company's Consolidated Statement of Cash Flows. As a result of this transaction, the Company recorded a $10.8 million gain on the previously held equity interest in this joint venture. Additionally, the Company acquired assets of $16.0 million , including $11.2 million in definite-lived intangible assets, and assumed liabilities of $4.6 million . The Company also recorded $13.9 million of goodwill, which is expected to be non-deductible for tax purposes. Gustav Wahler GmbH u. Co KG On February 28, 2014, the Company acquired 100% of the equity interests in Wahler. Wahler was a producer of exhaust gas recirculation ("EGR") valves, EGR tubes and thermostats, and had operations in Germany, Brazil, the U.S., China and Slovakia. The cash paid, net of cash acquired was $110.5 million ( 80.1 million Euro). The Wahler acquisition strengthens the Company's strategic position as a producer of complete EGR systems and creates additional market opportunities in both passenger and commercial vehicle applications. The operating results and assets are reported within the Company's Engine reporting segment as of the date of the acquisition. The Company paid $110.5 million , which is recorded as an investing activity in the Company's Consolidated Statement of Cash Flows. Additionally, the Company assumed retirement-related liabilities of $3.2 million and assumed debt of $40.3 million , which are reflected in the supplemental cash flow information on the Company's Consolidated Statement of Cash Flows. The following table summarizes the aggregated estimated fair value of the assets acquired and liabilities assumed on February 28, 2014, the date of acquisition: (millions of dollars) Receivables, net $ 52.4 Inventories, net 46.8 Property, plant and equipment, net 55.3 Goodwill 74.6 Other intangible assets 42.7 Other assets and liabilities (47.4 ) Accounts payable and accrued expenses (70.4 ) Total consideration, net of cash acquired 154.0 Less: Assumed retirement-related liabilities 3.2 Less: Assumed debt 40.3 Cash paid, net of cash acquired $ 110.5 In connection with the acquisition, the Company capitalized $24.9 million for customer relationships, $10.2 million for know-how, $4.1 million for patented technology and $3.5 million for the Wahler trade name. These intangible assets will be amortized over a period of 5 to 15 years. The income approach was used to determine the fair value of all intangible assets. Additionally, $56.9 million in goodwill is non-deductible for tax purposes. |
Reporting Segments and Related
Reporting Segments and Related Information | 12 Months Ended |
Dec. 31, 2016 | |
Segment Reporting [Abstract] | |
Reporting segments and related information | REPORTING SEGMENTS AND RELATED INFORMATION The Company's business is comprised of two reporting segments: Engine and Drivetrain. These segments are strategic business groups, which are managed separately as each represents a specific grouping of related automotive components and systems. The Company allocates resources to each segment based upon the projected after-tax return on invested capital ("ROIC") of its business initiatives. ROIC is comprised of Adjusted EBIT after deducting notional taxes compared to the projected average capital investment required. Adjusted EBIT is comprised of earnings before interest, income taxes and noncontrolling interest (“EBIT") adjusted for restructuring, goodwill impairment charges, affiliates' earnings and other items not reflective of on-going operating income or loss. Adjusted EBIT is the measure of segment income or loss used by the Company. The Company believes Adjusted EBIT is most reflective of the operational profitability or loss of our reporting segments. The following tables show segment information and Adjusted EBIT for the Company's reporting segments. 2016 Segment information Net sales Year-end assets Depreciation/ amortization Long-lived asset expenditures (b) (millions of dollars) Customers Inter-segment Net Engine $ 5,547.3 $ 42.8 $ 5,590.1 $ 4,134.6 $ 211.9 $ 298.7 Drivetrain 3,523.7 — 3,523.7 3,212.4 154.5 182.8 Inter-segment eliminations — (42.8 ) (42.8 ) — — — Total 9,071.0 — 9,071.0 7,347.0 366.4 481.5 Corporate (a) — — — 1,487.7 25.0 19.1 Consolidated $ 9,071.0 $ — $ 9,071.0 $ 8,834.7 $ 391.4 $ 500.6 2015 Segment information Net sales Year-end assets Depreciation/ amortization Long-lived asset expenditures (b) (millions of dollars) Customers Inter-segment Net Engine $ 5,466.5 $ 33.5 $ 5,500.0 $ 4,017.8 $ 200.2 $ 332.4 Drivetrain 2,556.7 — 2,556.7 3,685.1 97.0 221.8 Inter-segment eliminations — (33.5 ) (33.5 ) — — — Total 8,023.2 — 8,023.2 7,702.9 297.2 554.2 Corporate (a) — — — 1,122.8 23.0 23.1 Consolidated $ 8,023.2 $ — $ 8,023.2 $ 8,825.7 $ 320.2 $ 577.3 2014 Segment information Net sales Year-end assets Depreciation/ amortization Long-lived asset (millions of dollars) Customers Inter-segment Net Engine $ 5,673.7 $ 32.2 $ 5,705.9 $ 3,936.2 $ 215.3 $ 349.8 Drivetrain 2,631.4 — 2,631.4 1,783.5 92.8 189.2 Inter-segment eliminations — (32.2 ) (32.2 ) — — — Total 8,305.1 — 8,305.1 5,719.7 308.1 539.0 Corporate (a) — — — 1,505.5 22.3 24.0 Consolidated $ 8,305.1 $ — $ 8,305.1 $ 7,225.2 $ 330.4 $ 563.0 _______________ (a) Corporate assets include investments and other long-term receivables and deferred income taxes. (b) Long-lived asset expenditures include capital expenditures and tooling outlays. Adjusted earnings before interest, income taxes and noncontrolling interest ("Adjusted EBIT") Year Ended December 31, (millions of dollars) 2016 2015 2014 Engine $ 934.1 $ 900.7 $ 924.0 Drivetrain 354.5 294.6 303.3 Adjusted EBIT 1,288.6 1,195.3 1,227.3 Asbestos-related charge 703.6 — — Loss on divestiture 127.1 — — Restructuring expense 26.9 65.7 90.8 Merger and acquisition expense 23.7 21.8 — Intangible asset impairment 12.6 — 10.3 Contract expiration gain (6.2 ) — — Pension settlement loss — 25.7 3.1 Gain on previously held equity interest — (10.8 ) — Corporate, including equity in affiliates' earnings and stock-based compensation 132.1 113.2 112.1 Interest income (6.3 ) (7.5 ) (5.5 ) Interest expense and finance charges 84.6 60.4 36.4 Earnings before income taxes and noncontrolling interest 190.5 926.8 980.1 Provision for income taxes 30.3 280.4 292.6 Net earnings 160.2 646.4 687.5 Net earnings attributable to the noncontrolling interest, net of tax 41.7 36.7 31.7 Net earnings attributable to BorgWarner Inc. $ 118.5 $ 609.7 $ 655.8 Geographic Information Outside the U.S., only Germany, China, South Korea, Mexico and Hungary exceeded 5% of consolidated net sales during the year ended December 31, 2016, attributing sales to the location of production rather than the location of the customer. Also, the Company's 50% equity investment in NSK-Warner (see the Balance Sheet Information footnote to the Consolidated Financial Statements) of $172.9 million , $158.7 million and $143.8 million at December 31, 2016, 2015 and 2014, respectively, is excluded from the definition of long-lived assets, as are goodwill and certain other non-current assets. Net sales Long-lived assets (millions of dollars) 2016 2015 2014 2016 2015 2014 United States $ 2,236.0 $ 1,985.1 $ 2,008.1 $ 799.3 $ 800.5 $ 586.2 Europe: Germany 1,735.1 1,857.1 2,145.6 370.3 380.9 413.6 Hungary 541.1 500.5 518.1 122.2 112.4 73.2 France 305.2 339.2 405.2 39.5 41.4 42.5 Other Europe 888.7 921.8 1,097.3 298.2 276.6 258.8 Total Europe 3,470.1 3,618.6 4,166.2 830.2 811.3 788.1 China 1,218.0 1,009.0 885.1 384.6 355.8 299.9 South Korea 948.2 741.7 623.0 208.0 218.6 185.9 Mexico 805.6 312.7 201.4 136.2 132.8 96.6 Other foreign 393.1 356.1 421.3 143.5 129.1 137.2 Total $ 9,071.0 $ 8,023.2 $ 8,305.1 $ 2,501.8 $ 2,448.1 $ 2,093.9 Sales to Major Customers Consolidated net sales to Ford (including its subsidiaries) were approximately 15% , 15% , and 13% for the years ended December 31, 2016, 2015 and 2014, respectively; and to Volkswagen (including its subsidiaries) were approximately 13% , 15% and 17% for the years ended December 31, 2016, 2015 and 2014, respectively. Both of the Company's reporting segments had significant sales to Volkswagen and Ford in 2016, 2015 and 2014. Such sales consisted of a variety of products to a variety of customer locations and regions. No other single customer accounted for more than 10% of consolidated net sales in any of the years presented. Sales by Product Line Sales of turbochargers for light vehicles represented approximately 28% , 31% and 28% of total net sales for the years ended December 31, 2016, 2015 and 2014, respectively. The Company currently supplies light vehicle turbochargers to many OEMs including BMW, Daimler, Fiat Chrysler Automobiles, Ford, General Motors, Great Wall, Hyundai, Renault, Volkswagen and Volvo. No other single product line accounted for more than 10% of consolidated net sales in any of the years presented. Interim Financial Information (Unaudited) (millions of dollars, except per share amounts) 2016 2015 Quarter ended Mar-31 Jun-30 Sep-30 Dec-31 Year Mar-31 Jun-30 Sep-30 Dec-31 Year Net sales $ 2,268.6 $ 2,329.2 $ 2,214.2 $ 2,259.0 $ 9,071.0 $ 1,984.2 $ 2,031.9 $ 1,884.0 $ 2,123.1 $ 8,023.2 Cost of sales 1,804.3 1,832.5 1,743.1 1,758.0 7,137.9 1,555.2 1,602.9 1,485.8 1,676.2 6,320.1 Gross profit 464.3 496.7 471.1 501.0 1,933.1 429.0 429.0 398.2 446.9 1,703.1 Selling, general and administrative expenses 188.4 202.3 209.7 217.1 817.5 168.2 167.4 148.0 178.4 662.0 Other expense, net 11.7 25.0 111.1 741.9 889.7 1.2 19.1 13.1 68.0 101.4 Operating income (loss) 264.2 269.4 150.3 (458.0 ) 225.9 259.6 242.5 237.1 200.5 939.7 Equity in affiliates’ earnings, net of tax (9.1 ) (10.1 ) (12.4 ) (11.3 ) (42.9 ) (8.5 ) (11.1 ) (8.7 ) (11.7 ) (40.0 ) Interest income (1.6 ) (1.5 ) (1.6 ) (1.6 ) (6.3 ) (1.7 ) (1.6 ) (2.0 ) (2.2 ) (7.5 ) Interest expense and finance charges 21.3 21.4 22.4 19.5 84.6 10.0 17.6 15.0 17.8 60.4 Earnings (loss) before income taxes and noncontrolling interest 253.6 259.6 141.9 (464.6 ) 190.5 259.8 237.6 232.8 196.6 926.8 Provision (benefit) for income taxes 80.4 84.2 48.8 (183.1 ) 30.3 72.1 80.2 66.9 61.2 280.4 Net earnings (loss) 173.2 175.4 93.1 (281.5 ) 160.2 187.7 157.4 165.9 135.4 646.4 Net earnings attributable to the noncontrolling interest, net of tax 9.1 11.0 9.8 11.8 41.7 8.8 9.3 8.5 10.1 36.7 Net earnings (loss) attributable to BorgWarner Inc. (a) $ 164.1 $ 164.4 $ 83.3 $ (293.3 ) $ 118.5 $ 178.9 $ 148.1 $ 157.4 $ 125.3 $ 609.7 Earnings per share — basic $ 0.75 $ 0.76 $ 0.39 $ (1.39 ) $ 0.55 $ 0.79 $ 0.66 $ 0.70 $ 0.57 $ 2.72 Earnings per share — diluted $ 0.75 $ 0.76 $ 0.39 $ (1.39 ) $ 0.55 $ 0.79 $ 0.65 $ 0.70 $ 0.56 $ 2.70 _______________ (a) The Company's results were impacted by the following: • Quarter ended December 31, 2016: The Company recorded an asbestos-related charge of $703.6 million representing the difference in the total liability from what was previously accrued, consulting fees, less available insurance coverage, and an intangible asset impairment loss of $12.6 million related to the Engine segment Etatech’s ECCOS intellectual technology. Additionally, the Company recorded an incremental loss on divestiture of $20.6 million related to the sale of Remy light vehicle aftermarket business. The Company also recorded merger and acquisition expense of $4.8 million primarily related to the Remy transaction. The Company recorded tax benefits of $263.0 million related to asbestos-related charge, $4.4 million related to intangible asset loss, and $4.9 million related to other one-time tax adjustments. The Company also recorded a tax expense of $4.9 million related to the sale of the Remy light vehicle aftermarket business and the reversal of the associated deferred tax balances. • Quarter ended September 30, 2016: The Company recorded an asset impairment expense of $106.5 million to adjust the net book value of the Remy light vehicle aftermarket business to fair value, based on the anticipated sale price. Additionally, the Company recorded restructuring expense of $1.3 million related to Drivetrain and Engine segment actions designed to improve future profitability and competitiveness. The Company also recorded merger and acquisition expense of $5.9 million primarily related to the Remy transaction. The Company recorded tax benefits of $27.6 million related to asset impairment expense, $2.4 million related to other one-time tax adjustments, $0.5 million related to restructuring expense, and $0.4 million related to a gain associated with the release of certain Remy light vehicle aftermarket liabilities due to the expiration of a customer contract. • Quarter ended June 30, 2016: The Company recorded restructuring expense of $19.2 million related to Drivetrain and Engine segment actions designed to improve future profitability and competitiveness. The Company also recorded merger and acquisition expense of $7.2 million primarily related to the Remy transaction. The Company recorded tax benefits of $4.4 million related to restructuring expense and $0.3 million related to other one-time tax adjustments, as well as a tax expense of $2.6 million related to a gain associated with the release of certain Remy light vehicle aftermarket liabilities due to the expiration of a customer contract. • Quarter ended March 31, 2016: The Company recorded restructuring expense of $6.4 million related to Drivetrain and Engine segment actions designed to improve future profitability and competitiveness. The Company also recorded merger and acquisition expense of $5.8 million primarily related to the Remy transaction. The Company recorded tax benefits of $1.0 million related to restructuring expense and $1.0 million related to other one-time tax adjustments. • Quarter ended December 31, 2015: The Company recorded restructuring expense of $24.4 million related to Drivetrain and Engine segment actions designed to improve future profitability and competitiveness. The Company also incurred a non-cash settlement loss of $25.7 million related to a lump-sum pension de-risking disbursement made to an insurance company to unconditionally and irrevocably guarantee all future payments to certain participants that were receiving payments from the U.S. pension plan. Furthermore, the Company recorded merger and acquisition expense of $17.9 million primarily related to the Remy transaction. The Company recorded tax benefits of $9.0 million related to the pension settlement loss, $7.7 million primarily related to foreign tax incentives and tax settlements, $3.8 million related to merger and acquisition expense, partially offset by a tax expense of $0.4 million related to restructuring expense. • Quarter ended September 30, 2015: The Company recorded restructuring expense of $6.3 million related to Drivetrain and Engine segment actions designed to improve future profitability and competitiveness. Additionally, the Company recorded $3.0 million of restructuring expense related to a global realignment plan intended to enhance treasury management flexibility by creating a legal entity structure that better aligns with the Company's business strategy. The Company also recorded merger and acquisition expense of $3.9 million primarily related to the Remy transaction. The Company recorded tax benefits of $4.5 million related to a global realignment plan, $0.7 million related to restructuring expense and $0.4 million primarily related to foreign tax incentives. • Quarter ended June 30, 2015: The Company recorded restructuring expense of $10.5 million related to Drivetrain and Engine segment actions designed to improve future profitability and competitiveness. Additionally, the Company recorded $9.4 million of restructuring expense related to a global realignment plan intended to enhance treasury management flexibility by creating a legal entity structure that better aligns with the Company's business strategy. The Company recorded tax expense of $10.3 million related to a global realignment plan, partially offset by tax benefits of $3.9 million related to tax settlements, $2.2 million related to restructuring expense and $1.3 million primarily related to foreign tax incentives. • Quarter ended March 31, 2015: The Company recorded restructuring expense of $9.4 million related to Drivetrain and Engine segment actions designed to improve future profitability and competitiveness. Additionally, the Company recorded $2.7 million of restructuring expense related to a global realignment plan intended to enhance treasury management flexibility by creating a legal entity structure that better aligns with the Company's business strategy. The Company also recorded a $10.8 million gain on the previously held equity interest in BERU Diesel as a result of purchasing the remaining 51% of this joint venture. The Company recorded tax benefits of $2.4 million primarily related to foreign tax incentives and $1.2 million related to restructuring expense. |
Summary of Significant Accoun26
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Use of estimates | Use of estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the accompanying notes, as well as, the amounts of revenues and expenses reported during the periods covered by these financial statements and accompanying notes. Actual results could differ from those estimates. |
Consolidations | Principles of consolidation The Consolidated Financial Statements include all majority-owned subsidiaries with a controlling financial interest. All inter-company accounts and transactions have been eliminated in consolidation. Investments in 20% to 50% owned affiliates are accounted for under the equity method when the Company does not have a controlling financial interest. |
Revenue recognition | Revenue recognition The Company recognizes revenue when title and risk of loss pass to the customer, which is usually upon shipment of product. Although the Company may enter into long-term supply agreements with its major customers, each shipment of goods is treated as a separate sale and the prices are not fixed over the life of the agreements. |
Cost of sales | Cost of sales The Company includes materials, direct labor and manufacturing overhead within cost of sales. Manufacturing overhead is comprised of indirect materials, indirect labor, factory operating costs and other such costs associated with manufacturing products for sale. |
Cash | Cash Cash is valued at fair market value. It is the Company's policy to classify all highly liquid investments with original maturities of three months or less as cash. Cash is maintained with several financial institutions. Deposits held with banks may exceed the amount of insurance provided on such deposits. Generally, these deposits may be redeemed upon demand and are maintained with financial institutions of reputable credit and therefore bear minimal risk. |
Restricted cash | Restricted cash Restricted cash as of December 31, 2015 related to amounts deposited with the paying agent to settle shares of Remy International Inc. ("Remy") stock in connection with the acquisition of Remy on November 10, 2015, that was not paid to the shareholders until the first half of 2016. |
Receivables, net | Receivables, net The Company factors certain receivables through third party financial institutions without recourse. These are treated as a sale. The transactions are accounted for as a reduction in accounts receivable as the agreements transfer effective control over and risk related to the receivables to the buyers. The Company does not service any domestic accounts after the factoring has occurred. The Company does not have any servicing assets or liabilities. See the Balance Sheet Information footnote to the Consolidated Financial Statements for more information on receivables, net. |
Inventories, net | Inventories, net Inventories are valued at the lower of cost or market. Cost of certain U.S. inventories is determined using the last-in, first-out (“LIFO”) method, while other U.S. and foreign operations use the first-in, first-out (“FIFO”) or average-cost methods. |
Pre-production costs related to long-term supply arrangements | Pre-production costs related to long-term supply arrangements Engineering, research and development and other design and development costs for products sold on long-term supply arrangements are expensed as incurred unless the Company has a contractual guarantee for reimbursement from the customer. Costs for molds, dies and other tools used to make products sold on long-term supply arrangements for which the Company either has title to the assets or has the non-cancelable right to use the assets during the term of the supply arrangement are capitalized in property, plant and equipment and amortized to cost of sales over the shorter of the term of the arrangement or over the estimated useful lives of the assets, typically three to five years. Costs for molds, dies and other tools used to make products sold on long-term supply arrangements for which the Company has a contractual guarantee for lump sum reimbursement from the customer are capitalized in prepayments and other current assets. |
Property, plant and equipment and depreciation, net | Property, plant and equipment, net Property, plant and equipment is valued at cost less accumulated depreciation. Expenditures for maintenance, repairs and renewals of relatively minor items are generally charged to expense as incurred. Renewals of significant items are capitalized. Depreciation is generally computed on a straight-line basis over the estimated useful lives of the assets. Useful lives for buildings range from 15 to 40 years and useful lives for machinery and equipment range from three to 12 years. For income tax purposes, accelerated methods of depreciation are generally used. |
Impairment of long-lived assets | Impairment of long-lived assets, including definite-lived intangible assets The Company reviews the carrying value of its long-lived assets, whether held for use or disposal, including other amortizing intangible assets, when events and circumstances warrant such a review under Accounting Standards Codification ("ASC") Topic 360. In assessing long-lived assets for an impairment loss, assets are grouped with other assets and liabilities at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. In assessing long-lived assets for impairment, management generally considers individual facilities the lowest level for which identifiable cash flows are largely independent. A recoverability review is performed using the undiscounted cash flows if there is a triggering event. If the undiscounted cash flow test for recoverability identifies a possible impairment, management will perform a fair value analysis. Management determines fair value under ASC Topic 820 using the appropriate valuation technique of market, income or cost approach. If the carrying value of a long-lived asset is considered impaired, an impairment charge is recorded for the amount by which the carrying value of the long-lived asset exceeds its fair value. Management believes that the estimates of future cash flows and fair value assumptions are reasonable; however, changes in assumptions underlying these estimates could affect the valuations. Long-lived assets held for sale are recorded at the lower of their carrying amount or fair value less cost to sell. Significant judgments and estimates used by management when evaluating long-lived assets for impairment include: (i) an assessment as to whether an adverse event or circumstance has triggered the need for an impairment review; (ii) undiscounted future cash flows generated by the asset; and (iii) fair valuation of the asset. |
Goodwill and other indefinite-lived intangible assets | Goodwill and other indefinite-lived intangible assets During the fourth quarter of each year, the Company qualitatively assesses its goodwill and indefinite-lived intangible assets assigned to each of its reporting units. This qualitative assessment evaluates various events and circumstances, such as macro economic conditions, industry and market conditions, cost factors, relevant events and financial trends, that may impact a reporting unit's fair value. Using this qualitative assessment, the Company determines whether it is more-likely-than-not the reporting unit's fair value exceeds its carrying value. If it is determined that it is not more-likely-than-not the reporting unit's fair value exceeds the carrying value, or upon consideration of other factors, including recent acquisition or divestiture activity, the Company performs a quantitative, "step one," goodwill impairment analysis. In addition, the Company may test goodwill in between annual test dates if an event occurs or circumstances change that could more-likely-than-not reduce the fair value of a reporting unit below its carrying value. |
Product warranties | Product warranties The Company provides warranties on some, but not all, of its products. The warranty terms are typically from one to three years. Provisions for estimated expenses related to product warranty are made at the time products are sold. These estimates are established using historical information about the nature, frequency and average cost of warranty claim settlements as well as product manufacturing and industry developments and recoveries from third parties. Management actively studies trends of warranty claims and takes action to improve product quality and minimize warranty claims. Management believes that the warranty accrual is appropriate; however, actual claims incurred could differ from the original estimates, requiring adjustments to the accrual. The product warranty accrual is allocated to current and non-current liabilities in the Consolidated Balance Sheets. |
Other loss accruals and valuation allowances | Other loss accruals and valuation allowances The Company has numerous other loss exposures, such as customer claims, workers' compensation claims, litigation and recoverability of assets. Establishing loss accruals or valuation allowances for these matters requires the use of estimates and judgment in regard to the risk exposure and ultimate realization. The Company estimates losses under the programs using consistent and appropriate methods, however, changes to its assumptions could materially affect the recorded accrued liabilities for loss or asset valuation allowances. |
Asbestos | Asbestos The Company and certain of its subsidiaries along with numerous other companies are named as defendants in personal injury lawsuits based on alleged exposure to asbestos-containing materials. With the assistance of third party consultants, the Company estimates the liability and corresponding insurance recovery for pending and future claims not yet asserted through December 31, 2059 with a runoff through 2067 and defense costs. This estimate is based on the Company's historical claim experience and estimates of the number and resolution cost of potential future claims that may be filed based on anticipated levels of unique plaintiff asbestos-related claims in the U.S. tort system against all defendants. This estimate is not discounted to present value. The Company currently believes that December 31, 2067 is a reasonable assumption as to the last date on which it is likely to have resolved all asbestos-related claims, based on the nature and useful life of the Company’s products and the likelihood of incidence of asbestos-related disease in the U.S. population generally. The Company assesses the sufficiency of its estimated liability for pending and future claims and defense costs on an ongoing basis by evaluating actual experience regarding claims filed, settled and dismissed, and amounts paid in settlements. In addition to claims and settlement experience, the Company considers additional quantitative and qualitative factors such as changes in legislation, the legal environment, and the Company's defense strategy. The Company continues to have additional excess insurance coverage available for potential future asbestos-related claims. In connection with the Company’s ongoing review of its asbestos-related claims, the Company also reviewed the amount of its potential insurance coverage for such claims, taking into account the remaining limits of such coverage, the number and amount of claims on our insurance from co-insured parties, ongoing litigation against the Company’s insurers, potential remaining recoveries from insolvent insurers, the impact of previous insurance settlements, and coverage available from solvent insurers not party to the coverage litigation. |
Environmental contingencies | Environmental contingencies The Company accounts for environmental costs in accordance with ASC Topic 450. Costs related to environmental assessments and remediation efforts at operating facilities are accrued when it is probable that a liability has been incurred and the amount of that liability can be reasonably estimated. Estimated costs are recorded at undiscounted amounts, based on experience and assessments and are regularly evaluated. The liabilities are recorded in accounts payable and accrued expenses and other non-current liabilities in the Company's Consolidated Balance Sheets. |
Derivative financial instruments | Derivative financial instruments The Company recognizes that certain normal business transactions generate risk. Examples of risks include exposure to exchange rate risk related to transactions denominated in currencies other than the functional currency, changes in commodity costs and interest rates. It is the objective and responsibility of the Company to assess the impact of these transaction risks and offer protection from selected risks through various methods, including financial derivatives. Virtually all derivative instruments held by the Company are designated as hedges, have high correlation with the underlying exposure and are highly effective in offsetting underlying price movements. Accordingly, gains and losses from changes in qualifying hedge fair values are matched with the underlying transactions. All hedge instruments are carried at their fair value based on quoted market prices for contracts with similar maturities. The Company does not engage in any derivative transactions for purposes other than hedging specific risks. |
Foreign currency | Foreign currency The financial statements of foreign subsidiaries are translated to U.S. dollars using the period-end exchange rate for assets and liabilities and an average exchange rate for each period for revenues, expenses and capital expenditures. The local currency is the functional currency for substantially all of the Company's foreign subsidiaries. Translation adjustments for foreign subsidiaries are recorded as a component of accumulated other comprehensive income (loss) in equity. The Company recognizes transaction gains and losses arising from fluctuations in currency exchange rates on transactions denominated in currencies other than the functional currency in earnings as incurred. |
Pension and other postretirement plans | Pensions and other postretirement employee defined benefits The Company's defined benefit pension and other postretirement employee benefit plans are accounted for in accordance with ASC Topic 715. Disability, early retirement and other postretirement employee benefits are accounted for in accordance with ASC Topic 712. Pensions and other postretirement employee benefit costs and related liabilities and assets are dependent upon assumptions used in calculating such amounts. These assumptions include discount rates, expected returns on plan assets, health care cost trends, compensation and other factors. In accordance with GAAP, actual results that differ from the assumptions used are accumulated and amortized over future periods, and accordingly, generally affect recognized expense in future periods. |
Income taxes | Income taxes In accordance with ASC Topic 740, the Company's income tax expense is calculated based on expected income and statutory tax rates in the various jurisdictions in which the Company operates and requires the use of management's estimates and judgments. |
New Accounting Pronouncements | New Accounting Pronouncements In January 2017, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2017-04, "Simplifying the Test for Goodwill Impairment." It eliminates Step 2 from the goodwill impairment test and an entity should recognize an impairment charge for the amount by which the carrying amount of goodwill exceeds the reporting unit's fair value, not to exceed the carrying amount of goodwill. This guidance is effective for annual and any interim impairment tests in fiscal years beginning after December 15, 2019. The Company does not expect this guidance to have any impact on its Consolidated Financial Statements. In January 2017, the FASB issued Accounting Standards Update ("ASU") No. 2017-01, "Clarifying the Definition of a Business." It revises the definition of a business and provides a framework to evaluate when an input and a substantive process are present in an acquisition to be considered a business. This guidance is effective for annual periods beginning after December 15, 2017. The Company does not expect this guidance to have any impact on its Consolidated Financial Statements. In November 2016, the FASB issued ASU No. 2016-18, "Restricted Cash." It requires that amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. This guidance is effective for interim and annual reporting periods beginning after December 15, 2017. The Company does not expect this guidance to have a material impact on its Consolidated Financial Statements. In August 2016, the FASB issued ASU No. 2016-15, "Classification of Certain Cash Receipts and Cash Payments." It provides guidance on eight specific cash flow issues with the objective of reducing the existing diversity in practice in how they are classified in the statement of cash flows. This guidance is effective for interim and annual reporting periods beginning after December 15, 2017. Early adoption is permitted, provided that all of the amendments are adopted in the same period. The Company does not expect this guidance to have a material impact on its Consolidated Financial Statements. In March 2016, the FASB issued ASU No. 2016-09, "Improvements to Employee Share-Based Payment Accounting." Under this guidance, the areas of simplification involve several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, impact on earnings per share and classification on the statement of cash flows. This guidance is effective for interim and annual reporting periods beginning after December 15, 2016 and the Company will adopt this guidance in the first quarter of 2017. Upon the adoption of the guidance, all of the tax effects of share-based payments will be recorded in the income statement. The impact to the Consolidated Financial Statements will be dependent upon the underlying vesting or exercise activity and related future stock prices. The Company is currently evaluating the other impacts this guidance will have on its Consolidated Financial Statements. In February 2016, the FASB issued ASU No. 2016-02, "Leases (Topic 842)." Under this guidance, lessees will be required to recognize a right-of-use asset and a lease liability for all operating leases defined under previous GAAP. This guidance is effective for interim and annual reporting periods beginning after December 15, 2018. The Company is currently evaluating the impact this guidance will have on its Consolidated Financial Statements. In September 2015, the FASB issued ASU No. 2015-16, "Simplifying the Accounting for Measurement-Period Adjustments." Under this guidance, an acquirer is required to recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. This guidance is effective for interim and annual reporting periods beginning after December 15, 2015. The Company adopted this guidance in the first quarter of 2016 and recorded fair value adjustments related to the Remy acquisition based on new information obtained during the measurement period primarily related to warranty, inventory, and deferred taxes. These adjustments have resulted in a decrease in goodwill of $12.1 million from the Company's initial estimate recorded in 2016. In August 2015, the FASB issued ASU No. 2015-15, "Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements." Under this guidance, debt issuance costs associated with line-of-credit arrangements would be deferred as an asset and amortized ratably over the term, regardless of whether there are any outstanding borrowings on the line-of-credit arrangement. This guidance is effective for interim and annual reporting periods beginning after December 15, 2015 and the Company adopted this guidance in the first quarter of 2016 with no impact on the Company's Consolidated Financial Statements. In July 2015, the FASB issued ASU No. 2015-11, "Simplifying the Measurement of Inventory." Under this guidance, inventory should be measured at the lower of cost and net realizable value. Subsequent measurement is unchanged for inventory measured using LIFO or the retail inventory method. This guidance is effective for interim and annual reporting periods beginning after December 15, 2016. The Company does not expect this guidance to have a material impact on its Consolidated Financial Statements. In May 2015, the FASB issued ASU No. 2015-07, "Disclosures for Investments in Certain Entities That Calculate Net Asset Value per Share (or Its Equivalent)." Under this guidance, investments measured at net asset value, as a practical expedient for fair value, are excluded from the fair value hierarchy. This guidance is effective for interim and annual reporting periods beginning after December 15, 2015 and the Company adopted this guidance in the first quarter of 2016. The pension asset disclosure has been updated retrospectively to reflect this guidance and there is no impact on the Company's Consolidated Financial Statements. In May 2014, the FASB amended the Accounting Standards Codification to add Topic 606, "Revenue from Contracts with Customers," outlining a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and superseding most current revenue recognition guidance. This guidance is effective for interim and annual reporting periods beginning after December 15, 2017. The Company anticipates changes to the revenue recognition of pre-production activities such as customer owned tooling and engineering design & development recoveries, including the potential recording of these items as revenue. Further, the Company is currently analyzing the impact of the new guidance on its contracts and customer arrangements that include various pricing structures and cancellation clauses, which could impact the timing of revenue recognition. The Company expects to adopt this guidance effective January 1, 2018 utilizing the Modified Retrospective approach and is currently evaluating the impact that the adoption of this guidance will have on its consolidated financial statements. |
Research and Development Costs
Research and Development Costs (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Research and Development [Abstract] | |
Schedule of Research and Development Costs | Year Ended December 31, (millions of dollars) 2016 2015 2014 Gross R&D expenditures $ 417.8 $ 386.2 $ 392.8 Customer reimbursements (74.6 ) (78.8 ) (56.6 ) Net R&D expenditures $ 343.2 $ 307.4 $ 336.2 |
Other Expense, Net (Tables)
Other Expense, Net (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Other Income and Expenses [Abstract] | |
Schedule of Other Nonoperating Income (Expense) | Year Ended December 31, (millions of dollars) 2016 2015 2014 Asbestos-related charge $ 703.6 $ — $ — Loss on divestiture 127.1 — — Restructuring expense 26.9 65.7 90.8 Merger and acquisition expense 23.7 21.8 — Intangible asset impairment 12.6 — 10.3 Pension settlement loss — 25.7 3.1 Gain on previously held equity interest — (10.8 ) — Other (4.2 ) (1.0 ) (10.4 ) Other expense, net $ 889.7 $ 101.4 $ 93.8 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Components of income tax expense (benefit) | Year Ended December 31, (millions of dollars) 2016 2015 2014 Earnings before income taxes: U.S. $ (724.7 ) $ 125.6 $ 218.8 Non-U.S. 915.2 801.2 761.3 Total $ 190.5 $ 926.8 $ 980.1 Provision for income taxes: Current: Federal $ 37.4 $ 32.5 $ 25.7 State 6.1 (4.3 ) 3.9 Foreign 251.7 228.3 220.8 Total current 295.2 256.5 250.4 Deferred: Federal (239.8 ) 31.8 66.2 State (13.2 ) 2.6 (1.2 ) Foreign (11.9 ) (10.5 ) (22.8 ) Total deferred (264.9 ) 23.9 42.2 Total provision for income taxes $ 30.3 $ 280.4 $ 292.6 |
Effective Income Tax Rate Reconciliation | Year Ended December 31, (millions of dollars) 2016 2015 2014 Income taxes at U.S. statutory rate of 35% $ 66.7 $ 324.4 $ 343.0 Increases (decreases) resulting from: State taxes, net of federal benefit (10.6 ) 8.2 2.6 U.S. tax on non-U.S. earnings 40.7 31.5 18.8 Affiliates' earnings (15.0 ) (14.0 ) (16.2 ) Foreign rate differentials (93.3 ) (92.6 ) (84.1 ) Tax holidays (25.5 ) (21.2 ) (23.6 ) Withholding taxes 13.3 7.8 10.6 Tax credits (3.2 ) (3.2 ) (3.9 ) Reserve adjustments, settlements and claims 11.6 19.4 41.0 Valuation allowance adjustments (2.7 ) 8.3 5.5 Non-deductible transaction costs 8.3 8.1 5.4 Provision to return and other one-time tax adjustments 0.3 (5.1 ) (8.8 ) Impact of transactions 16.3 11.6 — Currency 10.0 0.1 (0.2 ) Other foreign taxes 12.9 9.0 7.4 Partnership income 3.4 3.1 (0.3 ) Other (2.9 ) (15.0 ) (4.6 ) Provision for income taxes, as reported $ 30.3 $ 280.4 $ 292.6 |
Reconciliation of the total gross unrecognized tax benefits | (millions of dollars) 2016 2015 Balance, January 1 $ 127.3 $ 60.4 Additions based on tax positions related to current year 16.1 20.7 Additions for tax positions of prior years 1.6 6.7 Additions from acquisitions — 53.4 Reductions for closure of tax audits and settlements (45.7 ) (10.4 ) Reductions for lapse in statute of limitations (5.0 ) (0.3 ) Translation adjustment (3.2 ) (3.2 ) Balance, December 31 $ 91.1 $ 127.3 |
Tax jurisdiction | Tax jurisdiction Years no longer subject to audit Tax jurisdiction Years no longer subject to audit U.S. Federal 2012 and prior Japan 2015 and prior China 2010 and prior Mexico 2010 and prior France 2013 and prior Poland 2011 and prior Germany 2007 and prior South Korea 2010 and prior Hungary 2008 and prior |
Deferred Tax Assets (Liabilities) | December 31, (millions of dollars) 2016 2015 Deferred tax assets: Foreign tax credits $ 139.5 $ 142.6 Employee compensation 41.3 34.6 Other comprehensive loss 66.3 79.7 Research and development capitalization 145.1 100.4 Net operating loss and capital loss carryforwards 71.5 81.8 Pension and other postretirement benefits 38.8 41.1 Asbestos-related 263.0 — Other 128.9 125.3 Total deferred tax assets $ 894.4 $ 605.5 Valuation allowance (71.2 ) (71.0 ) Net deferred tax asset $ 823.2 $ 534.5 Deferred tax liabilities: Goodwill and intangible assets (251.3 ) (259.2 ) Fixed assets (147.1 ) (115.5 ) Other (55.0 ) (66.4 ) Total deferred tax liabilities $ (453.4 ) $ (441.1 ) Net deferred taxes $ 369.8 $ 93.4 |
Balance Sheet Information (Tabl
Balance Sheet Information (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Balance Sheet Related Disclosures [Abstract] | |
Balance sheet information | December 31, (millions of dollars) 2016 2015 Receivables, net: Customers $ 1,448.3 $ 1,423.6 Other 243.9 243.3 Gross receivables 1,692.2 1,666.9 Bad debt allowance(a) (2.9 ) (1.9 ) Total receivables, net $ 1,689.3 $ 1,665.0 Inventories, net: Raw material and supplies $ 378.6 $ 412.9 Work in progress 102.9 102.5 Finished goods 174.9 222.4 FIFO inventories 656.4 737.8 LIFO reserve (15.2 ) (14.2 ) Total inventories, net $ 641.2 $ 723.6 Prepayments and other current assets: Prepaid tooling $ 77.5 $ 98.5 Prepaid taxes 8.0 11.9 Restricted cash — 12.3 Other 51.9 46.2 Total prepayments and other current assets $ 137.4 $ 168.9 Property, plant and equipment, net: Land and land use rights $ 111.0 $ 118.2 Buildings 670.6 661.7 Machinery and equipment 2,371.2 2,154.3 Capital leases 3.9 7.2 Construction in progress 338.2 386.4 Property, plant and equipment, gross 3,494.9 3,327.8 Accumulated depreciation (1,137.5 ) (1,036.8 ) Property, plant & equipment, net, excluding tooling 2,357.4 2,291.0 Tooling, net of amortization 144.4 157.1 Property, plant & equipment, net $ 2,501.8 $ 2,448.1 Investments and other long-term receivables: Investment in equity affiliates $ 218.9 $ 200.1 Other long-term receivables 283.3 260.8 Total investments and other long-term receivables $ 502.2 $ 460.9 Other non-current assets: Deferred income taxes $ 424.0 $ 213.5 Asbestos insurance asset 178.7 108.5 Other 150.7 158.0 Total other non-current assets $ 753.4 $ 480.0 December 31, (millions of dollars) 2016 2015 Accounts payable and accrued expenses: Trade payables $ 1,323.3 $ 1,225.6 Payroll and employee related 206.4 201.1 Product warranties 63.9 70.6 Customer related 52.8 55.7 Asbestos-related liability 51.7 47.7 Interest 22.9 20.4 Retirement related 18.1 20.1 Dividends payable to noncontrolling shareholders 15.7 20.0 Unrecognized tax benefits 15.5 45.5 Insurance 7.8 — Severance 6.4 29.4 Derivatives 1.2 19.1 Other 61.6 111.2 Total accounts payable and accrued expenses $ 1,847.3 $ 1,866.4 Other non-current liabilities: Deferred income taxes $ 54.2 $ 120.1 Deferred revenue 33.5 36.6 Product warranties 31.4 37.3 Other 156.6 160.4 Total other non-current liabilities $ 275.7 $ 354.4 (a) Bad debt allowance: 2016 2015 2014 Beginning balance, January 1 $ (1.9 ) $ (2.3 ) $ (2.1 ) Provision (3.2 ) (0.5 ) (0.6 ) Write-offs 0.2 0.7 0.3 Business divestiture 2.0 — — Translation adjustment and other — 0.2 0.1 Ending balance, December 31 $ (2.9 ) $ (1.9 ) $ (2.3 ) |
Summarized financial data for NSK-Warner | November 30, (millions of dollars) 2016 2015 Balance sheets: Cash and securities $ 98.6 $ 74.9 Current assets, including cash and securities 256.3 231.9 Non-current assets 194.5 167.5 Current liabilities 122.6 119.1 Non-current liabilities 48.2 39.3 Total equity 280.0 241.0 Year Ended November 30, (millions of dollars) 2016 2015 2014 Statements of operations: Net sales $ 601.8 $ 519.0 $ 546.4 Gross profit 134.1 118.6 124.5 Net earnings 71.7 73.3 80.3 |
Goodwill and Other Intangibles
Goodwill and Other Intangibles (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of goodwill [Text Block] | 2016 2015 (millions of dollars) Engine Drivetrain Engine Drivetrain Gross goodwill balance, January 1 $ 1,338.2 $ 921.5 $ 1,362.0 $ 345.7 Accumulated impairment losses, January 1 (501.8 ) (0.2 ) (501.8 ) (0.2 ) Net goodwill balance, January 1 $ 836.4 $ 921.3 $ 860.2 $ 345.5 Goodwill during the year: Acquisitions* — (12.1 ) 11.6 584.7 Divestitures** — (24.2 ) — — Translation adjustment and other (14.2 ) (5.0 ) (35.4 ) (8.9 ) Ending balance, December 31 $ 822.2 $ 880.0 $ 836.4 $ 921.3 |
Intangible assets disclosure [Text Block] | December 31, 2016 December 31, 2015 (millions of dollars) Gross carrying amount Accumulated amortization Net carrying amount Gross carrying amount Accumulated amortization Net carrying amount Amortized intangible assets: Patented and unpatented technology $ 108.1 $ 41.5 $ 66.6 $ 128.7 $ 42.4 $ 86.3 Customer relationships 481.4 141.2 340.2 490.3 116.1 374.2 Miscellaneous 5.3 3.4 1.9 5.6 3.0 2.6 Total amortized intangible assets 594.8 186.1 408.7 624.6 161.5 463.1 In-process R&D 3.8 — 3.8 14.6 — 14.6 Unamortized trade names 51.0 — 51.0 66.1 — 66.1 Total other intangible assets $ 649.6 $ 186.1 $ 463.5 $ 705.3 $ 161.5 $ 543.8 |
Intangible assets gross roll forward [Text Block] | (millions of dollars) 2016 2015 Beginning balance, January 1 $ 705.3 $ 307.8 Acquisitions* — 423.8 Impairment** (23.9 ) — Divestitures*** (19.9 ) — Translation adjustment (11.9 ) (26.3 ) Ending balance, December 31 $ 649.6 $ 705.3 |
Accumulated amortization net [Text Block] | (millions of dollars) 2016 2015 Beginning balance, January 1 $ 161.5 $ 156.7 Amortization 40.4 19.2 Impairment (8.2 ) — Divestitures (0.3 ) — Translation adjustment (7.3 ) (14.4 ) Ending balance, December 31 $ 186.1 $ 161.5 |
Product Warranty (Tables)
Product Warranty (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Product Warranties Disclosures [Abstract] | |
Product warranty liability [Text Block] | The changes in the carrying amount of the Company’s total product warranty liability for the years ended December 31, 2016 and 2015 were as follows: (millions of dollars) 2016 2015 Beginning balance, January 1 $ 107.9 $ 132.0 Provisions 62.2 28.6 Acquisitions 6.9 12.3 Dispositions (9.1 ) — Payments (70.1 ) (54.7 ) Translation adjustment (2.5 ) (10.3 ) Ending balance, December 31 $ 95.3 $ 107.9 Acquisition activity in 2016 of $6.9 million relates to the Company's accrual for product issues that pre-dated the Company's 2015 acquisition of Remy. Disposition activity in 2016 of $9.1 million relates to the sale of the Remy light vehicle aftermarket business. Acquisitions activity in 2015 of $12.3 million , relates to $29.4 million in warranty liability associated with the Company's purchase of Remy, partially offset by $17.1 million related to a significant settled warranty claim associated with a product issue that pre-dated the Company's 2014 acquisition of Gustav Wahler GmbH u. Co. KG and its general partner ("Wahler"). Including the impact of the reversal of a corresponding receivable, the Wahler settlement had an immaterial impact on the Consolidated Balance Sheet at December 31, 2015 and Consolidated Statement of Operations for the year ended December 31, 2015. The Company’s warranty provision as a percentage of net sales has increased from 0.4% as of December 31, 2015 to 0.7% as of December 31, 2016. This change is primarily related to the Company’s fourth quarter 2015 acquisition of Remy. Furthermore, the Company's 2016 provision includes a $5.2 million warranty reversal related to the expiration of a Remy light vehicle aftermarket customer contract. The product warranty liability is classified in the Consolidated Balance Sheets as follows: December 31, (millions of dollars) 2016 2015 Accounts payable and accrued expenses $ 63.9 $ 70.6 Other non-current liabilities 31.4 37.3 Total product warranty liability $ 95.3 $ 107.9 |
Notes Payable and Long-Term D33
Notes Payable and Long-Term Debt (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Debt Instrument [Line Items] | |
Outstanding Notes Payable And Long Term Debt [Text Block] | December 31, (millions of dollars) 2016 2015 Short-term debt Short-term borrowings $ 156.5 $ 280.7 Long-term debt 5.75% Senior notes due 11/01/16 ($150 million par value) $ — $ 152.2 8.00% Senior notes due 10/01/19 ($134 million par value) 139.1 138.5 4.625% Senior notes due 09/15/20 ($250 million par value) 251.9 245.6 1.80% Senior notes due 11/7/22 (€500 million par value) 520.7 536.8 3.375% Senior notes due 03/15/25 ($500 million par value) 495.6 495.1 7.125% Senior notes due 02/15/29 ($121 million par value) 118.8 118.7 4.375% Senior notes due 03/15/45 ($500 million par value) 493.3 493.0 Term loan facilities and other 43.6 89.7 Total long-term debt $ 2,063.0 $ 2,269.6 Less: current portion 19.4 160.7 Long-term debt, net of current portion $ 2,043.6 $ 2,108.9 |
Annual principal payments [Text Block] | (millions of dollars) 2017 $ 175.9 2018 17.1 2019 136.1 2020 252.1 2021 2.1 After 2021 1,647.4 Total payments $ 2,230.7 Less: unamortized discounts 11.2 Total $ 2,219.5 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Assets and liabilities measured at fair value [Text Block] | Basis of fair value measurements Balance at December 31, 2016 Quoted prices in active markets for identical items Significant other observable inputs Significant unobservable inputs Valuation technique (millions of dollars) Assets: Commodity contracts $ 0.1 $ — $ 0.1 $ — A Foreign currency contracts $ 7.2 $ — $ 7.2 $ — A Other long-term receivables (insurance settlement agreement note receivable) $ 71.5 $ — $ 71.5 $ — C Liabilities: Foreign currency contracts $ 1.1 $ — $ 1.1 $ — A Basis of fair value measurements (millions of dollars) Balance at December 31, 2015 Quoted prices in active markets for identical items Significant other observable inputs Significant unobservable inputs Valuation technique Assets: Foreign currency contracts $ 2.7 $ — $ 2.7 $ — A Other long-term receivables (insurance settlement agreement note receivable) $ 81.2 $ — $ 81.2 $ — C Liabilities: Foreign currency contracts $ 8.7 $ — $ 8.7 $ — A Commodity contracts $ 10.4 $ — $ 10.4 $ — A Interest rate swap contracts $ 2.7 $ — $ 2.7 $ — A |
Fair value defined benefit plan assets measured at recurring and non-recurring basis [Text Block] | Basis of fair value measurements (millions of dollars) Balance at December 31, 2016 Quoted prices in active markets for identical items Significant other observable inputs Significant unobservable inputs Valuation technique Assets measured at NAV (a) U.S. Plans: Fixed income securities $ 113.8 $ 15.3 $ — $ — A 98.5 Equity securities 94.2 37.2 — — A 57.0 Real estate and other 21.5 13.1 0.5 — A 7.9 $ 229.5 $ 65.6 $ 0.5 $ — $ 163.4 Non-U.S. Plans: Fixed income securities $ 183.4 $ — $ — $ — A 183.4 Equity securities 190.8 87.1 — — A 103.7 Real estate and other 19.6 — — — A 19.6 $ 393.8 $ 87.1 $ — $ — $ 306.7 Basis of fair value measurements (millions of dollars) Balance at December 31, 2015 Quoted prices in active markets for identical items Significant other observable inputs Significant unobservable inputs Valuation technique Assets measured at NAV (a) U.S. Plans: Fixed income securities $ 117.4 $ 14.3 $ — $ — A 103.1 Equity securities 94.2 36.9 — — A 57.3 Real estate and other 24.2 — 0.5 — A 23.7 $ 235.8 $ 51.2 $ 0.5 $ — $ 184.1 Non-U.S. Plans: Fixed income securities $ 181.0 $ — $ — $ — A 181.0 Equity securities 194.7 82.9 — — A 111.8 Real estate and other 19.4 — — — A 19.4 $ 395.1 $ 82.9 $ — $ — $ 312.2 ________________ (a) Certain assets that are measured at fair value using the NAV per share (or its equivalent) practical expedient have not been classified in the fair value hierarchy. These amounts represent investments in commingled and managed funds which have underlying assets in fixed income securities, equity securities, and other assets. |
Financial Instruments (Tables)
Financial Instruments (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Derivative [Line Items] | |
Schedule of Price Risk Derivatives [Table Text Block] | Commodity derivative contracts Commodity Volume hedged December 31, 2016 Volume hedged December 31, 2015 Units of measure Duration Copper 213.8 6,273.2 Metric Tons Dec -17 |
Schedule of Interest Rate Derivatives [Table Text Block] | Interest rate swap contracts (in millions) Hedge Type Notional Amount Duration Fixed to floating Fair value $ 250.0 Sept - 20 Fixed to floating Fair value $ 134.0 Oct - 19 |
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value [Text Block] | Assets Liabilities (millions of dollars) Location December 31, 2016 December 31, 2015 Location December 31, 2016 December 31, 2015 Foreign currency Prepayments and other current assets $ 7.2 $ 2.7 Accounts payable and accrued expenses $ 1.1 $ 8.7 Commodity Prepayments and other current assets $ 0.1 $ — Accounts payable and accrued expenses $ — $ 10.4 Interest rate swaps Other non-current assets $ — $ — Other non-current liabilities $ — $ 2.7 |
Deferred Losses Reported In Other Comprehensive Income Loss [Text Block] | Deferred gain (loss) in AOCI at Gain (loss) expected to be reclassified to income in one year or less (millions of dollars) December 31, 2016 December 31, 2015 Foreign currency $ 5.6 $ (0.1 ) $ 5.6 Commodity (0.1 ) (2.1 ) (0.1 ) Net investment hedges 12.6 12.2 — Foreign currency denominated debt 16.9 $ 0.1 — Total $ 35.0 $ 10.1 $ 5.5 |
Derivatives Designated As Cash Flow Hedging Instruments [Text Block] | Gain (loss) reclassified from AOCI to income Gain (loss) recognized in income Year Ended December 31, Year Ended December 31, (millions of dollars) Location 2016 2015 Location 2016 2015 Foreign currency Sales $ (0.1 ) $ (1.4 ) SG&A expense $ 0.3 $ (0.5 ) Foreign currency Cost of goods sold $ 1.4 $ 7.2 SG&A expense $ — $ 0.2 Commodity Cost of goods sold $ (1.4 ) $ (0.1 ) Cost of goods sold $ (0.3 ) $ — Cross-currency swap Interest $ — $ 0.4 Interest expense $ — $ — Year Ended December 31, 2016 (millions of dollars) Gain (loss) on swaps Gain (loss) on borrowings Income Statement Classification Interest expense and finance charges $ 8.5 $ (8.5 ) |
Foreign currency contracts [Member] | |
Derivative [Line Items] | |
Foreign Exchange Derivative Contracts Outstanding [Text Block] | Foreign currency derivatives (in millions) Functional currency Traded currency Notional in traded currency Notional in traded currency Duration Chinese renminbi Euro — 30.5 Dec - 16 Chinese renminbi US dollar 33.5 13.8 Dec - 17 Euro British pound 4.2 — Dec - 17 Euro Hungarian forint — 3,434.5 Dec - 16 Euro Japanese yen 1,004.8 487.1 Dec - 17 Euro Polish zloty 18.8 — Dec - 17 Euro US dollar 35.3 30.1 Dec - 17 Japanese yen Chinese renminbi 68.7 92.6 Dec - 17 Japanese yen Korean won 5,689.2 5,998.9 Dec - 17 Japanese yen US dollar 2.0 3.0 Dec - 17 Korean won Euro — 2.5 Dec - 16 Korean won Japanese yen 539.9 — Dec - 17 Korean won US dollar 14.2 77.9 Dec - 17 Mexican peso US dollar 10.5 — Dec - 17 Swedish krona Euro 48.2 — Dec - 17 US dollar Mexican peso — 469.0 Sept - 16 |
Retirement Benefit Plans (Table
Retirement Benefit Plans (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Compensation and Retirement Disclosure [Abstract] | |
Expense for defined contribution and defined benefit pension plans and other post employment defined benefit plans [Text Block] | Year Ended December 31, (millions of dollars) 2016 2015 2014 Defined contribution expense $ 28.3 $ 28.0 $ 27.6 Defined benefit pension expense 10.1 35.5 18.6 Other postretirement employee benefit expense 1.4 3.3 3.3 Total $ 39.8 $ 66.8 $ 49.5 |
Reconciliation of the plans' benefit obligations, plan assets, funded status and recognition [Text Block] | Pension benefits Other postretirement Year Ended December 31, employee benefits 2016 2015 Year Ended December 31, (millions of dollars) US Non-US US Non-US 2016 2015 Change in projected benefit obligation: Projected benefit obligation, January 1 $ 300.7 $ 508.5 $ 306.2 $ 527.8 $ 145.3 $ 169.7 Service cost — 16.2 — 14.9 0.2 0.2 Interest cost 9.6 12.5 11.2 14.1 4.0 5.7 Plan participants’ contributions — 0.4 — 0.3 — — Plan amendments — 0.2 — — — — Settlement and curtailment — (1.3 ) (48.1 ) (4.7 ) — — Actuarial (gain) loss (5.7 ) 70.2 (12.1 ) (9.0 ) (14.4 ) (16.8 ) Currency translation — (45.3 ) — (42.9 ) — — (Divestiture) Acquisition — (12.8 ) 68.1 23.9 — 1.7 Benefits paid (22.1 ) (20.4 ) (24.6 ) (15.9 ) (15.2 ) (15.2 ) Projected benefit obligation, December 31 $ 282.5 $ 528.2 $ 300.7 $ 508.5 $ 119.9 $ 145.3 Change in plan assets: Fair value of plan assets, January 1 $ 235.8 $ 395.1 $ 265.6 $ 395.6 Actual return on plan assets 12.7 54.0 (0.6 ) 10.3 Employer contribution 2.7 17.0 — 19.3 Plan participants’ contribution — 0.4 — 0.3 Settlements — (1.3 ) (48.1 ) (2.5 ) Currency translation — (40.8 ) — (30.8 ) (Divestiture) Acquisition — (10.2 ) 43.5 18.8 Benefits paid (21.7 ) (20.4 ) (24.6 ) (15.9 ) Fair value of plan assets, December 31 $ 229.5 $ 393.8 $ 235.8 $ 395.1 Funded status $ (53.0 ) $ (134.4 ) $ (64.9 ) $ (113.4 ) $ (119.9 ) $ (145.3 ) Amounts in the Consolidated Balance Sheets consist of: Non-current assets $ — $ 4.9 $ — $ 9.4 $ — $ — Current liabilities (0.1 ) (3.5 ) (0.3 ) (3.0 ) (14.5 ) (16.8 ) Non-current liabilities (52.9 ) (135.8 ) (64.6 ) (119.8 ) (105.4 ) (128.5 ) Net amount $ (53.0 ) $ (134.4 ) $ (64.9 ) $ (113.4 ) $ (119.9 ) $ (145.3 ) Amounts in accumulated other comprehensive loss consist of: Net actuarial loss $ 116.9 $ 163.7 $ 125.4 $ 144.2 $ 19.9 $ 36.5 Net prior service (credit) cost (7.4 ) 0.8 (8.2 ) 0.7 (19.2 ) (24.0 ) Net amount* $ 109.5 $ 164.5 $ 117.2 $ 144.9 $ 0.7 $ 12.5 Total accumulated benefit obligation for all plans $ 282.5 $ 505.5 $ 300.7 $ 486.2 ________________ * AOCI shown above does not include our equity investee, NSK-Warner. NSK-Warner had an AOCI loss of $10.8 million and $7.1 million at December 31, 2016 and 2015, respectively. |
Funded status of pension plans with accumulated benefit obligations in excess of plan assets [Text Block] | December 31, (millions of dollars) 2016 2015 Accumulated benefit obligation $ (594.0 ) $ (597.6 ) Plan assets 423.3 431.0 Deficiency $ (170.7 ) $ (166.6 ) Pension deficiency by country: United States $ (53.0 ) $ (64.9 ) Germany (77.5 ) (64.3 ) Other (40.2 ) (37.4 ) Total pension deficiency $ (170.7 ) $ (166.6 ) |
Weighted average asset allocations of funded pensions plans and target allocations [Text Block] | December 31, Target Allocation 2016 2015 U.S. Plans: Real estate and other 9 % 12 % 0% - 14% Fixed income securities 50 % 53 % 41% - 61% Equity securities 41 % 35 % 30% - 50% 100 % 100 % Non-U.S. Plans: Real estate and other 5 % 5 % 0% - 6% Fixed income securities 47 % 46 % 43% - 53% Equity securities 48 % 49 % 46% - 56% 100 % 100 % |
Components of net periodic benefit cost [Text Block] | Pension benefits Other postretirement employee benefits Year Ended December 31, 2016 2015 2014 Year Ended December 31, (millions of dollars) US Non-US US Non-US US Non-US 2016 2015 2014 Service cost $ — $ 16.2 $ — $ 14.9 $ — $ 12.8 $ 0.2 $ 0.2 $ 0.3 Interest cost 9.6 12.5 11.2 14.1 12.1 18.1 4.0 5.7 6.7 Expected return on plan assets (15.0 ) (24.3 ) (17.0 ) (24.8 ) (17.6 ) (21.1 ) — — — Settlements, curtailments and other — — 25.7 (0.8 ) 3.1 0.7 — — — Amortization of unrecognized prior service (credit) cost (0.8 ) 0.6 (0.8 ) 0.1 (0.8 ) — (4.9 ) (5.7 ) (6.4 ) Amortization of unrecognized loss 5.1 6.2 6.3 6.6 6.5 4.8 2.1 3.1 2.7 Net periodic (income) cost $ (1.1 ) $ 11.2 $ 25.4 $ 10.1 $ 3.3 $ 15.3 $ 1.4 $ 3.3 $ 3.3 |
Defined benefit plan weighted average assumptions used in calculating benefit obligations [Text Block] | December 31, (percent) 2016 2015 U.S. pension plans: Discount rate 3.94 4.15 Rate of compensation increase N/A N/A U.S. other postretirement employee benefit plans: Discount rate 3.61 3.84 Rate of compensation increase N/A N/A Non-U.S. pension plans: Discount rate 2.25 2.99 Rate of compensation increase 3.00 3.01 The Company’s weighted-average assumptions used to determine the net periodic benefit cost for its defined benefit pension and other postretirement employee benefit plans for the years ended December 31, 2016, 2015 and 2014 were as follows: Year Ended December 31, (percent) 2016 2015 2014 U.S. pension plans: Discount rate 4.15 3.89 4.41 Rate of compensation increase N/A N/A N/A Expected return on plan assets 6.70 6.71 6.75 U.S. other postretirement plans: Discount rate 3.84 3.50 4.00 Rate of compensation increase N/A N/A N/A Expected return on plan assets N/A N/A N/A Non-U.S. pension plans: Discount rate 2.99 2.84 3.90 Rate of compensation increase 3.01 2.84 2.77 Expected return on plan assets 6.41 6.53 6.24 |
Defined benefit plan estimated future benefit payments [Text Block] | Pension benefits Other postretirement employee benefits (millions of dollars) Year U.S. Non-U.S. 2017 $ 22.8 $ 17.7 $ 14.8 2018 19.8 18.7 13.7 2019 19.7 17.3 12.6 2020 19.6 19.1 12.1 2021 19.3 19.5 11.0 2022-2026 89.8 110.7 39.6 |
Defined benefit plan effect of one percentage point change in assumed health care cost trend rates [Text Block] | One Percentage Point (millions of dollars) Increase Decrease Effect on other postretirement employee benefit obligation $ 7.9 $ (7.0 ) Effect on total service and interest cost components $ 0.3 $ (0.3 ) |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock option activity [Text Block] | Shares (thousands) Weighted average exercise price Weighted average remaining contractual life (in years) Aggregate intrinsic value (in millions) Outstanding at January 1, 2014 1,997 $ 15.82 2.6 $ 80.0 Exercised (283 ) $ 14.04 $ 13.8 Outstanding at December 31, 2014 1,714 $ 16.11 1.7 $ 66.5 Exercised (440 ) $ 14.76 $ 19.2 Forfeited (7 ) $ 14.52 Outstanding at December 31, 2015 1,267 $ 16.59 0.9 $ 33.7 Exercised (794 ) $ 16.07 $ 14.4 Outstanding at December 31, 2016 473 $ 17.47 0.1 $ 10.4 Options exercisable at December 31, 2016 473 $ 17.47 0.1 $ 10.4 |
Proceeds from stock option exercises [Text Block] | Year Ended December 31, (millions of dollars) 2016 2015 2014 Proceeds from stock options exercised — gross $ 12.7 $ 6.5 $ 4.0 Tax benefit 0.3 10.3 12.9 Proceeds from stock options exercised, net of tax $ 13.0 $ 16.8 $ 16.9 |
Restricted stock compensation expense [Text Block] | Year Ended December 31, (millions of dollars, except per share data) 2016 2015 2014 Restricted stock compensation expense $ 26.7 $ 28.0 $ 20.7 Restricted stock compensation expense, net of tax $ 19.5 $ 20.4 $ 15.1 |
Status of nonvested restricted stock [Text Block] | Shares subject to restriction Weighted average price Nonvested at January 1, 2014 1,411 $ 37.86 Granted 447 $ 54.36 Vested (530 ) $ 37.42 Forfeited (62 ) $ 41.14 Nonvested at December 31, 2014 1,266 $ 43.57 Granted 687 $ 58.45 Vested (588 ) $ 39.14 Forfeited (39 ) $ 50.85 Nonvested at December 31, 2015 1,326 $ 53.18 Granted 724 $ 30.07 Vested (551 ) $ 47.55 Forfeited (70 ) $ 43.05 Nonvested at December 31, 2016 1,429 $ 44.12 |
Amounts expensed under plan and share issuances [Text Block] | Year Ended December 31, (millions of dollars, except share data) 2016 2015 2014 Expense $ 9.6 $ 12.2 $ 11.4 Number of shares — — — |
Accumulated Other Comprehensi38
Accumulated Other Comprehensive Loss (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Schedule of Accumulated Other Comprehensive Income (Loss) [Table Text Block] | (millions of dollars) Foreign currency translation adjustments Hedge instruments Defined benefit postretirement plans Other Total Beginning Balance, January 1, 2014 $ 181.1 $ (16.0 ) $ (181.5 ) $ 2.4 $ (14.0 ) Comprehensive (loss) income before reclassifications (341.8 ) 26.7 (73.8 ) 0.3 (388.6 ) Income taxes associated with comprehensive (loss) income before reclassifications — (9.6 ) 23.3 — 13.7 Reclassification from accumulated other comprehensive (loss) income — 0.6 6.8 — 7.4 Income taxes reclassified into net earnings — — (2.1 ) — (2.1 ) Ending Balance December 31, 2014 $ (160.7 ) $ 1.7 $ (227.3 ) $ 2.7 $ (383.6 ) Comprehensive (loss) income before reclassifications (260.5 ) 2.6 44.9 0.2 (212.8 ) Income taxes associated with comprehensive (loss) income before reclassifications — (1.6 ) (14.3 ) — (15.9 ) Reclassification from accumulated other comprehensive (loss) income — (6.1 ) 9.6 — 3.5 Income taxes reclassified into net earnings — 1.4 (2.8 ) — (1.4 ) Ending Balance December 31, 2015 $ (421.2 ) $ (2.0 ) $ (189.9 ) $ 2.9 $ (610.2 ) Comprehensive (loss) income before reclassifications (109.1 ) 8.0 (11.4 ) (1.6 ) (114.1 ) Income taxes associated with comprehensive (loss) income before reclassifications — (0.7 ) (2.6 ) — (3.3 ) Reclassification from accumulated other comprehensive (loss) income — 0.1 8.3 — 8.4 Income taxes reclassified into net earnings — (0.4 ) (2.5 ) — (2.9 ) Ending Balance December 31, 2016 $ (530.3 ) $ 5.0 $ (198.1 ) $ 1.3 $ (722.1 ) |
Contingencies (Tables)
Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Estimated Future Settlement Of Existing Claims [Table Text Block] | December 31, (millions of dollars) 2016 2015 Assets: Non-current assets $ 386.4 $ 277.3 Total insurance assets $ 386.4 $ 277.3 Liabilities: Accounts payable and accrued expenses $ 51.7 $ 47.7 Other non-current liabilities 827.6 60.8 Total accrued liabilities $ 879.3 $ 108.5 |
Restructuring (Tables)
Restructuring (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Restructuring and Related Activities [Abstract] | |
Schedule of Restructuring Reserve by Type of Cost [Table Text Block] | Severance Accruals (millions of dollars) Drivetrain Engine Total Balance at January 1, 2015 $ 41.9 $ 2.0 $ 43.9 Acquisition* 0.4 — 0.4 Provision 32.6 11.3 43.9 Cash payments (46.0 ) (9.0 ) (55.0 ) Translation adjustment (3.6 ) (0.2 ) (3.8 ) Balance at December 31, 2015 25.3 4.1 29.4 Provision 5.0 5.6 10.6 Cash payments (26.9 ) (6.9 ) (33.8 ) Translation adjustment 0.3 (0.1 ) 0.2 Balance at December 31, 2016 $ 3.7 $ 2.7 $ 6.4 ____________________________________ * Acquisition relates to the Company's 2015 purchase of Remy. |
Leases and Commitments (Tables)
Leases and Commitments (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Leases [Abstract] | |
Schedule of Future Minimum Rental Payments for Operating Leases [Table Text Block] | (millions of dollars) 2017 $ 24.1 2018 8.0 2019 6.4 2020 6.5 2021 6.3 After 2021 3.8 Total minimum lease payments $ 55.1 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings per Share reconciliation [Text Block] | Year Ended December 31, (in millions except per share amounts) 2016 2015 2014 Basic earnings per share: Net earnings attributable to BorgWarner Inc. $ 118.5 $ 609.7 $ 655.8 Weighted average shares of common stock outstanding 214.374 224.414 227.150 Basic earnings per share of common stock $ 0.55 $ 2.72 $ 2.89 Diluted earnings per share: Net earnings attributable to BorgWarner Inc. $ 118.5 $ 609.7 $ 655.8 Weighted average shares of common stock outstanding 214.374 224.414 227.150 Effect of stock-based compensation 0.954 1.234 1.774 Weighted average shares of common stock outstanding including dilutive shares 215.328 225.648 228.924 Diluted earnings per share of common stock $ 0.55 $ 2.70 $ 2.86 |
Recent Transactions (Tables)
Recent Transactions (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Business Acquisition [Line Items] | |
Business Acquisition, Pro Forma Information [Table Text Block] | (millions of dollars, except per share amounts) 2015 2014 Net sales $ 8,977.7 $ 9,487.4 Net earnings $ 652.0 $ 653.9 Earnings per share: Basic $ 2.91 $ 2.88 Diluted $ 2.89 $ 2.86 |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed [Table Text Block] | (millions of dollars) Receivables, net $ 222.8 Inventories, net 195.3 Property, plant and equipment, net 196.6 Goodwill 572.6 Other intangible assets 412.6 Other assets and liabilities (207.8 ) Accounts payable and accrued expenses (163.1 ) Total consideration, net of cash acquired 1,229.0 Less: Assumed retirement-related liabilities 31.1 Less: Assumed debt 10.9 Cash paid, net of cash acquired $ 1,187.0 (millions of dollars) Receivables, net $ 52.4 Inventories, net 46.8 Property, plant and equipment, net 55.3 Goodwill 74.6 Other intangible assets 42.7 Other assets and liabilities (47.4 ) Accounts payable and accrued expenses (70.4 ) Total consideration, net of cash acquired 154.0 Less: Assumed retirement-related liabilities 3.2 Less: Assumed debt 40.3 Cash paid, net of cash acquired $ 110.5 |
Reporting Segments and Relate44
Reporting Segments and Related Information (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment [Table Text Block] | 2016 Segment information Net sales Year-end assets Depreciation/ amortization Long-lived asset expenditures (b) (millions of dollars) Customers Inter-segment Net Engine $ 5,547.3 $ 42.8 $ 5,590.1 $ 4,134.6 $ 211.9 $ 298.7 Drivetrain 3,523.7 — 3,523.7 3,212.4 154.5 182.8 Inter-segment eliminations — (42.8 ) (42.8 ) — — — Total 9,071.0 — 9,071.0 7,347.0 366.4 481.5 Corporate (a) — — — 1,487.7 25.0 19.1 Consolidated $ 9,071.0 $ — $ 9,071.0 $ 8,834.7 $ 391.4 $ 500.6 2015 Segment information Net sales Year-end assets Depreciation/ amortization Long-lived asset expenditures (b) (millions of dollars) Customers Inter-segment Net Engine $ 5,466.5 $ 33.5 $ 5,500.0 $ 4,017.8 $ 200.2 $ 332.4 Drivetrain 2,556.7 — 2,556.7 3,685.1 97.0 221.8 Inter-segment eliminations — (33.5 ) (33.5 ) — — — Total 8,023.2 — 8,023.2 7,702.9 297.2 554.2 Corporate (a) — — — 1,122.8 23.0 23.1 Consolidated $ 8,023.2 $ — $ 8,023.2 $ 8,825.7 $ 320.2 $ 577.3 2014 Segment information Net sales Year-end assets Depreciation/ amortization Long-lived asset (millions of dollars) Customers Inter-segment Net Engine $ 5,673.7 $ 32.2 $ 5,705.9 $ 3,936.2 $ 215.3 $ 349.8 Drivetrain 2,631.4 — 2,631.4 1,783.5 92.8 189.2 Inter-segment eliminations — (32.2 ) (32.2 ) — — — Total 8,305.1 — 8,305.1 5,719.7 308.1 539.0 Corporate (a) — — — 1,505.5 22.3 24.0 Consolidated $ 8,305.1 $ — $ 8,305.1 $ 7,225.2 $ 330.4 $ 563.0 _______________ (a) Corporate assets include investments and other long-term receivables and deferred income taxes. (b) Long-lived asset expenditures include capital expenditures and tooling outlays. Adjusted earnings before interest, income taxes and noncontrolling interest ("Adjusted EBIT") Year Ended December 31, (millions of dollars) 2016 2015 2014 Engine $ 934.1 $ 900.7 $ 924.0 Drivetrain 354.5 294.6 303.3 Adjusted EBIT 1,288.6 1,195.3 1,227.3 Asbestos-related charge 703.6 — — Loss on divestiture 127.1 — — Restructuring expense 26.9 65.7 90.8 Merger and acquisition expense 23.7 21.8 — Intangible asset impairment 12.6 — 10.3 Contract expiration gain (6.2 ) — — Pension settlement loss — 25.7 3.1 Gain on previously held equity interest — (10.8 ) — Corporate, including equity in affiliates' earnings and stock-based compensation 132.1 113.2 112.1 Interest income (6.3 ) (7.5 ) (5.5 ) Interest expense and finance charges 84.6 60.4 36.4 Earnings before income taxes and noncontrolling interest 190.5 926.8 980.1 Provision for income taxes 30.3 280.4 292.6 Net earnings 160.2 646.4 687.5 Net earnings attributable to the noncontrolling interest, net of tax 41.7 36.7 31.7 Net earnings attributable to BorgWarner Inc. $ 118.5 $ 609.7 $ 655.8 |
Schedule of Revenue from External Customers and Long-Lived Assets, by Geographical Areas [Table Text Block] | Net sales Long-lived assets (millions of dollars) 2016 2015 2014 2016 2015 2014 United States $ 2,236.0 $ 1,985.1 $ 2,008.1 $ 799.3 $ 800.5 $ 586.2 Europe: Germany 1,735.1 1,857.1 2,145.6 370.3 380.9 413.6 Hungary 541.1 500.5 518.1 122.2 112.4 73.2 France 305.2 339.2 405.2 39.5 41.4 42.5 Other Europe 888.7 921.8 1,097.3 298.2 276.6 258.8 Total Europe 3,470.1 3,618.6 4,166.2 830.2 811.3 788.1 China 1,218.0 1,009.0 885.1 384.6 355.8 299.9 South Korea 948.2 741.7 623.0 208.0 218.6 185.9 Mexico 805.6 312.7 201.4 136.2 132.8 96.6 Other foreign 393.1 356.1 421.3 143.5 129.1 137.2 Total $ 9,071.0 $ 8,023.2 $ 8,305.1 $ 2,501.8 $ 2,448.1 $ 2,093.9 |
Schedule of Quarterly Financial Information [Table Text Block] | (millions of dollars, except per share amounts) 2016 2015 Quarter ended Mar-31 Jun-30 Sep-30 Dec-31 Year Mar-31 Jun-30 Sep-30 Dec-31 Year Net sales $ 2,268.6 $ 2,329.2 $ 2,214.2 $ 2,259.0 $ 9,071.0 $ 1,984.2 $ 2,031.9 $ 1,884.0 $ 2,123.1 $ 8,023.2 Cost of sales 1,804.3 1,832.5 1,743.1 1,758.0 7,137.9 1,555.2 1,602.9 1,485.8 1,676.2 6,320.1 Gross profit 464.3 496.7 471.1 501.0 1,933.1 429.0 429.0 398.2 446.9 1,703.1 Selling, general and administrative expenses 188.4 202.3 209.7 217.1 817.5 168.2 167.4 148.0 178.4 662.0 Other expense, net 11.7 25.0 111.1 741.9 889.7 1.2 19.1 13.1 68.0 101.4 Operating income (loss) 264.2 269.4 150.3 (458.0 ) 225.9 259.6 242.5 237.1 200.5 939.7 Equity in affiliates’ earnings, net of tax (9.1 ) (10.1 ) (12.4 ) (11.3 ) (42.9 ) (8.5 ) (11.1 ) (8.7 ) (11.7 ) (40.0 ) Interest income (1.6 ) (1.5 ) (1.6 ) (1.6 ) (6.3 ) (1.7 ) (1.6 ) (2.0 ) (2.2 ) (7.5 ) Interest expense and finance charges 21.3 21.4 22.4 19.5 84.6 10.0 17.6 15.0 17.8 60.4 Earnings (loss) before income taxes and noncontrolling interest 253.6 259.6 141.9 (464.6 ) 190.5 259.8 237.6 232.8 196.6 926.8 Provision (benefit) for income taxes 80.4 84.2 48.8 (183.1 ) 30.3 72.1 80.2 66.9 61.2 280.4 Net earnings (loss) 173.2 175.4 93.1 (281.5 ) 160.2 187.7 157.4 165.9 135.4 646.4 Net earnings attributable to the noncontrolling interest, net of tax 9.1 11.0 9.8 11.8 41.7 8.8 9.3 8.5 10.1 36.7 Net earnings (loss) attributable to BorgWarner Inc. (a) $ 164.1 $ 164.4 $ 83.3 $ (293.3 ) $ 118.5 $ 178.9 $ 148.1 $ 157.4 $ 125.3 $ 609.7 Earnings per share — basic $ 0.75 $ 0.76 $ 0.39 $ (1.39 ) $ 0.55 $ 0.79 $ 0.66 $ 0.70 $ 0.57 $ 2.72 Earnings per share — diluted $ 0.75 $ 0.76 $ 0.39 $ (1.39 ) $ 0.55 $ 0.79 $ 0.65 $ 0.70 $ 0.56 $ 2.70 _______________ (a) The Company's results were impacted by the following: • Quarter ended December 31, 2016: The Company recorded an asbestos-related charge of $703.6 million representing the difference in the total liability from what was previously accrued, consulting fees, less available insurance coverage, and an intangible asset impairment loss of $12.6 million related to the Engine segment Etatech’s ECCOS intellectual technology. Additionally, the Company recorded an incremental loss on divestiture of $20.6 million related to the sale of Remy light vehicle aftermarket business. The Company also recorded merger and acquisition expense of $4.8 million primarily related to the Remy transaction. The Company recorded tax benefits of $263.0 million related to asbestos-related charge, $4.4 million related to intangible asset loss, and $4.9 million related to other one-time tax adjustments. The Company also recorded a tax expense of $4.9 million related to the sale of the Remy light vehicle aftermarket business and the reversal of the associated deferred tax balances. • Quarter ended September 30, 2016: The Company recorded an asset impairment expense of $106.5 million to adjust the net book value of the Remy light vehicle aftermarket business to fair value, based on the anticipated sale price. Additionally, the Company recorded restructuring expense of $1.3 million related to Drivetrain and Engine segment actions designed to improve future profitability and competitiveness. The Company also recorded merger and acquisition expense of $5.9 million primarily related to the Remy transaction. The Company recorded tax benefits of $27.6 million related to asset impairment expense, $2.4 million related to other one-time tax adjustments, $0.5 million related to restructuring expense, and $0.4 million related to a gain associated with the release of certain Remy light vehicle aftermarket liabilities due to the expiration of a customer contract. • Quarter ended June 30, 2016: The Company recorded restructuring expense of $19.2 million related to Drivetrain and Engine segment actions designed to improve future profitability and competitiveness. The Company also recorded merger and acquisition expense of $7.2 million primarily related to the Remy transaction. The Company recorded tax benefits of $4.4 million related to restructuring expense and $0.3 million related to other one-time tax adjustments, as well as a tax expense of $2.6 million related to a gain associated with the release of certain Remy light vehicle aftermarket liabilities due to the expiration of a customer contract. • Quarter ended March 31, 2016: The Company recorded restructuring expense of $6.4 million related to Drivetrain and Engine segment actions designed to improve future profitability and competitiveness. The Company also recorded merger and acquisition expense of $5.8 million primarily related to the Remy transaction. The Company recorded tax benefits of $1.0 million related to restructuring expense and $1.0 million related to other one-time tax adjustments. • Quarter ended December 31, 2015: The Company recorded restructuring expense of $24.4 million related to Drivetrain and Engine segment actions designed to improve future profitability and competitiveness. The Company also incurred a non-cash settlement loss of $25.7 million related to a lump-sum pension de-risking disbursement made to an insurance company to unconditionally and irrevocably guarantee all future payments to certain participants that were receiving payments from the U.S. pension plan. Furthermore, the Company recorded merger and acquisition expense of $17.9 million primarily related to the Remy transaction. The Company recorded tax benefits of $9.0 million related to the pension settlement loss, $7.7 million primarily related to foreign tax incentives and tax settlements, $3.8 million related to merger and acquisition expense, partially offset by a tax expense of $0.4 million related to restructuring expense. • Quarter ended September 30, 2015: The Company recorded restructuring expense of $6.3 million related to Drivetrain and Engine segment actions designed to improve future profitability and competitiveness. Additionally, the Company recorded $3.0 million of restructuring expense related to a global realignment plan intended to enhance treasury management flexibility by creating a legal entity structure that better aligns with the Company's business strategy. The Company also recorded merger and acquisition expense of $3.9 million primarily related to the Remy transaction. The Company recorded tax benefits of $4.5 million related to a global realignment plan, $0.7 million related to restructuring expense and $0.4 million primarily related to foreign tax incentives. • Quarter ended June 30, 2015: The Company recorded restructuring expense of $10.5 million related to Drivetrain and Engine segment actions designed to improve future profitability and competitiveness. Additionally, the Company recorded $9.4 million of restructuring expense related to a global realignment plan intended to enhance treasury management flexibility by creating a legal entity structure that better aligns with the Company's business strategy. The Company recorded tax expense of $10.3 million related to a global realignment plan, partially offset by tax benefits of $3.9 million related to tax settlements, $2.2 million related to restructuring expense and $1.3 million primarily related to foreign tax incentives. • Quarter ended March 31, 2015: The Company recorded restructuring expense of $9.4 million related to Drivetrain and Engine segment actions designed to improve future profitability and competitiveness. Additionally, the Company recorded $2.7 million of restructuring expense related to a global realignment plan intended to enhance treasury management flexibility by creating a legal entity structure that better aligns with the Company's business strategy. The Company also recorded a $10.8 million gain on the previously held equity interest in BERU Diesel as a result of purchasing the remaining 51% of this joint venture. The Company recorded tax benefits of $2.4 million primarily related to foreign tax incentives and $1.2 million related to restructuring expense. |
Summary of Significant Accoun45
Summary of Significant Accounting Policies (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Presentation impact on debt issuance costs - ASU 2015-03 | $ 16 | |
Percentage owned affiliates accounted for under equity method, minimum | 20.00% | |
Percentage owned affiliates accounted for under equity method, maximum | 50.00% | |
Inventory Disclosure [Abstract] | ||
Inventories, net | $ 641.2 | 723.6 |
Inventory, LIFO Reserve | 15.2 | 14.2 |
United States | ||
Inventory Disclosure [Abstract] | ||
Inventories, net | $ 131.4 | $ 122.2 |
Minimum [Member] | ||
Standard product warranty term | 1 year | |
Minimum [Member] | Long-term Supply Arrangements [Member] | ||
Property, Plant and Equipment [Abstract] | ||
Property, Plant and Equipment, Useful Life, Minimum | 3 years | |
Minimum [Member] | Building [Member] | ||
Property, Plant and Equipment [Abstract] | ||
Property, Plant and Equipment, Useful Life, Minimum | 15 years | |
Minimum [Member] | Machinery and equipments | ||
Property, Plant and Equipment [Abstract] | ||
Property, Plant and Equipment, Useful Life, Minimum | 3 years | |
Maximum [Member] | ||
Standard product warranty term | 3 years | |
Maximum [Member] | Long-term Supply Arrangements [Member] | ||
Property, Plant and Equipment [Abstract] | ||
Property, Plant and Equipment, Useful Life, Minimum | 5 years | |
Maximum [Member] | Building [Member] | ||
Property, Plant and Equipment [Abstract] | ||
Property, Plant and Equipment, Useful Life, Minimum | 40 years | |
Maximum [Member] | Machinery and equipments | ||
Property, Plant and Equipment [Abstract] | ||
Property, Plant and Equipment, Useful Life, Minimum | 12 years |
Research and Development Cost46
Research and Development Costs (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Research and Development [Abstract] | |||
Gross R&D expenditures | $ 417.8 | $ 386.2 | $ 392.8 |
Customer reimbursements | (74.6) | (78.8) | (56.6) |
Net R&D expenditures | $ 343.2 | $ 307.4 | $ 336.2 |
Net R&D expenditures as a percentage of net sales | 3.80% | 3.80% | 4.00% |
Research and Development Contract, Percent of Net Research and Development, Maximum | 5.00% | 5.00% | 5.00% |
Other Expense, Net (Details)
Other Expense, Net (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Nov. 10, 2015 | Jan. 29, 2015 | |
Asbestos-related charge | $ 703.6 | $ 0 | $ 0 | ||||||||||
Loss on divestiture | $ 20.6 | 127.1 | 0 | 0 | |||||||||
Restructuring expense | $ 1.3 | $ 19.2 | $ 6.4 | $ 24.4 | $ 6.3 | $ 10.5 | $ 9.4 | 26.9 | 65.7 | 90.8 | |||
Merger and acquisition expense | 4.8 | 5.9 | 7.2 | 5.8 | 17.9 | 3.9 | 23.7 | 21.8 | 0 | ||||
Intangible asset impairment | 12.6 | 0 | 10.3 | ||||||||||
Pension settlement loss | 0 | 25.7 | 3.1 | ||||||||||
Gain on previously held equity interest | 0 | (10.8) | 0 | ||||||||||
Other | (4.2) | (1) | (10.4) | ||||||||||
Other expense, net | 741.9 | $ 111.1 | $ 25 | $ 11.7 | 68 | $ 13.1 | $ 19.1 | $ 1.2 | 889.7 | 101.4 | $ 93.8 | ||
Asbestos-related liabilities | 827.6 | 60.8 | 827.6 | 60.8 | |||||||||
Asbestos-related charge, net of tax | 440.6 | ||||||||||||
United States Pension Plan of US Entity [Member] | |||||||||||||
Loss on divestiture | 20.6 | ||||||||||||
Pension Benefit Obligation Settled | 48.1 | ||||||||||||
Pension plan assets transferred | 48.1 | ||||||||||||
Remy International Inc. [Member] | |||||||||||||
Business acquisition, percentage of voting interests acquired | 100.00% | ||||||||||||
BERU Diesel Start Systems Pvt. Ltd. | |||||||||||||
Business acquisition, percentage of voting interests acquired | 51.00% | ||||||||||||
Asbestos Issue [Member] | |||||||||||||
Asbestos-related liabilities | $ 879.3 | $ 108.5 | $ 879.3 | $ 108.5 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Earnings before income taxes and the provision for income taxes | |||||||||||
Earnings before income taxes - U.S. | $ (724.7) | $ 125.6 | $ 218.8 | ||||||||
Earnings before income taxes - Non-U.S. | 915.2 | 801.2 | 761.3 | ||||||||
Earnings before income taxes and noncontrolling interest | $ (464.6) | $ 141.9 | $ 259.6 | $ 253.6 | $ 196.6 | $ 232.8 | $ 237.6 | $ 259.8 | 190.5 | 926.8 | 980.1 |
Current: | |||||||||||
Federal | 37.4 | 32.5 | 25.7 | ||||||||
State | 6.1 | (4.3) | 3.9 | ||||||||
Foreign | 251.7 | 228.3 | 220.8 | ||||||||
Total current | 295.2 | 256.5 | 250.4 | ||||||||
Deferred: | |||||||||||
Federal | (239.8) | 31.8 | 66.2 | ||||||||
State | (13.2) | 2.6 | (1.2) | ||||||||
Foreign | (11.9) | (10.5) | (22.8) | ||||||||
Total deferred | (264.9) | 23.9 | 42.2 | ||||||||
Provision for income taxes | $ (183.1) | $ 48.8 | $ 84.2 | $ 80.4 | $ 61.2 | $ 66.9 | $ 80.2 | $ 72.1 | $ 30.3 | $ 280.4 | $ 292.6 |
Effective tax rate | 15.90% | 30.30% | 29.90% |
Income Taxes - Income Tax Recon
Income Taxes - Income Tax Reconciliation (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Effective Income Tax Rate Reconciliation, Amount [Abstract] | |||||||||||
Income taxes at U.S. statutory rate of 35% | $ 66.7 | $ 324.4 | $ 343 | ||||||||
State taxes, net of federal benefit | (10.6) | 8.2 | 2.6 | ||||||||
U.S. tax on non-U.S. earnings | 40.7 | 31.5 | 18.8 | ||||||||
Affiliates' earnings | (15) | (14) | (16.2) | ||||||||
Foreign rate differential | (93.3) | (92.6) | (84.1) | ||||||||
Tax holidays | (25.5) | (21.2) | (23.6) | ||||||||
Withholding taxes | 13.3 | 7.8 | 10.6 | ||||||||
Tax credits | (3.2) | (3.2) | (3.9) | ||||||||
Reserve adjustments, settlements and claims | 11.6 | 19.4 | 41 | ||||||||
Valuation allowance adjustments | (2.7) | 8.3 | 5.5 | ||||||||
Non-deductible transaction costs | 8.3 | 8.1 | 5.4 | ||||||||
Provision to return and other one-time tax adjustments | 0.3 | (5.1) | (8.8) | ||||||||
Impact of transactions | 16.3 | 11.6 | 0 | ||||||||
Currency | 10 | 0.1 | (0.2) | ||||||||
Other foreign taxes | 12.9 | 9 | 7.4 | ||||||||
Partnership income | 3.4 | 3.1 | (0.3) | ||||||||
Other | (2.9) | (15) | (4.6) | ||||||||
Provision for income taxes | $ (183.1) | $ 48.8 | $ 84.2 | $ 80.4 | $ 61.2 | $ 66.9 | $ 80.2 | $ 72.1 | 30.3 | 280.4 | 292.6 |
Tax benefits associated with asbestos-related charge | 263 | 263 | |||||||||
Tax benefits associated with loss on divestiture | (4.9) | 22.7 | |||||||||
Tax benefit associated with restructuring | 0.5 | 4.4 | 1 | 0.4 | 0.7 | 2.2 | 1.2 | 6 | 3.7 | 15.3 | |
Tax benefit on intangible asset impairment | 0.4 | ||||||||||
Tax expense on gain from customer contract expiration | 2.6 | 2.2 | |||||||||
Tax benefit associated with merger and acquisition expense | 3.8 | ||||||||||
Other tax benefits | 9 | $ 1.1 | |||||||||
Tax impact of other tax adjustments | 4.9 | $ 2.4 | $ 0.3 | $ 1 | $ 7.7 | $ 0.4 | $ 1.3 | $ 2.4 | 8.6 | $ 9.9 | |
Tax benefits associated with intangible asset impairment | $ 4.4 | $ 4.4 |
Income Taxes - Unrecognized Tax
Income Taxes - Unrecognized Tax Benefits (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Contingency [Line Items] | ||
Unrecognized tax benefits, net | $ 88.6 | |
Unrecognized tax benefits that would impact effective tax rate | 69.9 | |
Deferred Tax Asset/Liability Related to Advanced Pricing Agreement | $ 44 | |
Reconciliation of the total gross unrecognized tax benefits | ||
Balance, January 1 | 127.3 | 60.4 |
Additions based on tax positions related to current year | 16.1 | 20.7 |
Additions for tax positions of prior years | 1.6 | 6.7 |
Additions from acquisitions | 0 | 53.4 |
Reductions for closure of tax audits and settlements | (45.7) | (10.4) |
Reductions for lapse in statute of limitations | (5) | (0.3) |
Translation adjustment | (3.2) | (3.2) |
Balance, December 31 | 91.1 | 127.3 |
Income tax penalties and interest expense | 3.2 | 2.3 |
Income tax penalties and interest accrued on unrecognized tax benefits | 16 | $ 12.8 |
Other Current Liabilities [Member] | ||
Reconciliation of the total gross unrecognized tax benefits | ||
Balance, December 31 | $ 15.5 |
Income Taxes - Income Tax Exami
Income Taxes - Income Tax Examinations (Details) | 12 Months Ended |
Dec. 31, 2016 | |
U.S. Federal | |
Major tax payer in tax Jurisdiction | |
Years no longer subject to examination | 2012 and prior |
Japan | |
Major tax payer in tax Jurisdiction | |
Years no longer subject to examination | 2015 and prior |
China | |
Major tax payer in tax Jurisdiction | |
Years no longer subject to examination | 2010 and prior |
France | |
Major tax payer in tax Jurisdiction | |
Years no longer subject to examination | 2013 and prior |
Germany | |
Major tax payer in tax Jurisdiction | |
Years no longer subject to examination | 2007 and prior |
Hungary | |
Major tax payer in tax Jurisdiction | |
Years no longer subject to examination | 2008 and prior |
Mexico | |
Major tax payer in tax Jurisdiction | |
Years no longer subject to examination | 2010 and prior |
Poland | |
Major tax payer in tax Jurisdiction | |
Years no longer subject to examination | 2011 and prior |
South Korea | |
Major tax payer in tax Jurisdiction | |
Years no longer subject to examination | 2010 and prior |
Income Taxes - Components of De
Income Taxes - Components of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Millions | Dec. 31, 2016 | Dec. 31, 2015 |
Deferred tax assets: | ||
Foreign tax credits | $ 139.5 | $ 142.6 |
Employee compensation | 41.3 | 34.6 |
Other comprehensive loss | 66.3 | 79.7 |
Research and development capitalization | 145.1 | 100.4 |
Net operating loss and capital loss carryforwards | 71.5 | 81.8 |
Pension and other postretirement benefits | 38.8 | 41.1 |
Deferred tax assets, asbestos-related | 263 | 0 |
Other | 128.9 | 125.3 |
Total deferred tax assets | 894.4 | 605.5 |
Valuation allowance | (71.2) | (71) |
Net deferred tax asset | 823.2 | 534.5 |
Deferred tax liabilities: | ||
Goodwill and intangible assets | (251.3) | (259.2) |
Fixed assets | (147.1) | (115.5) |
Other | (55) | (66.4) |
Total deferred tax liabilities | (453.4) | (441.1) |
Net deferred taxes | $ 369.8 | $ 93.4 |
Income Taxes Income Taxes - Ope
Income Taxes Income Taxes - Operating Loss Carryforwards (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Operating Loss Carryforwards [Line Items] | ||
Net operating loss and capital loss carryforwards | $ 71.5 | $ 81.8 |
State Operating Loss Carryforwards | 817.8 | |
Deferred tax liability, unremitted foreign earnings | 38.5 | |
Undistributed Earnings of Foreign Subsidiaries | 3,900 | |
U.S. Federal | ||
Operating Loss Carryforwards [Line Items] | ||
Foreign tax credit carryforwards | 139.5 | |
Non-U.S. Tax Jurisdiction | ||
Operating Loss Carryforwards [Line Items] | ||
Operating Loss Carryforwards | 134.7 | |
Operating Loss Carryforwards subject to expiration | 96.6 | |
Operating Loss Carryforwards not subject to expiration | 38.1 | |
Operating Loss Carryforwards valuation allowance | 72.9 | |
Net operating loss and capital loss carryforwards | 134.7 | |
Non-U.S. income tax holidays | 25.5 | $ 21.2 |
State and Local Jurisdiction | ||
Operating Loss Carryforwards [Line Items] | ||
Operating Loss Carryforwards valuation allowance | 632.3 | |
Deferred Tax Assets, Tax Credit Carryforwards, Other | 14.8 | |
Tax Credit Carryforward, Valuation Allowance | 14.8 | |
Remy International Inc. [Member] | ||
Operating Loss Carryforwards [Line Items] | ||
Operating Loss Carryforwards | 68.4 | |
Foreign tax credit carryforwards | 93.6 | |
Research and development credit | 6.9 | |
Tax Credit Carryforward, Amount | 47 | |
Net U.S. Cash Tax Liability | $ 8.4 |
Balance Sheet Information (Deta
Balance Sheet Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Receivables, net: | |||
Customers | $ 1,448.3 | $ 1,423.6 | |
Other | 243.9 | 243.3 | |
Gross receivables | 1,692.2 | 1,666.9 | |
Bad debt allowance(a) | (2.9) | (1.9) | |
Total receivables, net | 1,689.3 | 1,665 | |
Inventories, net: | |||
Raw material and supplies | 378.6 | 412.9 | |
Work in progress | 102.9 | 102.5 | |
Finished goods | 174.9 | 222.4 | |
FIFO inventories | 656.4 | 737.8 | |
LIFO reserve | (15.2) | (14.2) | |
Total inventories, net | 641.2 | 723.6 | |
Prepayments and other current assets: | |||
Prepaid tooling | 77.5 | 98.5 | |
Prepaid taxes | 8 | 11.9 | |
Restricted cash | 0 | 12.3 | |
Other | 51.9 | 46.2 | |
Total prepayments and other current assets | 137.4 | 168.9 | |
Property, plant and equipment, net: | |||
Property, plant and equipment, gross | 3,494.9 | 3,327.8 | |
Accumulated depreciation | (1,137.5) | (1,036.8) | |
Property, plant & equipment, net, excluding tooling | 2,357.4 | 2,291 | |
Tooling, net of amortization | 144.4 | 157.1 | |
Property, plant & equipment, net | 2,501.8 | 2,448.1 | |
Investments and other long-term receivables: | |||
Investment in equity affiliates | 218.9 | 200.1 | |
Other long-term receivables | 283.3 | 260.8 | |
Total investments and other long-term receivables | 502.2 | 460.9 | |
Other non-current assets: | |||
Deferred income taxes | 424 | 213.5 | |
Asbestos insurance asset | 178.7 | 108.5 | |
Other | 150.7 | 158 | |
Total other non-current assets | 753.4 | 480 | |
Accounts payable and accrued expenses: | |||
Trade payables | 1,323.3 | 1,225.6 | |
Payroll and employee related | 206.4 | 201.1 | |
Product warranties | 63.9 | 70.6 | |
Customer related | 52.8 | 55.7 | |
Asbestos-related liability | 51.7 | 47.7 | |
Interest | 22.9 | 20.4 | |
Retirement related | 18.1 | 20.1 | |
Dividends payable to noncontrolling shareholders | 15.7 | 20 | |
Unrecognized tax benefits | 15.5 | 45.5 | |
Insurance | 7.8 | 0 | |
Severance | 6.4 | 29.4 | |
Derivatives | 1.2 | 19.1 | |
Other | 61.6 | 111.2 | |
Total accounts payable and accrued expenses | 1,847.3 | 1,866.4 | |
Other non-current liabilities: | |||
Deferred income taxes | 54.2 | 120.1 | |
Deferred revenue | 33.5 | 36.6 | |
Product warranties | 31.4 | 37.3 | |
Other | 156.6 | 160.4 | |
Total other non-current liabilities | 275.7 | 354.4 | |
Bad debt allowance | |||
Trade payables for capital expenditures | 85.3 | 76.9 | |
Interest costs capitalized | 14.1 | 16.5 | $ 13.5 |
Land [Member] | |||
Property, plant and equipment, net: | |||
Property, plant and equipment, gross | 111 | 118.2 | |
Building [Member] | |||
Property, plant and equipment, net: | |||
Property, plant and equipment, gross | 670.6 | 661.7 | |
Machinery and equipments | |||
Property, plant and equipment, net: | |||
Property, plant and equipment, gross | 2,371.2 | 2,154.3 | |
Capital leases | |||
Property, plant and equipment, net: | |||
Property, plant and equipment, gross | 3.9 | 7.2 | |
Construction in progress | |||
Property, plant and equipment, net: | |||
Property, plant and equipment, gross | 338.2 | 386.4 | |
Allowance for Doubtful Accounts [Member] | |||
Bad debt allowance | |||
Beginning balance, January 1 | (1.9) | (2.3) | (2.1) |
Provision | (3.2) | (0.5) | (0.6) |
Write-offs | 0.2 | 0.7 | 0.3 |
Business divestiture | 2 | 0 | 0 |
Translation adjustment and other | 0 | 0.2 | 0.1 |
Ending balance, December 31 | $ (2.9) | $ (1.9) | $ (2.3) |
Balance Sheet Information - Equ
Balance Sheet Information - Equity Method Investment (Details) - NSK Warner [Member] - USD ($) $ in Millions | 12 Months Ended | |||||
Dec. 31, 2016 | Nov. 30, 2016 | Dec. 31, 2015 | Nov. 30, 2015 | Dec. 31, 2014 | Nov. 30, 2014 | |
Schedule of Equity Method Investments [Line Items] | ||||||
Equity investment in NSK Warner, percent | 50.00% | |||||
Joint Venture Partner Interest In Subsidiary | 40.00% | |||||
Equity Method Investment, Dividends or Distributions | $ 34.3 | $ 18 | $ 45.1 | |||
Equity Method Investment, Summarized Financial Information [Abstract] | ||||||
Cash and securities | $ 98.6 | $ 74.9 | ||||
Current assets, including cash and securities | 256.3 | 231.9 | ||||
Non-current assets | 194.5 | 167.5 | ||||
Current liabilities | 122.6 | 119.1 | ||||
Non-current liabilities | 48.2 | 39.3 | ||||
Total equity | 280 | 241 | ||||
Equity Method Investment, Summarized Financial Information, Income Statement [Abstract] | ||||||
Net sales | 601.8 | 519 | $ 546.4 | |||
Gross profit | 134.1 | 118.6 | 124.5 | |||
Net earnings | $ 71.7 | $ 73.3 | $ 80.3 | |||
Purchases from Equity Method Investee | $ 23.9 | $ 23 | $ 21.3 |
Goodwill and Other Intangible56
Goodwill and Other Intangibles - Goodwill (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | ||
Changes in the carrying amount of goodwill | ||||
Net goodwill balance, January 1 | $ 1,757.7 | |||
Ending balance, December 31 | $ 1,702.2 | $ 1,757.7 | ||
Goodwill impairment test, weighted average cost of capital discount rate for future cash flow | 10.00% | |||
Sensitivity analysis Increase in discount rate | 1.00% | |||
Sensitivity analysis decrease in operating margin assumption | 1.00% | |||
Engine [Member] | ||||
Changes in the carrying amount of goodwill | ||||
Gross goodwill balance, January 1 | $ 1,338.2 | 1,362 | ||
Accumulated impairment losses, January 1 | (501.8) | $ (501.8) | ||
Net goodwill balance, January 1 | 836.4 | 860.2 | ||
Acquisitions | 0 | [1] | 11.6 | |
Translation adjustment and other | (14.2) | (35.4) | ||
Ending balance, December 31 | 822.2 | 836.4 | ||
Drivetrain [Member] | ||||
Changes in the carrying amount of goodwill | ||||
Gross goodwill balance, January 1 | 921.5 | 345.7 | ||
Accumulated impairment losses, January 1 | (0.2) | $ (0.2) | ||
Net goodwill balance, January 1 | 921.3 | 345.5 | ||
Acquisitions | (12.1) | 584.7 | ||
Divestitures | (24.2) | |||
Translation adjustment and other | (5) | (8.9) | ||
Ending balance, December 31 | $ 880 | $ 921.3 | ||
[1] | *Acquisitions relate to the Company's 2015 purchases of Remy and BERU Diesel and fair value adjustments in 2016 based on new information obtained during the measurement period for Remy acquisition.** Divestitures relate to the Company's 2016 disposition of Remy light vehicle aftermarket business and Divgi-Warner Private Limited. . |
Goodwill and Other Intangible57
Goodwill and Other Intangibles - Intangible Assets (Details) - USD ($) $ in Millions | 12 Months Ended | ||||||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2016 | Dec. 31, 2015 | |||
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |||||||
Amortized intangible assets, gross | $ 594.8 | $ 624.6 | |||||
Amortized intangible assets, accumulated amortization | $ 161.5 | $ 156.7 | $ 156.7 | 186.1 | 161.5 | ||
Amortized intangible assets, net | 408.7 | 463.1 | |||||
Other intangible assets, net | 463.5 | 543.8 | |||||
Amortized intangible assets, future amortization expense [Abstract] | |||||||
Future Amortization Expense - 2017 | 36.9 | ||||||
Future Amortization Expense - 2018 | 35.7 | ||||||
Future Amortization Expense - 2019 | 35.2 | ||||||
Future Amortization Expense - 2020 | 34.8 | ||||||
Future Amortization Expense - 2021 | 34.8 | ||||||
Intangible assets (excluding goodwill), gross [Roll Forward] | |||||||
Beginning balance, January 1 | 705.3 | 307.8 | |||||
Acquisitions | 0 | [1] | 423.8 | ||||
Impairment | [1] | (23.9) | 0 | ||||
Divestitures | (19.9) | 0 | |||||
Translation adjustment | (11.9) | (26.3) | |||||
Ending balance, December 31 | 649.6 | 705.3 | 307.8 | ||||
Intangible assets, accumulated amortization [Roll Forward] | |||||||
Beginning balance, January 1 | 161.5 | 156.7 | |||||
Amortization | 40.4 | 19.2 | 27.2 | ||||
Impairment | (8.2) | 0 | |||||
Divestitures | (0.3) | 0 | |||||
Translation adjustment | (7.3) | (14.4) | |||||
Ending balance, December 31 | 186.1 | 161.5 | $ 156.7 | ||||
Patented and unpatented technology [Member] | |||||||
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |||||||
Amortized intangible assets, gross | 108.1 | 128.7 | |||||
Amortized intangible assets, accumulated amortization | 42.4 | 42.4 | 41.5 | 42.4 | |||
Amortized intangible assets, net | 66.6 | 86.3 | |||||
Intangible assets, accumulated amortization [Roll Forward] | |||||||
Beginning balance, January 1 | 42.4 | ||||||
Ending balance, December 31 | 41.5 | 42.4 | |||||
Customer relationships | |||||||
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |||||||
Amortized intangible assets, gross | 481.4 | 490.3 | |||||
Amortized intangible assets, accumulated amortization | 116.1 | 116.1 | 141.2 | 116.1 | |||
Amortized intangible assets, net | 340.2 | 374.2 | |||||
Intangible assets, accumulated amortization [Roll Forward] | |||||||
Beginning balance, January 1 | 116.1 | ||||||
Ending balance, December 31 | 141.2 | 116.1 | |||||
Miscellaneous amortizable assets | |||||||
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |||||||
Amortized intangible assets, gross | 5.3 | 5.6 | |||||
Amortized intangible assets, accumulated amortization | 3 | 3 | 3.4 | 3 | |||
Amortized intangible assets, net | 1.9 | 2.6 | |||||
Intangible assets, accumulated amortization [Roll Forward] | |||||||
Beginning balance, January 1 | 3 | ||||||
Ending balance, December 31 | $ 3.4 | $ 3 | |||||
In-process research and development | |||||||
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |||||||
Indefinite-lived intangible assets (excluding goodwill) | 3.8 | 14.6 | |||||
Unamortized trade names | |||||||
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |||||||
Unamortized trade names | $ 51 | $ 66.1 | |||||
Minimum [Member] | |||||||
Amortized intangible assets, future amortization expense [Abstract] | |||||||
Amortized intangible assets, useful life | 3 years | ||||||
Maximum [Member] | |||||||
Amortized intangible assets, future amortization expense [Abstract] | |||||||
Amortized intangible assets, useful life | 15 years | ||||||
[1] | *Acquisitions relate to the Company's 2015 purchases of Remy and BERU Diesel.** Relates to the impairment of the Company's Etatech ECCOS intellectual technology in 2016.*** Divestiture relates to the Company's sale of Remy light vehicle aftermarket business in 2016. |
Product Warranty (Details)
Product Warranty (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | |
Movement in Standard and Extended Product Warranty, Increase (Decrease) [Roll Forward] | ||||
Beginning balance, January 1 | $ 107.9 | $ 132 | ||
Provisions | 62.2 | 28.6 | ||
Acquisitions | 6.9 | 12.3 | ||
Dispositions | (9.1) | 0 | ||
Payments | (70.1) | (54.7) | ||
Translation adjustment | (2.5) | (10.3) | ||
Ending balance, December 31 | 95.3 | 107.9 | ||
Product Warranty Accrual, Balance Sheet Classification [Abstract] | ||||
Accounts payable and accrued expenses | $ 63.9 | $ 70.6 | ||
Other non-current liabilities | 31.4 | 37.3 | ||
Total product warranty liability | $ 107.9 | $ 132 | $ 95.3 | $ 107.9 |
Warranty provision as a percentage of sales | 0.70% | 0.40% | ||
Standard and Extended Product Warranty Accrual, Period Increase (Decrease) | $ 5.2 | |||
Remy International Inc. [Member] | ||||
Movement in Standard and Extended Product Warranty, Increase (Decrease) [Roll Forward] | ||||
Acquisitions | $ 29.4 | |||
Gustav Wahler GmbH u. Co. KG and General Partner [Member] | ||||
Movement in Standard and Extended Product Warranty, Increase (Decrease) [Roll Forward] | ||||
Acquisitions | $ 17.1 |
Notes Payable and Long-Term D59
Notes Payable and Long-Term Debt (Details) € in Millions | 12 Months Ended | ||||
Dec. 31, 2016USD ($) | Dec. 31, 2016EUR (€) | Jul. 20, 2016USD ($) | Dec. 31, 2015USD ($) | Mar. 12, 2014USD ($) | |
Debt Instrument [Line Items] | |||||
Short-term Debt, Weighted Average Interest Rate | 2.30% | 2.30% | 1.30% | ||
Debt, Weighted Average Interest Rate | 3.80% | 3.80% | 3.60% | ||
Long-term Debt, by Current and Noncurrent [Abstract] | |||||
Total long-term debt | $ 2,063,000,000 | $ 2,269,600,000 | |||
Current portion of long-term debt | 19,400,000 | 160,700,000 | |||
Long-term debt, net of current portion | 2,043,600,000 | 2,108,900,000 | |||
Long-term Debt, by Maturity [Abstract] | |||||
2,017 | 175,900,000 | ||||
2,018 | 17,100,000 | ||||
2,019 | 136,100,000 | ||||
2,020 | 252,100,000 | ||||
2,021 | 2,100,000 | ||||
After 2,021 | 1,647,400,000 | ||||
Total payments | 2,230,700,000 | ||||
Less: unamortized discounts | 11,200,000 | ||||
Total | 2,219,500,000 | ||||
Multi-currency revolving credit agreement, maximum borrowing capacity | 1,250,000,000 | ||||
Estimated fair value of senior unsecured notes | 2,081,400,000 | 2,197,600,000 | |||
Fair value higher than carrying value for senior unsecured notes | 62,000,000 | 17,700,000 | |||
Outstanding letters of credit | 32,300,000 | 29,300,000 | |||
Short Term Borrowings [Member] | |||||
Short-term debt | |||||
Total short-term debt | 156,500,000 | 280,700,000 | |||
Senior Notes Due November 2016 | |||||
Long-term Debt, by Current and Noncurrent [Abstract] | |||||
Total long-term debt | 152,200,000 | ||||
Debt instrument par value | $ 150,000,000 | ||||
Debt instrument stated interest rate | 5.75% | 5.75% | |||
Debt instrument maturity period | Nov. 1, 2016 | ||||
Senior Notes Due October 2019 | |||||
Long-term Debt, by Current and Noncurrent [Abstract] | |||||
Total long-term debt | $ 139,100,000 | 138,500,000 | |||
Debt instrument par value | $ 134,000,000 | ||||
Debt instrument stated interest rate | 8.00% | 8.00% | |||
Debt instrument maturity period | Oct. 1, 2019 | ||||
Senior Notes Due September 2020 | |||||
Long-term Debt, by Current and Noncurrent [Abstract] | |||||
Total long-term debt | $ 251,900,000 | 245,600,000 | |||
Debt instrument par value | $ 250,000,000 | ||||
Debt instrument stated interest rate | 4.625% | 4.625% | |||
Debt instrument maturity period | Sep. 15, 2020 | ||||
Senior Notes Due November 2022 | |||||
Long-term Debt, by Current and Noncurrent [Abstract] | |||||
Total long-term debt | $ 520,700,000 | 536,800,000 | |||
Debt instrument par value | € | € 500 | ||||
Debt instrument stated interest rate | 1.80% | 1.80% | |||
Debt instrument maturity period | Nov. 7, 2022 | ||||
Senior Notes Due March 2025 | |||||
Long-term Debt, by Current and Noncurrent [Abstract] | |||||
Total long-term debt | $ 495,600,000 | 495,100,000 | |||
Debt instrument par value | $ 500,000,000 | ||||
Debt instrument stated interest rate | 3.375% | 3.375% | |||
Debt instrument maturity period | Mar. 15, 2025 | ||||
Senior Notes Due February 2029 | |||||
Long-term Debt, by Current and Noncurrent [Abstract] | |||||
Total long-term debt | $ 118,800,000 | 118,700,000 | |||
Debt instrument par value | $ 121,000,000 | ||||
Debt instrument stated interest rate | 7.125% | 7.125% | |||
Debt instrument maturity period | Feb. 15, 2029 | ||||
Senior Notes Due March 2045 | |||||
Long-term Debt, by Current and Noncurrent [Abstract] | |||||
Total long-term debt | $ 493,300,000 | 493,000,000 | |||
Debt instrument par value | $ 500,000,000 | ||||
Debt instrument stated interest rate | 4.375% | 4.375% | |||
Debt instrument maturity period | Mar. 15, 2045 | ||||
Multi Currency Revolving Credit Facility [Member] | |||||
Long-term Debt, by Maturity [Abstract] | |||||
Multi-currency revolving credit agreement, maximum borrowing capacity | $ 1,000,000,000 | ||||
Commercial Paper [Member] | |||||
Long-term Debt, by Current and Noncurrent [Abstract] | |||||
Total long-term debt | 50,800,000 | 215,000,000 | |||
Long-term Debt, by Maturity [Abstract] | |||||
Multi-currency revolving credit agreement, current borrowing capacity | $ 1,000,000,000 | ||||
Term Loan Facilities And Other [Member] | |||||
Long-term Debt, by Current and Noncurrent [Abstract] | |||||
Total long-term debt | 43,600,000 | 89,700,000 | |||
Interest Rate Swap [Member] | |||||
Debt Instrument [Line Items] | |||||
Derivative, Notional Amount | $ 384,000,000 | ||||
Interest Rate Swap [Member] | Senior Notes Four [Member] | |||||
Long-term Debt, by Maturity [Abstract] | |||||
Derivative liabilities | 1,900,000 | ||||
Interest Rate Swap [Member] | Senior Notes Three [Member] | |||||
Long-term Debt, by Maturity [Abstract] | |||||
Derivative liabilities | 800,000 | ||||
Unamortized portion of debt derivative [Member] | Senior Notes Four [Member] | |||||
Long-term Debt, by Maturity [Abstract] | |||||
Derivative assets | 3,900,000 | ||||
Unamortized portion of debt derivative [Member] | Senior Notes Three [Member] | |||||
Long-term Debt, by Current and Noncurrent [Abstract] | |||||
Total long-term debt | 4,100,000 | 5,500,000 | |||
Long-term Debt, by Maturity [Abstract] | |||||
Derivative assets | $ 1,300,000 | ||||
Unamortized portion of debt derivative [Member] | Senior Notes Two [Member] | |||||
Long-term Debt, by Current and Noncurrent [Abstract] | |||||
Total long-term debt | $ 2,400,000 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - Fair Value, Measurements, Recurring [Member] - USD ($) $ in Millions | Dec. 31, 2016 | Dec. 31, 2015 |
Liabilities, Fair Value Disclosure [Abstract] | ||
Interest rate swap contracts | $ 2.7 | |
Fair Value, Inputs, Level 2 [Member] | ||
Liabilities, Fair Value Disclosure [Abstract] | ||
Interest rate swap contracts | 2.7 | |
Market Approach Valuation Technique [Member] | ||
Fair Value Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Commodity Contract Assets | $ 0.1 | |
Assets, Fair Value Disclosure [Abstract] | ||
Foreign currency contracts | 7.2 | 2.7 |
Liabilities, Fair Value Disclosure [Abstract] | ||
Foreign currency contracts | 1.1 | 8.7 |
Commodity contracts | 10.4 | |
Market Approach Valuation Technique [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Commodity Contract Assets | 0 | |
Market Approach Valuation Technique [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Fair Value Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Commodity Contract Assets | 0.1 | |
Assets, Fair Value Disclosure [Abstract] | ||
Foreign currency contracts | 7.2 | 2.7 |
Liabilities, Fair Value Disclosure [Abstract] | ||
Foreign currency contracts | 1.1 | 8.7 |
Commodity contracts | 10.4 | |
Market Approach Valuation Technique [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Fair Value Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Commodity Contract Assets | 0 | |
Income Approach Valuation Technique [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Other long-term receivables (insurance settlement agreement note receivable) | 71.5 | 81.2 |
Income Approach Valuation Technique [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Other long-term receivables (insurance settlement agreement note receivable) | $ 71.5 | $ 81.2 |
Fair Value Measurements - Defin
Fair Value Measurements - Defined Benefit Plan Assets (Details) - USD ($) $ in Millions | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
U.S. Plans: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | $ 229.5 | $ 235.8 | $ 265.6 |
Non-U.S. Plans: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 393.8 | 395.1 | $ 395.6 |
Fair Value, Measurements, Recurring [Member] | U.S. Plans: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 229.5 | 235.8 | |
Fair Value, Measurements, Recurring [Member] | U.S. Plans: | Fair Value, Inputs, Level 1 [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 65.6 | 51.2 | |
Fair Value, Measurements, Recurring [Member] | U.S. Plans: | Fair Value, Inputs, Level 2 [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 0.5 | 0.5 | |
Fair Value, Measurements, Recurring [Member] | Non-U.S. Plans: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 393.8 | 395.1 | |
Fair Value, Measurements, Recurring [Member] | Non-U.S. Plans: | Fair Value, Inputs, Level 1 [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 87.1 | 82.9 | |
Fixed Income Securities [Member] | Fair Value, Measurements, Recurring [Member] | U.S. Plans: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 113.8 | 117.4 | |
Fixed Income Securities [Member] | Fair Value, Measurements, Recurring [Member] | Non-U.S. Plans: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 183.4 | 181 | |
Equity Securities [Member] | Fair Value, Measurements, Recurring [Member] | U.S. Plans: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 94.2 | 94.2 | |
Equity Securities [Member] | Fair Value, Measurements, Recurring [Member] | Non-U.S. Plans: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 190.8 | 194.7 | |
Real estate and other | Fair Value, Measurements, Recurring [Member] | U.S. Plans: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 21.5 | 24.2 | |
Real estate and other | Fair Value, Measurements, Recurring [Member] | Non-U.S. Plans: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 19.6 | 19.4 | |
Market Approach Valuation Technique [Member] | Fixed Income Securities [Member] | Fair Value, Measurements, Recurring [Member] | U.S. Plans: | Fair Value, Inputs, Level 1 [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 15.3 | 14.3 | |
Market Approach Valuation Technique [Member] | Fixed Income Securities [Member] | Fair Value, Measurements, Recurring [Member] | Non-U.S. Plans: | Fair Value, Inputs, Level 2 [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | |||
Market Approach Valuation Technique [Member] | Equity Securities [Member] | Fair Value, Measurements, Recurring [Member] | U.S. Plans: | Fair Value, Inputs, Level 1 [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 37.2 | 36.9 | |
Market Approach Valuation Technique [Member] | Equity Securities [Member] | Fair Value, Measurements, Recurring [Member] | Non-U.S. Plans: | Fair Value, Inputs, Level 1 [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 87.1 | 82.9 | |
Market Approach Valuation Technique [Member] | Real estate and other | Fair Value, Measurements, Recurring [Member] | U.S. Plans: | Fair Value, Inputs, Level 1 [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 13.1 | ||
Market Approach Valuation Technique [Member] | Real estate and other | Fair Value, Measurements, Recurring [Member] | U.S. Plans: | Fair Value, Inputs, Level 2 [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 0.5 | 0.5 | |
Net Asset Value [Member] | Fair Value, Measurements, Recurring [Member] | U.S. Plans: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 163.4 | 184.1 | |
Net Asset Value [Member] | Fair Value, Measurements, Recurring [Member] | Non-U.S. Plans: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 306.7 | 312.2 | |
Net Asset Value [Member] | Fixed Income Securities [Member] | Fair Value, Measurements, Recurring [Member] | U.S. Plans: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 98.5 | 103.1 | |
Net Asset Value [Member] | Fixed Income Securities [Member] | Fair Value, Measurements, Recurring [Member] | Non-U.S. Plans: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 183.4 | 181 | |
Net Asset Value [Member] | Equity Securities [Member] | Fair Value, Measurements, Recurring [Member] | U.S. Plans: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 57 | 57.3 | |
Net Asset Value [Member] | Equity Securities [Member] | Fair Value, Measurements, Recurring [Member] | Non-U.S. Plans: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 103.7 | 111.8 | |
Net Asset Value [Member] | Real estate and other | Fair Value, Measurements, Recurring [Member] | U.S. Plans: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 7.9 | 23.7 | |
Net Asset Value [Member] | Real estate and other | Fair Value, Measurements, Recurring [Member] | Non-U.S. Plans: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | $ 19.6 | $ 19.4 |
Financial Instruments (Details)
Financial Instruments (Details) € in Millions, ₩ in Millions, ¥ in Millions, ¥ in Millions, £ in Millions, PLN in Millions, MXN in Millions, HUF in Millions, $ in Millions | 12 Months Ended | ||||||||||||||
Dec. 31, 2016USD ($)t | Dec. 31, 2015USD ($)t | Dec. 31, 2016PLN | Dec. 31, 2016JPY (¥) | Dec. 31, 2016KRW (₩) | Dec. 31, 2016CNY (¥) | Dec. 31, 2016EUR (€) | Dec. 31, 2016GBP (£) | Jul. 20, 2016USD ($) | Dec. 31, 2015HUF | Dec. 31, 2015JPY (¥) | Dec. 31, 2015KRW (₩) | Dec. 31, 2015CNY (¥) | Dec. 31, 2015EUR (€) | Dec. 31, 2015MXN | |
Commodity Contract [Member] | Dec - 17 | |||||||||||||||
Derivative [Line Items] | |||||||||||||||
Derivative, Nonmonetary Notional Amount, Mass | t | 213.8 | 6,273.2 | |||||||||||||
Interest Rate Swap [Member] | |||||||||||||||
Derivative [Line Items] | |||||||||||||||
Derivative, Notional Amount | $ 384 | ||||||||||||||
Interest Rate Swap [Member] | Sept - 20 | |||||||||||||||
Derivative [Line Items] | |||||||||||||||
Derivative, Notional Amount | $ 250 | ||||||||||||||
Interest Rate Swap [Member] | Oct - 19 | |||||||||||||||
Derivative [Line Items] | |||||||||||||||
Derivative, Notional Amount | 134 | ||||||||||||||
Sweden, Kronor | Foreign currency contracts [Member] | Dec - 17 | |||||||||||||||
Derivative [Line Items] | |||||||||||||||
Derivative, Notional Amount | € | € 48.2 | ||||||||||||||
Mexico, Pesos | Foreign currency contracts [Member] | Dec - 17 | |||||||||||||||
Derivative [Line Items] | |||||||||||||||
Derivative, Notional Amount | $ 10.5 | ||||||||||||||
Chinese yuan | Foreign currency contracts [Member] | Dec - 16 | |||||||||||||||
Derivative [Line Items] | |||||||||||||||
Derivative, Notional Amount | € | € 30.5 | ||||||||||||||
Chinese yuan | Foreign currency contracts [Member] | Dec - 17 | |||||||||||||||
Derivative [Line Items] | |||||||||||||||
Derivative, Notional Amount | 33.5 | 13.8 | |||||||||||||
Euro | Foreign currency contracts [Member] | Dec - 16 | |||||||||||||||
Derivative [Line Items] | |||||||||||||||
Derivative, Notional Amount | HUF | HUF 3,434.5 | ||||||||||||||
Euro | Foreign currency contracts [Member] | Dec - 17 | |||||||||||||||
Derivative [Line Items] | |||||||||||||||
Derivative, Notional Amount | 35.3 | 30.1 | PLN 18.8 | ¥ 1,004.8 | £ 4.2 | ¥ 487.1 | |||||||||
Japanese yen | Foreign currency contracts [Member] | Dec - 17 | |||||||||||||||
Derivative [Line Items] | |||||||||||||||
Derivative, Notional Amount | 2 | 3 | ₩ 5,689.2 | ¥ 68.7 | ₩ 5,998.9 | ¥ 92.6 | |||||||||
Korean won | Foreign currency contracts [Member] | Dec - 16 | |||||||||||||||
Derivative [Line Items] | |||||||||||||||
Derivative, Notional Amount | € | € 2.5 | ||||||||||||||
Korean won | Foreign currency contracts [Member] | Dec - 17 | |||||||||||||||
Derivative [Line Items] | |||||||||||||||
Derivative, Notional Amount | 14.2 | 77.9 | ¥ 539.9 | ||||||||||||
US dollar | Foreign currency contracts [Member] | Sept - 16 | |||||||||||||||
Derivative [Line Items] | |||||||||||||||
Derivative, Notional Amount | MXN | MXN 469 | ||||||||||||||
Prepayments and other current assets | Foreign currency contracts [Member] | |||||||||||||||
Derivative [Line Items] | |||||||||||||||
Derivative assets | 7.2 | 2.7 | |||||||||||||
Prepayments and other current assets | Commodity Contract [Member] | |||||||||||||||
Derivative [Line Items] | |||||||||||||||
Derivative assets | 0.1 | 0 | |||||||||||||
Other non-current assets | Interest Rate Swap [Member] | |||||||||||||||
Derivative [Line Items] | |||||||||||||||
Derivative assets | $ 0 | $ 0 |
Financial Instruments - Foreign
Financial Instruments - Foreign currency derivatives (Details) - Foreign currency contracts [Member] € in Millions, ₩ in Millions, ¥ in Millions, ¥ in Millions, £ in Millions, PLN in Millions, MXN in Millions, HUF in Millions, $ in Millions | Dec. 31, 2016USD ($) | Dec. 31, 2016PLN | Dec. 31, 2016JPY (¥) | Dec. 31, 2016KRW (₩) | Dec. 31, 2016CNY (¥) | Dec. 31, 2016EUR (€) | Dec. 31, 2016GBP (£) | Dec. 31, 2015USD ($) | Dec. 31, 2015HUF | Dec. 31, 2015JPY (¥) | Dec. 31, 2015KRW (₩) | Dec. 31, 2015CNY (¥) | Dec. 31, 2015EUR (€) | Dec. 31, 2015MXN |
Dec - 17 | Chinese yuan | ||||||||||||||
Derivative [Line Items] | ||||||||||||||
Derivative, Notional Amount | $ | $ 33.5 | $ 13.8 | ||||||||||||
Dec - 17 | Euro | ||||||||||||||
Derivative [Line Items] | ||||||||||||||
Derivative, Notional Amount | 35.3 | PLN 18.8 | ¥ 1,004.8 | £ 4.2 | 30.1 | ¥ 487.1 | ||||||||
Dec - 17 | Japanese yen | ||||||||||||||
Derivative [Line Items] | ||||||||||||||
Derivative, Notional Amount | 2 | ₩ 5,689.2 | ¥ 68.7 | 3 | ₩ 5,998.9 | ¥ 92.6 | ||||||||
Dec - 17 | Korean won | ||||||||||||||
Derivative [Line Items] | ||||||||||||||
Derivative, Notional Amount | 14.2 | ¥ 539.9 | $ 77.9 | |||||||||||
Dec - 17 | Mexico, Pesos | ||||||||||||||
Derivative [Line Items] | ||||||||||||||
Derivative, Notional Amount | $ | $ 10.5 | |||||||||||||
Dec - 17 | Sweden, Kronor | ||||||||||||||
Derivative [Line Items] | ||||||||||||||
Derivative, Notional Amount | € 48.2 | |||||||||||||
Sept - 16 | US dollar | ||||||||||||||
Derivative [Line Items] | ||||||||||||||
Derivative, Notional Amount | MXN | MXN 469 | |||||||||||||
Dec - 16 | Chinese yuan | ||||||||||||||
Derivative [Line Items] | ||||||||||||||
Derivative, Notional Amount | € 30.5 | |||||||||||||
Dec - 16 | Euro | ||||||||||||||
Derivative [Line Items] | ||||||||||||||
Derivative, Notional Amount | HUF | HUF 3,434.5 | |||||||||||||
Dec - 16 | Korean won | ||||||||||||||
Derivative [Line Items] | ||||||||||||||
Derivative, Notional Amount | € 2.5 |
Financial Instruments - Balance
Financial Instruments - Balance Sheet (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Derivatives, Fair Value [Line Items] | ||
Cash Flow Hedge Gain (Loss) to be Reclassified within Twelve Months | $ 5.5 | |
Accumulated other comprehensive income (loss), cumulative change in foreign currency denominated debt, before tax | 16.9 | $ 0.1 |
Foreign currency contracts [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Cash Flow Hedge Gain (Loss) to be Reclassified within Twelve Months | 5.6 | |
Foreign currency contracts [Member] | Prepayments and other current assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets | 7.2 | 2.7 |
Foreign currency contracts [Member] | Accounts payable and accrued expenses | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liabilities | 1.1 | 8.7 |
Commodity Contract [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Accumulated other comprehensive income (loss), cumulative changes in net gain (loss) from cash flow hedges, before tax | (0.1) | (2.1) |
Cash Flow Hedge Gain (Loss) to be Reclassified within Twelve Months | (0.1) | |
Commodity Contract [Member] | Prepayments and other current assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets | 0.1 | 0 |
Commodity Contract [Member] | Accounts payable and accrued expenses | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liabilities | 0 | 10.4 |
Interest Rate Swap [Member] | Other non-current assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets | 0 | 0 |
Interest Rate Swap [Member] | Accounts payable and accrued expenses | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liabilities | $ 0 | $ 2.7 |
Financial Instruments - Income
Financial Instruments - Income Statement (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||
Market value of hedge instruments | $ 35 | $ 10.1 |
Cash Flow Hedge Gain (Loss) to be Reclassified within Twelve Months | 5.5 | |
Interest Rate Swap [Member] | Interest expense [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gain (Loss) on Fair Value Hedges Recognized in Earnings | 8.5 | |
Foreign currency contracts [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Market value of hedge instruments | 5.6 | (0.1) |
Cash Flow Hedge Gain (Loss) to be Reclassified within Twelve Months | 5.6 | |
Foreign currency contracts [Member] | Sales [Member] | ||
Derivative Instruments, Gain (Loss) Reclassified from Accumulated OCI into Income, Effective Portion, Net [Abstract] | ||
Gain (loss) reclassified from AOCI to income (effective portion) | (0.1) | (1.4) |
Foreign currency contracts [Member] | Selling general and administrative expenses [Member] | ||
Derivative Instruments, Gain (Loss) Reclassified from Accumulated OCI into Income, Effective Portion, Net [Abstract] | ||
Gain (loss) recognized in income (ineffective portion) | 0.3 | (0.5) |
Foreign currency contracts [Member] | Cost of goods sold [Member] | ||
Derivative Instruments, Gain (Loss) Reclassified from Accumulated OCI into Income, Effective Portion, Net [Abstract] | ||
Gain (loss) reclassified from AOCI to income (effective portion) | 1.4 | 7.2 |
Foreign currency contracts [Member] | Selling general and administrative expenses One [Member] | ||
Derivative Instruments, Gain (Loss) Reclassified from Accumulated OCI into Income, Effective Portion, Net [Abstract] | ||
Gain (loss) recognized in income (ineffective portion) | 0 | 0.2 |
Commodity Contract [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Cash Flow Hedge Gain (Loss) to be Reclassified within Twelve Months | (0.1) | |
Accumulated other comprehensive income (loss), cumulative changes in net gain (loss) from cash flow hedges, before tax | (0.1) | (2.1) |
Commodity Contract [Member] | Cost of goods sold [Member] | ||
Derivative Instruments, Gain (Loss) Reclassified from Accumulated OCI into Income, Effective Portion, Net [Abstract] | ||
Gain (loss) reclassified from AOCI to income (effective portion) | (1.4) | (0.1) |
Gain (loss) recognized in income (ineffective portion) | (0.3) | 0 |
Currency Swap [Member] | Interest expense [Member] | ||
Derivative Instruments, Gain (Loss) Reclassified from Accumulated OCI into Income, Effective Portion, Net [Abstract] | ||
Gain (loss) reclassified from AOCI to income (effective portion) | 0 | 0.4 |
Net investment hedge contracts [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Market value of hedge instruments | 12.6 | $ 12.2 |
Fixed rate debt swapped to floating [Member] | Interest expense [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gain (Loss) on Fair Value Hedges Recognized in Earnings | $ (8.5) |
Retirement Benefit Plans (Detai
Retirement Benefit Plans (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Defined Benefit Plan Disclosure [Line Items] | |||
Pension settlement loss | $ 0 | $ 25.7 | $ 3.1 |
Defined contribution expense | 28.3 | 28 | 27.6 |
Defined benefit pension expense | 10.1 | 35.5 | 18.6 |
Other postretirement employee benefit expense | 1.4 | 3.3 | 3.3 |
Total | 39.8 | 66.8 | 49.5 |
Discretionary contributions to German plans | $ 30.2 | ||
Defined Benefit Plan, Estimated Future Employer Contributions in Next Fiscal Year, Under Contractual Obligation | 3.2 | ||
Minimum [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Estimated future employer contributions in next fiscal year | 15 | ||
Maximum [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Estimated future employer contributions in next fiscal year | $ 25 | ||
U.S. Plans: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Settlement and curtailment | (48.1) | ||
Defined Benefit Plan, Settlements, Plan Assets | $ 48.1 |
Retirement Benefit Plans - Bene
Retirement Benefit Plans - Benefit Obligation and Plan Assets (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | ||
Change in plan assets: | ||||
Funded status of plan | $ (170.7) | $ (166.6) | ||
Amounts recognized in Balance Sheet [Abstract] | ||||
Non-current liabilities | (294.1) | (312.9) | ||
NSK Warner [Member] | ||||
Amounts recognized in accumulated other comprehensive Income Loss) [Abstract] | ||||
Net amount | [1] | 10.8 | 7.1 | |
U.S. Plans: | ||||
Change in benefit obligation [Roll Forward] | ||||
Projected benefit obligation, January 1 | 300.7 | 306.2 | ||
Interest cost | 9.6 | 11.2 | $ 12.1 | |
Settlement and curtailment | (48.1) | |||
Actuarial (gain) loss | (5.7) | (12.1) | ||
Acquisition | 68.1 | |||
Divestiture | 0 | |||
Benefits paid and other | (22.1) | (24.6) | ||
Projected benefit obligation, December 31 | 282.5 | 300.7 | 306.2 | |
Change in plan assets: | ||||
Fair value of plan assets, January 1 | 235.8 | 265.6 | ||
Actual return on plan assets | 12.7 | (0.6) | ||
Employer contribution | 2.7 | |||
Defined Benefit Plan, Settlements, Plan Assets | (48.1) | |||
Divestiture | 0 | |||
Acquisition | 43.5 | |||
Benefits paid | (21.7) | (24.6) | ||
Fair value of plan assets, December 31 | 229.5 | 235.8 | 265.6 | |
Funded status of plan | (53) | (64.9) | ||
Amounts recognized in Balance Sheet [Abstract] | ||||
Non-current assets | 0 | 0 | ||
Current liabilities | (0.1) | (0.3) | ||
Non-current liabilities | (52.9) | (64.6) | ||
Net amount | (53) | (64.9) | ||
Amounts recognized in accumulated other comprehensive Income Loss) [Abstract] | ||||
Net actuarial loss | 116.9 | 125.4 | ||
Net prior service (credit) cost | (7.4) | (8.2) | ||
Net amount | [1] | 109.5 | 117.2 | |
Defined Benefit Plan, Accumulated Benefit Obligation | 282.5 | 300.7 | ||
Non-U.S. Plans: | ||||
Change in benefit obligation [Roll Forward] | ||||
Projected benefit obligation, January 1 | 508.5 | 527.8 | ||
Service cost | 16.2 | 14.9 | 12.8 | |
Interest cost | 12.5 | 14.1 | 18.1 | |
Plan participants’ contributions | 0.4 | 0.3 | ||
Plan amendments | 0.2 | |||
Settlement and curtailment | (1.3) | (4.7) | ||
Actuarial (gain) loss | 70.2 | (9) | ||
Currency translation | (45.3) | (42.9) | ||
Acquisition | 23.9 | |||
Divestiture | (12.8) | |||
Benefits paid and other | (20.4) | (15.9) | ||
Projected benefit obligation, December 31 | 528.2 | 508.5 | 527.8 | |
Change in plan assets: | ||||
Fair value of plan assets, January 1 | 395.1 | 395.6 | ||
Actual return on plan assets | 54 | 10.3 | ||
Employer contribution | 17 | 19.3 | ||
Plan participants’ contributions | 0.4 | 0.3 | ||
Defined Benefit Plan, Settlements, Plan Assets | (1.3) | (2.5) | ||
Currency translation | (40.8) | (30.8) | ||
Divestiture | (10.2) | |||
Acquisition | 18.8 | |||
Benefits paid | (20.4) | (15.9) | ||
Fair value of plan assets, December 31 | 393.8 | 395.1 | 395.6 | |
Funded status of plan | (134.4) | (113.4) | ||
Amounts recognized in Balance Sheet [Abstract] | ||||
Non-current assets | 4.9 | 9.4 | ||
Current liabilities | (3.5) | (3) | ||
Non-current liabilities | (135.8) | (119.8) | ||
Net amount | (134.4) | (113.4) | ||
Amounts recognized in accumulated other comprehensive Income Loss) [Abstract] | ||||
Net actuarial loss | 163.7 | 144.2 | ||
Net prior service (credit) cost | 0.8 | 0.7 | ||
Net amount | [1] | 164.5 | 144.9 | |
Defined Benefit Plan, Accumulated Benefit Obligation | 505.5 | 486.2 | ||
U.S. other postretirement benefit plans [Member] | ||||
Change in benefit obligation [Roll Forward] | ||||
Projected benefit obligation, January 1 | 145.3 | 169.7 | ||
Service cost | 0.2 | 0.2 | 0.3 | |
Interest cost | 4 | 5.7 | 6.7 | |
Actuarial (gain) loss | (14.4) | (16.8) | ||
Acquisition | 0 | 1.7 | ||
Benefits paid and other | (15.2) | (15.2) | ||
Projected benefit obligation, December 31 | 119.9 | 145.3 | $ 169.7 | |
Change in plan assets: | ||||
Funded status of plan | (119.9) | (145.3) | ||
Amounts recognized in Balance Sheet [Abstract] | ||||
Non-current assets | 0 | 0 | ||
Current liabilities | (14.5) | (16.8) | ||
Non-current liabilities | (105.4) | (128.5) | ||
Net amount | (119.9) | (145.3) | ||
Amounts recognized in accumulated other comprehensive Income Loss) [Abstract] | ||||
Net actuarial loss | 19.9 | 36.5 | ||
Net prior service (credit) cost | (19.2) | (24) | ||
Net amount | [1] | $ 0.7 | $ 12.5 | |
[1] | AOCI shown above does not include our equity investee, NSK-Warner. NSK-Warner had an AOCI loss of $10.8 million and $7.1 million at December 31, 2016 and 2015, respectively. |
Retirement Benefit Plans Retire
Retirement Benefit Plans Retirement Benefit Plans - Funded status of plans with ABO in excess of plan assets (Details) - USD ($) $ in Millions | Dec. 31, 2016 | Dec. 31, 2015 |
Defined Benefit Plan Disclosure [Line Items] | ||
Accumulated benefit obligation | $ (594) | $ (597.6) |
Plan assets | 423.3 | 431 |
Funded status of plan | (170.7) | (166.6) |
Non-U.S. Plans: | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Funded status of plan | (134.4) | (113.4) |
Germany | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Funded status of plan | (77.5) | (64.3) |
United States | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Funded status of plan | (53) | (64.9) |
Other | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Funded status of plan | $ (40.2) | $ (37.4) |
Retirement Benefit Plans - Asse
Retirement Benefit Plans - Asset Allocations (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2014 | Dec. 31, 2015 | |
Defined Benefit Plan Disclosure [Line Items] | |||
Discretionary contributions to German plans | $ 30.2 | ||
U.S. Plans: | |||
Defined Benefit Plan, Assets for Plan Benefits [Abstract] | |||
Asset allocations | 100.00% | 100.00% | |
Non-U.S. Plans: | |||
Defined Benefit Plan, Assets for Plan Benefits [Abstract] | |||
Asset allocations | 100.00% | 100.00% | |
Real estate and other [Member] | U.S. Plans: | |||
Defined Benefit Plan, Assets for Plan Benefits [Abstract] | |||
Asset allocations | 9.00% | 12.00% | |
Defined Benefit Plan, Assets, Target Allocations [Abstract] | |||
Target allocation, range minimum | 0.00% | ||
Target allocation, range maximum | 14.00% | ||
Real estate and other [Member] | Non-U.S. Plans: | |||
Defined Benefit Plan, Assets for Plan Benefits [Abstract] | |||
Asset allocations | 5.00% | 5.00% | |
Defined Benefit Plan, Assets, Target Allocations [Abstract] | |||
Target allocation, range minimum | 0.00% | ||
Target allocation, range maximum | 6.00% | ||
Fixed income securities [Member] | U.S. Plans: | |||
Defined Benefit Plan, Assets for Plan Benefits [Abstract] | |||
Asset allocations | 50.00% | 53.00% | |
Defined Benefit Plan, Assets, Target Allocations [Abstract] | |||
Target allocation, range minimum | 41.00% | ||
Target allocation, range maximum | 61.00% | ||
Fixed income securities [Member] | Non-U.S. Plans: | |||
Defined Benefit Plan, Assets for Plan Benefits [Abstract] | |||
Asset allocations | 47.00% | 46.00% | |
Defined Benefit Plan, Assets, Target Allocations [Abstract] | |||
Target allocation, range minimum | 43.00% | ||
Target allocation, range maximum | 53.00% | ||
Equity securities [Member] | U.S. Plans: | |||
Defined Benefit Plan, Assets for Plan Benefits [Abstract] | |||
Asset allocations | 41.00% | 35.00% | |
Defined Benefit Plan, Assets, Target Allocations [Abstract] | |||
Target allocation, range minimum | 30.00% | ||
Target allocation, range maximum | 50.00% | ||
Equity securities [Member] | Non-U.S. Plans: | |||
Defined Benefit Plan, Assets for Plan Benefits [Abstract] | |||
Asset allocations | 48.00% | 49.00% | |
Defined Benefit Plan, Assets, Target Allocations [Abstract] | |||
Target allocation, range minimum | 46.00% | ||
Target allocation, range maximum | 56.00% |
Retirement Benefit Plans - Net
Retirement Benefit Plans - Net Periodic Benefit Cost (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
U.S. Plans: | |||
Defined Benefit Plan, Net Periodic Benefit Cost [Abstract] | |||
Interest cost | $ 9.6 | $ 11.2 | $ 12.1 |
Expected return on plan assets | (15) | (17) | (17.6) |
Settlements, curtailments and other | 25.7 | 3.1 | |
Amortization of unrecognized prior service (credit) cost | (0.8) | (0.8) | (0.8) |
Amortization of unrecognized loss | 5.1 | 6.3 | 6.5 |
Net periodic benefit cost | (1.1) | 25.4 | 3.3 |
Non-U.S. Plans: | |||
Defined Benefit Plan, Net Periodic Benefit Cost [Abstract] | |||
Service cost | 16.2 | 14.9 | 12.8 |
Interest cost | 12.5 | 14.1 | 18.1 |
Expected return on plan assets | (24.3) | (24.8) | (21.1) |
Settlements, curtailments and other | (0.8) | 0.7 | |
Amortization of unrecognized prior service (credit) cost | 0.6 | 0.1 | |
Amortization of unrecognized loss | 6.2 | 6.6 | 4.8 |
Net periodic benefit cost | 11.2 | 10.1 | 15.3 |
U.S. other postretirement benefit plans [Member] | |||
Defined Benefit Plan, Net Periodic Benefit Cost [Abstract] | |||
Service cost | 0.2 | 0.2 | 0.3 |
Interest cost | 4 | 5.7 | 6.7 |
Amortization of unrecognized prior service (credit) cost | (4.9) | (5.7) | (6.4) |
Amortization of unrecognized loss | 2.1 | 3.1 | 2.7 |
Net periodic benefit cost | 1.4 | $ 3.3 | $ 3.3 |
Other post employment plans amortization of net losses expected in the next year | 1.3 | ||
Amortization of net prior service cost expected in the next year | (4.1) | ||
Pension Plan [Member] | |||
Defined Benefit Plan, Net Periodic Benefit Cost [Abstract] | |||
Amortization of net (losses) expected in next year | $ 11.6 |
Retirement Benefit Plans - Assu
Retirement Benefit Plans - Assumptions Used (Details) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
U.S. Plans: | |||
Defined Benefit Plan, Weighted Average Assumptions Used in Calculating Benefit Obligation [Abstract] | |||
Assumptions used calculating benefit obligation, discount rate | 3.94% | 4.15% | |
Defined Benefit Plan, Weighted Average Assumptions Used in Calculating Net Periodic Benefit Cost [Abstract] | |||
Assumptions used calculating net periodic benefit cost, discount rate | 4.15% | 3.89% | 4.41% |
Assumptions used calculating net periodic benefit cost, expected long-term return on assets | 6.70% | 6.71% | 6.75% |
Non-U.S. Plans: | |||
Defined Benefit Plan, Weighted Average Assumptions Used in Calculating Benefit Obligation [Abstract] | |||
Assumptions used calculating benefit obligation, discount rate | 2.25% | 2.99% | |
Assumptions used calculating benefit obligation, rate of compensation increase | 3.00% | 3.01% | |
Defined Benefit Plan, Weighted Average Assumptions Used in Calculating Net Periodic Benefit Cost [Abstract] | |||
Assumptions used calculating net periodic benefit cost, discount rate | 2.99% | 2.84% | 3.90% |
Assumptions used calculating net periodic benefit cost, rate of compensation increase | 3.01% | 2.84% | 2.77% |
Assumptions used calculating net periodic benefit cost, expected long-term return on assets | 6.41% | 6.53% | 6.24% |
U.S. other postretirement benefit plans [Member] | |||
Defined Benefit Plan, Weighted Average Assumptions Used in Calculating Benefit Obligation [Abstract] | |||
Assumptions used calculating benefit obligation, discount rate | 3.61% | 3.84% | |
Defined Benefit Plan, Weighted Average Assumptions Used in Calculating Net Periodic Benefit Cost [Abstract] | |||
Assumptions used calculating net periodic benefit cost, discount rate | 3.84% | 3.50% | 4.00% |
Retirement Benefit Plans - Esti
Retirement Benefit Plans - Estimated Future Payments (Details) $ in Millions | Dec. 31, 2016USD ($) |
U.S. Plans: | |
Defined Benefit Plan, Expected Future Benefit Payments, Fiscal Year Maturity [Abstract] | |
2,017 | $ 22.8 |
2,018 | 19.8 |
2,019 | 19.7 |
2,020 | 19.6 |
2,021 | 19.3 |
2022-2026 | 89.8 |
Non-U.S. Plans: | |
Defined Benefit Plan, Expected Future Benefit Payments, Fiscal Year Maturity [Abstract] | |
2,017 | 17.7 |
2,018 | 18.7 |
2,019 | 17.3 |
2,020 | 19.1 |
2,021 | 19.5 |
2022-2026 | 110.7 |
U.S. other postretirement benefit plans [Member] | |
Defined Benefit Plan, Expected Future Benefit Payments, Fiscal Year Maturity [Abstract] | |
2,017 | 14.8 |
2,018 | 13.7 |
2,019 | 12.6 |
2,020 | 12.1 |
2,021 | 11 |
2022-2026 | $ 39.6 |
Retirement Benefit Plans - Heal
Retirement Benefit Plans - Health Care Trend Rates (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2016USD ($) | |
Assumed health care cost trend rates [Abstract] | |
Health care cost trend rate assumed for next fiscal year | 6.79% |
Ultimate health care cost trend rate | 5.00% |
Effect of one-percentage point change in assumed health care cost trend rates [Abstract] | |
Effect of one percentage point increase on accumulated postretirement benefit obligation | $ 7.9 |
Effect of one percentage point decrease on accumulated postretirement benefit obligation | (7) |
Effect of one percentage point increase on service and interest cost components | 0.3 |
Effect of one percentage point decrease on service and interest cost components | $ (0.3) |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2012 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized | 8,000 | |||
Status of Stock Options | ||||
Number of shares authorized for grant | 5,700 | |||
Shares outstanding under option, beginning balance | 1,267 | 1,714 | 1,997 | |
Shares exercised | (794) | (440) | (283) | |
Shares forfeited | (7) | |||
Shares outstanding under option, ending balance | 473 | 1,267 | 1,714 | |
Weighted average exercise price, beginning balance | $ 16.59 | $ 16.11 | $ 15.82 | |
Weighted average exercise price, exercised | 16.07 | 14.76 | 14.04 | |
Weighted average exercise price, forfeited | 14.52 | |||
Weighted average exercise price, ending balance | $ 17.47 | $ 16.59 | $ 16.11 | |
Weighted average remaining contractual life outstanding, beginning balance | 11 months | 1 year 8 months | 2 years 7 months | |
Aggregate intrinsic value, outstanding, beginning balance | $ 33.7 | $ 66.5 | $ 80 | |
Aggregate intrinsic value, exercised | 14.4 | 19.2 | 13.8 | |
Aggregate intrinsic value, outstanding, ending balance | $ 10.4 | 33.7 | 66.5 | |
Weighted average remaining contractual life, outstanding | 1 month | |||
Share under option, option exercisable | 473 | |||
Weighted average exercise price, options exercisable | $ 17.47 | |||
Weighted average remaining contractual life option exercisable | 1 month | |||
Aggregate intrinsic value, option exercisable | $ 10.4 | |||
Proceeds from stock based compensation - gross | 12.7 | 6.5 | 4 | |
Tax benefit (loss) | 0.3 | 10.3 | 12.9 | |
Proceeds from stock options exercised, including the tax benefit | $ 13 | $ 16.8 | $ 16.9 |
Stock-Based Compensation - Rest
Stock-Based Compensation - Restricted Stock (Details) - Restricted Stock [Member] - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Restricted stock expense | $ 26.7 | $ 28 | $ 20.7 |
Restricted stock expense, net of tax | $ 19.5 | $ 20.4 | $ 15.1 |
Status of nonvested restricted stock [Roll Forward] | |||
Nonvested shares subject to restriction, beginning balance | 1,326,000 | 1,266,000 | 1,411,000 |
Nonvested shares subject to restriction, weighted average price, beginning balance | $ 53.18 | $ 43.57 | $ 37.86 |
Nonvested shares subject to restriction, granted | 724,000 | 687,000 | 447,000 |
Nonvested shares subject to restriction, weighted average price, granted | $ 30.07 | $ 58.45 | $ 54.36 |
Nonvested shares subject to restriction, vested | (551,000) | (588,000) | (530,000) |
Nonvested shares subject to restriction, weighted average price, vested | $ 47.55 | $ 39.14 | $ 37.42 |
Nonvested shares subject to restriction, forfeited | (70,000) | (39,000) | (62,000) |
Nonvested shares subject to restriction, weighted average price, forfeited | $ 43.05 | $ 50.85 | $ 41.14 |
Nonvested shares subject to restriction, ending balance | 1,429,000 | 1,326,000 | 1,266,000 |
Nonvested shares subject to restriction, weighted average price, ending balance | $ 44.12 | $ 53.18 | $ 43.57 |
Restricted stock unrecognized compensation, amount | $ 25.6 | ||
Restricted stock unrecognized compensation, period | 2 years | ||
Management [Member] | |||
Status of nonvested restricted stock [Roll Forward] | |||
Nonvested shares subject to restriction, granted | 698,788 | ||
Director [Member] | |||
Status of nonvested restricted stock [Roll Forward] | |||
Nonvested shares subject to restriction, granted | 25,048 |
Stock-Based Compensation - Perf
Stock-Based Compensation - Performance Share Plans (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Relative Revenue Growth Performance Share Plans [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Performance share plan expense | $ 7.1 | |||
Total Shareholder Return Performance Share Plans [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Performance share plan expense | $ 9.6 | $ 12.2 | $ 11.4 | |
Scenario, Forecast [Member] | Relative Revenue Growth Performance Share Plans [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Performance share plan, shares issued in period | 115,000 |
Accumulated Other Comprehensi77
Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | ||||
Foreign currency translation adjustments | $ (530.3) | $ (421.2) | $ (160.7) | $ 181.1 |
Hedge instruments | 5 | (2) | 1.7 | (16) |
Defined benefit postretirement plans | (198.1) | (189.9) | (227.3) | (181.5) |
Other | 1.3 | 2.9 | 2.7 | 2.4 |
Accumulated other comprehensive loss | (722.1) | (610.2) | (383.6) | $ (14) |
Comprehensive (loss) income before reclassifications, Foreign currency translation adjustments | (109.1) | (260.5) | (341.8) | |
Comprehensive (loss) income before reclassifications, Hedge instruments | 8 | 2.6 | 26.7 | |
Comprehensive (loss) income before reclassifications, Defined benefit postretirement plans | (11.4) | 44.9 | (73.8) | |
Comprehensive (loss) income before reclassifications, Other | (1.6) | 0.2 | 0.3 | |
Comprehensive (loss) income before reclassifications, Total | (114.1) | (212.8) | (388.6) | |
Income taxes associated with comprehensive (loss) income before reclassifications, Hedge instruments | (0.7) | (1.6) | (9.6) | |
Income taxes associated with comprehensive (loss) income before reclassifications, Defined benefit postretirement plans | (2.6) | (14.3) | 23.3 | |
Income taxes associated with comprehensive (loss) income before reclassifications, Total | (3.3) | (15.9) | 13.7 | |
Reclassification from accumulated other comprehensive (loss) income, Hedge instruments | 0.1 | (6.1) | 0.6 | |
Reclassification from accumulated other comprehensive (loss) income, Defined benefit postretirement plans | 8.3 | 9.6 | 6.8 | |
Reclassification from accumulated other comprehensive (loss) income, Total | 8.4 | 3.5 | 7.4 | |
Income taxes reclassified into net earnings, Hedge instruments | (0.4) | 1.4 | 0 | |
Income taxes reclassified into net earnings, Defined benefit postretirement plans | (2.5) | (2.8) | (2.1) | |
Income taxes reclassified into net earnings, Total | $ (2.9) | $ (1.4) | $ (2.1) |
Contingencies (Details)
Contingencies (Details) $ in Millions | 12 Months Ended | 139 Months Ended | 151 Months Ended | |||
Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Dec. 31, 2008USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2016USD ($) | |
Accrual for Environmental Loss Contingencies Disclosure [Abstract] | ||||||
Waste disposal sites with potential liability under the Comprehensive Environmental Response, Compensation and Liability Act | 27 | |||||
Accrual for indicated environmental liabilities | $ 6.3 | $ 5.4 | $ 5.4 | $ 6.3 | ||
Estimated future settlement of existing claims [Abstract] | ||||||
Liability for Asbestos and Environmental Claims, Gross, Payment for Claims | 45.3 | 54.7 | 432.7 | 477.7 | ||
Asbestos-related charge | 703.6 | 0 | $ 0 | |||
Asbestos-related charge, net of tax | 440.6 | |||||
Assets | ||||||
Non-current assets | 178.7 | 108.5 | 108.5 | 178.7 | ||
Liabilities [Abstract] | ||||||
Liability for Asbestos and Environmental Claims, Gross | $ 827.6 | $ 60.8 | $ 60.8 | $ 827.6 | ||
UAW Litigation [Member] | ||||||
Contingencies [Abstract] | ||||||
Loss as a result of the September 2008 DTP ruling | $ 4 | |||||
Asbestos Issue [Member] | ||||||
Accrual for Environmental Loss Contingencies Disclosure [Abstract] | ||||||
Number of claimants settled and dismissed | 2,800 | 5,300 | ||||
Contingencies [Abstract] | ||||||
Number of pending claims | 9,400 | 10,100 | 10,100 | 9,400 | ||
Payment being made to a claimant by or on behalf of the Company | 352 | 349 | ||||
Payment being made to a claimant by or on behalf of the company, percentage | 13.00% | 7.00% | ||||
Cash and notes received from insurers | $ 270 | $ 263.9 | $ 263.9 | $ 270 | ||
Estimated future settlement of existing claims [Abstract] | ||||||
Percentage of reduction in pending asbestos claims | 48.00% | |||||
Assets | ||||||
Non-current assets | $ 386.4 | 277.3 | 277.3 | 386.4 | ||
Total insurance assets | 386.4 | 277.3 | 277.3 | 386.4 | ||
Liabilities [Abstract] | ||||||
Liability for Asbestos and Environmental Claims, Gross | 879.3 | 108.5 | 108.5 | 879.3 | ||
Accounts Payable and Accrued Liabilities [Member] | Asbestos Issue [Member] | ||||||
Liabilities [Abstract] | ||||||
Liability for Asbestos and Environmental Claims, Gross | 51.7 | 47.7 | 47.7 | 51.7 | ||
Other non-current liabilities | Asbestos Issue [Member] | ||||||
Liabilities [Abstract] | ||||||
Liability for Asbestos and Environmental Claims, Gross | $ 827.6 | 60.8 | 60.8 | $ 827.6 | ||
Asbestos claims that were processed [Member] | Asbestos Issue [Member] | ||||||
Assets | ||||||
Non-current assets | $ 168.8 | $ 168.8 |
Restructuring (Details)
Restructuring (Details) $ in Millions | 3 Months Ended | 12 Months Ended | ||||||||||
Sep. 30, 2016USD ($) | Jun. 30, 2016USD ($) | Mar. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Sep. 30, 2015USD ($) | Jun. 30, 2015USD ($) | Mar. 31, 2015USD ($) | Dec. 31, 2016USD ($)employeelabor_union | Dec. 31, 2015USD ($)employee | Dec. 31, 2014USD ($)employee | Nov. 10, 2015 | Feb. 28, 2014 | |
Restructuring Cost and Reserve [Line Items] | ||||||||||||
Restructuring and Related Cost, Agreements with Labor Unions, Number | labor_union | 3 | |||||||||||
Asset Impairment Charges | $ 106.5 | |||||||||||
Restructuring expense | $ 1.3 | $ 19.2 | $ 6.4 | $ 24.4 | $ 6.3 | $ 10.5 | $ 9.4 | $ 26.9 | $ 65.7 | $ 90.8 | ||
Drivetrain [Member] | ||||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||||
Employee termination benefits, number of employees effected | employee | 450 | |||||||||||
Employee termination benefits | $ 3 | 20.1 | 50.6 | |||||||||
Other restructuring charges | 5.2 | 7.9 | 11.2 | |||||||||
Restructuring expense | 8.2 | $ 28 | $ 61.8 | |||||||||
Gustav Wahler GmbH u. Co. KG and General Partner [Member] | ||||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||||
Employee termination benefits, number of employees effected | employee | 70 | 95 | ||||||||||
Employee termination benefits | 9.6 | $ 11.6 | $ 6.5 | |||||||||
Corporate and Other [Member] | ||||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||||
Restructuring expense | $ 3 | $ 9.4 | $ 2.7 | 12.5 | 12 | |||||||
Remy International Inc. [Member] | ||||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||||
Employee termination benefits | 2 | 10.1 | ||||||||||
Other restructuring charges | 3.1 | |||||||||||
Restructuring expense | 6.1 | 10.1 | ||||||||||
Employee Severance [Member] | ||||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||||
Restructuring Reserve | 29.4 | 6.4 | 29.4 | 43.9 | ||||||||
Restructuring expense | 10.6 | 43.9 | ||||||||||
Payments for Restructuring | (33.8) | (55) | ||||||||||
Restructuring Reserve, Translation Adjustment | 0.2 | (3.8) | ||||||||||
Remy International Inc [Member] | Employee Severance [Member] | ||||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||||
Restructuring expense | 0.4 | |||||||||||
Remy International Inc. [Member] | ||||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||||
Business acquisition, percentage of voting interests acquired | 100.00% | |||||||||||
Gustav Wahler GmbH u. Co. KG and General Partner [Member] | ||||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||||
Business acquisition, percentage of voting interests acquired | 100.00% | |||||||||||
Engine [Member] | Employee Severance [Member] | ||||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||||
Restructuring Reserve | 4.1 | 2.7 | 4.1 | 2 | ||||||||
Restructuring expense | 5.6 | 11.3 | ||||||||||
Payments for Restructuring | (6.9) | (9) | ||||||||||
Restructuring Reserve, Translation Adjustment | (0.1) | (0.2) | ||||||||||
Engine [Member] | Remy International Inc [Member] | Employee Severance [Member] | ||||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||||
Restructuring expense | 0 | |||||||||||
Drivetrain [Member] | Employee Severance [Member] | ||||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||||
Restructuring Reserve | $ 25.3 | 3.7 | 25.3 | $ 41.9 | ||||||||
Restructuring expense | 5 | 32.6 | ||||||||||
Payments for Restructuring | (26.9) | (46) | ||||||||||
Restructuring Reserve, Translation Adjustment | $ 0.3 | (3.6) | ||||||||||
Drivetrain [Member] | Remy International Inc [Member] | Employee Severance [Member] | ||||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||||
Restructuring expense | $ 0.4 |
Leases and Commitments (Details
Leases and Commitments (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Leases [Abstract] | |||
Total lease rent expense | $ 38.2 | $ 31.9 | $ 33.9 |
Future minimum operating lease payments | |||
2,017 | 24.1 | ||
2,018 | 8 | ||
2,019 | 6.4 | ||
2,020 | 6.5 | ||
2,021 | 6.3 | ||
After 2,021 | 3.8 | ||
Total minimum lease payments | $ 55.1 |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Basic earnings per share [Abstract] | |||||||||||
Weighted average shares of common stock outstanding | 214,374 | 224,414 | 227,150 | ||||||||
Earnings per share — basic | $ (1.39) | $ 0.39 | $ 0.76 | $ 0.75 | $ 0.57 | $ 0.70 | $ 0.66 | $ 0.79 | $ 0.55 | $ 2.72 | $ 2.89 |
Diluted earnings per share [Abstract] | |||||||||||
Net earnings attributable to BorgWarner Inc. | $ (293.3) | $ 83.3 | $ 164.4 | $ 164.1 | $ 125.3 | $ 157.4 | $ 148.1 | $ 178.9 | $ 118.5 | $ 609.7 | $ 655.8 |
Effect of stock-based compensation | 954 | 1,234 | 1,774 | ||||||||
Weighted average shares of common stock outstanding including dilutive shares | 215,328 | 225,648 | 228,924 | ||||||||
Earnings per share — diluted | $ (1.39) | $ 0.39 | $ 0.76 | $ 0.75 | $ 0.56 | $ 0.70 | $ 0.65 | $ 0.79 | $ 0.55 | $ 2.70 | $ 2.86 |
Recent Transactions (Details)
Recent Transactions (Details) $ / shares in Units, € in Millions, ₨ in Millions, $ in Millions | Jan. 29, 2015USD ($) | Jan. 29, 2015INR (₨) | Feb. 28, 2014USD ($) | Dec. 31, 2016USD ($) | Sep. 30, 2016USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($)$ / shares | Dec. 31, 2014USD ($)$ / shares | Dec. 31, 2014EUR (€) | Oct. 31, 2016USD ($) | Nov. 10, 2015USD ($)$ / shares |
Business Acquisition [Line Items] | |||||||||||
Gain on previously held equity interest | $ 0 | $ 10.8 | $ 0 | ||||||||
Payments for businesses acquired, net of cash acquired | 0 | 1,199.6 | 110.5 | ||||||||
Liabilities assumed from business acquired | 0 | 31.1 | 3.2 | ||||||||
Debt assumed from business acquired | 0 | 10.9 | 40.3 | ||||||||
Goodwill | $ 1,702.2 | 1,702.2 | 1,757.7 | ||||||||
Net sales | 8,977.7 | 9,487.4 | |||||||||
Net earnings | $ 652 | $ 653.9 | |||||||||
Basic | $ / shares | $ 2.91 | $ 2.88 | |||||||||
Diluted | $ / shares | $ 2.89 | $ 2.86 | |||||||||
Proceeds from divestiture of businesses, net of cash divested | $ 5.4 | 85.8 | $ 0 | $ 0 | |||||||
Noncontrolling Interest, Decrease from Deconsolidation | 4.8 | ||||||||||
Goodwill, Purchase Accounting Adjustments | (12.1) | ||||||||||
Proceeds from Divestiture of Businesses | 80 | ||||||||||
Asset Impairment Charges | $ 106.5 | ||||||||||
Loss on divestiture | 20.6 | 127.1 | 0 | 0 | |||||||
Assets | 8,834.7 | 8,834.7 | 8,825.7 | 7,225.2 | |||||||
Inventories, net | $ 641.2 | $ 641.2 | 723.6 | ||||||||
Gustav Wahler GmbH u. Co. KG and General Partner [Member] | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Business acquisition, percentage of voting interests acquired | 100.00% | ||||||||||
Payments for businesses acquired, net of cash acquired | 110.5 | $ 110.5 | € 80.1 | ||||||||
Liabilities assumed from business acquired | $ 3.2 | ||||||||||
Debt assumed from business acquired | 40.3 | ||||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Assets, Receivables | 52.4 | ||||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Inventory | 46.8 | ||||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Property, Plant, and Equipment | 55.3 | ||||||||||
Goodwill | 74.6 | ||||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 42.7 | ||||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Other Assets and Liabilities | (47.4) | ||||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Liabilities, Accounts Payable | (70.4) | ||||||||||
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net | 154 | ||||||||||
Liabilities assumed from businesses acquired | 3.2 | ||||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Liabilities, Long-term Debt | 40.3 | ||||||||||
Business Acquisition, Goodwill, Nondeductible Amount | 56.9 | ||||||||||
Remy International Inc. [Member] | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Business acquisition, percentage of voting interests acquired | 100.00% | ||||||||||
Business Acquisition, Share Price | $ / shares | $ 29.50 | ||||||||||
Business Combination, Consideration Transferred, Other | 361 | ||||||||||
Payments for businesses acquired, net of cash acquired | $ 1,187 | ||||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Assets, Receivables | $ 222.8 | ||||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Inventory | 195.3 | ||||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Property, Plant, and Equipment | 196.6 | ||||||||||
Goodwill | 572.6 | ||||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 412.6 | ||||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Other Assets and Liabilities | (207.8) | ||||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Liabilities, Accounts Payable | (163.1) | ||||||||||
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net | 1,229 | ||||||||||
Liabilities assumed from businesses acquired | 31.1 | ||||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Liabilities, Long-term Debt | 10.9 | ||||||||||
BERU Diesel Start Systems Pvt. Ltd. | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Business acquisition, percentage of voting interests acquired | 51.00% | ||||||||||
Business Combination, Step Acquisition, Equity Interest in Acquiree, Percentage | 100.00% | ||||||||||
Noncash or Part Noncash Acquisition, Value of Liabilities Assumed | $ 4.6 | ||||||||||
Payments for businesses acquired, net of cash acquired | 12.6 | ₨ 783.1 | |||||||||
Business Acquisition, Goodwill, Nondeductible Amount | 13.9 | ||||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Assets | 16 | ||||||||||
Noncash or Part Noncash Acquisition, Value of Assets Acquired | $ 11.2 | ||||||||||
In-process research and development | Remy International Inc. [Member] | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 3.8 | ||||||||||
Other Intangible Assets [Member] | Remy International Inc. [Member] | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 0.1 | ||||||||||
Know-how [Member] | Gustav Wahler GmbH u. Co. KG and General Partner [Member] | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 10.2 | ||||||||||
Patented Technology [Member] | Gustav Wahler GmbH u. Co. KG and General Partner [Member] | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 4.1 | ||||||||||
Customer Relationships [Member] | Gustav Wahler GmbH u. Co. KG and General Partner [Member] | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 24.9 | ||||||||||
Customer Relationships [Member] | Remy International Inc. [Member] | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 303.3 | ||||||||||
Developed Technology Rights [Member] | Remy International Inc. [Member] | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 46.4 | ||||||||||
Trade Names [Member] | Remy International Inc. [Member] | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | $ 59 | ||||||||||
Trade Names [Member] | Gustav Wahler GmbH u. Co. KG and General Partner [Member] | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | $ 3.5 | ||||||||||
Minimum [Member] | Gustav Wahler GmbH u. Co. KG and General Partner [Member] | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 5 years | 5 years | |||||||||
Minimum [Member] | Remy International Inc. [Member] | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 5 years | ||||||||||
Maximum [Member] | Gustav Wahler GmbH u. Co. KG and General Partner [Member] | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 15 years | 15 years | |||||||||
Maximum [Member] | Remy International Inc. [Member] | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 15 years | ||||||||||
Acquisition-related Costs [Member] | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Net earnings | $ (23.2) | ||||||||||
Fair Value Adjustment to Inventory [Member] | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Net earnings | 12.2 | ||||||||||
Interest Expense Adjustment [Member] | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Net earnings | $ 3 | ||||||||||
Divgi-Warner [Member] | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Noncontrolling Interest, Parent Ownership of Interests Sold | 60.00% | ||||||||||
Remy light vehicle aftermarket business [Member] | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Assets | $ 284.1 | ||||||||||
Inventories, net | 94.7 | ||||||||||
Accounts Receivable, Net, Current | 72.6 | ||||||||||
Liabilities | $ 93.2 |
Reporting Segments and Relate83
Reporting Segments and Related Information (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | ||
Segment Reporting Information [Line Items] | ||||||||||||
Customer sales | $ 9,071 | $ 8,023.2 | $ 8,305.1 | |||||||||
Net sales | $ 2,259 | $ 2,214.2 | $ 2,329.2 | $ 2,268.6 | $ 2,123.1 | $ 1,884 | $ 2,031.9 | $ 1,984.2 | 9,071 | 8,023.2 | 8,305.1 | |
Year-end assets | 8,834.7 | 8,825.7 | 8,834.7 | 8,825.7 | 7,225.2 | |||||||
Depreciation and amortization | 391.4 | 320.2 | 330.4 | |||||||||
Long-lived asset expenditures | [1] | 500.6 | 577.3 | 563 | ||||||||
Operating Segments [Member] | ||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||
Customer sales | 9,071 | 8,023.2 | 8,305.1 | |||||||||
Net sales | 9,071 | 8,023.2 | 8,305.1 | |||||||||
Year-end assets | 7,347 | 7,702.9 | 7,347 | 7,702.9 | 5,719.7 | |||||||
Depreciation and amortization | 366.4 | 297.2 | 308.1 | |||||||||
Long-lived asset expenditures | [1] | 481.5 | 554.2 | 539 | ||||||||
Engine [Member] | ||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||
Customer sales | 5,547.3 | 5,466.5 | 5,673.7 | |||||||||
Inter-segment sales | 42.8 | 33.5 | 32.2 | |||||||||
Net sales | 5,590.1 | 5,500 | 5,705.9 | |||||||||
Year-end assets | 4,134.6 | 4,017.8 | 4,134.6 | 4,017.8 | 3,936.2 | |||||||
Depreciation and amortization | 211.9 | 200.2 | 215.3 | |||||||||
Long-lived asset expenditures | [1] | 298.7 | 332.4 | 349.8 | ||||||||
Drivetrain [Member] | ||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||
Customer sales | 3,523.7 | 2,556.7 | 2,631.4 | |||||||||
Inter-segment sales | ||||||||||||
Net sales | 3,523.7 | 2,556.7 | 2,631.4 | |||||||||
Year-end assets | 3,212.4 | 3,685.1 | 3,212.4 | 3,685.1 | 1,783.5 | |||||||
Depreciation and amortization | 154.5 | 97 | 92.8 | |||||||||
Long-lived asset expenditures | [1] | 182.8 | 221.8 | 189.2 | ||||||||
Inter-segment eliminations [Member] | ||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||
Inter-segment sales | (42.8) | (33.5) | (32.2) | |||||||||
Net sales | (42.8) | (33.5) | (32.2) | |||||||||
Corporate Segment [Member] | ||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||
Year-end assets | [2] | $ 1,487.7 | $ 1,122.8 | 1,487.7 | 1,122.8 | 1,505.5 | ||||||
Depreciation and amortization | [2] | 25 | 23 | 22.3 | ||||||||
Long-lived asset expenditures | [1],[2] | $ 19.1 | $ 23.1 | $ 24 | ||||||||
[1] | Long-lived asset expenditures include capital expenditures and tooling outlays. | |||||||||||
[2] | Corporate assets include investments and other long-term receivables and deferred income taxes. |
Reporting Segments and Relate84
Reporting Segments and Related Information - Adjusted EBIT (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Segment Reporting Information [Line Items] | |||||||||||
Adjusted EBIT | $ 1,288.6 | $ 1,195.3 | $ 1,227.3 | ||||||||
Asbestos-related charge | 703.6 | 0 | 0 | ||||||||
Loss on divestiture | $ 20.6 | 127.1 | 0 | 0 | |||||||
Restructuring expense | $ 1.3 | $ 19.2 | $ 6.4 | $ 24.4 | $ 6.3 | $ 10.5 | $ 9.4 | 26.9 | 65.7 | 90.8 | |
Intangible asset impairment | 12.6 | 0 | 10.3 | ||||||||
Gain (Loss) on Contract Termination | (6.2) | 0 | 0 | ||||||||
Pension settlement loss | 0 | 25.7 | 3.1 | ||||||||
Merger and acquisition expense | 4.8 | 5.9 | 7.2 | 5.8 | 17.9 | 3.9 | 23.7 | 21.8 | 0 | ||
Gain on previously held equity interest | 0 | (10.8) | 0 | ||||||||
Corporate, including equity in affiliates' earnings and stock-based compensation | 132.1 | 113.2 | 112.1 | ||||||||
Interest income | (1.6) | (1.6) | (1.5) | (1.6) | (2.2) | (2) | (1.6) | (1.7) | (6.3) | (7.5) | (5.5) |
Interest expense and finance charges | 19.5 | 22.4 | 21.4 | 21.3 | 17.8 | 15 | 17.6 | 10 | 84.6 | 60.4 | 36.4 |
Earnings before income taxes and noncontrolling interest | 190.5 | 926.8 | 980.1 | ||||||||
Provision for income taxes | (183.1) | 48.8 | 84.2 | 80.4 | 61.2 | 66.9 | 80.2 | 72.1 | 30.3 | 280.4 | 292.6 |
Net earnings | (281.5) | 93.1 | 175.4 | 173.2 | 135.4 | 165.9 | 157.4 | 187.7 | 160.2 | 646.4 | 687.5 |
Net earnings attributable to the noncontrolling interest, net of tax | 11.8 | 9.8 | 11 | 9.1 | 10.1 | 8.5 | 9.3 | 8.8 | 41.7 | 36.7 | 31.7 |
Net earnings attributable to BorgWarner Inc. | (293.3) | $ 83.3 | $ 164.4 | $ 164.1 | $ 125.3 | $ 157.4 | $ 148.1 | $ 178.9 | 118.5 | 609.7 | 655.8 |
Engine [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Adjusted EBIT | 934.1 | 900.7 | 924 | ||||||||
Drivetrain [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Adjusted EBIT | $ 354.5 | $ 294.6 | $ 303.3 | ||||||||
U.S. Plans: | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Loss on divestiture | $ 20.6 |
Reporting Segments and Relate85
Reporting Segments and Related Information - Geographic Information (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Maximum percentage in consolidated sales of countries outside the US other than Germany France Hungary and South Korea | 5.00% | ||||||||||
Investment in NSK-Warner | $ 218.9 | $ 200.1 | $ 218.9 | $ 200.1 | |||||||
Net sales | 2,259 | $ 2,214.2 | $ 2,329.2 | $ 2,268.6 | 2,123.1 | $ 1,884 | $ 2,031.9 | $ 1,984.2 | 9,071 | 8,023.2 | $ 8,305.1 |
Long-lived assets | 2,501.8 | 2,448.1 | 2,501.8 | 2,448.1 | 2,093.9 | ||||||
Assets | 8,834.7 | 8,825.7 | 8,834.7 | 8,825.7 | 7,225.2 | ||||||
United States | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Net sales | 2,236 | 1,985.1 | 2,008.1 | ||||||||
Long-lived assets | 799.3 | 800.5 | 799.3 | 800.5 | 586.2 | ||||||
Europe [Member] | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Net sales | 3,470.1 | 3,618.6 | 4,166.2 | ||||||||
Long-lived assets | 830.2 | 811.3 | 830.2 | 811.3 | 788.1 | ||||||
Germany | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Net sales | 1,735.1 | 1,857.1 | 2,145.6 | ||||||||
Long-lived assets | 370.3 | 380.9 | 370.3 | 380.9 | 413.6 | ||||||
Hungary | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Net sales | 541.1 | 500.5 | 518.1 | ||||||||
Long-lived assets | 122.2 | 112.4 | 122.2 | 112.4 | 73.2 | ||||||
France | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Net sales | 305.2 | 339.2 | 405.2 | ||||||||
Long-lived assets | 39.5 | 41.4 | 39.5 | 41.4 | 42.5 | ||||||
Other Europe [Member] | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Net sales | 888.7 | 921.8 | 1,097.3 | ||||||||
Long-lived assets | 298.2 | 276.6 | 298.2 | 276.6 | 258.8 | ||||||
China | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Net sales | 1,218 | 1,009 | 885.1 | ||||||||
Long-lived assets | 384.6 | 355.8 | 384.6 | 355.8 | 299.9 | ||||||
Korea | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Net sales | 948.2 | 741.7 | 623 | ||||||||
Long-lived assets | 208 | 218.6 | 208 | 218.6 | 185.9 | ||||||
Mexico | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Net sales | 805.6 | 312.7 | 201.4 | ||||||||
Long-lived assets | 136.2 | 132.8 | 136.2 | 132.8 | 96.6 | ||||||
Other Foreign [Member] | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Net sales | 393.1 | 356.1 | 421.3 | ||||||||
Long-lived assets | $ 143.5 | 129.1 | $ 143.5 | 129.1 | 137.2 | ||||||
NSK Warner [Member] | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Equity investment in NSK Warner, percent | 50.00% | 50.00% | |||||||||
Investment in NSK-Warner | $ 172.9 | $ 158.7 | $ 172.9 | $ 158.7 | $ 143.8 |
Reporting Segments and Relate86
Reporting Segments and Related Information - Major Customers & Products (Details) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Revenue from External Customer [Line Items] | |||
Percentage of net sales | 10.00% | ||
Sales Revenue, Goods, Net [Member] | Turbochargers [Member] | |||
Revenue from External Customer [Line Items] | |||
Concentration Risk, Percentage | 28.00% | 31.00% | 28.00% |
Sales Revenue, Goods, Net [Member] | Volkswagen [Member] | |||
Revenue from External Customer [Line Items] | |||
Concentration Risk, Percentage | 13.00% | 15.00% | 17.00% |
Sales Revenue, Goods, Net [Member] | Ford [Member] | |||
Revenue from External Customer [Line Items] | |||
Concentration Risk, Percentage | 15.00% | 15.00% | 13.00% |
Reporting Segments and Relate87
Reporting Segments and Related Information - Quarterly Information (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Asbestos-related charge | $ 703.6 | $ 0 | $ 0 | ||||||||
Net sales | $ 2,259 | $ 2,214.2 | $ 2,329.2 | $ 2,268.6 | $ 2,123.1 | $ 1,884 | $ 2,031.9 | $ 1,984.2 | 9,071 | 8,023.2 | 8,305.1 |
Cost of sales | 1,758 | 1,743.1 | 1,832.5 | 1,804.3 | 1,676.2 | 1,485.8 | 1,602.9 | 1,555.2 | 7,137.9 | 6,320.1 | 6,548.7 |
Gross profit | 501 | 471.1 | 496.7 | 464.3 | 446.9 | 398.2 | 429 | 429 | 1,933.1 | 1,703.1 | 1,756.4 |
Selling, general and administrative expenses | 217.1 | 209.7 | 202.3 | 188.4 | 178.4 | 148 | 167.4 | 168.2 | 817.5 | 662 | 698.9 |
Other expense, net | 741.9 | 111.1 | 25 | 11.7 | 68 | 13.1 | 19.1 | 1.2 | 889.7 | 101.4 | 93.8 |
Operating income | (458) | 150.3 | 269.4 | 264.2 | 200.5 | 237.1 | 242.5 | 259.6 | 225.9 | 939.7 | 963.7 |
Equity in affiliates’ earnings, net of tax | (11.3) | (12.4) | (10.1) | (9.1) | (11.7) | (8.7) | (11.1) | (8.5) | (42.9) | (40) | (47.3) |
Interest income | (1.6) | (1.6) | (1.5) | (1.6) | (2.2) | (2) | (1.6) | (1.7) | (6.3) | (7.5) | (5.5) |
Interest expense and finance charges | 19.5 | 22.4 | 21.4 | 21.3 | 17.8 | 15 | 17.6 | 10 | 84.6 | 60.4 | 36.4 |
Earnings before income taxes and noncontrolling interest | (464.6) | 141.9 | 259.6 | 253.6 | 196.6 | 232.8 | 237.6 | 259.8 | 190.5 | 926.8 | 980.1 |
Provision for income taxes | (183.1) | 48.8 | 84.2 | 80.4 | 61.2 | 66.9 | 80.2 | 72.1 | 30.3 | 280.4 | 292.6 |
Net earnings | (281.5) | 93.1 | 175.4 | 173.2 | 135.4 | 165.9 | 157.4 | 187.7 | 160.2 | 646.4 | 687.5 |
Net earnings attributable to the noncontrolling interest, net of tax | 11.8 | 9.8 | 11 | 9.1 | 10.1 | 8.5 | 9.3 | 8.8 | 41.7 | 36.7 | 31.7 |
Net earnings attributable to BorgWarner Inc. | $ (293.3) | $ 83.3 | $ 164.4 | $ 164.1 | $ 125.3 | $ 157.4 | $ 148.1 | $ 178.9 | $ 118.5 | $ 609.7 | $ 655.8 |
Earnings per share — basic | $ (1.39) | $ 0.39 | $ 0.76 | $ 0.75 | $ 0.57 | $ 0.70 | $ 0.66 | $ 0.79 | $ 0.55 | $ 2.72 | $ 2.89 |
Earnings per share — diluted | $ (1.39) | $ 0.39 | $ 0.76 | $ 0.75 | $ 0.56 | $ 0.70 | $ 0.65 | $ 0.79 | $ 0.55 | $ 2.70 | $ 2.86 |
Pension settlement loss | $ 0 | $ 25.7 | $ 3.1 | ||||||||
Merger and acquisition expense | $ 4.8 | $ 5.9 | $ 7.2 | $ 5.8 | $ 17.9 | $ 3.9 | 23.7 | 21.8 | 0 | ||
Tax benefits associated with asbestos-related charge | 263 | 263 | |||||||||
Tax (expenses) benefits associated with loss on divestiture | (4.9) | 22.7 | |||||||||
Tax benefits associated with intangible asset impairment | 4.4 | 4.4 | |||||||||
Effective income tax rate reconciliation, asset impairment expense | 27.6 | ||||||||||
Tax expense on gain from customer contract expiration | (2.6) | (2.2) | |||||||||
Tax expense global realignment plan | 4.5 | $ 10.3 | |||||||||
Restructuring expense | 1.3 | 19.2 | 6.4 | 24.4 | 6.3 | 10.5 | $ 9.4 | 26.9 | 65.7 | 90.8 | |
Tax impact of other tax settlements | 3.9 | ||||||||||
Intangible asset impairment | 12.6 | 0 | 10.3 | ||||||||
Loss on divestiture | 20.6 | 127.1 | 0 | 0 | |||||||
Tax benefit associated with restructuring | 0.5 | 4.4 | 1 | 0.4 | 0.7 | 2.2 | 1.2 | 6 | 3.7 | 15.3 | |
Tax benefits related to partial reversal of a gain with customer contract expiration | 0.4 | ||||||||||
Tax benefit on intangible asset impairment | 0.4 | ||||||||||
Other tax benefits | 9 | 1.1 | |||||||||
Tax impact of other tax adjustments | 4.9 | 2.4 | $ 0.3 | $ 1 | $ 7.7 | 0.4 | 1.3 | 2.4 | 8.6 | 9.9 | |
Asset Impairment Charges | $ 106.5 | ||||||||||
Tax benefit associated with merger and acquisition expense | 3.8 | ||||||||||
Gain on previously held equity interest | $ 0 | 10.8 | 0 | ||||||||
Corporate and Other [Member] | |||||||||||
Restructuring expense | $ 3 | $ 9.4 | $ 2.7 | $ 12.5 | $ 12 | ||||||
U.S. Plans: | |||||||||||
Loss on divestiture | $ 20.6 |