BorgWarner (BWA) 10-K 11 Feb 10 2009 FY Annual report Financial data

Document and Company Informatio

Document and Company Information (USD $)
In Billions, except Share data	12 Months Ended Dec. 31, 2009	Feb. 05, 2010	Jun. 30, 2009
Document and Company Information [Abstract]
Entity Registrant Name	BORGWARNER INC.
Entity Central Index Key	0000908255
Document Type	10-K
Document Period End Date	2009-12-31
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Public Float			$4
Entity Common Stock, Shares Outstanding		116,915,339

Consolidated Balance Sheets

Consolidated Balance Sheets (USD $)
In Millions	Dec. 31, 2009	Dec. 31, 2008
ASSETS
Cash	357.4	103.4
Receivables, net	732	607.1
Inventories, net	314.3	451.2
Deferred income taxes	60.2	67.5
Prepayments and other current assets	87.9	79
Total current assets	1551.8	1308.2
Property, plant and equipment, net	1490.3	1586.2
Investments and advances	257.4	266.5
Goodwill	1061.4	1052.4
Other non-current assets	450.5	430.7
Total assets	4811.4	4,644
LIABILITIES AND STOCKHOLDERS' EQUITY
Notes payable	69.1	183.8
Current portion of long-term debt	0	136.9
Accounts payable and accrued expenses	977.1	923
Income taxes payable	0	6.3
Total current liabilities	1046.2	1,250
Long-term debt	773.2	459.6
Other non-current liabilities:
Retirement-related liabilities	473.7	543.8
Other	295.6	353.1
Total other non-current liabilities	769.3	896.9
Capital stock:
Preferred stock, $0.01 par value; authorized shares: 5,000,000; none issued	0	0
Common stock, value	1.2	1.2
Capital in excess of par value	1034.1	977.6
Retained earnings	1193.4	1200.5
Accumulated other comprehensive income (loss)	14.5	-85.9
Common stock held in treasury, at cost: 1,498,855 shares in 2009 and 2,167,170 shares in 2008	-57.9	-87.4
Total BorgWarner Inc. stockholders' equity	2185.3	2,006
Noncontrolling interest	37.4	31.5
Total stockholders' equity	2222.7	2037.5
Total liabilities and stockholders' equity	4811.4	4,644
Non-voting common stock
Capital stock:
Common stock, value	$0	$0

Consolidated Balance Sheets (Pa

Consolidated Balance Sheets (Parenthetical) (USD $)
	Dec. 31, 2009	Dec. 31, 2008
Capital stock:
Preferred stock, par value	0.01	0.01
Preferred stock, authorized shares	5,000,000	5,000,000
Preferred stock, issued shares	0	0
Common stock, par value	0.01	0.01
Common stock, authorized shares	150,000,000	150,000,000
Common stock, issued shares	118,336,410	117,699,542
Common stock, outstanding shares	116,837,555	115,532,372
Common stock held in treasury, at cost, shares	1,498,855	2,167,170
Non-voting common stock
Capital stock:
Common stock, par value	0.01	0.01
Common stock, authorized shares	25,000,000	25,000,000
Common stock, issued shares	0	0
Common stock, outstanding shares	0	0

Consolidated Statements of Oper

Consolidated Statements of Operations (USD $)
In Millions, except Share data in Thousands	12 Months Ended Dec. 31, 2009	12 Months Ended Dec. 31, 2008		12 Months Ended Dec. 31, 2007
Consolidated Statements of Operations [Abstract]
Net sales	3961.8	5263.9		5328.6
Cost of sales	3,401	4425.4		4378.7
Gross profit	560.8	838.5		949.9
Selling, general and administrative expenses	459.8	542.9		531.9
Restructuring expense	50.3	127.5		0
Goodwill impairment charge	0	156.8		0
Other (income) expense	-0.1	4		-0.1
Operating income	50.8	7.3		418.1
Equity in affiliates' earnings, net of tax	-21.8	-38.4		-40.3
Interest income	-2.5	-7.1		-6.7
Interest expense and finance charges	57.2	38.8		34.7
Earnings before income taxes and noncontrolling interest	17.9	14		430.4
Provision (benefit) for income taxes	-18.5	33.3		113.9
Net earnings (loss)	36.4	-19.3		316.5
Net earnings attributable to the noncontrolling interest, net of tax	9.4	16.3		28
Net earnings (loss) attributable to BorgWarner Inc.	$27	-35.6		288.5
Earnings (loss) per share - basic	0.23	-0.31	[1]	2.49
Earnings (loss) per share - diluted	0.23	-0.31	[1]	2.45
Average shares outstanding (thousands):
Basic	116,522	116,007		116,002
Diluted	116,939	116,007		117,840
[1]*The Company had a loss for the year ended December 31, 2008. As a result, diluted loss per share is the same as basic loss per share in the period, as any dilutive securities would reduce the loss per share.

Consolidated Statements of Cash

Consolidated Statements of Cash Flows (USD $)
In Millions	12 Months Ended Dec. 31, 2009	12 Months Ended Dec. 31, 2008	12 Months Ended Dec. 31, 2007
OPERATING
Net earnings (loss)	36.4	-19.3	316.5
Non-cash charges (credits) to operations:
Depreciation and tooling amortization	234.6	259.7	243.1
Amortization of intangible assets and other	26.3	27.1	21.5
Restructuring expense, net of cash paid	38.4	115.9	0
Goodwill impairment charge	0	156.8	0
Stock based compensation expense	22	21.2	16.3
Deferred income tax benefit	-57.7	-78.3	-29.9
Convertible bond premium amortization	12.7	0	0
Equity in affiliates' earnings, net of dividends received, and other	21.3	12	(12)
Net earnings (loss) adjusted for non-cash charges to operations	334	495.1	555.5
Changes in assets and liabilities:
Receivables	-106.6	163.9	-6.2
Inventories	143	-26.3	-34.7
Prepayments and other current assets	1.2	16	9
Accounts payable and accrued expenses	98.9	-195.6	94.2
Income taxes payable	-6.9	(23)	-15.1
Other non-current assets and liabilities	-112.6	-29.3	0.8
Net cash provided by operating activities	351	400.8	603.5
INVESTING
Capital expenditures, including tooling outlays	(172)	-369.7	-293.9
Net proceeds from asset disposals	23.1	5.7	17.3
Payments for business acquired	-7.5	0	0
Net proceeds from sale of business	1.6	5.5	0
Purchases of marketable securities	0	0	(13)
Proceeds from sales of marketable securities	0	14.6	60.4
Net cash used in investing activities	-154.8	-343.9	-229.2
FINANCING
Net increase (decrease) in notes payable	-114.7	114.8	-92.6
Additions to long-term debt	381.6	0	20
Repayments of long-term debt, including current portion	-164.5	-7.3	-29.1
Payments for noncontrolling interest acquired	-48.5	-141.2	-138.8
Payment for purchase of bond hedge	-56.4	0	0
Proceeds from warrant issuance	31.2	0	0
Repayment of accounts receivable securitization facility	(50)	0	0
Proceeds from accounts receivable securitization facility	50	0	0
Payment for purchase of treasury stock	0	-55.9	(47)
Proceeds from interest rate swap termination	30	0	0
Proceeds from stock options exercised, including the tax benefit	8.7	17.1	46.3
Dividends paid to BorgWarner stockholders	-13.8	-51.1	-39.4
Dividends paid to noncontrolling stockholders	-8.8	-12.5	-17.5
Net cash provided by (used in) financing activities	44.8	-136.1	-298.1
Effect of exchange rate changes on cash	13	-5.9	(11)
Net increase (decrease) in cash	254	-85.1	65.2
Cash at beginning of year	103.4	188.5	123.3
Cash at end of year	357.4	103.4	188.5
Net cash paid during the year for:
Interest	68.8	44.4	42.7
Income taxes	60.3	122	91.6
Non-cash investing transactions:
Domination and Profit Transfer Agreement (See Note 19)	0	44	0
Non-cash financing transactions:
Stock performance plans	6	5	10
Restricted common stock for employees	14.1	9	1.6
Restricted common stock for non-employee directors	0.7	0.7	0.3

Consolidated Statements of Stoc

Consolidated Statements of Stockholders Equity and Comprehensive Income (Loss) (USD $)
In Millions, except Share data	Common stock	Capital in excess of par value	Treasury stock	Retained earnings	Accumulated other comprehensive income (loss)	Noncontrolling interest	Comprehensive income (loss)	Total
Beginning balance, Shares at Dec. 31, 2006	115,394,568		(7,968)
Beginning balance at Dec. 31, 2006	0.6	871.1	-0.1	1064.1	-60.3	162.1	322.9
Dividends declared				-39.4		-17.5
Stock split	0.6			-0.6
Stock option expense		16.3
Stock incentive plans		45.7	0.6	-0.1
Stock incentive plans, Shares	1,725,339		19,083
Executive stock plan		10
Executive stock plan, Shares	78,170
Net issuance of restricted stock, less amortization		0.3
Net issuance of restricted stock, less amortization, Shares	8,632
Purchases of treasury stock			(47)
Purchases of treasury stock, Shares			(1,089,252)
FIN 48 adoption				-16.6
Net earnings (loss)				316.5		28	316.5	316.5
Net earnings attributable to the noncontrolling interest, net of tax				(28)			(28)	28
Defined benefit post employment plans					70.6		70.6
Net unrealized gain (loss) on available-for-sale securities					-0.1		-0.1
Currency translation and hedge instruments, net					123.7	7.9	123.7
Comprehensive loss attributable to the noncontrolling interest					-6.8		-6.8
Purchase of subsidiary shares from noncontrolling interest						-62.6
Ending balance at Dec. 31, 2007	1.2	943.4	-46.5	1295.9	127.1	117.9	475.9
Ending balance, Shares at Dec. 31, 2007	117,206,709		(1,078,137)
Dividends declared				-51.1		-12.5
Stock option expense		12.2
Stock incentive plans		10.8	15	-8.7
Stock incentive plans, Shares			375,075
Executive stock plan		1.5
Executive stock plan, Shares	197,052
Net issuance of restricted stock, less amortization		9.7
Net issuance of restricted stock, less amortization, Shares	295,781
Purchases of treasury stock			-55.9
Purchases of treasury stock, Shares			(1,464,108)
Net earnings (loss)				-19.3		16.2	-19.3	-19.3
Net earnings attributable to the noncontrolling interest, net of tax				-16.3			-16.3	16.3
Defined benefit post employment plans					-74.7		-74.7
Net unrealized gain (loss) on available-for-sale securities					-1.4		-1.4
Currency translation and hedge instruments, net					-126.1	-0.5	-126.1
Comprehensive loss attributable to the noncontrolling interest					-10.8		-10.8
Purchase of subsidiary shares from noncontrolling interest						-1.9
Domination and Profit Transfer Agreement (See Note 19)						-87.7		44
Ending balance at Dec. 31, 2008	1.2	977.6	-87.4	1200.5	-85.9	31.5	-248.6	2037.5
Ending balance, Shares at Dec. 31, 2008	117,699,542		(2,167,170)
Dividends declared				-13.8		-8.8
Stock option expense		7.2
Stock incentive plans		-0.7	16.2	(7)
Stock incentive plans, Shares			380,499
Executive stock plan		6	13.3	-13.3
Executive stock plan, Shares			287,816
Net issuance of restricted stock, less amortization		14.8
Net issuance of restricted stock, less amortization, Shares	636,868
Convertible bond issuance		34.7
Convertible bond - Hedge		-36.7
Convertible bond - Warrant		31.2
Net earnings (loss)				36.4		9.4	36.4	36.4
Net earnings attributable to the noncontrolling interest, net of tax				-9.4			-9.4	9.4
Defined benefit post employment plans					-3.4		-3.4
Currency translation and hedge instruments, net					99.9	1.9	99.9
Comprehensive loss attributable to the noncontrolling interest					3.9		3.9
Dalian joint venture						3.4
Ending balance at Dec. 31, 2009	1.2	1034.1	-57.9	1193.4	14.5	37.4	127.4	2222.7
Ending balance, Shares at Dec. 31, 2009	118,336,410		(1,498,855)

Summary of Significant Accounti

Summary of Significant Accounting Policies
	12 Months Ended Dec. 31, 2009 USD / shares
Summary of Significant Accounting Policies [Abstract]
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	NOTE1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The following paragraphs briefly describe the Companys significant accounting policies. Basis of presentation We have reclassified certain prior year amounts to conform to the presentation of our 2009 Consolidated Statement of Operations. The Companys presentation of the Consolidated Balance Sheets, Consolidated Statements of Operations, Consolidated Statements of Stockholders Equity and Comprehensive Income (Loss), and Reporting Segments and Related Information Note have been adjusted to conform with the requirements of Accounting Standards Codification (ASC) Topic 810, Noncontrolling Interest in Consolidated Financial Statements and ASC Topic 805, Business Combinations. Refer to New Accounting Pronouncements for further information regarding these reclassifications. 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 at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Concentrations of risk 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. The Company performs ongoing credit evaluations of its suppliers and customers and, with the exception of certain financing transactions, does not require collateral from its customers. The Companys customers are primarily original equipment manufacturers (OEMs) of light-vehicles (passenger cars, sport-utility vehicles, vans and light-trucks). The Companys products are also sold to other OEMs of commercial trucks, buses and agricultural and off-highway vehicles. We also manufacture and sell our products to certain TierOne vehicle systems suppliers and into the aftermarket for light and commercial vehicles. Some automotive parts suppliers continue to experience commodity cost pressures and the effects of industry overcapacity. These factors have increased pressure on the industrys supply base, as suppliers cope with higher commodity costs, lower production volumes and other challenges. The Company receives certain of its raw materials from sole suppliers or a limited number of suppliers. The inability of a supplier to fulfill supply requirements of the Company could materially affect future operating results. Principles of consolidation The Consolidated Financial Statements include all majority-owned subsidiaries. All inter-company accounts and transactions have been eliminated in consolidation. 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

Research and Development Costs

Research and Development Costs
	12 Months Ended Dec. 31, 2009 USD / shares
Research and Development Costs [Abstract]
RESEARCH AND DEVELOPMENT COSTS	NOTE2 RESEARCH AND DEVELOPMENT COSTS The following table presents the Companys gross and net expenditures on research and development (RD) activities: millions of Dollars Year Ended December 31, 2009 2008 2007 Gross RD expenditures $ 219.0 $ 273.4 $ 246.7 Customer reimbursements (63.8 ) (67.7 ) (35.9 ) Net RD expenditures $ 155.2 $ 205.7 $ 210.8 The Companys netRD expenditures are included in the selling, general, and administrative expenses of the Consolidated Statements of Operations. Net RD expenditures as a percentage of net sales were 3.9% in 2009 and 2008 and 4.0% in 2007. Customer reimbursements are netted against grossRD expenditures upon billing of services performed. The Company has contracts with several customers at the Companys various RD locations. No such contract exceeded $6million in any of the years presented.

Other

Other (Income) Expense
	12 Months Ended Dec. 31, 2009 USD / shares
Other (Income) Expenses [Abstract]
OTHER (INCOME) EXPENSE	NOTE3 OTHER (INCOME) EXPENSE Items included in (other income) expense consist of: millions of Dollars Year Ended December 31, 2009 2008 2007 Loss on the sale of a product line $ $ 2.2 $ Net (gain) loss on asset disposals (0.1 ) 2.0 0.6 Other (0.2 ) (0.7 ) Total other (income) expense $ (0.1 ) $ 4.0 $ (0.1 )

Income Taxes

Income Taxes
	12 Months Ended Dec. 31, 2009 USD / shares
Income Taxes [Abstract]
INCOME TAXES	NOTE4 INCOME TAXES Earnings before income taxes and the provision for income taxes are presented in the following table. millions of Dollars 2009 2008 2007 Year Ended December 31, U.S. Non-U.S. Total U.S. Non-U.S. Total U.S. Non-U.S. Total Earnings (loss) before taxes $ (138.5 ) $ 156.4 $ 17.9 $ (123.8 ) $ 137.8 $ 14.0 $ 48.4 $ 382.0 $ 430.4 Provision for income taxes: Current: Federal/foreign (2.7 ) 42.7 40.0 7.7 99.5 107.2 36.6 106.2 142.8 State 1.5 1.5 1.0 1.0 1.0 1.0 Total current (1.2 ) 42.7 41.5 8.7 99.5 108.2 37.6 106.2 143.8 Deferred (51.6 ) (8.4 ) (60.0 ) (44.7 ) (30.2 ) (74.9 ) (10.0 ) (19.9 ) (29.9 ) Total provision for income taxes $ (52.8 ) $ 34.3 $ (18.5 ) $ (36.0 ) $ 69.3 $ 33.3 $ 27.6 $ 86.3 $ 113.9 Effective tax rate (38.1 )% 21.9 % (103.4 )% (29.1 )% 50.3 % 237.9 % 57.0 % 22.6 % 26.5 % The provision for income taxes resulted in an effective tax rate for 2009 of (103.4)% compared with rates of 237.9% in 2008 and 26.5% in 2007. The effective tax rate of (103.4)% for 2009 differs from the U.S.statutory rate primarily due to a reduction in U.S.income; foreign rates, which differ from those in the U.S.; the realization of certain business tax credits including RD and U.S.based foreign tax credits; and favorable permanent differences between book and tax treatment for items, including equity in affiliates earnings. The Company adopted the provisions of ASC Topic 740 on January1, 2007. As a result of the implementation of ASC Topic 740, the Company recognized a $16.6million reduction to the January1, 2007 balance of retained earnings. At December31, 2007, the Company reported $71.7million of unrecognized tax benefits; approximately $62.5million represe

Balance Sheet Information

Balance Sheet Information
	12 Months Ended Dec. 31, 2009 USD / shares
Balance Sheet Information [Abstract]
BALANCE SHEET INFORMATION	NOTE5 BALANCE SHEET INFORMATION Detailed balance sheet data are as follows: millions of dollars December 31, 2009 2008 Receivables: Customers $ 634.5 $ 522.7 Other 101.8 90.1 Gross receivables 736.3 612.8 Bad debt allowance(a) (4.3 ) (5.7 ) Net receivables $ 732.0 $ 607.1 Inventories: Raw material and supplies $ 187.3 $ 260.7 Work in progress 69.8 95.7 Finished goods 68.8 111.4 FIFO inventories 325.9 467.8 LIFO reserve (11.6 ) (16.6 ) Net inventories $ 314.3 $ 451.2 Other current assets: Prepaid tooling $ 25.6 $ 28.1 Product liability insurance receivable 24.9 22.1 Derivatives 12.0 11.3 Prepaid tax 2.2 1.6 Prepaid insurance 1.4 1.6 Other 21.8 14.3 Total other current assets $ 87.9 $ 79.0 Property, plant and equipment: Land $ 56.3 $ 56.1 Buildings 570.0 563.7 Machinery and equipment 1,866.5 1,756.1 Capital leases 2.4 1.1 Construction in progress 126.4 160.0 Total property, plant and equipment 2,621.6 2,537.0 Accumulated depreciation (1,211.6 ) (1,047.4 ) 1,410.0 1,489.6 Tooling, net of amortization 80.3 96.6 Property, plant equipment, net $ 1,490.3 $ 1,586.2 Investments and advances: Investment in equity affiliates $ 194.8 $ 214.3 Other investments and advances 62.6 52.2 Total investments and advances $ 257.4 $ 266.5 Other non-current assets: Product liability insurance receivable $ 25.0 $ 12.6 Deferred income taxes 247.1 201.4 Other intangible assets 148.6 148.4 Deferred pension assets 0.1 0.5 Other 29.7 67.8 Total other non-current assets $ 450.5 $ 430.7 Accounts payable and accrued expenses: Trade payables $ 539.2 $ 423.4 Trade payables for capital expenditures 28.6 43.2 Payroll and employee related 136.7 95

Goodwill and Other Intangibles

Goodwill and Other Intangibles
	12 Months Ended Dec. 31, 2009 USD / shares
Goodwill and Other Intangibles [Abstract]
GOODWILL AND OTHER INTANGIBLES	NOTE6 GOODWILL AND OTHER INTANGIBLES The Company annually reviews its goodwill for impairment in the fourth quarter of each year for all of its reporting units, or more often when events and circumstances warrant such a review. The Companys goodwill impairment review utilizes the two-step impairment test required under ASC Topic 350, which requires us to make significant assumptions and estimates about the extent and timing of future cash flows, discount rates and growth rates. The basis of our goodwill impairment analysis is the Companys annual budget and long-range plan (LRP). The annual budget and LRP include a five year projection of future cash flows based on actual new products and customer commitments. As part of the projection, we assumed the last year of the LRP data is a fair indication, on average, including fundamental industry growth, of the future performance of the business beyond the five year period into perpetuity. As the LRP is estimated over a significant future period of time, those estimates and assumptions are subject to a high degree of uncertainty. We also utilize market valuation models and other financial ratios, which require us to make certain assumptions and estimates regarding the applicability of those models to our assets and businesses. We believe that the assumptions and estimates used to determine the estimated fair values of each of our business units are reasonable. Different assumptions could materially affect the estimated fair value. The primary assumptions affecting the Companys December31, 2009 goodwill 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 an estimate of the Companys weighted average cost of debt and equity. We believe this 10% discount rate is representative of a rate of return that would be expected by a market participant. Operating Income Margin: The Company utilized historical and expected operating income margins, which varied based on the projections of each business unit being evaluated. While the Company believes that these assumptions are appropriate, significant changes in these assumptions may materially affect the Companys analysis. The following table illustrates the sensitivity to an increase in our discount rate and decrease in our operating income margin assumptions; as it would have reduced the Companys goodwill of $1,061.4million as of December31, 2009: 2009 millions of dollars Impairment Impact 1percentage point increase in discount rate $ 109.9 1percentage point decrease in operating income margin $ 93.1 As of September30, 2008 and December31, 2008, the Company recorded an impairment charge of 104.3 $(146.8)million and 7.2 $(10.0)million, respectively, to adjust BERUs goodwill to its estimated fair value. The impairment charge is attributable to a decrease in the operating units estimated fair value based primarily upon the effect of the decline in European market conditions on current and projected operating resu

Product Warranty

Product Warranty
	12 Months Ended Dec. 31, 2009 USD / shares
Product Warranty [Abstract]
PRODUCT WARRANTY	NOTE7 PRODUCT WARRANTY The changes in the carrying amount of the Companys total product warranty liability for the years ended December31, 2009 and 2008 were as follows: millions of dollars 2009 2008 Beginning balance $ 82.1 $ 70.1 Provisions 46.0 66.1 Payments (68.3 ) (50.6 ) Translation adjustment 1.9 (3.5 ) Ending balance $ 61.7 $ 82.1 Contained within the 2008 provision is approximately $23.5 for a warranty-related issue associated with a companys transmission product sold in Europe, limited to mid-2007 through May 2008 production. Approximately $17million of this claim was paid in 2009. The product warranty liability is classified in the consolidated balance sheets as follows: millions of dollars 2009 2008 Accounts payable and accrued expenses $ 32.5 $ 51.4 Other non-current liabilities 29.2 30.7 Total product warranty liability $ 61.7 $ 82.1

Notes Payable and Long-Term Deb

Notes Payable and Long-Term Debt
	12 Months Ended Dec. 31, 2009 USD / shares
Notes Payable and Long-Term Debt [Abstract]
NOTES PAYABLE AND LONG-TERM DEBT	NOTE8 NOTESPAYABLE AND LONG-TERM DEBT Following is a summary of notes payable and long-term debt. The weighted average interest rate on all borrowings outstanding as of December31, 2009 and 2008 was 6.9% and 5.0%, respectively. millions of dollars 2009 2008 December 31, Current Long-Term Current Long-Term Bank borrowings and other $ 32.5 $ 1.5 $ 130.7 $ 1.0 Term loans due through 2015 (at an average rate of 3.9% in 2009 and 4.9% in 2008) 36.6 7.6 53.1 12.9 6.50%Senior Notes due 02/17/09, net of unamortized discount(a) 136.7 3.50%Convertible Notes dues 4/15/12 330.2 5.75%Senior Notes due 11/01/16, net of unamortized discount(a) 149.3 149.2 8.00%Senior Notes due 10/01/19, net of unamortized discount(a) 133.9 133.9 7.125%Senior Notes due 02/15/29, net of unamortized discount 119.3 119.2 Carrying amount of notes payable and long-term debt 69.1 741.8 320.5 416.2 Impact of derivatives on debt(a) 31.4 0.2 43.4 Total notes payable and long-term debt $ 69.1 $ 773.2 $ 320.7 $ 459.6 (a) In 2006, the Company entered into several interest rate swaps that had the effect of converting $325.0million of fixed rate notes to variable rates. The weighted average effective interest rate of these borrowings, including the effects of outstanding swaps as noted in Note9 was 5.3% as of December31, 2008. In the first quarter of 2009, $100million in interest rate swaps related to the Companys 2009 fixed rate debt matured and the Company terminated $150million in interest rate swap agreements related to the Companys 2016 fixed rate debt and $75million of interest rate swap agreements related to the Companys 2019 fixed rate debt. As a result of the first quarter 2009 swap terminations, a $34.5million gain remained in debt to be amortized over the remaining lives of the respective 2016 and 2019 debt. As of December31, 2009, the unamortized portion was $31.4million. Annual principal payments required as of December31, 2009 are as follows (in millions of dollars): 2010 $ 69.1 2011 4.4 2012 332.4 2013 2.1 2014 After 2014 436.5 Total Payments $ 844.5 Less: Unamortized Discounts (2.2 ) Total $ 842.3 The Companys long-term debt includes various financial covena

Fair Value Measurements

Fair Value Measurements
	12 Months Ended Dec. 31, 2009 USD / shares
Fair Value Measurements [Abstract]
FAIR VALUE MEASUREMENTS	NOTE9 FAIR VALUE MEASUREMENTS On January1, 2009, the Company fully adopted as required, ASC Topic 820 Fair Value Measurements which expands the disclosure of fair value measurements and its impact on the Companys financial statements. 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 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 or liabilities. 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 table classifies the assets and liabilities measured at fair value on a recurring and non-recurring basis as of December31, 2009: Basis of Fair Value Measurements Quoted Prices in Significant Active Other Significant Balance at Markets for Observable Unobservable December31, Identical Items Inputs Inputs Valuation (millions) 2009 (Level 1) (Level 2) (Level 3) Technique Assets: Engine segment fixed assets $ $ $ $ B Commodity contracts 8.4 8.4 A Foreign exchange contracts 3.8 3.8 A $ 12.2 $ $ 12.2 $ Liabilities: Commodity contracts $ 0.1 $ $ 0.1 $ A Foreign exchange contracts 17.5 17.5 A Net investment hedge

Financial Instruments

Financial Instruments
	12 Months Ended Dec. 31, 2009 USD / shares
Financial Instruments [Abstract]
FINANCIAL INSTRUMENTS	NOTE10 FINANCIAL INSTRUMENTS On January1, 2009, the Company adopted as required, ASC Topic 815, Disclosures about Derivative Instruments and Hedging Activities which expands the disclosure of financial instruments. The Companys financial instruments include cash and marketable securities. Due to the short-term nature of these instruments, their book value approximates their fair value. The Companys financial instruments also include long-term debt, interest rate and currency swaps, commodity forward contracts, and foreign currency forward contracts. All derivative contracts are placed with counterparties that have an SP, or equivalent, investment grade credit rating at the time of the contracts placement. At December31, 2009 the Company had no derivative contracts that contained credit risk related contingent features. The Company selectively uses cross-currency swaps to hedge the foreign currency exposure associated with our net investment in certain foreign operations (net investment hedges). Fair values of cross currency swaps are based on observable inputs, such as interest rate, yield curves, credit risks, currency exchange rates and other external valuation methodology (Level2 inputs under ASC Topic 820). The Company uses certain commodity derivative instruments to protect against commodity price changes related to forecasted raw material and supplies purchases. The primary purpose of our commodity price hedging activities is to manage the volatility associated with these forecasted purchases. The Company primarily utilizes forward and option contracts, which are designated as cash flow hedges. The fair values for certain commodity derivative instruments are based on Level2 evidence (for example, future prices reported on commodity exchanges) under ASC Topic 820. To the extent that derivative instruments are deemed to be effective as defined by ASC Topic 815, gains and losses arising from these contracts are deferred in other comprehensive income or loss. Such gains and losses will be reclassified into income as the underlying operating transactions are realized. Gains and losses not qualifying for deferral treatment have been credited/charged to income as they are recognized. The Company uses foreign exchange forward and option contracts to protect against exchange rate movements for forecasted cash flows for purchases, operating expenses or sales transactions designated in currencies other than the functional currency of the operating unit. Most contracts mature in less than one year, however, certain long-term commitments are covered by forward currency arrangements to protect against currency risk through 2011. Foreign currency contracts require the Company, at a future date, to either buy or sell foreign currency in exchange for the operating units local currency. To the extent that derivative instruments are deemed to be effective as defined by ASC Topic 815, gains and losses arising from these contracts are deferred in other comprehensive income or loss. Such gains and losses will be reclassified into income as the underlying operating transactions are realized. Gains and losses not qualif

Retirement Benefit Plans

Retirement Benefit Plans
	12 Months Ended Dec. 31, 2009 USD / shares
Retirement Benefit Plans [Abstract]
RETIREMENT BENEFIT PLANS	NOTE11 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 $16.6million, $22.1million and $23.7million in 2009, 2008 and 2007, respectively. The Company has a number of defined benefit pension plans and other post employment 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 the U.S., U.K., Germany, Japan, South Korea, Italy, France, Ireland, Monaco and Mexico. The other post employment benefit plans, which provide medical and life insurance benefits, are unfunded plans. All pension and other post employment benefit plans in the U.S.have been closed to new employees since 1999. The measurement date for all plans is December31. On February26, 2009, the Companys subsidiary, BorgWarner Diversified Transmission Products Inc. (DTP), entered into a Plant Shutdown Agreement with the United Auto Workers (UAW) for its Muncie, Indiana automotive component plant (the Muncie Plant). Management subsequently wound-down production activity at the plant, with operations effectively ceased as of March31, 2009. As a result of the closure of the Muncie Plant, the Company recorded a curtailment gain of $41.9million in the other post employment benefit plan in the first quarter of 2009. The Plant Shutdown Agreement with the UAW for the Muncie Plant also included a settlement of a portion of the UAW retiree health care obligation, resulting in the remeasurement of the retiree medical plan. The financial impact of this settlement resulted in expense recognition of $14.0million, a $47.2million reduction to retirement-related liabilities, a $27.2million increase in accumulated other comprehensive income and a $34.0million increase in accounts payable and accrued expenses in the first quarter of 2009. The $34.0million in accounts payable and accrued expenses will be paid in monthly installments, which began in May 2009 and will conclude in April 2010. The combined pre-tax impact of these actions was a net gain of $27.9million, comprised of a $41.9million curtailment gain and $14.0million settlement loss on the Companys Condensed Consolidated Statements of Operations as of March31, 2009. As part of the Plant Shutdown Agreement with the UAW for the Muncie Plant, the Company changed certain pension plan provisions. The pre-tax impact of this change was a $2.3million reduction in 2009 U.S.pension expense and a $13.5million reduction in the projected benefit obligation. In April 2009, the Company made changes to certain Muncie retirees medical program. The effect of the changes to this group i

Stock Incentive Plans

Stock Incentive Plans
	12 Months Ended Dec. 31, 2009 USD / shares
Stock Incentive Plans [Abstract]
STOCK INCENTIVE PLANS	NOTE12 STOCK INCENTIVE PLANS Under the Companys 1993 Stock Incentive Plan (1993 Plan), the Company granted options to purchase shares of the Companys common stock at the fair market value on the date of grant. The options vest over periods up to three years and have a term of ten years from date of grant. As of December31, 2003, there were no options available for future grants under the 1993 Plan. The 1993 Plan expired at the end of 2003 and was replaced by the Companys 2004 Stock Incentive Plan, which was amended at the Companys 2009 Annual Stockholders Meeting, among other things, to increase the number of shares available for issuance under the Plan. Under the BorgWarner Inc. Amended and Restated 2004 Stock Incentive Plan (2004 Stock Incentive Plan), the number of shares authorized for grant was 12,500,000, of which approximately 2,900,000shares are available for future issuance. As of December31, 2009, there were a total of 5,177,282 outstanding options under the 1993 and 2004 Stock Incentive Plans. Stock Options Stock option compensation expense reduced earnings before income taxes and noncontrolling interest and net earnings for the years ended December31, 2009, 2008 and 2007 by: Year Ended December31, (millions), except per share data 2009 2008 2007 Earnings before income taxes and noncontrolling interest $ 6.6 $ 12.2 $ 16.3 Net earnings $ 5.1 $ 9.1 $ 11.9 Per share basic $ 0.04 $ 0.08 $ 0.10 Per share diluted $ 0.04 $ 0.08 $ 0.10 Total unrecognized compensation cost related to nonvested stock options at December31, 2009 is approximately $0.5million. This cost is expected to be recognized in the first quarter of 2010. A summary of the plans shares under option at December31, 2009, 2008 and 2007 is as follows: Average Remaining Intrinsic Shares Exercise Contractual Value (thousands) Price Life (in years) (In millions) Outstanding at January1, 2007 6,942 $ 23.74 7.8 $ 40.1 Granted 1,816 $ 34.95 Exercised (1,744 ) 20.52 $ 36.4 Forfeited (683 ) 24.48 Outstanding at December31, 2007 6,331 $ 27.75 7.7 $ 130.8 Granted Exercised (366 ) 23.82 $ 8.3 Forfeited (167 ) 32.58 Outstanding at December31, 2008 5,798 $ 27.86 6.7 $ 6.0 Granted Exercised (381

Other Comprehensive Income

Other Comprehensive Income (Loss)
	12 Months Ended Dec. 31, 2009 USD / shares
Other Comprehensive Income (Loss) [Abstract]
OTHER COMPREHENSIVE INCOME (LOSS)	NOTE13 OTHER COMPREHENSIVE INCOME (LOSS) The components of accumulated other comprehensive income (loss), net of tax, in the Consolidated Balance Sheets are as follows: millions of dollars 2009 2008 Foreign currency translation adjustments, net $ 210.6 $ 155.8 Market value of hedge instruments, net (31.2 ) (76.3 ) Defined benefit post employment plans, net (165.9 ) (162.5 ) Comprehensive loss attributable to the noncontrolling interest 1.0 (2.9 ) Accumulated other comprehensive income (loss) $ 14.5 $ (85.9 ) The changes in the components of other comprehensive income (loss) in the Consolidated Statements of Stockholders Equity are as follows: millions of dollars 2009 2008 2007 Foreign currency translation adjustments $ 54.8 $ (88.6 ) $ 162.5 Market value change of hedge instruments 63.3 (56.8 ) (56.5 ) Income taxes (18.2 ) 19.3 17.7 Net foreign currency translation and hedge instruments adjustment 99.9 (126.1 ) 123.7 Unrealized loss on available-for-sale securities (1.4 ) (0.1 ) Defined benefit post employment plans (13.1 ) (104.5 ) 133.2 Income taxes 9.7 29.8 (62.6 ) Net defined benefit post employment plans (3.4 ) (74.7 ) 70.6 Comprehensive income (loss) attributable to noncontrolling interest 3.9 (10.8 )* (6.8 )* Other comprehensive income (loss) $ 100.4 $ (213.0 ) $ 187.4 * Refer to Note1, Summary of Significant Accounting Policies for implementation of ASC Topic 810.

Contingencies

Contingencies
	12 Months Ended Dec. 31, 2009 USD / shares
Contingencies [Abstract]
CONTINGENCIES	NOTE14 CONTINGENCIES In the normal course of business the Company and its subsidiaries are parties 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 and its subsidiaries will ultimately be successful in any of these commercial and legal matters or, if not, what the impact might be. The Companys environmental and product liability contingencies are discussed separately below. The Companys management does not expect that the results in any of these commercial and legal claims, actions and complaints will have a material adverse effect on the Companys results of operations, financial position or cash flows. Litigation Outcome In January 2006, 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 Courts affirmation that DTP did not violate the Labor-Management Relations Act or the Employee Retirement Income Security Act by unilaterally amending certain medical plans effective April1, 2006 and October1, 2006, prior to the expiration of the then-current collective bargaining agreements. On September10, 2008, the Court found that DTPs 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 April24, 2009. Thus, the amendments were untimely. In 2008 the Company recorded a charge of $4.0million as a result of the Courts 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 February26, 2009 again seeking the Courts affirmation that DTP will not violate the Labor Management Relations Act or the Employment Retirement Income Security Act (ERISA) by modifying the level of benefits provided retirees to make them comparable to other Company retiree benefit plans after April24, 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 March11, 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 is continuing. At this stage of the litigation, the Company cannot make any predictions as to the outcome, but it is vigorously defending against the suit. 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

Leases and Commitments

Leases and Commitments
	12 Months Ended Dec. 31, 2009 USD / shares
Leases and Commitments [Abstract]
LEASES AND COMMITMENTS	NOTE15 LEASES AND COMMITMENTS Certain assets are leased under long-term operating leases. These include production equipment at one plant, rent for the corporate headquarters and an 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 $28.5million in 2009, $31.5million in 2008, and $29.8million in 2007. The Company does not have any material capital leases. The Company has guaranteed the residual values of certain leased machinery and equipment at its facilities. The guarantees extend through the maturity of the underlying lease, which is in September 2010. In the event the Company exercises its option not to purchase the remaining machinery and equipment, the Company has guaranteed a residual value of $6.0million at September30, 2010. Future minimum operating lease payments at December31, 2009 were as follows: millions of dollars 2010 $ 20.5 (a) 2011 11.6 2012 10.2 2013 6.2 2014 4.3 After 2014 9.2 Total minimum lease payments $ 62.0 (a) 2010 includes $6.0million for the guaranteed residual value of production equipment with a lease that expires in 2010.

Earnings Per Share

Earnings Per Share
	12 Months Ended Dec. 31, 2009 USD / shares
Earnings Per Share [Abstract]
EARNINGS PER SHARE	NOTE16 EARNINGS PER SHARE Earnings per share of common stock outstanding were computed as follows: in millions except per share amounts 2009 2008* 2007 Basic earnings (loss) per share: Net earnings (loss) $ 27.0 $ (35.6 ) $ 288.5 Average shares of common stock outstanding 116.522 116.007 116.002 Basic earnings (loss) per share of common stock $ 0.23 $ (0.31 ) $ 2.49 Diluted earnings (loss) per share: Net earnings (loss) $ 27.0 $ (35.6 ) $ 288.5 Average shares of common stock outstanding 116.522 116.007 116.002 Effect of dilutive securities 0.417 1.838 Average shares of common stock outstanding including dilutive shares 116.939 116.007 117.840 Diluted earnings (loss) per share of common stock $ 0.23 $ (0.31 ) $ 2.45 * The Company had a loss for the year ended December31, 2008. As a result, diluted loss per share is the same as basic loss per share in the period, as any dilutive securities would reduce the loss per share.

Restructuring

Restructuring
	12 Months Ended Dec. 31, 2009 USD / shares
Restructuring [Abstract]
RESTRUCTURING	NOTE17 RESTRUCTURING In the second quarter of 2009, the Company took additional restructuring actions. The Company reduced its North American workforce by approximately 550people, or 12%; its European workforce by approximately 150people, or 2%; and its Asian workforce by approximately 60people, or 3% in the second quarter. The net restructuring expense recognized in the second quarter was $9.0million for employee termination benefits. In addition to employee termination costs, the Company recorded $36.3million of asset impairment and $5.0million of other charges in the second quarter of 2009 related to the North American and European restructuring. The combined 2009 restructuring expenses of $50.3million are broken out by segment as follows: Engine $27.2million, Drivetrain $19.7million and Corporate $3.4million. Included in the second quarter of 2009 asset impairment charge is $22.3million related to one of the Companys European locations. During the second quarter of 2009 circumstances caused the Company to evaluate the long range outlook of the facility using an undiscounted and discounted cash flow model, both of which indicated that assets were impaired. The Company then used a replacement cost technique to determine the fair value of the assets at the facility. This reduction of asset value was included in the Engine segment. On July31, 2008, the Company announced a restructuring of its operations to align ongoing operations with a continuing, fundamental market shift in the auto industry. As a continuation of the Companys third quarter restructuring, on December11, 2008, the Company announced plans for additional restructuring actions. As a result of these third and fourth quarter 2008 restructuring actions, the Company had reduced its North American workforce by approximately 2,400people, or 33%; its European workforce by approximately 1,600people, or 18%; and its Asian workforce by approximately 400people, or 17%. The restructuring expense recognized for employee termination benefits was $54.6million. In addition to employee termination costs, the Company recorded $72.9million of asset impairment charges related to the North American and European restructuring. The combined restructuring expenses of $127.5million are broken out by segment as follows: Engine $85.3million, Drivetrain $40.9million and Corporate $1.3million. 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 reserves. For the year ended December31, 2009, the following table summarizes restructuring expense by segment: Employee Asset Other millions of dollars Related Costs Impairments Charges Total Drivetrain Group $ 1.9 $ 13.7 $ 4.1 $ 19.7 Engine Group 3.7

Recent Transactions

Recent Transactions
	12 Months Ended Dec. 31, 2009 USD / shares
Recent Transactions [Abstract]
RECENT TRANSACTIONS	NOTE18 RECENT TRANSACTIONS BERU In 2005, the Company acquired approximately 69.4% of the outstanding shares of BERU Aktiengesellschaft (BERU), headquartered in Ludwigsburg, Germany. The Company acquired approximately 12.8% of additional BERU shares in 2007. The purchase price paid for these shares was $138.8million, including transaction fees. In connection with the purchase, the Company recorded fair value of identified intangible assets and beginning inventory of $28.5million. Of this total, $2.1million, net of tax, of in process RD, order backlog and beginning inventory were immediately written off in the selling, general, and administrative line in the Consolidated Statement of Operations. Net liabilities of $1.0million and goodwill of $48.7million were also recorded. The Company also recorded a reduction in the minority interest of BERU of $62.6million. In the second quarter of 2008, the Company and BERU completed a Domination and Profit Transfer Agreement (DPTA), giving BorgWarner full control of BERU. Under this agreement BERU is obligated to transfer 100% of its annual profits or losses to the Company. Upon request of BERU noncontrolling shareholders, the Company is obligated to purchase their shares for a cash payment of 71.32 per share. Those BERU noncontrolling shareholders who did not sell their shares are entitled to receive an annual compensatory payment (perpetual dividend) of 4.23 (net) per share. The DPTA is a binding agreement. However, certain noncontrolling shareholders of BERU initiated an appraisal proceeding in the German court system that challenged the valuation of the 71.32 purchase price and 4.23 annual compensatory payment (perpetual dividend). On January7, 2009 the Company informed BERU of its intention to purchase the remaining outstanding shares at that time of approximately 4%, using the required German legal process referred to as a squeeze-out to gain 100% ownership. This process included an affirmative vote of BERU shareholders at its May20, 2009 annual shareholder meeting. The registration of the squeeze-out was challenged by certain noncontrolling shareholders of BERU with the commercial register in June 2009. The squeeze-out share price passed by the BERU shareholders in May 2009 was 73.39. The increase in price per share of 2.07 resulting from the squeeze out was reflected as an increase to the Companys total DPTA obligation. On September18, 2009 the noncontrolling shareholders of BERU who had challenged the squeeze-out resolution dropped their complaint. The elimination of all actions against the resolution allowed BERU to register the squeeze-out with the commercial register. The squeeze-out became effective on September30, 2009, making the Company the only shareholder of BERU. On October2, 2009 BERU was delisted as a public company in Germany. In October 2009 the Company paid 22.9 ($33.5)million for the approximately 311,000 outstanding shares of BERU. Certain noncontrolling shareholders have challenged the squeeze out share price of 73.39. A hearing date for this action is expected to be set in 2010. As a result of the tendering of shares, the Compan

Reporting Segments and Related

Reporting Segments and Related Information
	12 Months Ended Dec. 31, 2009 USD / shares
Reporting Segments and Related Information [Abstract]
REPORTING SEGMENTS AND RELATED INFORMATION	NOTE19 REPORTING SEGMENTS AND RELATED INFORMATION The Companys 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 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. The ROIC is comprised of projected earnings before interest, income taxes and noncontrolling interest (EBIT) adjusted for taxes compared to the projected average capital investment required. EBIT is considered a non-GAAP financial measure. Generally, a non-GAAP financial measure is a numerical measure of a companys financial performance, financial position or cash flows that excludes (or includes) amounts that are included in (or excluded from) the most directly comparable measure calculated and presented in accordance with GAAP. EBIT is defined as earnings before restructuring expense, goodwill impairment charge, interest, income taxes and noncontrolling interest. Earnings is intended to mean net earnings as presented in the Consolidated Statements of Operations under GAAP. The Company believes that EBIT is useful to demonstrate the operational profitability of its segments by excluding restructuring expense, goodwill impairment charge, interest, income taxes and noncontrolling interest, which are generally accounted for across the entire Company on a consolidated basis. EBIT is also one of the measures used by the Company to determine resource allocation within the Company. Although the Company believes that EBIT enhances understanding of its business and performance, it should not be considered an alternative to, or more meaningful than, net earnings or cash flows from operations as determined in accordance with GAAP. The following tables show net sales and segment earnings (loss) before interest and income taxes for the Companys reporting segments. Reporting Segments Earnings/ (Loss) Net Sales Before Long-Lived Inter- Interest Year-End Depr./ Asset millions of dollars Customers Segment Net and Taxes Assets amort. Expenditures (b) 2009 Engine $ 2,868.3 $ 14.9 $ 2,883.2 $ 219.8 $ 2,812.8 $ 188.7 $ 115.6 Drivetrain 1,093.5 1,093.5 (13.5 ) 1,104.1 65.9 44.6 Inter-segment eliminations (14.9 ) (14.9 ) Total 3,961.8 3,961.8 206.3 3,916.9 254.6 160.2