Document And Entity Information

9 Months Ended

Sep. 30, 2015

Oct. 23, 2015

Document And Entity Information [Abstract]

Document Type

10-Q

Amendment Flag

false

Document Period End Date

Sep. 30, 2015

Document Fiscal Period Focus

Q3

Document Fiscal Year Focus

2015

Entity Registrant Name

Delphi Automotive PLC

Entity Central Index Key

0001521332

Current Fiscal Year End Date

--12-31

Entity Filer Category

Large Accelerated Filer

Entity Common Stock, Shares Outstanding

280,088,170

Consolidated Statements Of Operations (USD $)

In Millions, except Per Share data, unless otherwise specified

3 Months Ended

9 Months Ended

12 Months Ended

Sep. 30, 2015

Jun. 30, 2015

Mar. 31, 2015

Dec. 31, 2014

Sep. 30, 2014

Jun. 30, 2014

Mar. 31, 2014

Sep. 30, 2015

Sep. 30, 2014

Dec. 31, 2014

Dec. 31, 2013

Income Statement [Abstract]

Net sales

$ 3,631

$ 3,762

$ 11,286

$ 11,721

Operating expenses:

Cost of sales

2,862

3,041

8,994

9,467

Selling, general and administrative

249

259

765

768

Amortization

23

24

70

71

Restructuring

36

46

69

121

Total operating expenses

3,170

3,370

9,898

10,427

Operating income

461

392

1,388

1,294

Interest expense

(30)

(33)

(92)

(101)

Other income (expense), net

(11)

5

(67)

(9)

Income from continuing operations before income taxes and equity income

420

364

1,229

1,184

Income tax expense

(61)

(56)

(202)

(181)

Income from continuing operations before equity income

359

308

1,027

1,003

Equity income, net of tax

5

10

15

Income from continuing operations

364

313

1,037

1,018

Income from discontinued operations, net of tax

54

12

277

54

Net income

418

325

1,314

1,072

Net income attributable to noncontrolling interest

14

20

56

65

Net income attributable to Delphi

404

305

1,258

1,007

Amounts attributable to Delphi:

Income from continuing operations

351

299

989

969

Income from discontinued operations

53

6

269

38

Net income attributable to Delphi

$ 404

$ 305

$ 1,258

$ 1,007

Basic net income per share:

Income from Continuing Operations, per basic share

$ 1.24

$ 1.00

$ 3.44

$ 3.20

Income from Discontinued Operations, per basic share

$ 0.19

$ 0.02

$ 0.94

$ 0.13

Basic net income per share attributable to Delphi

$ 1.43

$ 1.02

$ 4.38

$ 3.33

Weighted average number of basic shares outstanding

282.97

298.59

287.18

302.35

Diluted net income per share:

Income from Continuing Operations, per diluted share

$ 1.23

$ 1.00

$ 3.43

$ 3.19

Income from Discontinued Operations, per diluted share

$ 0.19

$ 0.02

$ 0.93

$ 0.13

Diluted net income per share attributable to Delphi

$ 1.42

$ 1.02

$ 4.36

$ 3.32

Weighted average number of diluted shares outstanding

284.40

300.14

288.33

303.56

Cash dividends declared per share

$ 0.25

$ 0.75

$ 1.00

$ 0.68

Consolidated Statements Of Comprehensive Income (USD $)

In Millions, unless otherwise specified

3 Months Ended

9 Months Ended

Sep. 30, 2015

Sep. 30, 2014

Sep. 30, 2015

Sep. 30, 2014

Statement of Comprehensive Income [Abstract]

Net income

$ 418

$ 325

$ 1,314

$ 1,072

Other comprehensive income (loss):

Currency translation adjustments

(120)

(179)

(293)

(172)

Net change in unrecognized gain (loss) on derivative instruments, net of tax (Note 14)

(33)

(23)

(39)

(16)

Employee benefit plans adjustment, net of tax

24

12

46

14

Other comprehensive income (loss)

(129)

(190)

(286)

(174)

Comprehensive income

289

135

1,028

898

Comprehensive income attributable to noncontrolling interests

3

17

44

60

Comprehensive income attributable to Delphi

$ 286

$ 118

$ 984

$ 838

Consolidated Balance Sheets (USD $)

In Millions, unless otherwise specified

Sep. 30, 2015

Dec. 31, 2014

Current assets:

Cash and cash equivalents

$ 434

$ 859

Restricted cash

2

1

Accounts receivable, net

2,615

2,400

Inventories (Note 3)

1,187

1,013

Other current assets (Note 4)

629

567

Current assets held for sale (Note 21)

187

384

Total current assets

5,054

5,224

Long-term assets:

Property, net

3,010

3,021

Investments in affiliates

93

98

Intangible assets, net (Note 2)

664

728

Goodwill (Note 2)

640

656

Other long-term assets (Note 4)

1,331

508

Long-term assets held for sale (Note 21)

0

511

Total long-term assets

5,738

5,522

Total assets

10,792

10,746

Current liabilities:

Short-term debt (Note 8)

424

34

Accounts payable

2,327

2,278

Accrued liabilities (Note 5)

1,182

1,221

Current liabilities held for sale (Note 21)

95

356

Total current liabilities

4,028

3,889

Long-term liabilities:

Long-term debt (Note 8)

2,698

2,417

Pension benefit obligations

898

1,002

Other long-term liabilities (Note 5)

394

390

Long-term liabilities held for sale (Note 21)

0

35

Total long-term liabilities

3,990

3,844

Total liabilities

8,018

7,733

Commitments and contingencies (Note 10)

Shareholders' equity:

Preferred shares, $0.01 par value per share, 50,000,000 shares authorized, none issued and outstanding

0

Ordinary shares, $0.01 par value per share, 1,200,000,000 shares authorized, 280,614,686 and 291,619,411 issued and outstanding as of September 30, 2015 and December 31, 2014, respectively

3

Additional paid-in capital

1,635

1,700

Retained earnings

1,693

1,548

Accumulated other comprehensive loss (Note 13)

(1,015)

(741)

Total Delphi shareholders' equity

2,316

2,510

Noncontrolling interest

458

503

Total shareholders' equity

2,774

3,013

Total liabilities and shareholders' equity

$ 10,792

$ 10,746

Consolidated Balance Sheets (Parenthetical) (USD $)

Sep. 30, 2015

Dec. 31, 2014

Statement of Financial Position [Abstract]

Preferred shares, par value per share

$ 0.01

Preferred shares, authorized

50,000,000

Preferred shares, outstanding

0

Ordinary Shares, Par or Stated Value Per Share

$ 0.01

Ordinary shares, authorized

1,200,000,000

Ordinary shares, outstanding

280,614,686

291,619,411

Consolidated Statements Of Cash Flows (USD $)

In Millions, unless otherwise specified

9 Months Ended

Sep. 30, 2015

Sep. 30, 2014

Cash flows from operating activities:

Net income

$ 1,314

$ 1,072

Income from discontinued operations, net of tax

277

54

Income from continuing operations

1,037

1,018

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation

324

335

Amortization

70

71

Amortization of deferred debt issuance costs

8

7

Restructuring expense, net of cash paid

(26)

12

Deferred income taxes

(10)

(3)

Pension and other postretirement benefit expenses

60

70

Income from equity method investments, net of dividends received

3

(15)

Loss on extinguishment of debt

52

34

Gain on sale of assets

(22)

0

Share-based compensation

52

53

Changes in operating assets and liabilities:

Accounts receivable, net

(217)

(139)

Inventories

(179)

(103)

Other assets

(26)

(32)

Accounts payable

125

16

Accrued and other long-term liabilities

(92)

(44)

Other, net

(71)

1

Pension contributions

(59)

(66)

Net cash provided by operating activities from continuing operations

1,029

1,215

Net cash (used in) provided by operating activities from discontinued operations

(21)

47

Net cash provided by operating activities

1,008

1,262

Cash flows from investing activities:

Capital expenditures

(539)

(601)

Proceeds from sale of property / investments

7

Net proceeds from divestiture of discontinued operations

730

0

Proceeds from business divestitures, net of $7 payment in 2015

18

0

Cost of businesses, investment and technology acquisitions, net of cash acquired

(38)

0

Deposit for acquisition of HellermannTyton

(844)

0

(Increase) decrease in restricted cash

(1)

1

Net cash provided by (used in) investing activities from continuing operations

(667)

(593)

Net cash used in investing activities from discontinued operations

(68)

(64)

Net cash provided by (used in) investing activities

(735)

(657)

Cash flows from financing activities:

Net proceeds under other short-term debt agreements

399

9

Repayments under long-term debt agreements

0

(164)

Repayment of senior notes

(546)

(526)

Proceeds from issuance of senior notes, net of issuance costs

753

691

Dividend payments of consolidated affiliates to minority shareholders

(63)

(61)

Repurchase of ordinary shares

(946)

(662)

Distribution of cash dividends

(216)

(228)

Taxes withheld and paid on employees' restricted share awards

(58)

(8)

Net cash used in financing activities

(677)

(949)

Effect of exchange rate fluctuations on cash and cash equivalents

(41)

(19)

Increase (decrease) in cash and cash equivalents

(445)

(363)

Cash and cash equivalents at beginning of period

904

1,389

Cash and cash equivalents at end of period

459

1,026

Cash and cash equivalents of discontinued operations

25

19

Cash and cash equivalents of continuing operations

$ 434

$ 1,007

Consolidated Statements Of Cash Flows (Parenthetical) (USD $)

In Millions, unless otherwise specified

9 Months Ended

Sep. 30, 2015

Sep. 30, 2014

Payment associated with business disposal

$ (7)

$ 0

Consolidated Statement Of Shareholders' Equity (USD $)

In Millions, except Share data

Total

Ordinary Shares

Additional Paid in Capital

Retained Earnings

Accumulated Other Comprehensive Loss

Total Delphi Shareholders' Equity

Noncontrolling Interest

Balance at Dec. 31, 2014

$ 3,013

$ 3

$ 1,700

$ 1,548

$ (741)

$ 2,510

$ 503

Balance, in shares at Dec. 31, 2014

291,000,000

Net income

1,314

1,258

56

Other comprehensive income (loss)

(286)

(274)

(12)

Dividends on ordinary shares

(216)

3

(219)

(216)

0

Dividend payments of consolidated affiliates to minority shareholders

(89)

Taxes witheld on employees' restricted share award vestings

(58)

Repurchase of ordinary shares, in shares

(12,174,805)

(12,000,000)

Repurchase of ordinary shares

(959)

(65)

(894)

(959)

Share-based compensation, in shares

2,000,000

Share based compensation

53

Excess tax benefits on share-based compensation

2

0

2

0

Balance at Sep. 30, 2015

$ 2,774

$ 3

$ 1,635

$ 1,693

$ (1,015)

$ 2,316

$ 458

Balance, in shares at Sep. 30, 2015

281,000,000

General

GENERAL

General and basis of presentation—“Delphi,” the “Company,” “we,” “us” and “our” refer to Delphi Automotive PLC, a public limited company which was formed under the laws of Jersey on May 19, 2011, together with its subsidiaries, including Delphi Automotive LLP, a limited liability partnership incorporated under the laws of England and Wales which was formed on August 19, 2009 for the purpose of acquiring certain assets of the former Delphi Corporation ("the Acquisition"), and became a subsidiary of Delphi Automotive PLC in connection with the completion of the Company’s initial public offering on November 22, 2011. The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). The consolidated financial statements and notes thereto included in this report should be read in conjunction with Delphi's 2014 Annual Report on Form 10-K and the Current Report on Form 8-K filed June 5, 2015 to update the 2014 Annual Report on Form 10-K for the reclassification of the Company's Thermal Systems business as discontinued operations.

Nature of operations—Delphi is a leading global vehicle components manufacturer and provides electrical and electronic, powertrain and safety technology solutions to the global automotive and commercial vehicle markets. Delphi operates manufacturing facilities and technical centers utilizing a regional service model that enables the Company to efficiently and effectively serve its global customers from low cost countries. In line with the growth in emerging markets, Delphi has been increasing its focus on these markets, particularly in China, where the Company has a major manufacturing base and strong customer relationships.

Significant Accounting Policies

SIGNIFICANT ACCOUNTING POLICIES

Consolidation—The consolidated financial statements include the accounts of Delphi and U.S. and non-U.S. subsidiaries in which Delphi holds a controlling financial or management interest and variable interest entities of which Delphi has determined that it is the primary beneficiary. Delphi’s share of the earnings or losses of non-controlled affiliates over which Delphi exercises significant influence (generally a 20% to 50% ownership interest) is included in the consolidated operating results using the equity method of accounting. When Delphi does not have the ability to exercise significant influence (generally when ownership interest is less than 20%), investments in non-consolidated affiliates are accounted for using the cost method. All adjustments, consisting of only normal recurring items, which are necessary for a fair presentation, have been included. All significant intercompany transactions and balances between consolidated Delphi businesses have been eliminated. The Company monitors its investments in affiliates for indicators of other-than-temporary declines in value on an ongoing basis. If the Company determines that such a decline has occurred, an impairment loss is recorded, which is measured as the difference between carrying value and estimated fair value.

During the three and nine months ended September 30, 2015, Delphi received dividends of $5 million and $13 million, respectively, from one of its equity method investments. During the nine months ended September 30, 2014, Delphi received a dividend of $10 million from its equity method investment in Korea Delphi Automotive Systems Corporation ("KDAC"), a Korean unconsolidated joint venture which was sold in the three months ended September 30, 2015 and has been reclassified to discontinued operations, as further described in Note 21. Discontinued Operations. The dividends were recognized as a reduction to the investment and represented a return on investment included in cash flows from operating activities and cash flows from operating activities from discontinued operations, respectively.

Investments in affiliates accounted for under the cost method totaled $23 million and $0 million as of September 30, 2015 and December 31, 2014, respectively, and are classified within other long-term assets in the consolidated balance sheet.

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

Net income per share—Basic net income per share is computed by dividing net income attributable to Delphi by the weighted average number of ordinary shares outstanding during the period. Diluted net income per share reflects the weighted average dilutive impact of all potentially dilutive securities from the date of issuance and is computed using the treasury stock method by dividing net income attributable to Delphi by the diluted weighted average number of ordinary shares outstanding. See Note 12. Shareholders’ Equity and Net Income Per Share for additional information including the calculation of basic and diluted net income per share.

Cash and cash equivalents—Cash and cash equivalents are defined as short-term, highly liquid investments with original maturities of three months or less.

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

Assets and liabilities held for sale—The Company considers assets to be held for sale when management approves and commits to a formal plan to actively market the assets for sale at a price reasonable in relation to their estimated fair value, the assets are available for immediate sale in their present condition, an active program to locate a buyer and other actions required to complete the sale have been initiated, the sale of the assets is probable and expected to be completed within one year (or, if it is expected that others will impose conditions on the sale of the assets that will extend the period required to complete the sale, that a firm purchase commitment is probable within one year) and it is unlikely that significant changes will be made to the plan. Upon designation as held for sale, the Company records the assets at the lower of their carrying value or their estimated fair value, less cost to sell, and ceases to record depreciation expense on the assets.

Assets and liabilities of a discontinued operation are reclassified as held for sale for all comparative periods presented in the consolidated balance sheet. For assets that meet the held for sale criteria but do not meet the definition of a discontinued operation, the Company reclassifies the assets and liabilities in the period in which the held for sale criteria are met, but does not reclassify prior period amounts.

Refer to Note 21. Discontinued Operations for further information regarding the Company's assets and liabilities held for sale.

Intangible assets—Intangible assets were $664 million and $728 million as of September 30, 2015 and December 31, 2014, respectively. Delphi amortizes definite-lived intangible assets over their estimated useful lives. Delphi has definite-lived intangible assets related to patents and developed technology, customer relationships, trade names and in-process research and development. Delphi does not amortize indefinite-lived in-process research and development, but tests for impairment annually, or more frequently when indicators of potential impairment exist, until the completion or abandonment of the associated research and development efforts. Costs to renew or extend the term of acquired intangible assets are recognized as expense as incurred. Amortization expense was $23 million and $70 million for the three and nine months ended September 30, 2015 and $24 million and $71 million for the three and nine months ended September 30, 2014, respectively.

Goodwill—Goodwill is the excess of the purchase price over the fair value of identifiable net assets acquired in business combinations. Delphi tests goodwill for impairment annually or more frequently when indications of potential impairment exist. Delphi monitors the existence of potential impairment indicators throughout the fiscal year.

The Company tests for goodwill impairment at the reporting unit level. Our reporting units are the components of operating segments which constitute businesses for which discrete financial information is available and is regularly reviewed by segment management.

The impairment test involves first qualitatively assessing goodwill for impairment. If the qualitative assessment is not met the Company then performs a quantitative assessment by first comparing the estimated fair value of each reporting unit to its carrying value, including goodwill. Fair value reflects the price a market participant would be willing to pay in a potential sale of the reporting unit. If the fair value exceeds carrying value, then we conclude that no goodwill impairment has occurred. If the carrying value of the reporting unit exceeds its estimated fair value, a second step is required to measure possible goodwill impairment loss. The second step includes hypothetically valuing the tangible and intangible assets and liabilities of the reporting unit as if the reporting unit had been acquired in a business combination. Then, the implied fair value of the reporting unit's goodwill is compared to the carrying value of that goodwill. If the carrying value of the reporting unit's goodwill exceeds the implied fair value of the goodwill, the Company recognizes an impairment loss in an amount equal to the excess, not to exceed the carrying value. There were no indicators of potential goodwill impairment as of September 30, 2015. Goodwill was $640 million and $656 million as of September 30, 2015 and December 31, 2014, respectively.

Warranty and product recalls—Expected warranty costs for products sold are recognized at the time of sale of the product based on an estimate of the amount that eventually will be required to settle such obligations. These accruals are based on factors such as past experience, production changes, industry developments and various other considerations. Costs of product recalls, which may include the cost of the product being replaced as well as the customer’s cost of the recall, including labor to remove and replace the recalled part, are accrued as part of our warranty accrual at the time an obligation becomes probable and can be reasonably estimated. These estimates are adjusted from time to time based on facts and circumstances that impact the status of existing claims. Refer to Note 6. Warranty Obligations.

Discontinued operations—The Company reports financial results for discontinued operations separately from continuing operations to distinguish the financial impact of disposal transactions from ongoing operations. Discontinued operations reporting occurs only when the disposal of a component or a group of components of the Company represents a strategic shift that will have a major effect on the Company's operations and financial results. During the nine months ended September 30, 2015, Delphi completed the divestitures of the Company's wholly owned Thermal Systems business and the Company's interest in its KDAC joint venture. The Company has also entered into a separate agreement for the sale of its interest in its Shanghai Delphi Automotive Air Conditioning ("SDAAC") joint venture. Delphi's interests in these joint ventures were previously reported within the Thermal Systems segment. Accordingly, the assets and liabilities, operating results and operating and investing cash flows for the previously reported Thermal Systems segment are presented as discontinued operations separate from the Company’s continuing operations for all periods presented. Prior period information has been reclassified to present this business as discontinued operations for all periods presented, and has therefore been excluded from both continuing operations and segment results for all periods presented in these consolidated financial statements and the notes to the consolidated financial statements, unless otherwise noted. These items had no impact on the amounts of previously reported net income attributable to Delphi or total shareholders' equity. Refer to Note 21. Discontinued Operations for further information regarding the Company's discontinued operations.

Income taxes—Deferred tax assets and liabilities reflect temporary differences between the amount of assets and liabilities for financial and tax reporting purposes. Such amounts are adjusted, as appropriate, to reflect changes in tax rates expected to be in effect when the temporary differences reverse. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in earnings in the period that includes the enactment date. A valuation allowance is recorded to reduce deferred tax assets to the amount that is more likely than not to be realized. In the event the Company determines it is more likely than not that the deferred tax assets will not be realized in the future, the valuation adjustment to the deferred tax assets will be charged to earnings in the period in which the Company makes such a determination. In determining the provision for income taxes for financial statement purposes, the Company makes certain estimates and judgments which affect its evaluation of the carrying value of its deferred tax assets, as well as its calculation of certain tax liabilities. Refer to Note 11. Income Taxes.

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

Customer concentrations—As reflected in the table below, combined net sales from continuing operations to General Motors Company ("GM") and Volkswagen Group (“VW”), Delphi's two largest customers, totaled approximately 23% and 22% of our total net sales for the three and nine months ended September 30, 2015, respectively, and 25% and 25% for the three and nine months ended September 30, 2014, respectively.



	Percentage of Total Net Sales								Accounts and Other Receivables
	Three Months Ended September 30,				Nine Months Ended September 30,				September 30, 2015		December 31, 2014
	2015		2014		2015		2014		September 30, 2015		December 31, 2014

									(in millions)
GM	15	%	17	%	14	%	16	%	$	334	$	301
VW	8	%	8	%	8	%	9	%	212		187

Retrospective changes—Prior period information has been reclassified to present the Thermal Systems business as discontinued operations for all periods presented, and has therefore been excluded from both continuing operations and segment results for all periods presented in these consolidated financial statements and the notes to the consolidated financial statements, unless otherwise noted. Refer to Note 21. Discontinued Operations for further information regarding the Company's discontinued operations.

Recently issued accounting pronouncements—In April 2014, the FASB issued ASU 2014-08, Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity. This guidance limits discontinued operations reporting to disposals of components of an entity that represent strategic shifts that have a major effect on an entity’s operations and financial results. The amendments also require expanded disclosures for discontinued operations with more information about the assets, liabilities, revenues, and expenses of discontinued operations. The amendments also require an entity to disclose the pre-tax profit or loss attributable to a disposal of an individually significant component of an entity that does not qualify for discontinued operations reporting. The guidance is effective for fiscal years beginning after December 15, 2014 and should be applied prospectively. Delphi adopted this guidance effective January 1, 2015, and has applied it to the Company’s discontinued operation classification of the Thermal Systems business, as further discussed in Note 21. Discontinued Operations.

In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers. This ASU supersedes most of the existing guidance on revenue recognition in Accounting Standards Codification ("ASC") Topic 605, Revenue Recognition and establishes a broad principle that would require an entity to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve this principle, an entity identifies the contract with a customer, identifies the separate performance obligations in the contract, determines the transaction price, allocates the transaction price to the separate performance obligations and recognizes revenue when each separate performance obligation is satisfied. The guidance is currently effective for fiscal years beginning after December 15, 2017 and is to be applied retrospectively at the entity's election either to each prior reporting period presented or with the cumulative effect of application recognized at the date of initial application. Early adoption is permitted for fiscal years beginning after December 15, 2016. The Company is currently evaluating the impact that the adoption of this guidance will have on its consolidated financial statements.

In June 2014, the FASB issued ASU 2014-12, Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period. This guidance requires that a performance target that affects vesting and that could be achieved after the requisite service period be treated as a performance condition of the award. A reporting entity should apply existing guidance in ASC Topic 718, Compensation-Stock Compensation, as it relates to such awards. The guidance is effective for fiscal years beginning after December 15, 2015, and may be applied either prospectively or retrospectively. Delphi adopted this guidance effective January 1, 2015, and it did not have a significant impact on Delphi's financial statements.

In April 2015, the FASB issued ASU 2015-03, Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs. This guidance requires that debt issuance costs be presented as a direct reduction to the carrying amount of the related debt in the balance sheet rather than as a deferred charge, consistent with the presentation of discounts on debt. ASU 2015-15, Interest - Imputation of Interest (Subtopic 835-30): Presentation and Subsequent Measurement of Debt Issuance Costs associated with Line-of-Credit Arrangements, was issued in August 2015 to clarify that the U.S. Securities and Exchange Commission ("SEC") staff would not object to an entity deferring and presenting debt issuance costs related to a line-of-credit arrangement as an asset and subsequently amortizing the deferred debt issuance costs ratably over the term of the line-of-credit arrangement, regardless of whether there are any outstanding borrowings on the line-of-credit arrangement. The guidance is effective for fiscal years beginning after December 15, 2015, and is to be applied retrospectively. The adoption of this guidance is not expected to have a significant impact on Delphi's financial statements, other than the reclassification of deferred issuance costs related to a recognized debt liability in accordance with the new presentation requirements.

In July 2015, the FASB issued ASU 2015-11, Inventory (Topic 330): Simplifying the Measurement of Inventory. This guidance requires an entity to measure inventory at the lower of cost and net realizable value, rather than at the lower of cost or market. The guidance is effective for interim and annual periods beginning after December 15, 2016, and is to be applied prospectively. Early adoption is permitted. The adoption of this guidance is not expected to have a significant impact on Delphi's financial statements.

In September 2015, the FASB issued ASU 2015-16, Business Combinations (Topic 805): Simplifying the Accounting for Measurement-Period Adjustments. This guidance requires that an acquirer recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined, including that the acquirer record, in the same period’s financial statements, the effect on earnings of changes in depreciation, amortization, or other income effects, if any. The guidance is effective for interim and annual periods beginning after December 15, 2015, and is to be applied prospectively to adjustments to provisional amounts that occur after the effective date, with earlier application permitted for financial statements that have not yet been made available for issuance. The adoption of this guidance is not expected to have a significant impact on Delphi's financial statements, other than the application to adjustments to provisional amounts resulting from business combinations for which the accounting is incomplete as of the end of a reporting period.

Inventories

INVENTORIES

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



	September 30, 2015		December 31, 2014

	(in millions)
Productive material	$	684	$	562
Work-in-process	96		104
Finished goods	407		347
Total	$	1,187	$	1,013

Assets

ASSETS

Other current assets consisted of the following:



	September 30, 2015		December 31, 2014

	(in millions)
Value added tax receivable	$	186	$	191
Deferred income taxes	177		171
Prepaid insurance and other expenses	97		59
Reimbursable engineering costs	70		55
Notes receivable	24		28
Income and other taxes receivable	39		34
Deposits to vendors	8		8
Derivative financial instruments (Note 14)	5		—
Other	23		21
Total	$	629	$	567

Other long-term assets consisted of the following:



	September 30, 2015		December 31, 2014

	(in millions)
Deferred income taxes	$	237	$	232
Debt issuance costs (Note 8)	34		42
Income and other taxes receivable	79		67
Reimbursable engineering costs	49		73
Value added tax receivable	23		28
Cost method investments	23		—
Acquisition deposit (Note 17)	820		—
Other	66		66
Total	$	1,331	$	508

Liabilities

LIABILITIES

Accrued liabilities consisted of the following:



	September 30, 2015		December 31, 2014

	(in millions)
Payroll-related obligations	$	245	$	243
Employee benefits, including current pension obligations	84		127
Income and other taxes payable	207		259
Warranty obligations (Note 6)	68		64
Restructuring (Note 7)	55		80
Customer deposits	28		34
Deferred income taxes	8		8
Derivative financial instruments (Note 14)	115		64
Accrued interest	15		30
Other	357		312
Total	$	1,182	$	1,221

Other long-term liabilities consisted of the following:



	September 30, 2015		December 31, 2014

	(in millions)
Environmental (Note 10)	$	4	$	4
Extended disability benefits	11		11
Warranty obligations (Note 6)	80		82
Restructuring (Note 7)	10		17
Payroll-related obligations	8		10
Accrued income taxes	28		29
Deferred income taxes	169		162
Derivative financial instruments (Note 14)	38		40
Other	46		35
Total	$	394	$	390

Warranty Obligations

WARRANTY OBLIGATIONS

Expected warranty costs for products sold are recognized principally at the time of sale of the product based on an estimate of the amount that eventually will be required to settle such obligations. These accruals are based on factors such as past experience, production changes, industry developments and various other considerations. The estimated costs related to product recalls based on a formal campaign soliciting return of that product are accrued at the time an obligation becomes probable and can be reasonably estimated. These estimates are adjusted from time to time based on facts and circumstances that impact the status of existing claims. Delphi has recognized its best estimate for its total aggregate warranty reserves, including product recall costs, across all of its operating segments as of September 30, 2015. The estimated reasonably possible amount to ultimately resolve all matters are not materially different from the recorded reserves as of September 30, 2015.

The table below summarizes the activity in the product warranty liability for the nine months ended September 30, 2015:



	Warranty Obligations

	(in millions)
Accrual balance at beginning of period	$	146
Provision for estimated warranties incurred during the period	55
Provision for changes in estimate for pre-existing warranties	—
Settlements made during the period (in cash or in kind)	(48		)
Foreign currency translation and other	(5		)
Accrual balance at end of period	$	148

Restructuring

RESTRUCTURING

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

As part of Delphi's continued efforts to optimize its cost structure, it has undertaken several restructuring programs which include workforce reductions as well as plant closures. The Company recorded employee-related and other restructuring charges related to these programs totaling approximately $36 million and $69 million during the three and nine months ended September 30, 2015, respectively. These charges were primarily related to Delphi's on-going restructuring programs focused on aligning manufacturing capacity with the current automotive production levels in Europe and South America and the continued rotation of our manufacturing footprint to low cost locations within these regions.

Restructuring costs of approximately $46 million and $121 million were recorded during the three and nine months ended September 30, 2014, respectively. These charges include the recognition of approximately $32 million of employee-related and other costs during the nine months ended September 30, 2014 related to the initiation of a workforce reduction at a European manufacturing site within the Powertrain Systems segment in the second quarter of 2014.

Additionally, the Company recorded $2 million during the nine months ended September 30, 2015 and $1 million and $3 million during the three and nine months ended September 30, 2014, respectively, of restructuring costs within discontinued operations related to the Thermal Systems business.

Restructuring charges for employee separation and termination benefits are paid either over the severance period or in a lump sum in accordance with either statutory requirements or individual agreements. Delphi incurred cash expenditures related to its restructuring programs of approximately $95 million and $109 million in the nine months ended September 30, 2015 and 2014, respectively.

The following table summarizes the restructuring charges recorded for the three and nine months ended September 30, 2015 and 2014 by operating segment:



	Three Months Ended September 30,				Nine Months Ended September 30,
	2015		2014		2015		2014

	(in millions)
Electrical/Electronic Architecture	$	13	$	24	$	22	$	51
Powertrain Systems	19		9		33		48
Electronics and Safety	4		13		14		22
Total	$	36	$	46	$	69	$	121

The table below summarizes the activity in the restructuring liability for the nine months ended September 30, 2015:



	Employee Termination Benefits Liability			Other Exit Costs Liability			Total

	(in millions)
Accrual balance at January 1, 2015	$	95		$	2		$	97
Provision for estimated expenses incurred during the period	67			2			69
Payments made during the period	(93		)	(2		)	(95		)
Foreign currency and other	(6		)	—			(6		)
Accrual balance at September 30, 2015	$	63		$	2		$	65

Debt

DEBT

The following is a summary of debt outstanding, net of discounts of approximately $5 million and $2 million as of September 30, 2015 and December 31, 2014, respectively:



	September 30, 2015			December 31, 2014

	(in millions)
Accounts receivable factoring	$	242		$	—
Revolving credit facility	60			—
6.125%, senior notes, due 2021	—			500
5.00%, senior notes, due 2023	800			800
4.15%, senior notes, due 2024	698			698
1.50%, Euro-denominated senior notes, due 2025	784			—
Tranche A Term Loan, due 2018	400			400
Capital leases and other	138			53
Total debt	3,122			2,451
Less: current portion	(424		)	(34		)
Long-term debt	$	2,698		$	2,417

Credit Agreement

In March 2011, in conjunction with the redemption of membership interests from Class A and Class C membership interest holders, Delphi Corporation (the "Issuer") entered into a credit agreement with JPMorgan Chase Bank, N.A., as lead arranger and administrative agent (the "Original Credit Agreement"), which provided for $3.0 billion in senior secured credit facilities consisting of term loans (as subsequently amended from time to time, the “Tranche A Term Loan” and the “Tranche B Term Loan,” respectively) and a revolving credit facility (as subsequently amended from time to time, the “Revolving Credit Facility”). The Original Credit Agreement was amended and restated on each of May 17, 2011 (the “May 2011 Credit Agreement”), September 14, 2012 (the “2012 Credit Agreement”) and March 1, 2013 (the Original Credit Agreement and each amendment and restatement of the Original Credit Agreement are individually and collectively referred to herein as the “Credit Agreement”). The May 2011 Credit Agreement, which was entered into simultaneously with the issuance of senior unsecured notes in the amount of $1 billion (as more fully described below), reduced the total size of the senior secured credit facilities to $2.4 billion. Under the 2012 Credit Agreement, the Company increased the Revolving Credit Facility to $1.3 billion and the Tranche A Term Loan to $574 million and used the incremental proceeds to pay a portion of the cost of acquiring the Motorized Vehicles Division of FCI (“MVL”). On March 1, 2013, following an unsecured note issuance in February 2013 (as more fully described below), the Tranche B Term Loan was fully repaid, the Tranche A Term Loan was increased to $575 million, the Revolving Credit Facility was increased to $1.5 billion, and the terms of the Tranche A Term Loan and the Revolving Credit Facility were extended to March 1, 2018. Approximately $14 million in issuance costs were paid in conjunction with the March 2013 amendment. In conjunction with an unsecured note issuance in March 2014 (as more fully described below), Delphi repaid a portion of its indebtedness on the Tranche A Term Loan, which resulted in the recognition of a loss on debt extinguishment related to this repayment of approximately $1 million during the nine months ended September 30, 2014.

Unamortized debt issuance costs associated with the Tranche A Term Loan and Revolving Credit Facility of $15 million are being amortized over the term of the Credit Agreement, as extended pursuant to the March 1, 2013 amendment. At September 30, 2015, Delphi had $60 million outstanding under the Revolving Credit Facility and approximately $8 million in letters of credit issued under the Credit Agreement. Letters of credit issued under the Credit Agreement reduce availability under the Revolving Credit Facility.

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



	September 30, 2015				December 31, 2014
	LIBOR plus		ABR plus		LIBOR plus		ABR plus
Revolving Credit Facility	1.00	%	0.00	%	1.00	%	0.00	%
Tranche A Term Loan	1.00	%	0.00	%	1.00	%	0.00	%

The Applicable Rate under the Credit Agreement may increase or decrease from time to time based on changes in credit ratings with the minimum interest level of 0.00% and maximum level of 2.25%. Accordingly, the interest rate will fluctuate during the term of the Credit Agreement based on changes in the ABR, LIBOR or future changes in our corporate credit ratings. The Credit Agreement also requires that the Issuer pay certain commitment fees on the unused portion of the Revolving Credit Facility and certain letter of credit issuance and fronting fees.

The interest rate period with respect to LIBOR interest rate options can be set at one-, two-, three-, or six-months as selected by the Issuer in accordance with the terms of the Credit Agreement (or other period as may be agreed by the applicable lenders), but payable no less than quarterly. The Issuer may elect to change the selected interest rate in accordance with the provisions of the Credit Agreement. As of September 30, 2015, the Issuer selected the one-month LIBOR interest rate option on the Tranche A Term Loan and the ABR interest rate option on the Revolving Credit Facility, as detailed in the table below, and the amounts outstanding, and rates effective as of September 30, 2015 were based on Delphi’s current credit rating and the Applicable Rate for the Credit Agreement:



		Borrowings as of
		September 30, 2015		Rates effective as of
	Applicable Rate	(in millions)		September 30, 2015
Revolving Credit Facility	ABR plus 0.00%	$	60	3.25	%
Tranche A Term Loan	LIBOR plus 1.00%	400		1.25	%

The Issuer was obligated to make quarterly principal payments throughout the term of the Tranche A Term Loan according to the amortization schedule in the Credit Agreement. In conjunction with the partial repayment of the Tranche A Term Loan during the nine months ended September 30, 2014, all principal payment obligations have been satisfied through March 1, 2018. Borrowings under the Credit Agreement are prepayable at the Issuer's option without premium or penalty. The Credit Agreement also contains certain mandatory prepayment provisions in the event the Company receives net cash proceeds from certain asset sales or casualty events. No mandatory prepayments under these provisions have been made or are due through September 30, 2015.

The Credit Agreement contains certain covenants that limit, among other things, the Company’s (and the Company’s subsidiaries’) ability to incur additional indebtedness or liens, to dispose of assets, to make certain investments, to prepay certain indebtedness and to pay dividends, or to make other distributions or redemptions/repurchases, in respect of the Company’s equity interests. In addition, the Credit Agreement requires that the Company maintain a consolidated leverage ratio (the ratio of Consolidated Total Indebtedness to Consolidated EBITDA, each as defined in the Credit Agreement) of less than 2.75 to 1.0. The Credit Agreement also contains events of default customary for financings of this type. The Company was in compliance with the Credit Agreement covenants as of September 30, 2015. In the first quarter of 2014, the Company satisfied credit rating-related conditions to the suspension of many of the restrictive covenants and the mandatory prepayment provisions relating to asset sales and casualty events discussed above. Such covenants and prepayment obligations are required to be reinstated if the applicable credit rating criteria are no longer satisfied.

As of September 30, 2015, all obligations under the Credit Agreement are borrowed by Delphi Corporation and jointly and severally guaranteed by its direct and indirect parent companies, subject to certain exceptions set forth in the Credit Agreement.

Prior to the first quarter of 2014, certain of Delphi Automotive PLC's direct and indirect subsidiaries, which are directly or indirectly 100% owned by Delphi Automotive PLC, fully and unconditionally guaranteed all obligations under the Credit Agreement. In addition, all obligations under the Credit Agreement, including the guaranties of those obligations, were originally secured by certain assets of Delphi Corporation and the guarantors, including substantially all of the assets of Delphi Automotive PLC, and its U.S. subsidiaries, and certain assets of Delphi Corporation’s direct and indirect parent companies. All guarantees of Delphi Corporation's subsidiaries and all then-existing security interests were released during the first quarter of 2014 when the Company satisfied certain credit-rating related and other conditions under the terms of the Credit Agreement. Such security interests and subsidiary guarantees may be reinstated at the election of the lenders if the applicable credit rating criteria are no longer satisfied.

Senior Notes

On May 17, 2011, Delphi Corporation issued $500 million of 5.875% senior unsecured notes due 2019 (the "5.875% Senior Notes") and $500 million of 6.125% senior unsecured notes due 2021 (the "6.125% Senior Notes") (collectively, the “2011 Senior Notes”) in a transaction exempt from registration under Rule 144A and Regulation S of the Securities Act of 1933 (the “Securities Act”). Delphi paid approximately $23 million of debt issuance costs in connection with the 2011 Senior Notes. The net proceeds of approximately $1 billion as well as cash on hand were used to pay down amounts outstanding under the Original Credit Agreement. In May 2012, Delphi Corporation completed a registered exchange offer for all of the 2011 Senior Notes. No proceeds were received by Delphi Corporation as a result of the exchange. In March 2014, Delphi redeemed for cash the entire $500 million aggregate principal amount outstanding of the 5.875% Senior Notes, financed by a portion of the proceeds received from the issuance of the 2014 Senior Notes, as defined below. In March 2015, Delphi redeemed for cash the entire $500 million aggregate principal amount outstanding of the 6.125% Senior Notes, financed by a portion of the proceeds from the issuance of the 2015 Euro-denominated Senior Notes, as defined below. As a result of the redemptions of the 2011 Senior Notes, Delphi recognized losses on debt extinguishment of approximately $52 million during the nine months ended September 30, 2015 and $33 million during the nine months ended September 30, 2014.

On February 14, 2013, Delphi Corporation issued $800 million of 5.00% senior unsecured notes due 2023 (the “2013 Senior Notes”) in a transaction registered under the Securities Act. The proceeds were primarily utilized to prepay our term loan indebtedness under the Credit Agreement. Delphi paid approximately $12 million of issuance costs in connection with the 2013 Senior Notes. Interest is payable semi-annually on February 15 and August 15 of each year to holders of record at the close of business on February 1 or August 1 immediately preceding the interest payment date.

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

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

Although the specific terms of each indenture governing each series of senior notes vary, the indentures contain certain restrictive covenants, including with respect to Delphi's (and Delphi's subsidiaries) ability to incur liens, enter into sale and leaseback transactions and merge with or into other entities. As of September 30, 2015, the Company was in compliance with the provisions of all series of the outstanding senior notes.

The 2013 Senior Notes and 2014 Senior Notes issued by Delphi Corporation are fully and unconditionally guaranteed, jointly and severally, by Delphi Automotive PLC and by certain of Delphi Automotive PLC's direct and indirect subsidiaries which are directly or indirectly 100% owned by Delphi Automotive PLC, subject to customary release provisions (other than in the case of Delphi Automotive PLC). The 2015 Euro-denominated Senior Notes issued by Delphi Automotive PLC are fully and unconditionally guaranteed, jointly and severally, by certain of Delphi Automotive PLC's direct and indirect subsidiaries (including Delphi Corporation), which are directly or indirectly 100% owned by Delphi Automotive PLC, subject to customary release provisions.

Other Financing

Receivable factoring—Various accounts receivable factoring facilities are maintained in Europe and are accounted for as short-term debt. These uncommitted factoring facilities are available through various financial institutions. Delphi also maintains a €400 million European accounts receivable factoring facility, with borrowings being subject to the availability of eligible accounts receivable. As of September 30, 2015 and December 31, 2014, $242 million and $0 million, respectively, were outstanding under these European accounts receivable factoring facilities. Collateral is not generally required related to these trade accounts receivable. Amounts drawn as of September 30, 2015 were principally related to funding a portion of the deposit for the acquisition of HellermannTyton Group PLC ("HellermannTyton"), as more fully discussed in Note 17. Acquisitions & Divestitures.

In 2015, the Company entered into arrangements with various financial institutions to sell eligible trade receivables from certain aftermarket customers in North America. These arrangements have original terms of one year and may be renewed annually. The receivables under these arrangements are sold without recourse to the Company and are therefore accounted for as true sales. During the three and nine months ended September 30, 2015, $21 million and $75 million of receivables were sold under these arrangements, and expenses of less than $1 million and $1 million, respectively, were recognized within interest expense.

Capital leases and other—As of September 30, 2015 and December 31, 2014, approximately $138 million and approximately $53 million, respectively, of other debt issued by certain non-U.S. subsidiaries and capital lease obligations were outstanding. As of September 30, 2015, $80 million of this debt related to European short-term borrowings to fund a portion of the deposit for the acquisition of HellermannTyton, as more fully discussed in Note 17. Acquisitions & Divestitures.

Interest—Cash paid for interest related to debt outstanding totaled $96 million and $99 million for the nine months ended September 30, 2015 and 2014, respectively.

Pension Benefits

PENSION BENEFITS

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

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

The amounts shown below reflect the defined benefit pension expense, including amounts attributable to discontinued operations, for the three and nine months ended September 30, 2015 and 2014:



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

	Three Months Ended September 30,
	2015			2014			2015		2014

	(in millions)
Service cost	$	15		$	14		$	—	$	—
Interest cost	19			23			—		1
Expected return on plan assets	(19		)	(19		)	—		—
Settlement loss (1)	13			—			—		—
Curtailment loss	—			4			—		—
Amortization of actuarial losses	4			2			1		—
Net periodic benefit cost	$	32		$	24		$	1	$	1


(1)	Primarily relates to amounts recognized related to the divestiture of the Company's Reception Systems business, as further described in Note 17. Acquisitions and Divestitures.



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

	Nine Months Ended September 30,
	2015			2014			2015		2014

	(in millions)
Service cost	$	44		$	44		$	—	$	—
Interest cost	58			73			1		2
Expected return on plan assets	(57		)	(59		)	—		—
Settlement loss	16			—			—		—
Curtailment loss	—			4			—		—
Amortization of actuarial losses	13			6			1		—
Net periodic benefit cost	$	74		$	68		$	2	$	2

Other postretirement benefit obligations were approximately $3 million and $3 million at September 30, 2015 and December 31, 2014, respectively.

Commitments And Contingencies

COMMITMENTS AND CONTINGENCIES

Ordinary Business Litigation

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

GM Ignition Switch Recall

In the first quarter of 2014, GM, Delphi’s largest customer, initiated a product recall related to ignition switches. Delphi received requests for information from, and cooperated with, various government agencies related to this ignition switch recall. In addition, Delphi was initially named as a co-defendant along with GM (and in certain cases other parties) in class action and product liability lawsuits related to this matter. During the second quarter of 2014, all of the class action cases were transferred to the United States District Court for the Southern District of New York (the “District Court”) for coordinated pretrial proceedings. Two consolidated amended class action complaints were filed in the District Court during the fourth quarter of 2014. Delphi was not named as a defendant in either complaint. An additional class action complaint, brought outside of the consolidated class actions mentioned above, named Delphi as a defendant. Delphi believes the allegations contained in this additional class action are without merit, and intends to vigorously defend against them. Although no assurances can be made as to the ultimate outcome of these or any other future claims, Delphi does not believe a loss is probable and, accordingly, no reserve has been made as of September 30, 2015.

Unsecured Creditors Litigation

The Fourth Amended and Restated Limited Liability Partnership Agreement of Delphi Automotive LLP (the “Fourth LLP Agreement”) was entered into on July 12, 2011 by the members of Delphi Automotive LLP in order to position the Company for its initial public offering. Under the terms of the Fourth LLP Agreement, if cumulative distributions to the members of Delphi Automotive LLP under certain provisions of the Fourth LLP Agreement exceed $7.2 billion, Delphi, as disbursing agent on behalf of DPHH, is required to pay to the holders of allowed general unsecured claims against DPHH $32.50 for every $67.50 in excess of $7.2 billion distributed to the members, up to a maximum amount of $300 million. In December 2014, a complaint was filed in the United States Bankruptcy Court for the Southern District of New York alleging that the redemption by Delphi Automotive LLP of the membership interests of GM and the Pension Benefit Guaranty Corporation (the "PBGC"), and the repurchase of shares and payment of dividends by Delphi Automotive PLC, constituted distributions under the terms of the Fourth LLP Agreement approximating $7.2 billion. Delphi considers cumulative distributions through September 30, 2015 to be substantially below the $7.2 billion threshold, and intends to vigorously contest the allegations set forth in the complaint. In June 2015, the plaintiffs' and Delphi's motions for summary judgment were denied. Both parties filed supplemental briefs in July 2015. Although no assurances can be made as to the ultimate outcome of this claim, Delphi does not believe a loss is probable and, accordingly, no reserve has been made as of September 30, 2015.

Brazil Matters

Delphi conducts significant business operations in Brazil that are subject to the Brazilian federal labor, social security, environmental, tax and customs laws, as well as a variety of state and local laws. While Delphi believes it complies with such laws, they are complex, subject to varying interpretations, and the Company is often engaged in litigation with government agencies regarding the application of these laws to particular circumstances. As of September 30, 2015, the majority of claims asserted against Delphi in Brazil relate to such litigation. The remaining claims in Brazil relate to commercial and labor litigation with private parties. As of September 30, 2015, claims totaling approximately $130 million (using September 30, 2015 foreign currency rates) have been asserted against Delphi in Brazil. As of September 30, 2015, the Company maintains accruals for these asserted claims of $23 million (using September 30, 2015 foreign currency rates). The amounts accrued represent claims that are deemed probable of loss and are reasonably estimable based on the Company’s analyses and assessment of the asserted claims and prior experience with similar matters. While the Company believes its accruals are adequate, the final amounts required to resolve these matters could differ materially from the Company’s recorded estimates and Delphi’s results of operations could be materially affected.

Environmental Matters

Delphi is subject to the requirements of U.S. federal, state, local and non-U.S. environmental and safety and health laws and regulations. As of September 30, 2015 and December 31, 2014, the undiscounted reserve for environmental investigation and remediation was approximately $5 million (of which $1 million was recorded in accrued liabilities and $4 million was recorded in other long-term liabilities) and $5 million (of which $1 million was recorded in accrued liabilities and $4 million was recorded in other long-term liabilities), respectively. Additionally, approximately $7 million and $16 million as of September 30, 2015 and December 31, 2014, respectively, of undiscounted reserve for environmental investigation and remediation attributable to discontinued operations was included within liabilities held for sale. Delphi cannot ensure that environmental requirements will not change or become more stringent over time or that its eventual environmental remediation costs and liabilities will not exceed the amount of its current reserves. In the event that such liabilities were to significantly exceed the amounts recorded, Delphi’s results of operations could be materially affected. At September 30, 2015, the difference between the recorded liabilities and the reasonably possible range of potential loss was not material.

Other Matters

In 2014, Delphi identified payments made by certain manufacturing facility employees in China, which were immaterial in amount, that may have violated certain provisions of the U.S. Foreign Corrupt Practices Act (the “FCPA”). Under the oversight of Delphi’s Audit Committee of the Board of Directors, Delphi engaged in a review of these matters with outside counsel and forensic auditors, and evaluated existing controls and compliance policies and procedures. Delphi completed additional compliance audits, undertook additional compliance training to reinforce its existing compliance programs and took appropriate action to strengthen its internal controls. Violations of the FCPA could result in criminal and/or civil liabilities and other forms of penalties or sanctions. Delphi has voluntarily disclosed these matters to the U.S. Department of Justice and the SEC, and has cooperated fully with these agencies. Although Delphi does not expect any significant adverse impact on the Company, there can be no assurance as to the ultimate outcome of these matters at this time.

Income Taxes

INCOME TAXES

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

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

The Company's income tax expense and effective tax rate from continuing operations for the three and nine months ended September 30, 2015 and 2014 were as follows:



	Three Months Ended September 30,						Nine Months Ended September 30,
	2015			2014			2015			2014

	(dollars in millions)
Income tax expense	$	61		$	56		$	202		$	181
Effective tax rate	15		%	15		%	16		%	15		%

The Company’s effective tax rate from continuing operations was impacted by unfavorable geographic income mix in 2015 as compared to 2014, primarily due to changes in the underlying operations of the business. The Company’s effective tax rate from continuing operations was also impacted by the tax expense (benefit) associated with unusual or infrequent items for the respective interim period as illustrated in the following table:



	Three Months Ended September 30,						Nine Months Ended September 30,
	2015			2014			2015			2014

	(in millions)
Tax credits (1)	$	(5	)	$	—		$	(5	)	$	(2	)
Withholding taxes	(1		)	—			(2		)	(1		)
Other change in tax reserves (2)	(1		)	—			3			(6		)
Other adjustments (3)	3			(7		)	4			(12		)
Income tax (benefit) expense associated with unusual or infrequent items	$	(4	)	$	(7	)	$	—		$	(21	)


(1)	For the three and nine months ended September 30, 2015 and nine months ended September 30, 2014, the tax benefit primarily relates to provision to return adjustments.


(2)	For the nine months ended September 30, 2015 and September 30, 2014, the tax expense and benefit, respectively, primarily relate to adjustments in tax reserves which were individually insignificant.


(3)	For the three and nine months ended September 30, 2015 and September 30, 2014, the tax expense and benefit, respectively, primarily relate to provision to return adjustments and other items which were individually insignificant.

Delphi Automotive PLC is a U.K. resident taxpayer and, we believe, not a domestic corporation for U.S. federal income tax purposes, and as such is not subject to U.S. tax, and generally not subject to U.K. tax on remitted foreign earnings.

Cash paid or withheld for income taxes was $281 million and $237 million for the nine months ended September 30, 2015 and 2014 respectively, including amounts attributable to discontinued operations.

Tax Return Filing Determinations and Elections

Delphi Automotive LLP, which acquired certain assets in a bankruptcy court approved transaction (the "Bankruptcy Plan") on October 6, 2009 (the "Acquisition Date"), was established on August 19, 2009 as a limited liability partnership incorporated under the laws of England and Wales. At the time of its formation, Delphi Automotive LLP elected to be treated as a partnership for U.S. federal income tax purposes. On June 24, 2014, the Internal Revenue Service (the “IRS”) issued us a Notice of Proposed Adjustment (the "NOPA") asserting that it believes Section 7874(b) of the Internal Revenue Code applies to Delphi Automotive LLP and that it should be treated as a domestic corporation for U.S. federal income tax purposes, retroactive to the Acquisition Date. If Delphi Automotive LLP is treated as a domestic corporation for U.S. federal income tax purposes, the Company expects that, although Delphi Automotive PLC is incorporated under the laws of Jersey and a tax resident in the U.K., it would also be treated as a domestic corporation for U.S. federal income tax purposes.

Delphi Automotive LLP filed U.S. federal partnership tax returns for 2009, 2010, and 2011. The IRS’s NOPA asserts that Section 7874(b) applies to Delphi Automotive LLP’s acquisition of certain assets pursuant to the Bankruptcy Plan, and consequently, Delphi Automotive LLP should be treated as a domestic corporation for U.S. federal income tax purposes. Notwithstanding the issuance of the NOPA, we continue to believe, after consultation with counsel, that neither Delphi Automotive LLP nor Delphi Automotive PLC should be treated as a domestic corporation for U.S. federal income tax purposes. We intend to vigorously contest the conclusions reached in the NOPA through the IRS’s administrative appeals process, and, if we are unable to reach a satisfactory resolution with the IRS, through litigation. Accordingly, we will continue to prepare and file our financial statements on the basis that neither Delphi Automotive LLP nor Delphi Automotive PLC is a domestic corporation for U.S. federal income tax purposes. We have not recorded any adjustments with respect to this matter, nor have we recorded any adjustments in connection with receiving the NOPA. However, while we believe that we should prevail, no assurance can be given that we will be able to reach a satisfactory resolution with the IRS or that, if we were to litigate, a court will agree with our position. Further, the ultimate resolution of this issue could take significant time and resources.

If these entities are treated as domestic corporations for U.S. federal income tax purposes, the Company will be subject to U.S. federal income tax on its worldwide taxable income, including distributions, as well as deemed income inclusions from some of its non-U.S. subsidiaries. This could have a material adverse impact on our income tax liability in the future. However, the Company may also benefit from deducting certain expenses that are currently not deducted in the U.S. As a U.S. company, any dividends we pay to non-U.S. shareholders could also be subject to U.S. federal income tax withholding at a rate of 30% (unless reduced or eliminated by an income tax treaty), and it is possible that tax may be withheld on such dividends in certain circumstances even before a final determination has been made with respect to the Company's U.S. income tax status. In addition, we could be liable for the failure by Delphi Automotive LLP to withhold U.S. federal income taxes on distributions to its non-U.S. members for periods beginning on or after the Acquisition Date. If we are unsuccessful in contesting the IRS’s assertion, we expect any unfavorable final outcome to adversely impact our tax position, most significantly in future periods, by increasing our annual effective tax rate to approximately 20% to 22%. For the nine months ended September 30, 2015, our effective tax rate was 16%. Although the outcome currently remains uncertain, the Company continues to maintain its position that neither Delphi Automotive LLP nor Delphi Automotive PLC should be treated as a domestic corporation for U.S. tax purposes. Accordingly, no adjustment for this matter has been recorded as of September 30, 2015.

Shareholders' Equity And Net Income Per Share

SHAREHOLDERS’ EQUITY AND NET INCOME PER SHARE

Net Income Per Share

Basic net income per share is computed by dividing net income attributable to Delphi by the weighted average number of ordinary shares outstanding during the period. Diluted net income per share reflects the weighted average dilutive impact of all potentially dilutive securities from the date of issuance and is computed using the treasury stock method by dividing net income attributable to Delphi by the diluted weighted average number of ordinary shares outstanding. For all periods presented, the calculation of net income per share contemplates the dilutive impacts, if any, of the Company’s share-based compensation plans. Refer to Note 18. Share-Based Compensation for additional information.

Weighted Average Shares

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



	Three Months Ended September 30,				Nine Months Ended September 30,
	2015		2014		2015		2014

	(in millions, except per share data)
Numerator:
Income from continuing operations	$	351	$	299	$	989	$	969
Income from discontinued operations	53		6		269		38
Net income attributable to Delphi	$	404	$	305	$	1,258	$	1,007
Denominator:
Weighted average ordinary shares outstanding, basic	282.97		298.59		287.18		302.35
Dilutive shares related to restricted stock units ("RSUs")	1.43		1.55		1.15		1.21
Weighted average ordinary shares outstanding, including dilutive shares	284.40		300.14		288.33		303.56

Basic net income per share:
Continuing operations	$	1.24	$	1.00	$	3.44	$	3.20
Discontinued operations	0.19		0.02		0.94		0.13
Basic net income per share attributable to Delphi	$	1.43	$	1.02	$	4.38	$	3.33
Diluted net income per share:
Continuing operations	$	1.23	$	1.00	$	3.43	$	3.19
Discontinued operations	0.19		0.02		0.93		0.13
Diluted net income per share attributable to Delphi	$	1.42	$	1.02	$	4.36	$	3.32
Anti-dilutive securities share impact	—		—		—		—

Share Repurchase Program

In January 2015, the Board of Directors authorized a share repurchase program of up to $1.5 billion of ordinary shares, which commenced in March 2015 following the completion of the Company's $1 billion January 2014 share repurchase program. This share repurchase program provides for share purchases in the open market or in privately negotiated transactions, depending on share price, market conditions and other factors, as determined by the Company.

A summary of the ordinary shares repurchased during the three and nine months ended September 30, 2015 and 2014 is as follows:



	Three Months Ended September 30,				Nine Months Ended September 30,
	2015		2014		2015		2014
Total number of shares repurchased	5,292,240		4,360,097		12,174,805		10,004,486
Average price paid per share	$	76.83	$	68.00	$	78.79	$	67.37
Total (in millions)	$	406	$	297	$	959	$	674

As of September 30, 2015, approximately $707 million of share repurchases remained available under the January 2015 share repurchase program. During the period from October 1, 2015 to October 28, 2015, the Company repurchased an additional $50 million worth of shares pursuant to a trading plan with set trading instructions established by the Company. As a result, approximately $657 million of share repurchases remain available under the January 2015 share repurchase program. All repurchased shares were retired, and are reflected as a reduction of ordinary share capital for the par value of the shares, with the excess applied as reductions to additional paid-in capital and retained earnings.

Dividends

On February 26, 2013, the Board of Directors approved the initiation of dividend payments on the Company's ordinary shares. In January 2014, the Board of Directors increased the annual dividend rate from $0.68 to $1.00 per ordinary share. The Company has declared and paid cash dividends per ordinary share during the periods presented as follows:



	Dividend		Amount
	Per Share		(in millions)
2015:
Third quarter	$	0.25	$	71
Second quarter	0.25		72
First quarter	0.25		73
Total	$	0.75	$	216
2014:
Fourth quarter	$	0.25	$	73
Third quarter	0.25		75
Second quarter	0.25		76
First quarter	0.25		77
Total	$	1.00	$	301

Other

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

Under the terms of the Fourth LLP Agreement, if cumulative distributions to the members of Delphi Automotive LLP under certain provisions of the Fourth LLP Agreement exceed $7.2 billion, Delphi, as disbursing agent on behalf of DPHH, is required to pay to the holders of allowed general unsecured claims against DPHH $32.50 for every $67.50 in excess of $7.2 billion distributed to the members, up to a maximum amount of $300 million. This contingency is not considered probable of occurring as of September 30, 2015 and accordingly, no reserve has been recorded. Refer to Note 10. Commitments and Contingencies for additional information.

Changes in Accumulated Other Comprehensive Income

CHANGES IN ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

The changes in accumulated other comprehensive income (loss) attributable to Delphi (net of tax) for the three and nine months ended September 30, 2015 and 2014 are shown below. Other comprehensive income includes activity relating to discontinued operations.



	Three Months Ended September 30,						Nine Months Ended September 30,
	2015			2014			2015			2014

	(in millions)
Foreign currency translation adjustments:
Balance at beginning of period	$	(505	)	$	(8	)	$	(333	)	$	(17	)
Aggregate adjustment for the period	(109		)	(176		)	(281		)	(167		)
Balance at end of period	(614		)	(184		)	(614		)	(184		)

Gains (losses) on derivatives:
Balance at beginning of period	(84		)	9			(78		)	2
Other comprehensive income before reclassifications (net tax effect of $16 million, $8 million, $30 million and $5 million)	(55		)	(30		)	(105		)	(27		)
Reclassification to income (net tax effect of $7 million, $3 million, $20 million and $5 million)	22			7			66			11
Balance at end of period	(117		)	(14		)	(117		)	(14		)

Pension and postretirement plans:
Balance at beginning of period	(308		)	(220		)	(330		)	(222		)
Other comprehensive income before reclassifications (net tax effect of $1 million, $4 million, $2 million and $3 million)	7			10			18			8
Reclassification to income (net tax effect of $1 million, $0 million, $2 million and $0 million)	17			2			28			6
Balance at end of period	(284		)	(208		)	(284		)	(208		)

Accumulated other comprehensive loss, end of period	$	(1,015	)	$	(406	)	$	(1,015	)	$	(406	)

Reclassifications from accumulated other comprehensive income to income for the three and nine months ended September 30, 2015 and 2014 were as follows:



Reclassification Out of Accumulated Other Comprehensive Income
Details About Accumulated Other Comprehensive Income Components	Three Months Ended September 30,						Nine Months Ended September 30,						Affected Line Item in the Statement of Operations
	2015			2014			2015			2014			Affected Line Item in the Statement of Operations

	(in millions)
Gains (losses) on derivatives:
Commodity derivatives	$	(11	)	$	(3	)	$	(32	)	$	(13	)	Cost of sales
Foreign currency derivatives	(18		)	1			(54		)	7			Cost of sales
Foreign currency derivatives	—			(2		)	—			—			Other income
	(29		)	(4		)	(86		)	(6		)	Income before income taxes
	7			(3		)	20			(5		)	Income tax expense
	(22		)	(7		)	(66		)	(11		)	Net income
	—			—			—			—			Net income attributable to noncontrolling interest
	$	(22	)	$	(7	)	$	(66	)	$	(11	)	Net income attributable to Delphi

Pension and postretirement plans:
Actuarial losses	$	(5	)	$	(2	)	$	(14	)	$	(6	)	(1)
Settlement loss	(13		)	—			(16		)	—			(1)
	(18		)	(2		)	(30		)	(6		)	Income before income taxes
	1			—			2			—			Income tax expense
	(17		)	(2		)	(28		)	(6		)	Net income
	—			—			—			—			Net income attributable to noncontrolling interest
	$	(17	)	$	(2	)	$	(28	)	$	(6	)	Net income attributable to Delphi

Total reclassifications for the period	$	(39	)	$	(9	)	$	(94	)	$	(17	)


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

Derivatives And Hedging Activities

Derivative Instruments and Hedging Activities

DERIVATIVES AND HEDGING ACTIVITIES

Delphi is exposed to market risk, such as fluctuations in foreign currency exchange rates, commodity prices and changes in interest rates, which may result in cash flow risks. To manage the volatility relating to these exposures, Delphi aggregates the exposures on a consolidated basis to take advantage of natural offsets. For exposures that are not offset within its operations, Delphi enters into various derivative transactions pursuant to its risk management policies, which prohibit holding or issuing derivative financial instruments for speculative purposes, and designation of derivative instruments is performed on a transaction basis to support hedge accounting. The changes in fair value of these hedging instruments are offset in part or in whole by corresponding changes in the fair value or cash flows of the underlying exposures being hedged. Delphi assesses the initial and ongoing effectiveness of its hedging relationships in accordance with its documented policy. As of September 30, 2015, Delphi has entered into derivative instruments to hedge cash flows extending out to December 2017.

Additionally, the Company has designated the €700 million 2015 Euro-denominated Senior Notes as a net investment hedge of the foreign currency exposure of its investments in certain Euro-denominated subsidiaries. Due to the high degree of effectiveness between the hedging instrument and the exposure being hedged, fluctuations in the value of the Euro-denominated debt due to exchange rate changes are recognized in cumulative translation adjustment within Other comprehensive income to offset changes in the value of the net investment of these Euro-denominated operations.

As of September 30, 2015, the Company had the following outstanding notional amounts related to commodity and foreign currency forward contracts that were entered into to hedge forecasted exposures:



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

	(in thousands)		(in millions)
Copper	88,904	pounds	$	210



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

	(in millions)
Mexican Peso	9,849	MXN	$	575
Polish Zloty	304	PLN	80
Chinese Yuan Renminbi	435	CNY	70
New Turkish Lira	212	TRY	70
Hungarian Forint	13,093	HUF	45
Brazilian Real	41	BRL	10

The Company had additional commodity and foreign currency forward contracts with notional amounts that individually amounted to less than $10 million.

As more fully disclosed in Note 17. Acquisitions and Divestitures, on July 30, 2015, Delphi made a recommended offer to acquire HellermannTyton. In conjunction with the proposed acquisition, in August 2015, the Company entered into option contracts with notional amounts totaling £917 million to hedge portions of the currency risk associated with the cash payment for the proposed acquisition at a cost of $15 million. Pursuant to the requirements of ASC 815, Derivatives and Hedging, the options do not qualify as hedges for accounting purposes, and therefore, changes in the fair value of the options are recognized in other income (expense), net. The options expire in the first quarter of 2016. During the three and nine months ended September 30, 2015, the change in fair value resulted in a pre-tax loss of $11 million included within other income (expense), net in the consolidated statement of operations.

Additionally, during the nine months ended September 30, 2014, Delphi entered into and settled treasury rate lock agreements which were designated as cash flow hedges in anticipation of issuing the 2014 Senior Notes, as further discussed in Note 8. Debt. The impacts of these agreements and the related amount of hedge ineffectiveness were not material.

The fair value of derivative financial instruments recorded in the consolidated balance sheets as of September 30, 2015 and December 31, 2014 are as follows:



	Asset Derivatives			Liability Derivatives			Net Amounts of Assets and (Liabilities) Presented in the Balance Sheet
	Balance Sheet Location	September 30, 2015		Balance Sheet Location	September 30, 2015		September 30, 2015

	(in millions)
Designated derivatives instruments:
Commodity derivatives	Other current assets	$	—	Accrued liabilities	$	34
Foreign currency derivatives*	Other current assets	1		Other current assets	—		1
Foreign currency derivatives*	Accrued liabilities	4		Accrued liabilities	82		(78	)
Commodity derivatives	Other long-term assets	—		Other long-term liabilities	12
Foreign currency derivatives*	Other long-term assets	1		Other long-term assets	1		—
Foreign currency derivatives*	Other long-term liabilities	—		Other long-term liabilities	25		(25	)
Total		$	6		$	154
Derivatives not designated:
Commodity derivatives	Other current assets	$	—	Accrued liabilities	$	2
Foreign currency derivatives*	Other current assets	4		Other current assets	—		4
Foreign currency derivatives*	Accrued liabilities	3		Accrued liabilities	4		(1	)
Foreign currency derivatives*	Other long-term liabilities	1		Other long-term liabilities	2		(1	)
Total		$	8		$	8



	Asset Derivatives			Liability Derivatives			Net Amounts of Assets and (Liabilities) Presented in the Balance Sheet
	Balance Sheet Location	December 31, 2014		Balance Sheet Location	December 31, 2014		December 31, 2014

	(in millions)
Designated derivatives instruments:
Commodity derivatives	Other current assets	$	—	Accrued liabilities	$	19
Foreign currency derivatives*	Accrued liabilities	3		Accrued liabilities	48		(45	)
Commodity derivatives	Other long-term assets	—		Other long-term liabilities	8
Foreign currency derivatives*	Other long-term liabilities	2		Other long-term liabilities	34		(32	)
Total		$	5		$	109
Derivatives not designated:
Foreign currency derivatives*	Accrued liabilities	$	1	Accrued liabilities	$	1	—
Total		$	1		$	1

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

The fair value of Delphi’s derivative financial instruments was in a net liability position as of September 30, 2015 and December 31, 2014.

The pre-tax effect of derivative financial instruments in the consolidated statement of operations and consolidated statement of comprehensive income for the three months ended September 30, 2015 is as follows:



Three Months Ended September 30, 2015	Loss Recognized in OCI (Effective Portion)			Loss Reclassified from OCI into Income (Effective Portion)			Gain Recognized in Income (Ineffective Portion Excluded from Effectiveness Testing)

	(in millions)
Designated derivatives instruments:
Commodity derivatives	$	(28	)	$	(11	)	$	—
Foreign currency derivatives	(43		)	(18		)	—
Total	$	(71	)	$	(29	)	$	—



	Loss Recognized in Income

	(in millions)
Derivatives not designated:
Commodity derivatives	$	—
Foreign currency derivatives	(11		)
Total	$	(11	)

The pre-tax effect of derivative financial instruments in the consolidated statement of operations and consolidated statement of comprehensive income for the three months ended September 30, 2014 is as follows:



Three Months Ended September 30, 2014	Loss Recognized in OCI (Effective Portion)			Loss Reclassified from OCI into Income (Effective Portion)			Gain Recognized in Income (Ineffective Portion Excluded from Effectiveness Testing)

	(in millions)
Designated derivatives instruments:
Commodity derivatives	$	(13	)	$	(3	)	$	—
Foreign currency derivatives	(25		)	(1		)	—
Total	$	(38	)	$	(4	)	$	—



	Gain Recognized in Income

	(in millions)
Derivatives not designated:
Commodity derivatives	$	—
Foreign currency derivatives (1)	22
Total	$	22


(1)	Primarily relates to amounts recognized in other income, which offset the losses recognized due to the remeasurement of intercompany loans.

The pre-tax effect of derivative financial instruments in the consolidated statement of operations and consolidated statement of comprehensive income for the nine months ended September 30, 2015 is as follows:



Nine Months Ended September 30, 2015	Loss Recognized in OCI (Effective Portion)			Loss Reclassified from OCI into Income (Effective Portion)			Gain Recognized in Income (Ineffective Portion Excluded from Effectiveness Testing)

	(in millions)
Designated derivatives instruments:
Commodity derivatives	$	(53	)	$	(29	)	$	—
Foreign currency derivatives	(82		)	(50		)	—
Total	$	(135	)	$	(79	)	$	—



	Loss Recognized in Income

	(in millions)
Derivatives not designated:
Commodity derivatives	$	(3	)
Foreign currency derivatives	(16		)
Total	$	(19	)

The pre-tax effect of derivative financial instruments in the consolidated statement of operations and consolidated statement of comprehensive income for the nine months ended September 30, 2014 is as follows:



Nine Months Ended September 30, 2014	Loss Recognized in OCI (Effective Portion)			(Loss) Gain Reclassified from OCI into Income (Effective Portion)			Gain Recognized in Income (Ineffective Portion Excluded from Effectiveness Testing)

	(in millions)
Designated derivatives instruments:
Commodity derivatives	$	(19	)	$	(13	)	$	—
Foreign currency derivatives	(13		)	7			—
Total	$	(32	)	$	(6	)	$	—



	Gain Recognized in Income

	(in millions)
Derivatives not designated:
Commodity derivatives	$	—
Foreign currency derivatives (1)	22
Total	$	22


(1)	Primarily relates to amounts recognized in other income, which offset the losses recognized due to the remeasurement of intercompany loans.

The gain or loss reclassified from OCI into income for the effective portion of designated derivative instruments and the gain or loss recognized in income for the ineffective portion of designated derivative instruments excluded from effectiveness testing were recorded to other income, net and cost of sales in the consolidated statements of operations for the three and nine months ended September 30, 2015 and 2014. The gain or loss recognized in income for non-designated derivative instruments was recorded in other income (expense), net and cost of sales for the three and nine months ended September 30, 2015 and 2014.

Gains and losses on derivatives qualifying as cash flow hedges are recorded in OCI, to the extent that hedges are effective, until the underlying transactions are recognized in earnings. Unrealized amounts in accumulated OCI will fluctuate based on changes in the fair value of hedge derivative contracts at each reporting period. Losses included in accumulated OCI as of September 30, 2015 were approximately $156 million (approximately $117 million net of tax). Of this total, approximately $116 million of losses are expected to be included in cost of sales within the next 12 months and $40 million of losses are expected to be included in cost of sales in subsequent periods. Cash flow hedges are discontinued when Delphi determines it is no longer probable that the originally forecasted transactions will occur. The amount included in cost of sales related to cash flow hedge ineffectiveness was insignificant for the three and nine months ended September 30, 2015 and 2014, respectively.

Changes in the value of the Euro-denominated debt designated as a net investment hedge are recorded in cumulative translation adjustment within OCI to offset changes in the value of the net investment in Euro-denominated operations. During the three and nine months ended September 30, 2015, $6 million and $27 million, respectively, of losses were recognized in OCI. Gains or losses on net investment hedges are reclassified to earnings only when the related currency translation adjustments are required to be reclassified, usually upon sale or liquidation of the investment, and there were no amounts reclassified or recognized for ineffectiveness in the three and nine months ended September 30, 2015. Cumulative losses included in accumulated OCI on the net investment hedge as of September 30, 2015 were approximately $27 million due to the strengthening of the Euro relative to the U.S. dollar over the term of this arrangement.

Fair Value Of Financial Instruments

Fair Value of Financial Instruments

FAIR VALUE OF FINANCIAL INSTRUMENTS

Fair Value Measurements on a Recurring Basis

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

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

As of September 30, 2015 and December 31, 2014, Delphi was in a net derivative liability position of $148 million and $104 million, respectively, and no significant adjustments were recorded for nonperformance risk based on the application of peer companies’ CDS rates and because Delphi’s exposures were to counterparties with investment grade credit ratings.

As described in Note 17. Acquisitions and Divestitures, as of September 30, 2015, additional contingent consideration may be earned as a result of Delphi's acquisition agreements for Ottomatika, Inc. ("Ottomatika") and Antaya Technologies Corporation ("Antaya"). The liability for contingent consideration is re-measured to fair value at each reporting date based on a probability-weighted discounted cash flow analysis using a rate that reflects the uncertainty surrounding the expected outcomes, which the Company believes is appropriate and representative of market participant assumptions. The measurement of the liability for contingent consideration is based on significant inputs that are not observable in the market, and is therefore classified as a Level 3 measurement in accordance with ASU Topic 820-10-35. Examples of utilized unobservable inputs are estimated future earnings of the acquired businesses and applicable discount rates. The estimate of the liability may fluctuate if there are changes in the forecast of the acquired businesses' future earnings or as a result of actual earnings levels achieved. The liability was classified within other long-term liabilities in the consolidated balance sheet at September 30, 2015 and December 31, 2014. Adjustments to this liability for interest accretion are recognized in interest expense, and any other changes in the fair value of this liability are recognized within other income (expense), net in the consolidated statement of operations.

As of September 30, 2015 and December 31, 2014, Delphi had the following assets measured at fair value on a recurring basis:



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

	(in millions)
As of September 30, 2015:
Foreign currency derivatives	$	5	$	—	$	5	$	—
Total	$	5	$	—	$	5	$	—
As of December 31, 2014:
Foreign currency derivatives	$	—	$	—	$	—	$	—
Total	$	—	$	—	$	—	$	—

As of September 30, 2015 and December 31, 2014, Delphi had the following liabilities measured at fair value on a recurring basis:



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

	(in millions)
As of September 30, 2015:
Commodity derivatives	$	48	$	—	$	48	$	—
Foreign currency derivatives	105		—		105		—
Contingent consideration	18		—		—		18
Total	$	171	$	—	$	153	$	18
As of December 31, 2014:
Commodity derivatives	$	27	$	—	$	27	$	—
Foreign currency derivatives	77		—		77		—
Contingent consideration	11		—		—		11
Total	$	115	$	—	$	104	$	11

The changes in the contingent consideration liability classified as a Level 3 measurement for the nine months ended September 30, 2015 were as follows:



	Contingent Consideration Liability

	(in millions)
Fair value at beginning of period	$	11
Additions	5
Payments	—
Interest accretion	2
Fair value at end of period	$	18

Financial Instruments

Delphi’s non-derivative financial instruments include debt, which consists of its accounts receivable factoring arrangements, capital leases and other debt issued by Delphi’s non-U.S. subsidiaries, the Revolving Credit Facility, the Tranche A Term Loan, the 2013 Senior Notes, the 2014 Senior Notes and the 2015 Euro-denominated Senior Notes. The fair value of debt is based on quoted market prices for instruments with public market data or significant other observable inputs for instruments without a quoted public market price (Level 2). As of September 30, 2015 and December 31, 2014, total debt was recorded at $3,122 million and $2,451 million, respectively, and had estimated fair values of $3,084 million and $2,567 million, respectively. For all other financial instruments recorded at September 30, 2015 and December 31, 2014, fair value approximates book value.

Fair Value Measurements on a Nonrecurring Basis

In addition to items that are measured at fair value on a recurring basis, Delphi also has items in its balance sheet that are measured at fair value on a nonrecurring basis. As these items are not measured at fair value on a recurring basis, they are not included in the tables above. Nonfinancial assets and liabilities that are measured at fair value on a nonrecurring basis include long-lived assets, assets held for sale, equity and cost method investments, intangible assets, asset retirement obligations, share-based compensation and liabilities for exit or disposal activities measured at fair value upon initial recognition. During the three and nine months ended September 30, 2015, Delphi recorded non-cash asset impairment charges of $0 million and $6 million, respectively, in cost of sales related to declines in the fair values of certain fixed assets. Delphi recorded non-cash asset impairment charges of $3 million in cost of sales and $1 million in selling, general and administrative expense during the three months ended September 30, 2014, and $5 million in cost of sales and $2 million in selling, general and administrative expense during the nine months ended September 30, 2014. These impairments related to certain assets and capitalized software licenses no longer being utilized. Fair value of long-lived assets is determined primarily using the anticipated cash flows discounted at a rate commensurate with the risk involved and a review of appraisals. As such, Delphi has determined that the fair value measurements of long-lived assets fall in Level 3 of the fair value hierarchy.

Additionally, as further described in Note 21. Discontinued Operations, an after-tax impairment loss of approximately $88 million was recorded in income from discontinued operations in the first quarter of 2015 based on the evaluation and estimate of the fair value of the Company's interest in KDAC of approximately $32 million, which was determined primarily based on negotiations with a third party and on a non-binding offer from that potential buyer at the time, in relation to the carrying value of this interest. Subsequently, the Company closed the sale of this interest in the third quarter of 2015, and recognized a gain on the divestiture of $47 million, net of tax expense, within income from discontinued operations during the three months ended September 30, 2015. For the nine months ended September 30, 2015, the Company recorded a net loss of $41 million on the KDAC divestiture within income from discontinued operations, which includes the $88 million impairment loss recorded in the first quarter of 2015, as further described in Note 21. Discontinued Operations.

Other Income, Net

OTHER INCOME, NET

Other income (expense), net included:



	Three Months Ended September 30,					Nine Months Ended September 30,
	2015			2014		2015			2014

	(in millions)
Interest income	$	2		$	2	$	4		$	6
Loss on extinguishment of debt	—			—		(52		)	(34		)
Costs associated with acquisitions	(11		)	—		(12		)	—
Gain on insurance recovery	—			—		—			14
Other, net	(2		)	3		(7		)	5
Other (expense) income, net	$	(11	)	$	5	$	(67	)	$	(9	)

As further discussed in Note 8. Debt, during the nine months ended September 30, 2015, Delphi redeemed for cash the entire aggregate principal amount outstanding of the 6.125% Senior Notes, resulting in a loss on debt extinguishment of approximately $52 million. As further discussed in Note 14. Derivatives and Hedging Activities, during the three and nine months ended September 30, 2015, the Company recorded a loss of $11 million on option contracts entered into in order to hedge portions of the currency risk associated with the cash payment for the proposed acquisition of HellermannTyton, which is reflected within Costs associated with acquisitions in the above table. Also, as further discussed in Note 21. Discontinued Operations, during the three months ended September 30, 2015, Delphi recorded $4 million for certain fees earned pursuant to the transition services agreement in connection with the sale of the Company's wholly owned Thermal Systems business.

During the nine months ended September 30, 2014 Delphi redeemed for cash the entire aggregate principal amount outstanding of the 5.875% Senior Notes and repaid a portion of its indebtedness on the Tranche A Term Loan, resulting in a loss on extinguishment of debt of approximately $34 million. Additionally, during the nine months ended September 30, 2014, Delphi reached a final settlement with its insurance carrier related to a business interruption insurance claim, and received proceeds from this settlement of approximately $14 million, net of related costs and expenses.

Acquisitions And Divestitures

Acquisitions and Divestitures

ACQUISITIONS AND DIVESTITURES

Sale of Thermal Systems Business

On June 30, 2015, Delphi completed the sale of the Company's wholly owned Thermal Systems business. On September 24, 2015, Delphi completed the sale of its interest in its KDAC joint venture. The Company has also entered into a separate agreement for the sale of its interest in its SDAAC joint venture, which is classified as held for sale as of September 30, 2015. Delphi's interests in these joint ventures were previously reported within the Thermal Systems segment. Accordingly, the results of the Thermal Systems business are classified as discontinued operations. Refer to Note 21. Discontinued Operations for further disclosure related to the Company's discontinued operations and the related assets and liabilities classified as held for sale as of September 30, 2015.

Sale of Reception Systems Business

In July 2015, Delphi completed the sale of its Reception Systems business for net cash proceeds of approximately $25 million and $39 million of buyer-assumed pension liabilities. The net sales of this business, which was previously reported within the Electronics and Safety segment, were approximately $55 million for the six months ended June 30, 2015. Delphi recognized a pre-tax gain on the divestiture of $39 million, which is included in cost of sales in the consolidated statement of operations. The results of operations of this business, including the gain on divestiture, were not significant to the consolidated financial statements for any period presented, and the divestiture did not meet the discontinued operations criteria.

Exit of Argentina Electrical Wiring Business

During the second quarter of 2015, Delphi completed the exit of its Electrical Wiring business located in Argentina, which was previously reported within the Electrical/Electronic Architecture segment. Delphi recognized a loss on the divestiture of this business of $14 million within cost of sales in the second quarter of 2015, which included a cash payment by Delphi to the buyer of $7 million. The results of operations of this business, including the loss on divestiture, were not significant to the consolidated financial statements for any period presented, and the disposal did not meet the discontinued operations criteria.

Acquisition of Ottomatika, Inc.

On July 23, 2015, Delphi acquired 100% of the equity interests of Ottomatika, Inc. ("Ottomatika"), an automated vehicle software developer, for total consideration of $32 million. The Company paid $16 million at closing utilizing cash on hand, with additional cash payments totaling $11 million deferred over a period of 3 years and additional contingent consideration of up to $5 million due upon the achievement of certain product development milestones over a 3-year period. The range of the undiscounted amounts the Company could be required to pay is between $0 and $5 million. As of the closing date of the acquisition, the contingent consideration was assigned a fair value of approximately $5 million. The results of operations of Ottomatika are reported within the Electronics and Safety segment from the date of acquisition. Delphi previously held a convertible debt investment in Ottomatika, and as a result of this transaction recognized a gain on its previously held investment of $2 million within other income (expense), net in the consolidated statement of operations.

The acquisition was accounted for as a business combination. The purchase price and related allocation to the acquired net assets of Ottomatika based on their estimated fair values is shown below (in millions):

Assets acquired and liabilities assumed



Purchase price, cash consideration	$	16
Purchase price, deferred consideration	11
Purchase price, fair value of contingent consideration	5
Fair value of previously held investment	4
Total purchase price	$	36

Indefinite-lived intangible assets	$	24
Definite-lived intangible assets	1
Liabilities assumed, net of other assets acquired	(8		)
Identifiable net assets acquired	17
Goodwill resulting from purchase	19
Total purchase price allocation	$	36

Intangible assets include amounts recognized for the fair value of in-process research and development, which will not be amortized, but tested for impairment until the completion or abandonment of the associated research and development efforts, and non-competition agreements, which will be amortized over their useful lives of approximately 4 years. The fair value of these assets was generally estimated utilizing income and market approaches.

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

Acquisition of Antaya Technologies Corporation

On October 31, 2014, the Company acquired 100% of the share capital of Antaya Technologies Corporation (“Antaya”), a leading manufacturer of on-glass connectors to the global automotive industry for approximately $151 million. Antaya has a global footprint with locations in Asia, Europe and North America. The Company paid $140 million at closing, with an additional cash payment of up to $40 million due upon the achievement of certain financial performance metrics over a 3-year period ending October 31, 2017. The range of the undiscounted amounts the Company could be required to pay for this earn-out payment is between $0 and $40 million. As of the closing date of the acquisition, the contingent consideration was assigned a fair value of approximately $11 million. The results of operations of Antaya are reported within the Electrical/Electronic Architecture segment from the date of acquisition.

The acquisition was accounted for as a business combination, with the total purchase price allocated on a preliminary basis using information available, in the fourth quarter of 2014. The purchase price and related allocation were finalized in the three months ended March 31, 2015, and resulted in no adjustments from the amounts disclosed as of December 31, 2014. The final purchase price and related allocation are shown below (in millions):

Assets acquired and liabilities assumed



Purchase price, cash consideration	$	140
Purchase price, fair value of contingent consideration	11
Total purchase price	$	151

Definite-lived intangible assets	$	75
Liabilities assumed, net of other assets acquired	(17		)
Identifiable net assets acquired	58
Goodwill resulting from purchase	93
Total purchase price allocation	$	151

Intangible assets include amounts recognized for the fair value of customer-based and technology-related assets, and will be amortized over their useful lives of approximately 14 years. The fair value of these assets was generally estimated utilizing income and market approaches. The Company acquired Antaya utilizing cash on hand.

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

Acquisition of Unwired Holdings, Inc.

On October 1, 2014, Delphi acquired 100% of the equity interests of Unwired Holdings, Inc., ("Unwired"), a media connectivity module supplier to the global automotive industry, for $191 million, net of approximately $19 million for acquired cash, excess net working capital and certain tax benefits. The results of operations of Unwired are reported within the Electrical/Electronic Architecture segment from the date of acquisition.

The acquisition was accounted for as a business combination, with the total purchase price allocated on a preliminary basis using information available, in the fourth quarter of 2014. The purchase price and related allocation were finalized in the three months ended June 30, 2015, and certain adjustments were recorded to the purchase price, goodwill and other assets purchased and liabilities assumed from the amounts disclosed as of December 31, 2014. These adjustments were not significant for any period presented after the acquisition date. The final purchase price and related allocation are shown below (in millions):

Assets acquired and liabilities assumed



Purchase price, cash consideration	$	191
Purchase price, acquired cash, excess net working capital and certain tax benefits	19
Total purchase price	$	210

Definite-lived intangible assets	$	63
Other assets purchased and liabilities assumed, net	17
Identifiable net assets acquired	80
Goodwill resulting from purchase	130
Total purchase price allocation	$	210

The acquired other intangible assets include both developed technology and customer relationships, and will be amortized over their estimated useful lives of approximately 10 years. The fair value of these assets was generally estimated utilizing income and market approaches. The Company acquired Unwired utilizing cash on hand.

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

Acquisition of Control-Tec LLC

On October 22, 2015, Delphi agreed to acquire Control-Tec LLC ("Control-Tec"), a leading provider of telematics and cloud-hosted data analytics solutions, for a purchase price of $105 million due at closing, subject to certain post-closing adjustments, with an additional cash payment of up to $40 million due upon the achievement of certain financial performance metrics over a future 3-year period beginning after the acquisition is closed. The acquisition is subject to the satisfaction of customary closing conditions and the receipt of regulatory and other approvals, and is expected to close in the fourth quarter of 2015. The Company intends to acquire Control-Tec utilizing cash on hand. Upon completion, Control-Tec will become part of Delphi’s Electronics and Safety segment.

Offer to Acquire HellermannTyton Group PLC

On July 30, 2015, Delphi and HellermannTyton Group PLC ("HellermannTyton"), a public limited company registered in England and Wales, and a leading global manufacturer of high-performance and innovative cable management solutions, announced the terms of a recommended cash offer by Delphi to acquire all of the issued and to be issued ordinary share capital of HellermannTyton for 480 pence per share, or approximately £1.07 billion in the aggregate (approximately $1.66 billion, based on the GBP:USD exchange rate of 1:1.54 on July 27, 2015), and an implied enterprise value of $1.85 billion. The transaction received the approval of HellermannTyton's shareholders on October 15, 2015, and is expected to close in the fourth quarter of 2015, subject to regulatory consents and approvals. Upon completion, HellermannTyton will become part of Delphi’s Electrical/Electronic Architecture segment.

In connection with the offer to acquire HellermannTyton, in July 2015, £540 million ($844 million using July 30, 2015 foreign currency rates) of cash was placed on deposit for purposes of satisfying payment of the consideration to effect the acquisition. The deposit was funded with cash on hand, along with amounts borrowed on the Revolving Credit Facility, the Company's European accounts receivable factoring facility and approximately $80 million of other European short-term borrowings. The deposit ($820 million using September 30, 2015 foreign currency rates) is recorded within other long-term assets in the consolidated balance sheet as of September 30, 2015. Delphi’s exposure to fluctuations in the GBP:USD exchange rate related to the deposit are naturally offset by other exposures within Delphi’s consolidated operations.

Also in connection with the offer to acquire HellermannTyton, on July 30, 2015, Delphi Automotive PLC and certain of its subsidiaries, certain financial institutions from time to time party thereto, as lenders and Barclays Bank PLC, as administrative agent, entered into a Senior Bridge Credit Agreement (the "Senior Bridge Credit Agreement"), pursuant to which, the lenders thereunder agreed to provide a £550 million bridge term loan facility. Delphi and Delphi Corporation are borrowers under the Senior Bridge Credit Agreement. The bridge term loans are available to be drawn in U.S. Dollars or Pounds Sterling for a period of 364 days, subject to the terms and conditions set forth in the Senior Bridge Credit Agreement, including customary certain funds conditions.

The proceeds of the bridge term loans may be used by Delphi and Delphi Corporation to finance the acquisition of HellermannTyton and to pay certain fees and expenses, as further provided in the Senior Bridge Credit Agreement. The Senior Bridge Credit Agreement provides that, consistent with Delphi Corporation’s existing credit facility, upon the maintenance of certain credit ratings criteria, subsidiaries of Delphi Corporation will not be required to provide guaranties, Delphi and its subsidiaries will not be required to provide collateral and certain negative covenants will remain suspended, subject, in each case, to potential reinstatement if the credit ratings criteria cease to be satisfied.

The Company has not drawn on the Senior Bridge Credit Agreement.

Other

During the second quarter of 2015, the Company's Powertrain Systems segment made a $20 million investment in Tula Technology Inc., an engine control software company, and the Electronics and Safety segment made a $3 million investment in Quanergy, a leader in 3D Light Detection and Ranging (“LIDAR”) sensing technology for automated driving. The Company's investments are accounted for under the cost method.

Share-Based Compensation

SHARE-BASED COMPENSATION

Long Term Incentive Plan

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

Board of Director Awards

On April 3, 2014, Delphi granted 24,144 RSUs to the Board of Directors at a grant date fair value of approximately $2 million. The grant date fair value was determined based on the closing price of the Company's ordinary shares on April 3, 2014. The RSUs vested on April 22, 2015, and 24,482 ordinary shares, which included shares issued in connection with dividend equivalents, were issued to members of the Board of Directors at a fair value of approximately $2 million. 2,673 ordinary shares were withheld to cover the minimum U.K. withholding taxes.

On April 23, 2015, Delphi granted 20,347 RSUs to the Board of Directors at a grant date fair value of approximately $2 million. The grant date fair value was determined based on the closing price of the Company's ordinary shares on April 23, 2015. The RSUs will vest on April 27, 2016, the day before the 2016 annual meeting of shareholders.

Executive Awards

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



Metric	2013 - 2015 Grants	2012 Grant
Average return on net assets (1)	50%	50%
Cumulative net income	N/A	30%
Cumulative earnings per share (2)	30%	N/A
Relative total shareholder return (3)	20%	20%


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


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

(3)

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

The details of the executive grants were as follows:



Grant Date	RSUs Granted	Time-Based Award Vesting Dates	Performance-Based Award Vesting Date
	(in millions)
February 2012	1.88	Annually on anniversary of grant date, 2013 - 2015	December 31, 2014
February 2013	1.45	Annually on anniversary of grant date, 2014 - 2016	December 31, 2015
February 2014	0.78	Annually on anniversary of grant date, 2015 - 2017	December 31, 2016
February 2015	0.90	Annually on anniversary of grant date, 2016 - 2018	December 31, 2017

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

In February 2014, under the time-based vesting terms of the 2012 and 2013 grants, 365,930 ordinary shares were issued to Delphi executives at a fair value of $23 million, of which 131,913 ordinary shares were withheld to cover minimum withholding taxes.

In February 2015, under the time-based vesting terms of the 2012, 2013 and 2014 grants, 535,345 ordinary shares were issued to Delphi executives at a fair value of $42 million, of which 199,211 ordinary shares were withheld to cover minimum withholding taxes.

The performance-based RSUs associated with the 2012 grant vested at the completion of a three-year performance period on December 31, 2014, and in the first quarter of 2015, 1,364,966 ordinary shares were issued to Delphi executives at a fair value of $107 million, of which 545,192 ordinary shares were withheld to cover minimum withholding taxes.

The grant date fair value of the RSUs is determined based on the closing price of the Company’s ordinary shares on the date of the grant of the award, including an estimate for forfeitures, and a contemporaneous valuation performed by an independent valuation specialist with respect to the relative total shareholder return awards. Based on the target number of awards issued for the February 2015, 2014 and 2013 grants, the fair value at grant date was estimated to be approximately $76 million, $53 million and $60 million, respectively.

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



	RSUs		Weighted Average Grant Date Fair Value
	(in thousands)
Nonvested, January 1, 2015	2,274		$	50.38
Granted	946		84.55
Vested	(527	)	39.95
Forfeited	(174	)	63.23
Nonvested, September 30, 2015	2,519		64.51

Delphi recognized compensation expense of $18 million ($14 million, net of tax) and $21 million ($16 million, net of tax) based on the Company’s best estimate of ultimate performance against the respective targets during the three months ended September 30, 2015 and 2014, respectively. Delphi recognized compensation expense of $53 million ($41 million, net of tax) and $54 million ($41 million, net of tax) based on the Company’s best estimate of ultimate performance against the respective targets during the nine months ended September 30, 2015 and 2014, respectively. Delphi will continue to recognize compensation expense, based on the grant date fair value of the awards applied to the Company’s best estimate of ultimate performance against the respective targets, over the requisite vesting periods of the awards. Based on the grant date fair value of the awards and the Company’s best estimate of ultimate performance against the respective targets as of September 30, 2015, unrecognized compensation expense on a pre-tax basis of approximately $105 million is anticipated to be recognized over a weighted average period of approximately 2 years. For the nine months ended September 30, 2015 and 2014, respectively, approximately $58 million and $8 million of cash was paid and reflected as a financing activity in the statements of cash flows related to the minimum statutory tax withholding for vested RSUs.

Supplemental Guarantor And Non-Guarantor Condensed Consolidating Financial Statements

SUPPLEMENTAL GUARANTOR AND NON-GUARANTOR CONDENSED CONSOLIDATING FINANCIAL STATEMENTS

Basis of Presentation

Notes Issued by the Subsidiary Issuer

As described in Note 8. Debt, Delphi Corporation (the "Subsidiary Issuer/Guarantor"), a 100% owned subsidiary of Delphi Automotive PLC (the "Parent"), issued the 2011 Senior Notes, the 2013 Senior Notes and the 2014 Senior Notes, each of which were registered under the Securities Act. The 2011 Senior Notes were subsequently redeemed and extinguished in March 2014 and March 2015. The 2013 Senior Notes, 2014 Senior Notes and, prior to their redemption, the 2011 Senior Notes, are fully and unconditionally guaranteed by Delphi Automotive PLC and certain of Delphi Automotive PLC's direct and indirect subsidiary companies, which are directly or indirectly 100% owned by Delphi Automotive PLC (the “Subsidiary Guarantors”), on a joint and several basis, subject to customary release provisions (other than in the case of Delphi Automotive PLC). All other consolidated direct and indirect subsidiaries of Delphi Automotive PLC are not subject to the guarantees (“Non-Guarantor Subsidiaries”).

Notes Issued by the Parent

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

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

The historical presentation of certain intercompany accounts and activity within the supplemental guarantor condensed consolidating financial statements has been revised to be consistent with the presentation as of September 30, 2015.

Statement of Operations Three Months Ended September 30, 2015



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

	(in millions)
Net sales	$	—		$	—		$	—		$	3,631		$	—		$	3,631
Operating expenses:
Cost of sales	—			—			(6		)	2,868			—			2,862
Selling, general and administrative	38			—			—			211			—			249
Amortization	—			—			—			23			—			23
Restructuring	—			—			—			36			—			36
Total operating expenses	38			—			(6		)	3,138			—			3,170
Operating (loss) income	(38		)	—			6			493			—			461
Interest (expense) income	(29		)	(8		)	(45		)	(19		)	71			(30		)
Other income (expense), net	—			23			10			27			(71		)	(11		)
(Loss) income from continuing operations before income taxes and equity income	(67		)	15			(29		)	501			—			420
Income tax benefit (expense)	—			—			11			(72		)	—			(61		)
(Loss) income from continuing operations before equity income	(67		)	15			(18		)	429			—			359
Equity in net income of affiliates	—			—			—			5			—			5
Equity in net income (loss) of subsidiaries	471			456			96			—			(1,023		)	—
Income from continuing operations	404			471			78			434			(1,023		)	364
Income from discontinued operations, net of tax	—			—			—			54			—			54
Net income (loss)	404			471			78			488			(1,023		)	418
Net income attributable to noncontrolling interest	—			—			—			14			—			14
Net income (loss) attributable to Delphi	$	404		$	471		$	78		$	474		$	(1,023	)	$	404

Statement of Operations Nine Months Ended September 30, 2015



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

	(in millions)
Net sales	$	—		$	—		$	—		$	11,286		$	—		$	11,286
Operating expenses:
Cost of sales	—			—			(6		)	9,000			—			8,994
Selling, general and administrative	64			—			—			701			—			765
Amortization	—			—			—			70			—			70
Restructuring	—			—			—			69			—			69
Total operating expenses	64			—			(6		)	9,840			—			9,898
Operating (loss) income	(64		)	—			6			1,446			—			1,388
Interest (expense) income	(75		)	(23		)	(128		)	(70		)	204			(92		)
Other income (expense), net	—			58			3			76			(204		)	(67		)
(Loss) income from continuing operations before income taxes and equity income	(139		)	35			(119		)	1,452			—			1,229
Income tax benefit (expense)	—			—			44			(246		)	—			(202		)
(Loss) income from continuing operations before equity income	(139		)	35			(75		)	1,206			—			1,027
Equity in net income of affiliates	—			—			—			10			—			10
Equity in net income (loss) of subsidiaries	1,397			1,362			358			—			(3,117		)	—
Income from continuing operations	1,258			1,397			283			1,216			(3,117		)	1,037
Income from discontinued operations, net of tax	—			—			—			277			—			277
Net income (loss)	1,258			1,397			283			1,493			(3,117		)	1,314
Net income attributable to noncontrolling interest	—			—			—			56			—			56
Net income (loss) attributable to Delphi	$	1,258		$	1,397		$	283		$	1,437		$	(3,117	)	$	1,258

Statement of Operations Three Months Ended September 30, 2014



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

	(in millions)
Net sales	$	—		$	—		$	—		$	3,762		$	—		$	3,762
Operating expenses:
Cost of sales	—			—			—			3,041			—			3,041
Selling, general and administrative	31			—			—			228			—			259
Amortization	—			—			—			24			—			24
Restructuring	—			—			—			46			—			46
Total operating expenses	31			—			—			3,339			—			3,370
Operating (loss) income	(31		)	—			—			423			—			392
Interest (expense) income	(6		)	(9		)	(45		)	(17		)	44			(33		)
Other income (expense), net	—			17			17			15			(44		)	5
(Loss) income from continuing operations before income taxes and equity income	(37		)	8			(28		)	421			—			364
Income tax benefit (expense)	1			—			10			(67		)	—			(56		)
(Loss) income from continuing operations before equity income	(36		)	8			(18		)	354			—			308
Equity in net income of affiliates	—			—			—			5			—			5
Equity in net income (loss) of subsidiaries	341			333			47			—			(721		)	—
Income from continuing operations	305			341			29			359			(721		)	313
Income from discontinued operations, net of tax	—			—			—			12			—			12
Net income (loss)	305			341			29			371			(721		)	325
Net income attributable to noncontrolling interest	—			—			—			20			—			20
Net income (loss) attributable to Delphi	$	305		$	341		$	29		$	351		$	(721	)	$	305

Statement of Operations Nine Months Ended September 30, 2014



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

	(in millions)
Net sales	$	—		$	—		$	—		$	11,721		$	—		$	11,721
Operating expenses:
Cost of sales	—			—			—			9,467			—			9,467
Selling, general and administrative	66			—			—			702			—			768
Amortization	—			—			—			71			—			71
Restructuring	—			—			—			121			—			121
Total operating expenses	66			—			—			10,361			—			10,427
Operating (loss) income	(66		)	—			—			1,360			—			1,294
Interest (expense) income	(15		)	(25		)	(137		)	(53		)	129			(101		)
Other income (expense), net	—			51			14			55			(129		)	(9		)
(Loss) income from continuing operations before income taxes and equity income	(81		)	26			(123		)	1,362			—			1,184
Income tax benefit (expense)	1			—			45			(227		)	—			(181		)
(Loss) income from continuing operations before equity income	(80		)	26			(78		)	1,135			—			1,003
Equity in net income of affiliates	—			—			—			15			—			15
Equity in net income (loss) of subsidiaries	1,087			1,061			189			—			(2,337		)	—
Income from continuing operations	1,007			1,087			111			1,150			(2,337		)	1,018
Income from discontinued operations, net of tax	—			—			—			54			—			54
Net income (loss)	1,007			1,087			111			1,204			(2,337		)	1,072
Net income attributable to noncontrolling interest	—			—			—			65			—			65
Net income (loss) attributable to Delphi	$	1,007		$	1,087		$	111		$	1,139		$	(2,337	)	$	1,007

Statement of Comprehensive Income Three Months Ended September 30, 2015



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

	(in millions)
Net income (loss)	$	404		$	471		$	78		$	488		$	(1,023	)	$	418
Other comprehensive income (loss):
Currency translation adjustments	(5		)	—			—			(115		)	—			(120		)
Net change in unrecognized gain (loss) on derivative instruments, net of tax	—			—			—			(33		)	—			(33		)
Employee benefit plans adjustment, net of tax	—			—			—			24			—			24
Other comprehensive loss	(5		)	—			—			(124		)	—			(129		)
Equity in other comprehensive income (loss) of subsidiaries	(113		)	(185		)	(23		)	—			321			—
Comprehensive income (loss)	286			286			55			364			(702		)	289
Comprehensive income attributable to noncontrolling interests	—			—			—			3			—			3
Comprehensive income (loss) attributable to Delphi	$	286		$	286		$	55		$	361		$	(702	)	$	286

Statement of Comprehensive Income Nine Months Ended September 30, 2015



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

	(in millions)
Net income (loss)	$	1,258		$	1,397		$	283		$	1,493		$	(3,117	)	$	1,314
Other comprehensive income (loss):
Currency translation adjustments	(27		)	—			—			(266		)	—			(293		)
Net change in unrecognized gain (loss) on derivative instruments, net of tax	—			—			—			(39		)	—			(39		)
Employee benefit plans adjustment, net of tax	—			—			—			46			—			46
Other comprehensive loss	(27		)	—			—			(259		)	—			(286		)
Equity in other comprehensive income (loss) of subsidiaries	(247		)	(413		)	(26		)	—			686			—
Comprehensive income (loss)	984			984			257			1,234			(2,431		)	1,028
Comprehensive income attributable to noncontrolling interests	—			—			—			44			—			44
Comprehensive income (loss) attributable to Delphi	$	984		$	984		$	257		$	1,190		$	(2,431	)	$	984

Statement of Comprehensive Income Three Months Ended September 30, 2014



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

	(in millions)
Net income (loss)	$	305		$	341		$	29		$	371		$	(721	)	$	325
Other comprehensive income (loss):
Currency translation adjustments	—			—			—			(179		)	—			(179		)
Net change in unrecognized gain (loss) on derivative instruments, net of tax	—			—			—			(23		)	—			(23		)
Employee benefit plans adjustment, net of tax	—			—			—			12			—			12
Other comprehensive loss	—			—			—			(190		)	—			(190		)
Equity in other comprehensive income (loss) of subsidiaries	(187		)	(223		)	(10		)	—			420			—
Comprehensive income (loss)	118			118			19			181			(301		)	135
Comprehensive income attributable to noncontrolling interests	—			—			—			17			—			17
Comprehensive income (loss) attributable to Delphi	$	118		$	118		$	19		$	164		$	(301	)	$	118

Statement of Comprehensive Income Nine Months Ended September 30, 2014



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

	(in millions)
Net income (loss)	$	1,007		$	1,087		$	111		$	1,204		$	(2,337	)	$	1,072
Other comprehensive income (loss):
Currency translation adjustments	—			—			—			(172		)	—			(172		)
Net change in unrecognized gain (loss) on derivative instruments, net of tax	—			—			—			(16		)	—			(16		)
Employee benefit plans adjustment, net of tax	—			—			—			14			—			14
Other comprehensive loss	—			—			—			(174		)	—			(174		)
Equity in other comprehensive income (loss) of subsidiaries	(169		)	(249		)	(1		)	—			419			—
Comprehensive income (loss)	838			838			110			1,030			(1,918		)	898
Comprehensive income attributable to noncontrolling interests	—			—			—			60			—			60
Comprehensive income (loss) attributable to Delphi	$	838		$	838		$	110		$	970		$	(1,918	)	$	838

Balance Sheet as of September 30, 2015



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

	(in millions)
ASSETS
Current assets:
Cash and cash equivalents	$	29	$	1	$	—	$	404	$	—		$	434
Restricted cash	—		—		—		2		—			2
Accounts receivable, net	—		—		—		2,615		—			2,615
Intercompany receivables, current	—		1,079		434		4,232		(5,745		)	—
Inventories	—		—		—		1,187		—			1,187
Other current assets	—		—		5		624		—			629
Current assets held for sale	—		—		—		187		—			187
Total current assets	29		1,080		439		9,251		(5,745		)	5,054
Long-term assets:
Intercompany receivables, long-term	—		813		992		1,578		(3,383		)	—
Property, net	—		—		—		3,010		—			3,010
Investments in affiliates	—		—		—		93		—			93
Investments in subsidiaries	7,128		7,088		3,059		—		(17,275		)	—
Intangible assets, net	—		—		—		1,304		—			1,304
Other long-term assets	5		—		29		1,297		—			1,331
Total long-term assets	7,133		7,901		4,080		7,282		(20,658		)	5,738
Total assets	$	7,162	$	8,981	$	4,519	$	16,533	$	(26,403	)	$	10,792
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Short-term debt	$	—	$	—	$	60	$	364	$	—		$	424
Accounts payable	—		—		—		2,327		—			2,327
Intercompany payables, current	4,041		551		898		251		(5,741		)	—
Accrued liabilities	21		—		11		1,150		—			1,182
Current liabilities held for sale	—		—		—		95		—			95
Total current liabilities	4,062		551		969		4,187		(5,741		)	4,028
Long-term liabilities:
Long-term debt	784		—		1,898		16		—			2,698
Intercompany payables, long-term	—		1,302		1,040		1,042		(3,384		)	—
Pension benefit obligations	—		—		—		898		—			898
Other long-term liabilities	—		—		13		381		—			394
Total long-term liabilities	784		1,302		2,951		2,337		(3,384		)	3,990
Total liabilities	4,846		1,853		3,920		6,524		(9,125		)	8,018
Total Delphi shareholders’ equity	2,316		7,128		599		9,551		(17,278		)	2,316
Noncontrolling interest	—		—		—		458		—			458
Total shareholders’ equity	2,316		7,128		599		10,009		(17,278		)	2,774
Total liabilities and shareholders’ equity	$	7,162	$	8,981	$	4,519	$	16,533	$	(26,403	)	$	10,792

Balance Sheet as of December 31, 2014



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

	(in millions)
ASSETS
Current assets:
Cash and cash equivalents	$	9	$	1	$	—	$	849	$	—		$	859
Restricted cash	—		—		—		1		—			1
Accounts receivable, net	—		—		—		2,400		—			2,400
Intercompany receivables, current	88		198		1,397		2,046		(3,729		)	—
Inventories	—		—		—		1,013		—			1,013
Other current assets	—		—		—		567		—			567
Current assets held for sale	—		—		—		384		—			384
Total current assets	97		199		1,397		7,260		(3,729		)	5,224
Long-term assets:
Intercompany receivables, long-term	—		775		947		1,519		(3,241		)	—
Property, net	—		—		—		3,021		—			3,021
Investments in affiliates	—		—		—		98		—			98
Investments in subsidiaries	5,215		6,071		1,644		—		(12,930		)	—
Intangible assets, net	—		—		—		1,384		—			1,384
Other long-term assets	—		—		42		466		—			508
Long-term assets held for sale	—		—		—		511		—			511
Total long-term assets	5,215		6,846		2,633		6,999		(16,171		)	5,522
Total assets	$	5,312	$	7,045	$	4,030	$	14,259	$	(19,900	)	$	10,746
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Short-term debt	$	—	$	—	$	—	$	34	$	—		$	34
Accounts payable	2		—		—		2,276		—			2,278
Intercompany payables, current	2,800		536		89		303		(3,728		)	—
Accrued liabilities	—		—		29		1,192		—			1,221
Current liabilities held for sale	—		—		—		356		—			356
Total current liabilities	2,802		536		118		4,161		(3,728		)	3,889
Long-term liabilities:
Long-term debt	—		—		2,398		19		—			2,417
Intercompany payables, long-term	—		1,294		1,001		947		(3,242		)	—
Pension benefit obligations	—		—		—		1,002		—			1,002
Other long-term liabilities	—		—		11		379		—			390
Long-term liabilities held for sale	—		—		—		35		—			35
Total long-term liabilities	—		1,294		3,410		2,382		(3,242		)	3,844
Total liabilities	2,802		1,830		3,528		6,543		(6,970		)	7,733
Total Delphi shareholders’ equity	2,510		5,215		502		7,213		(12,930		)	2,510
Noncontrolling interest	—		—		—		503		—			503
Total shareholders’ equity	2,510		5,215		502		7,716		(12,930		)	3,013
Total liabilities and shareholders’ equity	$	5,312	$	7,045	$	4,030	$	14,259	$	(19,900	)	$	10,746

Statement of Cash Flows for the Nine Months Ended September 30, 2015



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

	(in millions)
Net cash (used in) provided by operating activities from continuing operations	$	(15	)	$	100		$	—		$	1,044		$	(100	)	$	1,029
Net cash used in operating activities from discontinued operations	—			—			—			(21		)	—			(21		)
Net cash (used in) provided by operating activities	(15		)	100			—			1,023			(100		)	1,008
Cash flows from investing activities:
Capital expenditures	—			—			—			(539		)	—			(539		)
Proceeds from sale of property / investments	—			—			—			7			—			7
Net proceeds from divestiture of discontinued operations	—			—			—			730			—			730
Proceeds from business divestitures, net of $7 payment in 2015	—			—			—			18			—			18
Cost of business, investment and technology acquisitions, net of cash acquired	—			—			—			(38		)	—			(38		)
Deposit for acquisition of HellermannTyton	—			—			—			(844		)	—			(844		)
Increase in restricted cash	—			—			—			(1		)	—			(1		)
Loans to affiliates	—			(853		)	(342		)	(1,237		)	2,432			—
Repayments of loans from affiliates	—			—			135			—			(135		)	—
Investments in subsidiaries	(753		)	—			—			—			753			—
Net cash (used in) provided by investing activities from continuing operations	(753		)	(853		)	(207		)	(1,904		)	3,050			(667		)
Net cash used in investing activities from discontinued operations	—			—			—			(68		)	—			(68		)
Net cash (used in) provided by investing activities	(753		)	(853		)	(207		)	(1,972		)	3,050			(735		)
Cash flows from financing activities:
Net proceeds under other short-term debt agreements	—			—			—			399			—			399
Repayment of senior notes	—			—			(546		)	—			—			(546		)
Proceeds from issuance of senior notes, net of issuance costs	753			—			—			—			—			753
Dividend payments of consolidated affiliates to minority shareholders	—			—			—			(63		)	—			(63		)
Proceeds from borrowings from affiliates	1,332			—			853			247			(2,432		)	—
Payments on borrowings from affiliates	(135		)	—			—			—			135			—
Investment from parent	—			753			—			—			(753		)	—
Dividends paid to affiliates	—			—			(100		)	—			100			—
Repurchase of ordinary shares	(946		)	—			—			—			—			(946		)
Distribution of cash dividends	(216		)	—			—			—			—			(216		)
Taxes withheld and paid on employees' restricted share awards	—			—			—			(58		)	—			(58		)
Net cash provided by (used in) financing activities	788			753			207			525			(2,950		)	(677		)
Effect of exchange rate fluctuations on cash and cash equivalents	—			—			—			(41		)	—			(41		)
Increase (decrease) in cash and cash equivalents	20			—			—			(465		)	—			(445		)
Cash and cash equivalents at beginning of period	9			1			—			894			—			904
Cash and cash equivalents at end of period	$	29		$	1		$	—		$	429		$	—		$	459
Cash and cash equivalents of discontinued operations	$	—		$	—		$	—		$	25		$	—		$	25
Cash and cash equivalents of continuing operations	$	29		$	1		$	—		$	404		$	—		$	434

Statement of Cash Flows for the Nine Months Ended September 30, 2014



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

	(in millions)
Net cash provided by operating activities from continuing operations	$	37		$	—		$	—		$	1,178		$	—		$	1,215
Net cash provided by operating activities from discontinued operations	—			—			—			47			—			47
Net cash provided by operating activities	37			—			—			1,225			—			1,262
Cash flows from investing activities:
Capital expenditures	—			—			—			(601		)	—			(601		)
Proceeds from sale of property	—			—			—			7			—			7
Decrease in restricted cash	—			—			—			1			—			1
Loans to affiliates	—			—			(745		)	(848		)	1,593			—
Repayments of loans from affiliates	—			—			55			254			(309		)	—
Return of investments in subsidiaries	—			—			270			—			(270		)	—
Net cash (used in) provided by investing activities from continuing operations	—			—			(420		)	(1,187		)	1,014			(593		)
Net cash used in investing activities from discontinued operations	—			—			—			(64		)	—			(64		)
Net cash (used in) provided by investing activities	—			—			(420		)	(1,251		)	1,014			(657		)
Cash flows from financing activities:
Net proceeds under other short-term debt agreements	—			—			—			9			—			9
Repayments under long-term debt agreements	—			—			(164		)	—			—			(164		)
Repayment of senior notes	—			—			(526		)	—			—			(526		)
Proceeds from issuance of senior notes, net of issuance costs	—			—			691			—			—			691
Dividend payments of consolidated affiliates to minority shareholders	—			—			—			(61		)	—			(61		)
Proceeds from borrowings from affiliates	920			144			529			—			(1,593		)	—
Payments on borrowings from affiliates	(55		)	(144		)	(110		)	—			309			—
Capital distributions to affiliates	—			—			—			(270		)	270			—
Repurchase of ordinary shares	(662		)	—			—			—			—			(662		)
Distribution of cash dividends	(228		)	—			—			—			—			(228		)
Taxes withheld and paid on employees' restricted share awards	—			—			—			(8		)	—			(8		)
Net cash (used in) provided by financing activities	(25		)	—			420			(330		)	(1,014		)	(949		)
Effect of exchange rate fluctuations on cash and cash equivalents	—			—			—			(19		)	—			(19		)
Increase (decrease) in cash and cash equivalents	12			—			—			(375		)	—			(363		)
Cash and cash equivalents at beginning of period	7			—			—			1,382			—			1,389
Cash and cash equivalents at end of period	$	19		$	—		$	—		$	1,007		$	—		$	1,026
Cash and cash equivalents of discontinued operations	$	—		$	—		$	—		$	19		$	—		$	19
Cash and cash equivalents of continuing operations	$	19		$	—		$	—		$	988		$	—		$	1,007

Segment Reporting

SEGMENT REPORTING

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


•	Electrical/Electronic Architecture, which includes complete electrical architecture and component products.


•	Powertrain Systems, which includes extensive systems integration expertise in gasoline, diesel and fuel handling and full end-to-end systems including fuel and air injection, combustion, electronics controls, exhaust handling, test and validation capabilities, aftermarket and original equipment service.


•	Electronics and Safety, which includes component and systems integration expertise in infotainment and connectivity, body controls and security systems, displays, mechatronics, passive and active safety electronics and electric and hybrid electric vehicle power electronics, as well as advanced development of software.


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

The accounting policies of the segments are the same as those described in Note 2. Significant Accounting Policies, except that the disaggregated financial results for the segments have been prepared using a management approach, which is consistent with the basis and manner in which management internally disaggregates financial information for the purposes of assisting internal operating decisions. Generally, Delphi evaluates performance based on stand-alone segment net income before interest expense, other income (expense), net, income tax expense, equity income (loss), net of tax, income (loss) from discontinued operations, net of tax, restructuring, other project and integration costs related to acquisitions and other portfolio transactions, asset impairments and gains (losses) on business divestitures (“Adjusted Operating Income”) and accounts for inter-segment sales and transfers as if the sales or transfers were to third parties, at current market prices. Delphi’s management utilizes Adjusted Operating Income as the key performance measure of segment income or loss and for planning and forecasting purposes, as management believes this measure is most reflective of the operational profitability or loss of Delphi's operating segments. Segment Adjusted Operating Income should not be considered a substitute for results prepared in accordance with U.S. GAAP and should not be considered an alternative to net income attributable to Delphi, which is the most directly comparable financial measure to Adjusted Operating Income that is in accordance with U.S. GAAP. Segment Adjusted Operating Income, as determined and measured by Delphi, should also not be compared to similarly titled measures reported by other companies.

As described in Note 21. Discontinued Operations, the Company's previously reported Thermal Systems segment has been classified as discontinued operations, which required retrospective application to balance sheet, statement of operations and certain cash flow financial information for all periods presented. Discontinued operations also includes the Company's thermal original equipment service business, which was included in the sale of the wholly owned Thermal Systems business, the results of which were previously reported within the Powertrain Systems segment. Certain operations, primarily related to contract manufacturing services, which were previously included within the Thermal Systems reporting segment but which were not included in the scope of the divestiture, are reported in continuing operations and have been reclassified within the Electronics and Safety segment for all periods presented. Amounts for shared general and administrative operating expenses that were allocated to the Thermal Systems business in prior periods have been re-allocated to the Company's reportable operating segments.

Included below are sales and operating data for Delphi’s segments for the three and nine months ended September 30, 2015 and 2014.



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

	(in millions)
For the Three Months Ended September 30, 2015:
Net sales	$	1,941	$	1,057	$	675	$	(42	)	$	3,631
Depreciation & amortization	$	67	$	45	$	19	$	—		$	131
Adjusted operating income	$	263	$	124	$	83	$	—		$	470
Operating income	$	245	$	101	$	115	$	—		$	461
Equity income	$	5	$	—	$	—	$	—		$	5
Net income attributable to noncontrolling interest	$	8	$	5	$	—	$	—		$	13



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

	(in millions)
For the Three Months Ended September 30, 2014:
Net sales	$	1,993	$	1,117		$	704	$	(52	)	$	3,762
Depreciation & amortization	$	67	$	50		$	20	$	—		$	137
Adjusted operating income	$	249	$	114		$	82	$	—		$	445
Operating income	$	221	$	104		$	67	$	—		$	392
Equity income (loss)	$	6	$	(1	)	$	—	$	—		$	5
Net income attributable to noncontrolling interest	$	8	$	6		$	—	$	—		$	14



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

	(in millions)
For the Nine Months Ended September 30, 2015:
Net sales	$	6,063	$	3,281	$	2,070	$	(128	)	$	11,286
Depreciation & amortization	$	202	$	134	$	58	$	—		$	394
Adjusted operating income	$	819	$	399	$	250	$	—		$	1,468
Operating income	$	765	$	357	$	266	$	—		$	1,388
Equity income	$	10	$	—	$	—	$	—		$	10
Net income attributable to noncontrolling interest	$	25	$	23	$	—	$	—		$	48



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

	(in millions)
For the Nine Months Ended September 30, 2014:
Net sales	$	6,269	$	3,402		$	2,201	$	(151	)	$	11,721
Depreciation & amortization	$	197	$	149		$	60	$	—		$	406
Adjusted operating income	$	812	$	365		$	251	$	—		$	1,428
Operating income	$	753	$	316		$	225	$	—		$	1,294
Equity income (loss)	$	16	$	(1	)	$	—	$	—		$	15
Net income attributable to noncontrolling interest	$	25	$	24		$	—	$	—		$	49


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

The reconciliation of Adjusted Operating Income to Operating Income includes restructuring, other project and integration costs related to acquisitions and other portfolio transactions, asset impairments and gains (losses) on business divestitures. The reconciliation of Adjusted Operating Income to net income attributable to Delphi for the three and nine months ended September 30, 2015 and 2014 are as follows:



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

	(in millions)
For the Three Months Ended September 30, 2015:
Adjusted operating income	$	263		$	124		$	83		$	—	$	470
Restructuring	(13		)	(19		)	(4		)	—		(36		)
Other acquisition and portfolio project costs	(5		)	(4		)	(3		)	—		(12		)
Gain (loss) on business divestitures, net	—			—			39			—		39
Operating income	$	245		$	101		$	115		$	—	461
Interest expense												(30		)
Other income (expense), net												(11		)
Income from continuing operations before income taxes and equity income												420
Income tax expense												(61		)
Equity income, net of tax												5
Income from continuing operations												364
Income from discontinued operations, net of tax												54
Net income												418
Net income attributable to noncontrolling interest												14
Net income attributable to Delphi												$	404



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

	(in millions)
For the Three Months Ended September 30, 2014:
Adjusted operating income	$	249		$	114		$	82		$	—	$	445
Restructuring	(24		)	(9		)	(13		)	—		(46		)
Other acquisition and portfolio project costs	(3		)	—			—			—		(3		)
Asset impairments	(1		)	(1		)	(2		)	—		(4		)
Operating income	$	221		$	104		$	67		$	—	392
Interest expense												(33		)
Other income (expense), net												5
Income from continuing operations before income taxes and equity income												364
Income tax expense												(56		)
Equity income, net of tax												5
Income from continuing operations												313
Income from discontinued operations, net of tax												12
Net income												325
Net income attributable to noncontrolling interest												20
Net income attributable to Delphi												$	305



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

	(in millions)
For the Nine Months Ended September 30, 2015:
Adjusted operating income	$	819		$	399		$	250		$	—	$	1,468
Restructuring	(22		)	(33		)	(14		)	—		(69		)
Other acquisition and portfolio project costs	(15		)	(9		)	(6		)	—		(30		)
Asset impairments	(3		)	—			(3		)	—		(6		)
Gain (loss) on business divestitures, net	(14		)	—			39			—		25
Operating income	$	765		$	357		$	266		$	—	1,388
Interest expense												(92		)
Other income (expense), net												(67		)
Income from continuing operations before income taxes and equity income												1,229
Income tax expense												(202		)
Equity income, net of tax												10
Income from continuing operations												1,037
Income from discontinued operations, net of tax												277
Net income												1,314
Net income attributable to noncontrolling interest												56
Net income attributable to Delphi												$	1,258



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

	(in millions)
For the Nine Months Ended September 30, 2014:
Adjusted operating income	$	812		$	365		$	251		$	—	$	1,428
Restructuring	(51		)	(48		)	(22		)	—		(121		)
Other acquisition and portfolio project costs	(6		)	—			—			—		(6		)
Asset impairments	(2		)	(1		)	(4		)	—		(7		)
Operating income	$	753		$	316		$	225		$	—	1,294
Interest expense												(101		)
Other income (expense), net												(9		)
Income from continuing operations before income taxes and equity income												1,184
Income tax expense												(181		)
Equity income, net of tax												15
Income from continuing operations												1,018
Income from discontinued operations, net of tax												54
Net income												1,072
Net income attributable to noncontrolling interest												65
Net income attributable to Delphi												$	1,007

Discontinued Operations

DISCONTINUED OPERATIONS

During the first quarter of 2015, the Company determined that its previously reported Thermal Systems segment met the criteria to be classified as a discontinued operation as a result of entering into a definitive agreement for the sale of substantially all of the assets and liabilities of the Company's wholly owned Thermal Systems business and a commitment to a plan to dispose of the Company's interests in two joint ventures which were previously reported within the Thermal Systems segment.

On June 30, 2015 the Company closed the sale of its wholly owned Thermal Systems business to MAHLE GmbH ("MAHLE"). The Company received cash proceeds of approximately $670 million and recognized a preliminary gain on the divestiture of $285 million (approximately $0.99 per diluted share), net of tax expense of $56 million and transaction costs of $10 million, within income from discontinued operations. Consideration associated with the divestiture remains subject to further post-closing adjustments, primarily related to working capital. In conjunction with the sale, Delphi and MAHLE also entered into a transition services agreement under which Delphi is providing certain administrative and other services, as well as a supply agreement under which Delphi is supplying certain products, primarily for a period of up to eighteen months following the closing of the transaction. Delphi recorded $4 million to other income (expense), net for the three months ended September 30, 2015 for certain fees earned pursuant to the transition services agreement.

Delphi and MAHLE also entered into a separate letter of intent for the sale of Delphi's 50 percent interest in its Shanghai Delphi Automotive Air Conditioning ("SDAAC") joint venture. During the third quarter of 2015, one of Delphi's joint venture partners, Shanghai Aerospace Automobile Electromechanical Co., Ltd ("SAAE"), notified Delphi that it was exercising its right of first refusal to purchase Delphi's interest, and in October 2015, Delphi and SAAE entered into a definitive agreement for the sale of Delphi's SDAAC interest. The sale is expected to close in the first half of 2016, subject to customary regulatory and other approvals, and the Company expects to receive proceeds of approximately $100 million. The financial results of SDAAC, which are consolidated by Delphi, were historically reported as part of the Thermal Systems segment. Delphi's interest in this joint venture remains classified as held for sale as of September 30, 2015.

Additionally, on September 24, 2015 the Company closed the sale of its 50 percent interest in its Korea Delphi Automotive Systems Corporation ("KDAC") joint venture, which was accounted for under the equity method and was principally reported as part of the Thermal Systems segment, to the joint venture partner. The Company received cash proceeds of $70 million and recognized a gain on the divestiture of $47 million (approximately $0.17 per diluted share), net of tax expense, within income from discontinued operations during the three months ended September 30, 2015. For the nine months ended September 30, 2015, the Company recorded a net loss of $41 million on the KDAC divestiture within income from discontinued operations, which includes the $88 million impairment loss recorded in the first quarter of 2015, as further described below.

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

The Company determined that the assets and liabilities of the Thermal Systems segment met the held for sale criteria in accordance with FASB ASC 205, Presentation of Financial Statements. Accordingly, the held for sale Thermal Systems assets and liabilities were reclassified in the consolidated balance sheet to assets held for sale or liabilities held for sale, respectively, as the sale of such assets and liabilities is expected within one year, and to current or long-term assets and liabilities held for sale, as appropriate, for prior periods. The Company ceased recording depreciation of the held for sale Thermal Systems assets in the first quarter of 2015. As described above, Delphi completed the divestitures of the wholly owned Thermal Systems business on June 30, 2015, and of its 50 percent interest in KDAC on September 24, 2015. The following table summarizes the carrying value of the major classes of assets and liabilities of discontinued operations:



	September 30, 2015		December 31, 2014

	(in millions)
Cash and cash equivalents	$	25	$	45
Accounts receivable, net	58		228
Inventories, net	21		91
Property, net	72		322
Investments in affiliates	—		130
Intangible assets, net	1		18
Other assets	10		61
Total assets of the discontinued operations classified as held for sale	$	187	$	895

Accounts payable	$	77	$	303
Accrued liabilities	12		53
Other liabilities	6		35
Total liabilities of the discontinued operations classified as held for sale	$	95	$	391

As of September 30, 2015 and December 31, 2014, there was $106 million and $118 million, respectively, of Noncontrolling interest attributable to the Company's partner in the SDAAC joint venture.

Assets and liabilities classified as held for sale were required to be recorded at the lower of carrying value or fair value less costs to sell. Accordingly, an after-tax impairment loss of $88 million (approximately $0.30 per diluted share) was recorded in income from discontinued operations in the first quarter of 2015 based on the evaluation of the fair value of the Company's interest in KDAC as of March 31, 2015 in relation to its carrying value. As of March 31, 2015, the fair value of this interest was estimated to be approximately $32 million, which was determined primarily based on negotiations with a third party and on a non-binding offer from that potential buyer at the time. As described above, during the third quarter of 2015, the Company completed the sale of its interest in KDAC for net cash proceeds of $70 million. The Company's interest in KDAC is reported within investments in affiliates in the above table as of December 31, 2014.

The estimated fair value less costs to sell of the held for sale businesses exceeded their carrying value as of September 30, 2015, and therefore no adjustment to these long-lived assets was necessary. The divestiture of the businesses held for sale could result in a gain or loss on sale to the extent the ultimate selling price differs from the current carrying value of the net assets recorded.

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



	Three Months Ended September 30,						Nine Months Ended September 30,
	2015			2014			2015			2014

	(in millions)
Net sales	$	66		$	382		$	821		$	1,150
Cost of sales	60			347			748			1,040
Selling, general and administrative	3			11			25			35
Amortization	—			1			1			5
Restructuring	—			1			2			3
Other income and (expense) items that are not major, net	—			—			—			1
Income from discontinued operations before income taxes and equity income	3			22			45			68
Income tax benefit (expense) on discontinued operations	5			(7		)	(11		)	(19		)
Equity (loss) income from discontinued operations, net of tax	(1		)	(3		)	(1		)	5
Gain on divestiture of discontinued operations, net of tax	47			—			332			—
Impairment loss	—			—			(88		)	—
Income from discontinued operations, net of tax	54			12			277			54
Income from discontinued operations attributable to noncontrolling interests	1			6			8			16
Net income from discontinued operations attributable to Delphi	$	53		$	6		$	269		$	38

Income from discontinued operations before income taxes attributable to Delphi was $48 million and $13 million for the three months ended September 30, 2015 and 2014, respectively. Income from discontinued operations before income taxes attributable to Delphi was $279 million and $55 million for the nine months ended September 30, 2015 and 2014, respectively, which includes $1 million and $2 million, respectively, of income tax expense attributable to noncontrolling interests.

Significant Accounting Policies (Policies)

Consolidation, Policy

Consolidation—The consolidated financial statements include the accounts of Delphi and U.S. and non-U.S. subsidiaries in which Delphi holds a controlling financial or management interest and variable interest entities of which Delphi has determined that it is the primary beneficiary. Delphi’s share of the earnings or losses of non-controlled affiliates over which Delphi exercises significant influence (generally a 20% to 50% ownership interest) is included in the consolidated operating results using the equity method of accounting. When Delphi does not have the ability to exercise significant influence (generally when ownership interest is less than 20%), investments in non-consolidated affiliates are accounted for using the cost method. All adjustments, consisting of only normal recurring items, which are necessary for a fair presentation, have been included. All significant intercompany transactions and balances between consolidated Delphi businesses have been eliminated. The Company monitors its investments in affiliates for indicators of other-than-temporary declines in value on an ongoing basis. If the Company determines that such a decline has occurred, an impairment loss is recorded, which is measured as the difference between carrying value and estimated fair value.

During the three and nine months ended September 30, 2015, Delphi received dividends of $5 million and $13 million, respectively, from one of its equity method investments. During the nine months ended September 30, 2014, Delphi received a dividend of $10 million from its equity method investment in Korea Delphi Automotive Systems Corporation ("KDAC"), a Korean unconsolidated joint venture which was sold in the three months ended September 30, 2015 and has been reclassified to discontinued operations, as further described in Note 21. Discontinued Operations. The dividends were recognized as a reduction to the investment and represented a return on investment included in cash flows from operating activities and cash flows from operating activities from discontinued operations, respectively.

Investments in affiliates accounted for under the cost method totaled $23 million and $0 million as of September 30, 2015 and December 31, 2014, respectively, and are classified within other long-term assets in the consolidated balance sheet.

Use of Estimates, Policy

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

Net Income Per Share, Policy

Net income per share—Basic net income per share is computed by dividing net income attributable to Delphi by the weighted average number of ordinary shares outstanding during the period. Diluted net income per share reflects the weighted average dilutive impact of all potentially dilutive securities from the date of issuance and is computed using the treasury stock method by dividing net income attributable to Delphi by the diluted weighted average number of ordinary shares outstanding. See Note 12. Shareholders’ Equity and Net Income Per Share for additional information including the calculation of basic and diluted net income per share.

Basic net income per share is computed by dividing net income attributable to Delphi by the weighted average number of ordinary shares outstanding during the period. Diluted net income per share reflects the weighted average dilutive impact of all potentially dilutive securities from the date of issuance and is computed using the treasury stock method by dividing net income attributable to Delphi by the diluted weighted average number of ordinary shares outstanding. For all periods presented, the calculation of net income per share contemplates the dilutive impacts, if any, of the Company’s share-based compensation plans. Refer to Note 18. Share-Based Compensation for additional information.

Cash and Cash Equivalents, Policy

Cash and cash equivalents—Cash and cash equivalents are defined as short-term, highly liquid investments with original maturities of three months or less.

Transfers and Servicing of Financial Assets, Policy

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

Assets and Liabilities Held for Sale, Policy

Assets and liabilities held for sale—The Company considers assets to be held for sale when management approves and commits to a formal plan to actively market the assets for sale at a price reasonable in relation to their estimated fair value, the assets are available for immediate sale in their present condition, an active program to locate a buyer and other actions required to complete the sale have been initiated, the sale of the assets is probable and expected to be completed within one year (or, if it is expected that others will impose conditions on the sale of the assets that will extend the period required to complete the sale, that a firm purchase commitment is probable within one year) and it is unlikely that significant changes will be made to the plan. Upon designation as held for sale, the Company records the assets at the lower of their carrying value or their estimated fair value, less cost to sell, and ceases to record depreciation expense on the assets.

Assets and liabilities of a discontinued operation are reclassified as held for sale for all comparative periods presented in the consolidated balance sheet. For assets that meet the held for sale criteria but do not meet the definition of a discontinued operation, the Company reclassifies the assets and liabilities in the period in which the held for sale criteria are met, but does not reclassify prior period amounts.

Refer to Note 21. Discontinued Operations for further information regarding the Company's assets and liabilities held for sale.

Intangible Assets, Policy

Intangible assets—Intangible assets were $664 million and $728 million as of September 30, 2015 and December 31, 2014, respectively. Delphi amortizes definite-lived intangible assets over their estimated useful lives. Delphi has definite-lived intangible assets related to patents and developed technology, customer relationships, trade names and in-process research and development. Delphi does not amortize indefinite-lived in-process research and development, but tests for impairment annually, or more frequently when indicators of potential impairment exist, until the completion or abandonment of the associated research and development efforts. Costs to renew or extend the term of acquired intangible assets are recognized as expense as incurred. Amortization expense was $23 million and $70 million for the three and nine months ended September 30, 2015 and $24 million and $71 million for the three and nine months ended September 30, 2014, respectively.

Goodwill, Policy

Goodwill—Goodwill is the excess of the purchase price over the fair value of identifiable net assets acquired in business combinations. Delphi tests goodwill for impairment annually or more frequently when indications of potential impairment exist. Delphi monitors the existence of potential impairment indicators throughout the fiscal year.

The Company tests for goodwill impairment at the reporting unit level. Our reporting units are the components of operating segments which constitute businesses for which discrete financial information is available and is regularly reviewed by segment management.

The impairment test involves first qualitatively assessing goodwill for impairment. If the qualitative assessment is not met the Company then performs a quantitative assessment by first comparing the estimated fair value of each reporting unit to its carrying value, including goodwill. Fair value reflects the price a market participant would be willing to pay in a potential sale of the reporting unit. If the fair value exceeds carrying value, then we conclude that no goodwill impairment has occurred. If the carrying value of the reporting unit exceeds its estimated fair value, a second step is required to measure possible goodwill impairment loss. The second step includes hypothetically valuing the tangible and intangible assets and liabilities of the reporting unit as if the reporting unit had been acquired in a business combination. Then, the implied fair value of the reporting unit's goodwill is compared to the carrying value of that goodwill. If the carrying value of the reporting unit's goodwill exceeds the implied fair value of the goodwill, the Company recognizes an impairment loss in an amount equal to the excess, not to exceed the carrying value. There were no indicators of potential goodwill impairment as of September 30, 2015. Goodwill was $640 million and $656 million as of September 30, 2015 and December 31, 2014, respectively.

Warranty, Policy

Warranty and product recalls—Expected warranty costs for products sold are recognized at the time of sale of the product based on an estimate of the amount that eventually will be required to settle such obligations. These accruals are based on factors such as past experience, production changes, industry developments and various other considerations. Costs of product recalls, which may include the cost of the product being replaced as well as the customer’s cost of the recall, including labor to remove and replace the recalled part, are accrued as part of our warranty accrual at the time an obligation becomes probable and can be reasonably estimated. These estimates are adjusted from time to time based on facts and circumstances that impact the status of existing claims. Refer to Note 6. Warranty Obligations.

Expected warranty costs for products sold are recognized principally at the time of sale of the product based on an estimate of the amount that eventually will be required to settle such obligations. These accruals are based on factors such as past experience, production changes, industry developments and various other considerations. The estimated costs related to product recalls based on a formal campaign soliciting return of that product are accrued at the time an obligation becomes probable and can be reasonably estimated. These estimates are adjusted from time to time based on facts and circumstances that impact the status of existing claims. Delphi has recognized its best estimate for its total aggregate warranty reserves, including product recall costs, across all of its operating segments as of September 30, 2015. The estimated reasonably possible amount to ultimately resolve all matters are not materially different from the recorded reserves as of September 30, 2015.

Discontinued Operations, Policy

Discontinued operations—The Company reports financial results for discontinued operations separately from continuing operations to distinguish the financial impact of disposal transactions from ongoing operations. Discontinued operations reporting occurs only when the disposal of a component or a group of components of the Company represents a strategic shift that will have a major effect on the Company's operations and financial results. During the nine months ended September 30, 2015, Delphi completed the divestitures of the Company's wholly owned Thermal Systems business and the Company's interest in its KDAC joint venture. The Company has also entered into a separate agreement for the sale of its interest in its Shanghai Delphi Automotive Air Conditioning ("SDAAC") joint venture. Delphi's interests in these joint ventures were previously reported within the Thermal Systems segment. Accordingly, the assets and liabilities, operating results and operating and investing cash flows for the previously reported Thermal Systems segment are presented as discontinued operations separate from the Company’s continuing operations for all periods presented. Prior period information has been reclassified to present this business as discontinued operations for all periods presented, and has therefore been excluded from both continuing operations and segment results for all periods presented in these consolidated financial statements and the notes to the consolidated financial statements, unless otherwise noted. These items had no impact on the amounts of previously reported net income attributable to Delphi or total shareholders' equity. Refer to Note 21. Discontinued Operations for further information regarding the Company's discontinued operations.

Income Tax, Policy

Income taxes—Deferred tax assets and liabilities reflect temporary differences between the amount of assets and liabilities for financial and tax reporting purposes. Such amounts are adjusted, as appropriate, to reflect changes in tax rates expected to be in effect when the temporary differences reverse. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in earnings in the period that includes the enactment date. A valuation allowance is recorded to reduce deferred tax assets to the amount that is more likely than not to be realized. In the event the Company determines it is more likely than not that the deferred tax assets will not be realized in the future, the valuation adjustment to the deferred tax assets will be charged to earnings in the period in which the Company makes such a determination. In determining the provision for income taxes for financial statement purposes, the Company makes certain estimates and judgments which affect its evaluation of the carrying value of its deferred tax assets, as well as its calculation of certain tax liabilities. Refer to Note 11. Income Taxes.

Restructuring, Policy

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

Customer Concentations, Policy

Customer concentrations—As reflected in the table below, combined net sales from continuing operations to General Motors Company ("GM") and Volkswagen Group (“VW”), Delphi's two largest customers, totaled approximately 23% and 22% of our total net sales for the three and nine months ended September 30, 2015, respectively, and 25% and 25% for the three and nine months ended September 30, 2014, respectively.



	Percentage of Total Net Sales								Accounts and Other Receivables
	Three Months Ended September 30,				Nine Months Ended September 30,				September 30, 2015		December 31, 2014
	2015		2014		2015		2014		September 30, 2015		December 31, 2014

									(in millions)
GM	15	%	17	%	14	%	16	%	$	334	$	301
VW	8	%	8	%	8	%	9	%	212		187

Retrospective Changes, Policy

Retrospective changes—Prior period information has been reclassified to present the Thermal Systems business as discontinued operations for all periods presented, and has therefore been excluded from both continuing operations and segment results for all periods presented in these consolidated financial statements and the notes to the consolidated financial statements, unless otherwise noted. Refer to Note 21. Discontinued Operations for further information regarding the Company's discontinued operations.

Recently Issued Accounting Pronouncements, Policy

Recently issued accounting pronouncements—In April 2014, the FASB issued ASU 2014-08, Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity. This guidance limits discontinued operations reporting to disposals of components of an entity that represent strategic shifts that have a major effect on an entity’s operations and financial results. The amendments also require expanded disclosures for discontinued operations with more information about the assets, liabilities, revenues, and expenses of discontinued operations. The amendments also require an entity to disclose the pre-tax profit or loss attributable to a disposal of an individually significant component of an entity that does not qualify for discontinued operations reporting. The guidance is effective for fiscal years beginning after December 15, 2014 and should be applied prospectively. Delphi adopted this guidance effective January 1, 2015, and has applied it to the Company’s discontinued operation classification of the Thermal Systems business, as further discussed in Note 21. Discontinued Operations.

In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers. This ASU supersedes most of the existing guidance on revenue recognition in Accounting Standards Codification ("ASC") Topic 605, Revenue Recognition and establishes a broad principle that would require an entity to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve this principle, an entity identifies the contract with a customer, identifies the separate performance obligations in the contract, determines the transaction price, allocates the transaction price to the separate performance obligations and recognizes revenue when each separate performance obligation is satisfied. The guidance is currently effective for fiscal years beginning after December 15, 2017 and is to be applied retrospectively at the entity's election either to each prior reporting period presented or with the cumulative effect of application recognized at the date of initial application. Early adoption is permitted for fiscal years beginning after December 15, 2016. The Company is currently evaluating the impact that the adoption of this guidance will have on its consolidated financial statements.

In June 2014, the FASB issued ASU 2014-12, Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period. This guidance requires that a performance target that affects vesting and that could be achieved after the requisite service period be treated as a performance condition of the award. A reporting entity should apply existing guidance in ASC Topic 718, Compensation-Stock Compensation, as it relates to such awards. The guidance is effective for fiscal years beginning after December 15, 2015, and may be applied either prospectively or retrospectively. Delphi adopted this guidance effective January 1, 2015, and it did not have a significant impact on Delphi's financial statements.

In April 2015, the FASB issued ASU 2015-03, Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs. This guidance requires that debt issuance costs be presented as a direct reduction to the carrying amount of the related debt in the balance sheet rather than as a deferred charge, consistent with the presentation of discounts on debt. ASU 2015-15, Interest - Imputation of Interest (Subtopic 835-30): Presentation and Subsequent Measurement of Debt Issuance Costs associated with Line-of-Credit Arrangements, was issued in August 2015 to clarify that the U.S. Securities and Exchange Commission ("SEC") staff would not object to an entity deferring and presenting debt issuance costs related to a line-of-credit arrangement as an asset and subsequently amortizing the deferred debt issuance costs ratably over the term of the line-of-credit arrangement, regardless of whether there are any outstanding borrowings on the line-of-credit arrangement. The guidance is effective for fiscal years beginning after December 15, 2015, and is to be applied retrospectively. The adoption of this guidance is not expected to have a significant impact on Delphi's financial statements, other than the reclassification of deferred issuance costs related to a recognized debt liability in accordance with the new presentation requirements.

In July 2015, the FASB issued ASU 2015-11, Inventory (Topic 330): Simplifying the Measurement of Inventory. This guidance requires an entity to measure inventory at the lower of cost and net realizable value, rather than at the lower of cost or market. The guidance is effective for interim and annual periods beginning after December 15, 2016, and is to be applied prospectively. Early adoption is permitted. The adoption of this guidance is not expected to have a significant impact on Delphi's financial statements.

In September 2015, the FASB issued ASU 2015-16, Business Combinations (Topic 805): Simplifying the Accounting for Measurement-Period Adjustments. This guidance requires that an acquirer recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined, including that the acquirer record, in the same period’s financial statements, the effect on earnings of changes in depreciation, amortization, or other income effects, if any. The guidance is effective for interim and annual periods beginning after December 15, 2015, and is to be applied prospectively to adjustments to provisional amounts that occur after the effective date, with earlier application permitted for financial statements that have not yet been made available for issuance. The adoption of this guidance is not expected to have a significant impact on Delphi's financial statements, other than the application to adjustments to provisional amounts resulting from business combinations for which the accounting is incomplete as of the end of a reporting period.

Inventories, Policy

Inventories are stated at the lower of cost, determined on a first-in, first-out basis, or market, including direct material costs and direct and indirect manufacturing costs.

Pensions, Policy

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

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

Guarantor, Policy

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

Segment Reporting, Policy

The accounting policies of the segments are the same as those described in Note 2. Significant Accounting Policies, except that the disaggregated financial results for the segments have been prepared using a management approach, which is consistent with the basis and manner in which management internally disaggregates financial information for the purposes of assisting internal operating decisions. Generally, Delphi evaluates performance based on stand-alone segment net income before interest expense, other income (expense), net, income tax expense, equity income (loss), net of tax, income (loss) from discontinued operations, net of tax, restructuring, other project and integration costs related to acquisitions and other portfolio transactions, asset impairments and gains (losses) on business divestitures (“Adjusted Operating Income”) and accounts for inter-segment sales and transfers as if the sales or transfers were to third parties, at current market prices. Delphi’s management utilizes Adjusted Operating Income as the key performance measure of segment income or loss and for planning and forecasting purposes, as management believes this measure is most reflective of the operational profitability or loss of Delphi's operating segments. Segment Adjusted Operating Income should not be considered a substitute for results prepared in accordance with U.S. GAAP and should not be considered an alternative to net income attributable to Delphi, which is the most directly comparable financial measure to Adjusted Operating Income that is in accordance with U.S. GAAP. Segment Adjusted Operating Income, as determined and measured by Delphi, should also not be compared to similarly titled measures reported by other companies.

Significant Accounting Policies (Tables)

Schedule of Revenue by Major Customers by Reporting Segments

Customer concentrations—As reflected in the table below, combined net sales from continuing operations to General Motors Company ("GM") and Volkswagen Group (“VW”), Delphi's two largest customers, totaled approximately 23% and 22% of our total net sales for the three and nine months ended September 30, 2015, respectively, and 25% and 25% for the three and nine months ended September 30, 2014, respectively.



	Percentage of Total Net Sales								Accounts and Other Receivables
	Three Months Ended September 30,				Nine Months Ended September 30,				September 30, 2015		December 31, 2014
	2015		2014		2015		2014		September 30, 2015		December 31, 2014

									(in millions)
GM	15	%	17	%	14	%	16	%	$	334	$	301
VW	8	%	8	%	8	%	9	%	212		187

Inventories (Tables)

Schedule of Inventory, Current

A summary of inventories is shown below:



	September 30, 2015		December 31, 2014

	(in millions)
Productive material	$	684	$	562
Work-in-process	96		104
Finished goods	407		347
Total	$	1,187	$	1,013

Assets (Tables)

Schedule of Other Current Assets

Other current assets consisted of the following:



	September 30, 2015		December 31, 2014

	(in millions)
Value added tax receivable	$	186	$	191
Deferred income taxes	177		171
Prepaid insurance and other expenses	97		59
Reimbursable engineering costs	70		55
Notes receivable	24		28
Income and other taxes receivable	39		34
Deposits to vendors	8		8
Derivative financial instruments (Note 14)	5		—
Other	23		21
Total	$	629	$	567

Schedule of Other Assets, Noncurrent

Other long-term assets consisted of the following:



	September 30, 2015		December 31, 2014

	(in millions)
Deferred income taxes	$	237	$	232
Debt issuance costs (Note 8)	34		42
Income and other taxes receivable	79		67
Reimbursable engineering costs	49		73
Value added tax receivable	23		28
Cost method investments	23		—
Acquisition deposit (Note 17)	820		—
Other	66		66
Total	$	1,331	$	508

Liabilities (Tables)

Accrued Liabilities

Accrued liabilities consisted of the following:



	September 30, 2015		December 31, 2014

	(in millions)
Payroll-related obligations	$	245	$	243
Employee benefits, including current pension obligations	84		127
Income and other taxes payable	207		259
Warranty obligations (Note 6)	68		64
Restructuring (Note 7)	55		80
Customer deposits	28		34
Deferred income taxes	8		8
Derivative financial instruments (Note 14)	115		64
Accrued interest	15		30
Other	357		312
Total	$	1,182	$	1,221

Liabilities, Noncurrent



	September 30, 2015		December 31, 2014

	(in millions)
Environmental (Note 10)	$	4	$	4
Extended disability benefits	11		11
Warranty obligations (Note 6)	80		82
Restructuring (Note 7)	10		17
Payroll-related obligations	8		10
Accrued income taxes	28		29
Deferred income taxes	169		162
Derivative financial instruments (Note 14)	38		40
Other	46		35
Total	$	394	$	390

Warranty Obligations (Tables)

Schedule of Product Warranty Liability

The table below summarizes the activity in the product warranty liability for the nine months ended September 30, 2015:



	Warranty Obligations

	(in millions)
Accrual balance at beginning of period	$	146
Provision for estimated warranties incurred during the period	55
Provision for changes in estimate for pre-existing warranties	—
Settlements made during the period (in cash or in kind)	(48		)
Foreign currency translation and other	(5		)
Accrual balance at end of period	$	148

Restructuring (Tables)

Schedule of Restructuring and Related Costs

The following table summarizes the restructuring charges recorded for the three and nine months ended September 30, 2015 and 2014 by operating segment:



	Three Months Ended September 30,				Nine Months Ended September 30,
	2015		2014		2015		2014

	(in millions)
Electrical/Electronic Architecture	$	13	$	24	$	22	$	51
Powertrain Systems	19		9		33		48
Electronics and Safety	4		13		14		22
Total	$	36	$	46	$	69	$	121

Schedule of Restructuring Reserve by Type of Cost

The table below summarizes the activity in the restructuring liability for the nine months ended September 30, 2015:



	Employee Termination Benefits Liability			Other Exit Costs Liability			Total

	(in millions)
Accrual balance at January 1, 2015	$	95		$	2		$	97
Provision for estimated expenses incurred during the period	67			2			69
Payments made during the period	(93		)	(2		)	(95		)
Foreign currency and other	(6		)	—			(6		)
Accrual balance at September 30, 2015	$	63		$	2		$	65

Debt (Tables)

Schedule of Long-term Debt Instruments

The following is a summary of debt outstanding, net of discounts of approximately $5 million and $2 million as of September 30, 2015 and December 31, 2014, respectively:



	September 30, 2015			December 31, 2014

	(in millions)
Accounts receivable factoring	$	242		$	—
Revolving credit facility	60			—
6.125%, senior notes, due 2021	—			500
5.00%, senior notes, due 2023	800			800
4.15%, senior notes, due 2024	698			698
1.50%, Euro-denominated senior notes, due 2025	784			—
Tranche A Term Loan, due 2018	400			400
Capital leases and other	138			53
Total debt	3,122			2,451
Less: current portion	(424		)	(34		)
Long-term debt	$	2,698		$	2,417

Schedule of Interest Rates

Applicable Rates under the Credit Agreement on the specified dates are set forth below:



	September 30, 2015				December 31, 2014
	LIBOR plus		ABR plus		LIBOR plus		ABR plus
Revolving Credit Facility	1.00	%	0.00	%	1.00	%	0.00	%
Tranche A Term Loan	1.00	%	0.00	%	1.00	%	0.00	%

Schedule of Line of Credit Facilities

As of September 30, 2015, the Issuer selected the one-month LIBOR interest rate option on the Tranche A Term Loan and the ABR interest rate option on the Revolving Credit Facility, as detailed in the table below, and the amounts outstanding, and rates effective as of September 30, 2015 were based on Delphi’s current credit rating and the Applicable Rate for the Credit Agreement:



		Borrowings as of
		September 30, 2015		Rates effective as of
	Applicable Rate	(in millions)		September 30, 2015
Revolving Credit Facility	ABR plus 0.00%	$	60	3.25	%
Tranche A Term Loan	LIBOR plus 1.00%	400		1.25	%

Pension Benefits (Tables)

Schedule of Net Benefit Costs

The amounts shown below reflect the defined benefit pension expense, including amounts attributable to discontinued operations, for the three and nine months ended September 30, 2015 and 2014:



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

	Three Months Ended September 30,
	2015			2014			2015		2014

	(in millions)
Service cost	$	15		$	14		$	—	$	—
Interest cost	19			23			—		1
Expected return on plan assets	(19		)	(19		)	—		—
Settlement loss (1)	13			—			—		—
Curtailment loss	—			4			—		—
Amortization of actuarial losses	4			2			1		—
Net periodic benefit cost	$	32		$	24		$	1	$	1


(1)	Primarily relates to amounts recognized related to the divestiture of the Company's Reception Systems business, as further described in Note 17. Acquisitions and Divestitures.



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

	Nine Months Ended September 30,
	2015			2014			2015		2014

	(in millions)
Service cost	$	44		$	44		$	—	$	—
Interest cost	58			73			1		2
Expected return on plan assets	(57		)	(59		)	—		—
Settlement loss	16			—			—		—
Curtailment loss	—			4			—		—
Amortization of actuarial losses	13			6			1		—
Net periodic benefit cost	$	74		$	68		$	2	$	2

Schedule of Net Benefit Costs

The amounts shown below reflect the defined benefit pension expense, including amounts attributable to discontinued operations, for the three and nine months ended September 30, 2015 and 2014:



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

	Three Months Ended September 30,
	2015			2014			2015		2014

	(in millions)
Service cost	$	15		$	14		$	—	$	—
Interest cost	19			23			—		1
Expected return on plan assets	(19		)	(19		)	—		—
Settlement loss (1)	13			—			—		—
Curtailment loss	—			4			—		—
Amortization of actuarial losses	4			2			1		—
Net periodic benefit cost	$	32		$	24		$	1	$	1


(1)	Primarily relates to amounts recognized related to the divestiture of the Company's Reception Systems business, as further described in Note 17. Acquisitions and Divestitures.



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

	Nine Months Ended September 30,
	2015			2014			2015		2014

	(in millions)
Service cost	$	44		$	44		$	—	$	—
Interest cost	58			73			1		2
Expected return on plan assets	(57		)	(59		)	—		—
Settlement loss	16			—			—		—
Curtailment loss	—			4			—		—
Amortization of actuarial losses	13			6			1		—
Net periodic benefit cost	$	74		$	68		$	2	$	2

Income Taxes (Tables)

Schedule of Income Tax Expense (Benefit) and Effective Tax Rate

The Company's income tax expense and effective tax rate from continuing operations for the three and nine months ended September 30, 2015 and 2014 were as follows:



	Three Months Ended September 30,						Nine Months Ended September 30,
	2015			2014			2015			2014

	(dollars in millions)
Income tax expense	$	61		$	56		$	202		$	181
Effective tax rate	15		%	15		%	16		%	15		%

Schedule of Income Tax Expense (Benefit) associated with Unusual or Infrequent Items

The Company’s effective tax rate from continuing operations was also impacted by the tax expense (benefit) associated with unusual or infrequent items for the respective interim period as illustrated in the following table:



	Three Months Ended September 30,						Nine Months Ended September 30,
	2015			2014			2015			2014

	(in millions)
Tax credits (1)	$	(5	)	$	—		$	(5	)	$	(2	)
Withholding taxes	(1		)	—			(2		)	(1		)
Other change in tax reserves (2)	(1		)	—			3			(6		)
Other adjustments (3)	3			(7		)	4			(12		)
Income tax (benefit) expense associated with unusual or infrequent items	$	(4	)	$	(7	)	$	—		$	(21	)


(1)	For the three and nine months ended September 30, 2015 and nine months ended September 30, 2014, the tax benefit primarily relates to provision to return adjustments.


(2)	For the nine months ended September 30, 2015 and September 30, 2014, the tax expense and benefit, respectively, primarily relate to adjustments in tax reserves which were individually insignificant.


(3)	For the three and nine months ended September 30, 2015 and September 30, 2014, the tax expense and benefit, respectively, primarily relate to provision to return adjustments and other items which were individually insignificant.

Shareholders' Equity And Net Income Per Share (Tables)

Schedule of Weighted Average Number of Shares

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



	Three Months Ended September 30,				Nine Months Ended September 30,
	2015		2014		2015		2014

	(in millions, except per share data)
Numerator:
Income from continuing operations	$	351	$	299	$	989	$	969
Income from discontinued operations	53		6		269		38
Net income attributable to Delphi	$	404	$	305	$	1,258	$	1,007
Denominator:
Weighted average ordinary shares outstanding, basic	282.97		298.59		287.18		302.35
Dilutive shares related to restricted stock units ("RSUs")	1.43		1.55		1.15		1.21
Weighted average ordinary shares outstanding, including dilutive shares	284.40		300.14		288.33		303.56

Basic net income per share:
Continuing operations	$	1.24	$	1.00	$	3.44	$	3.20
Discontinued operations	0.19		0.02		0.94		0.13
Basic net income per share attributable to Delphi	$	1.43	$	1.02	$	4.38	$	3.33
Diluted net income per share:
Continuing operations	$	1.23	$	1.00	$	3.43	$	3.19
Discontinued operations	0.19		0.02		0.93		0.13
Diluted net income per share attributable to Delphi	$	1.42	$	1.02	$	4.36	$	3.32
Anti-dilutive securities share impact	—		—		—		—

Schedule of Share Repurchases

A summary of the ordinary shares repurchased during the three and nine months ended September 30, 2015 and 2014 is as follows:



	Three Months Ended September 30,				Nine Months Ended September 30,
	2015		2014		2015		2014
Total number of shares repurchased	5,292,240		4,360,097		12,174,805		10,004,486
Average price paid per share	$	76.83	$	68.00	$	78.79	$	67.37
Total (in millions)	$	406	$	297	$	959	$	674

Schedule of Dividends Declared

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



	Dividend		Amount
	Per Share		(in millions)
2015:
Third quarter	$	0.25	$	71
Second quarter	0.25		72
First quarter	0.25		73
Total	$	0.75	$	216
2014:
Fourth quarter	$	0.25	$	73
Third quarter	0.25		75
Second quarter	0.25		76
First quarter	0.25		77
Total	$	1.00	$	301

Changes in Accumulated Other Comprehensive Income (Tables)

Schedule of Accumulated Other Comprehensive Income

The changes in accumulated other comprehensive income (loss) attributable to Delphi (net of tax) for the three and nine months ended September 30, 2015 and 2014 are shown below. Other comprehensive income includes activity relating to discontinued operations.



	Three Months Ended September 30,						Nine Months Ended September 30,
	2015			2014			2015			2014

	(in millions)
Foreign currency translation adjustments:
Balance at beginning of period	$	(505	)	$	(8	)	$	(333	)	$	(17	)
Aggregate adjustment for the period	(109		)	(176		)	(281		)	(167		)
Balance at end of period	(614		)	(184		)	(614		)	(184		)

Gains (losses) on derivatives:
Balance at beginning of period	(84		)	9			(78		)	2
Other comprehensive income before reclassifications (net tax effect of $16 million, $8 million, $30 million and $5 million)	(55		)	(30		)	(105		)	(27		)
Reclassification to income (net tax effect of $7 million, $3 million, $20 million and $5 million)	22			7			66			11
Balance at end of period	(117		)	(14		)	(117		)	(14		)

Pension and postretirement plans:
Balance at beginning of period	(308		)	(220		)	(330		)	(222		)
Other comprehensive income before reclassifications (net tax effect of $1 million, $4 million, $2 million and $3 million)	7			10			18			8
Reclassification to income (net tax effect of $1 million, $0 million, $2 million and $0 million)	17			2			28			6
Balance at end of period	(284		)	(208		)	(284		)	(208		)

Accumulated other comprehensive loss, end of period	$	(1,015	)	$	(406	)	$	(1,015	)	$	(406	)

Reclassifications from accumulated other comprehensive income to income for the three and nine months ended September 30, 2015 and 2014 were as follows:



Reclassification Out of Accumulated Other Comprehensive Income
Details About Accumulated Other Comprehensive Income Components	Three Months Ended September 30,						Nine Months Ended September 30,						Affected Line Item in the Statement of Operations
	2015			2014			2015			2014			Affected Line Item in the Statement of Operations

	(in millions)
Gains (losses) on derivatives:
Commodity derivatives	$	(11	)	$	(3	)	$	(32	)	$	(13	)	Cost of sales
Foreign currency derivatives	(18		)	1			(54		)	7			Cost of sales
Foreign currency derivatives	—			(2		)	—			—			Other income
	(29		)	(4		)	(86		)	(6		)	Income before income taxes
	7			(3		)	20			(5		)	Income tax expense
	(22		)	(7		)	(66		)	(11		)	Net income
	—			—			—			—			Net income attributable to noncontrolling interest
	$	(22	)	$	(7	)	$	(66	)	$	(11	)	Net income attributable to Delphi

Pension and postretirement plans:
Actuarial losses	$	(5	)	$	(2	)	$	(14	)	$	(6	)	(1)
Settlement loss	(13		)	—			(16		)	—			(1)
	(18		)	(2		)	(30		)	(6		)	Income before income taxes
	1			—			2			—			Income tax expense
	(17		)	(2		)	(28		)	(6		)	Net income
	—			—			—			—			Net income attributable to noncontrolling interest
	$	(17	)	$	(2	)	$	(28	)	$	(6	)	Net income attributable to Delphi

Total reclassifications for the period	$	(39	)	$	(9	)	$	(94	)	$	(17	)


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

Derivatives And Hedging Activities (Tables)

Schedule of Notional Amounts of Outstanding Derivative Positions

As of September 30, 2015, the Company had the following outstanding notional amounts related to commodity and foreign currency forward contracts that were entered into to hedge forecasted exposures:



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

	(in thousands)		(in millions)
Copper	88,904	pounds	$	210



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

	(in millions)
Mexican Peso	9,849	MXN	$	575
Polish Zloty	304	PLN	80
Chinese Yuan Renminbi	435	CNY	70
New Turkish Lira	212	TRY	70
Hungarian Forint	13,093	HUF	45
Brazilian Real	41	BRL	10

Schedule of Derivative Instruments in Statement of Financial Position, Fair Value

The fair value of derivative financial instruments recorded in the consolidated balance sheets as of September 30, 2015 and December 31, 2014 are as follows:



	Asset Derivatives			Liability Derivatives			Net Amounts of Assets and (Liabilities) Presented in the Balance Sheet
	Balance Sheet Location	September 30, 2015		Balance Sheet Location	September 30, 2015		September 30, 2015

	(in millions)
Designated derivatives instruments:
Commodity derivatives	Other current assets	$	—	Accrued liabilities	$	34
Foreign currency derivatives*	Other current assets	1		Other current assets	—		1
Foreign currency derivatives*	Accrued liabilities	4		Accrued liabilities	82		(78	)
Commodity derivatives	Other long-term assets	—		Other long-term liabilities	12
Foreign currency derivatives*	Other long-term assets	1		Other long-term assets	1		—
Foreign currency derivatives*	Other long-term liabilities	—		Other long-term liabilities	25		(25	)
Total		$	6		$	154
Derivatives not designated:
Commodity derivatives	Other current assets	$	—	Accrued liabilities	$	2
Foreign currency derivatives*	Other current assets	4		Other current assets	—		4
Foreign currency derivatives*	Accrued liabilities	3		Accrued liabilities	4		(1	)
Foreign currency derivatives*	Other long-term liabilities	1		Other long-term liabilities	2		(1	)
Total		$	8		$	8



	Asset Derivatives			Liability Derivatives			Net Amounts of Assets and (Liabilities) Presented in the Balance Sheet
	Balance Sheet Location	December 31, 2014		Balance Sheet Location	December 31, 2014		December 31, 2014

	(in millions)
Designated derivatives instruments:
Commodity derivatives	Other current assets	$	—	Accrued liabilities	$	19
Foreign currency derivatives*	Accrued liabilities	3		Accrued liabilities	48		(45	)
Commodity derivatives	Other long-term assets	—		Other long-term liabilities	8
Foreign currency derivatives*	Other long-term liabilities	2		Other long-term liabilities	34		(32	)
Total		$	5		$	109
Derivatives not designated:
Foreign currency derivatives*	Accrued liabilities	$	1	Accrued liabilities	$	1	—
Total		$	1		$	1

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

Schedule of Derivative Instruments, Gain (Loss) in Statement of Financial Performance

The pre-tax effect of derivative financial instruments in the consolidated statement of operations and consolidated statement of comprehensive income for the three months ended September 30, 2015 is as follows:



Three Months Ended September 30, 2015	Loss Recognized in OCI (Effective Portion)			Loss Reclassified from OCI into Income (Effective Portion)			Gain Recognized in Income (Ineffective Portion Excluded from Effectiveness Testing)

	(in millions)
Designated derivatives instruments:
Commodity derivatives	$	(28	)	$	(11	)	$	—
Foreign currency derivatives	(43		)	(18		)	—
Total	$	(71	)	$	(29	)	$	—



	Loss Recognized in Income

	(in millions)
Derivatives not designated:
Commodity derivatives	$	—
Foreign currency derivatives	(11		)
Total	$	(11	)

The pre-tax effect of derivative financial instruments in the consolidated statement of operations and consolidated statement of comprehensive income for the three months ended September 30, 2014 is as follows:



Three Months Ended September 30, 2014	Loss Recognized in OCI (Effective Portion)			Loss Reclassified from OCI into Income (Effective Portion)			Gain Recognized in Income (Ineffective Portion Excluded from Effectiveness Testing)

	(in millions)
Designated derivatives instruments:
Commodity derivatives	$	(13	)	$	(3	)	$	—
Foreign currency derivatives	(25		)	(1		)	—
Total	$	(38	)	$	(4	)	$	—



	Gain Recognized in Income

	(in millions)
Derivatives not designated:
Commodity derivatives	$	—
Foreign currency derivatives (1)	22
Total	$	22


(1)	Primarily relates to amounts recognized in other income, which offset the losses recognized due to the remeasurement of intercompany loans.

The pre-tax effect of derivative financial instruments in the consolidated statement of operations and consolidated statement of comprehensive income for the nine months ended September 30, 2015 is as follows:



Nine Months Ended September 30, 2015	Loss Recognized in OCI (Effective Portion)			Loss Reclassified from OCI into Income (Effective Portion)			Gain Recognized in Income (Ineffective Portion Excluded from Effectiveness Testing)

	(in millions)
Designated derivatives instruments:
Commodity derivatives	$	(53	)	$	(29	)	$	—
Foreign currency derivatives	(82		)	(50		)	—
Total	$	(135	)	$	(79	)	$	—



	Loss Recognized in Income

	(in millions)
Derivatives not designated:
Commodity derivatives	$	(3	)
Foreign currency derivatives	(16		)
Total	$	(19	)

The pre-tax effect of derivative financial instruments in the consolidated statement of operations and consolidated statement of comprehensive income for the nine months ended September 30, 2014 is as follows:



Nine Months Ended September 30, 2014	Loss Recognized in OCI (Effective Portion)			(Loss) Gain Reclassified from OCI into Income (Effective Portion)			Gain Recognized in Income (Ineffective Portion Excluded from Effectiveness Testing)

	(in millions)
Designated derivatives instruments:
Commodity derivatives	$	(19	)	$	(13	)	$	—
Foreign currency derivatives	(13		)	7			—
Total	$	(32	)	$	(6	)	$	—



	Gain Recognized in Income

	(in millions)
Derivatives not designated:
Commodity derivatives	$	—
Foreign currency derivatives (1)	22
Total	$	22

Fair Value Of Financial Instruments (Tables)

Fair Value, Assets Measured on Recurring Basis

As of September 30, 2015 and December 31, 2014, Delphi had the following assets measured at fair value on a recurring basis:



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

	(in millions)
As of September 30, 2015:
Foreign currency derivatives	$	5	$	—	$	5	$	—
Total	$	5	$	—	$	5	$	—
As of December 31, 2014:
Foreign currency derivatives	$	—	$	—	$	—	$	—
Total	$	—	$	—	$	—	$	—

Fair Value, Liabilities Measured on Recurring Basis

As of September 30, 2015 and December 31, 2014, Delphi had the following liabilities measured at fair value on a recurring basis:



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

	(in millions)
As of September 30, 2015:
Commodity derivatives	$	48	$	—	$	48	$	—
Foreign currency derivatives	105		—		105		—
Contingent consideration	18		—		—		18
Total	$	171	$	—	$	153	$	18
As of December 31, 2014:
Commodity derivatives	$	27	$	—	$	27	$	—
Foreign currency derivatives	77		—		77		—
Contingent consideration	11		—		—		11
Total	$	115	$	—	$	104	$	11

Changes in Fair Value of Liabilities Measured on Recurring Basis with Unobservable Inputs

The changes in the contingent consideration liability classified as a Level 3 measurement for the nine months ended September 30, 2015 were as follows:



	Contingent Consideration Liability

	(in millions)
Fair value at beginning of period	$	11
Additions	5
Payments	—
Interest accretion	2
Fair value at end of period	$	18

Other Income, Net (Tables)

Interest and Other Income

Other income (expense), net included:



	Three Months Ended September 30,					Nine Months Ended September 30,
	2015			2014		2015			2014

	(in millions)
Interest income	$	2		$	2	$	4		$	6
Loss on extinguishment of debt	—			—		(52		)	(34		)
Costs associated with acquisitions	(11		)	—		(12		)	—
Gain on insurance recovery	—			—		—			14
Other, net	(2		)	3		(7		)	5
Other (expense) income, net	$	(11	)	$	5	$	(67	)	$	(9	)

Acquisitions And Divestitures (Tables)

Schedule of Recognized Identified Assets Acquired and Liabilities Assumed

The purchase price and related allocation to the acquired net assets of Ottomatika based on their estimated fair values is shown below (in millions):

Assets acquired and liabilities assumed



Purchase price, cash consideration	$	16
Purchase price, deferred consideration	11
Purchase price, fair value of contingent consideration	5
Fair value of previously held investment	4
Total purchase price	$	36

Indefinite-lived intangible assets	$	24
Definite-lived intangible assets	1
Liabilities assumed, net of other assets acquired	(8		)
Identifiable net assets acquired	17
Goodwill resulting from purchase	19
Total purchase price allocation	$	36

Schedule of Recognized Identified Assets Acquired and Liabilities Assumed

The final purchase price and related allocation are shown below (in millions):

Assets acquired and liabilities assumed



Purchase price, cash consideration	$	140
Purchase price, fair value of contingent consideration	11
Total purchase price	$	151

Definite-lived intangible assets	$	75
Liabilities assumed, net of other assets acquired	(17		)
Identifiable net assets acquired	58
Goodwill resulting from purchase	93
Total purchase price allocation	$	151

Schedule of Recognized Identified Assets Acquired and Liabilities Assumed

The final purchase price and related allocation are shown below (in millions):

Assets acquired and liabilities assumed



Purchase price, cash consideration	$	191
Purchase price, acquired cash, excess net working capital and certain tax benefits	19
Total purchase price	$	210

Definite-lived intangible assets	$	63
Other assets purchased and liabilities assumed, net	17
Identifiable net assets acquired	80
Goodwill resulting from purchase	130
Total purchase price allocation	$	210

Share-Based Compensation (Tables)

Schedule of Share-based Compensation Restricted Stock Units Performance Awards Weighting

Each executive will receive between 0% and 200% of his or her target performance-based award based on the Company’s performance against established company-wide performance metrics, which are:



Metric	2013 - 2015 Grants	2012 Grant
Average return on net assets (1)	50%	50%
Cumulative net income	N/A	30%
Cumulative earnings per share (2)	30%	N/A
Relative total shareholder return (3)	20%	20%


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


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

(3)

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

Schedule of Executive RSU Grants

The details of the executive grants were as follows:



Grant Date	RSUs Granted	Time-Based Award Vesting Dates	Performance-Based Award Vesting Date
	(in millions)
February 2012	1.88	Annually on anniversary of grant date, 2013 - 2015	December 31, 2014
February 2013	1.45	Annually on anniversary of grant date, 2014 - 2016	December 31, 2015
February 2014	0.78	Annually on anniversary of grant date, 2015 - 2017	December 31, 2016
February 2015	0.90	Annually on anniversary of grant date, 2016 - 2018	December 31, 2017

Schedule of Share-based Compensation Restricted Stock Units Award Activity

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



	RSUs		Weighted Average Grant Date Fair Value
	(in thousands)
Nonvested, January 1, 2015	2,274		$	50.38
Granted	946		84.55
Vested	(527	)	39.95
Forfeited	(174	)	63.23
Nonvested, September 30, 2015	2,519		64.51

Supplemental Guarantor And Non-Guarantor Condensed Consolidating Financial Statements (Tables)

Schedule of Condensed Income Statement

Statement of Operations Three Months Ended September 30, 2015



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

	(in millions)
Net sales	$	—		$	—		$	—		$	3,631		$	—		$	3,631
Operating expenses:
Cost of sales	—			—			(6		)	2,868			—			2,862
Selling, general and administrative	38			—			—			211			—			249
Amortization	—			—			—			23			—			23
Restructuring	—			—			—			36			—			36
Total operating expenses	38			—			(6		)	3,138			—			3,170
Operating (loss) income	(38		)	—			6			493			—			461
Interest (expense) income	(29		)	(8		)	(45		)	(19		)	71			(30		)
Other income (expense), net	—			23			10			27			(71		)	(11		)
(Loss) income from continuing operations before income taxes and equity income	(67		)	15			(29		)	501			—			420
Income tax benefit (expense)	—			—			11			(72		)	—			(61		)
(Loss) income from continuing operations before equity income	(67		)	15			(18		)	429			—			359
Equity in net income of affiliates	—			—			—			5			—			5
Equity in net income (loss) of subsidiaries	471			456			96			—			(1,023		)	—
Income from continuing operations	404			471			78			434			(1,023		)	364
Income from discontinued operations, net of tax	—			—			—			54			—			54
Net income (loss)	404			471			78			488			(1,023		)	418
Net income attributable to noncontrolling interest	—			—			—			14			—			14
Net income (loss) attributable to Delphi	$	404		$	471		$	78		$	474		$	(1,023	)	$	404

Statement of Operations Nine Months Ended September 30, 2015



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

	(in millions)
Net sales	$	—		$	—		$	—		$	11,286		$	—		$	11,286
Operating expenses:
Cost of sales	—			—			(6		)	9,000			—			8,994
Selling, general and administrative	64			—			—			701			—			765
Amortization	—			—			—			70			—			70
Restructuring	—			—			—			69			—			69
Total operating expenses	64			—			(6		)	9,840			—			9,898
Operating (loss) income	(64		)	—			6			1,446			—			1,388
Interest (expense) income	(75		)	(23		)	(128		)	(70		)	204			(92		)
Other income (expense), net	—			58			3			76			(204		)	(67		)
(Loss) income from continuing operations before income taxes and equity income	(139		)	35			(119		)	1,452			—			1,229
Income tax benefit (expense)	—			—			44			(246		)	—			(202		)
(Loss) income from continuing operations before equity income	(139		)	35			(75		)	1,206			—			1,027
Equity in net income of affiliates	—			—			—			10			—			10
Equity in net income (loss) of subsidiaries	1,397			1,362			358			—			(3,117		)	—
Income from continuing operations	1,258			1,397			283			1,216			(3,117		)	1,037
Income from discontinued operations, net of tax	—			—			—			277			—			277
Net income (loss)	1,258			1,397			283			1,493			(3,117		)	1,314
Net income attributable to noncontrolling interest	—			—			—			56			—			56
Net income (loss) attributable to Delphi	$	1,258		$	1,397		$	283		$	1,437		$	(3,117	)	$	1,258

Statement of Operations Three Months Ended September 30, 2014



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

	(in millions)
Net sales	$	—		$	—		$	—		$	3,762		$	—		$	3,762
Operating expenses:
Cost of sales	—			—			—			3,041			—			3,041
Selling, general and administrative	31			—			—			228			—			259
Amortization	—			—			—			24			—			24
Restructuring	—			—			—			46			—			46
Total operating expenses	31			—			—			3,339			—			3,370
Operating (loss) income	(31		)	—			—			423			—			392
Interest (expense) income	(6		)	(9		)	(45		)	(17		)	44			(33		)
Other income (expense), net	—			17			17			15			(44		)	5
(Loss) income from continuing operations before income taxes and equity income	(37		)	8			(28		)	421			—			364
Income tax benefit (expense)	1			—			10			(67		)	—			(56		)
(Loss) income from continuing operations before equity income	(36		)	8			(18		)	354			—			308
Equity in net income of affiliates	—			—			—			5			—			5
Equity in net income (loss) of subsidiaries	341			333			47			—			(721		)	—
Income from continuing operations	305			341			29			359			(721		)	313
Income from discontinued operations, net of tax	—			—			—			12			—			12
Net income (loss)	305			341			29			371			(721		)	325
Net income attributable to noncontrolling interest	—			—			—			20			—			20
Net income (loss) attributable to Delphi	$	305		$	341		$	29		$	351		$	(721	)	$	305

Statement of Operations Nine Months Ended September 30, 2014



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

	(in millions)
Net sales	$	—		$	—		$	—		$	11,721		$	—		$	11,721
Operating expenses:
Cost of sales	—			—			—			9,467			—			9,467
Selling, general and administrative	66			—			—			702			—			768
Amortization	—			—			—			71			—			71
Restructuring	—			—			—			121			—			121
Total operating expenses	66			—			—			10,361			—			10,427
Operating (loss) income	(66		)	—			—			1,360			—			1,294
Interest (expense) income	(15		)	(25		)	(137		)	(53		)	129			(101		)
Other income (expense), net	—			51			14			55			(129		)	(9		)
(Loss) income from continuing operations before income taxes and equity income	(81		)	26			(123		)	1,362			—			1,184
Income tax benefit (expense)	1			—			45			(227		)	—			(181		)
(Loss) income from continuing operations before equity income	(80		)	26			(78		)	1,135			—			1,003
Equity in net income of affiliates	—			—			—			15			—			15
Equity in net income (loss) of subsidiaries	1,087			1,061			189			—			(2,337		)	—
Income from continuing operations	1,007			1,087			111			1,150			(2,337		)	1,018
Income from discontinued operations, net of tax	—			—			—			54			—			54
Net income (loss)	1,007			1,087			111			1,204			(2,337		)	1,072
Net income attributable to noncontrolling interest	—			—			—			65			—			65
Net income (loss) attributable to Delphi	$	1,007		$	1,087		$	111		$	1,139		$	(2,337	)	$	1,007

Schedule of Comprehensive Income (Loss)

Statement of Comprehensive Income Three Months Ended September 30, 2015



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

	(in millions)
Net income (loss)	$	404		$	471		$	78		$	488		$	(1,023	)	$	418
Other comprehensive income (loss):
Currency translation adjustments	(5		)	—			—			(115		)	—			(120		)
Net change in unrecognized gain (loss) on derivative instruments, net of tax	—			—			—			(33		)	—			(33		)
Employee benefit plans adjustment, net of tax	—			—			—			24			—			24
Other comprehensive loss	(5		)	—			—			(124		)	—			(129		)
Equity in other comprehensive income (loss) of subsidiaries	(113		)	(185		)	(23		)	—			321			—
Comprehensive income (loss)	286			286			55			364			(702		)	289
Comprehensive income attributable to noncontrolling interests	—			—			—			3			—			3
Comprehensive income (loss) attributable to Delphi	$	286		$	286		$	55		$	361		$	(702	)	$	286

Statement of Comprehensive Income Nine Months Ended September 30, 2015



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

	(in millions)
Net income (loss)	$	1,258		$	1,397		$	283		$	1,493		$	(3,117	)	$	1,314
Other comprehensive income (loss):
Currency translation adjustments	(27		)	—			—			(266		)	—			(293		)
Net change in unrecognized gain (loss) on derivative instruments, net of tax	—			—			—			(39		)	—			(39		)
Employee benefit plans adjustment, net of tax	—			—			—			46			—			46
Other comprehensive loss	(27		)	—			—			(259		)	—			(286		)
Equity in other comprehensive income (loss) of subsidiaries	(247		)	(413		)	(26		)	—			686			—
Comprehensive income (loss)	984			984			257			1,234			(2,431		)	1,028
Comprehensive income attributable to noncontrolling interests	—			—			—			44			—			44
Comprehensive income (loss) attributable to Delphi	$	984		$	984		$	257		$	1,190		$	(2,431	)	$	984

Statement of Comprehensive Income Three Months Ended September 30, 2014



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

	(in millions)
Net income (loss)	$	305		$	341		$	29		$	371		$	(721	)	$	325
Other comprehensive income (loss):
Currency translation adjustments	—			—			—			(179		)	—			(179		)
Net change in unrecognized gain (loss) on derivative instruments, net of tax	—			—			—			(23		)	—			(23		)
Employee benefit plans adjustment, net of tax	—			—			—			12			—			12
Other comprehensive loss	—			—			—			(190		)	—			(190		)
Equity in other comprehensive income (loss) of subsidiaries	(187		)	(223		)	(10		)	—			420			—
Comprehensive income (loss)	118			118			19			181			(301		)	135
Comprehensive income attributable to noncontrolling interests	—			—			—			17			—			17
Comprehensive income (loss) attributable to Delphi	$	118		$	118		$	19		$	164		$	(301	)	$	118

Statement of Comprehensive Income Nine Months Ended September 30, 2014



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

	(in millions)
Net income (loss)	$	1,007		$	1,087		$	111		$	1,204		$	(2,337	)	$	1,072
Other comprehensive income (loss):
Currency translation adjustments	—			—			—			(172		)	—			(172		)
Net change in unrecognized gain (loss) on derivative instruments, net of tax	—			—			—			(16		)	—			(16		)
Employee benefit plans adjustment, net of tax	—			—			—			14			—			14
Other comprehensive loss	—			—			—			(174		)	—			(174		)
Equity in other comprehensive income (loss) of subsidiaries	(169		)	(249		)	(1		)	—			419			—
Comprehensive income (loss)	838			838			110			1,030			(1,918		)	898
Comprehensive income attributable to noncontrolling interests	—			—			—			60			—			60
Comprehensive income (loss) attributable to Delphi	$	838		$	838		$	110		$	970		$	(1,918	)	$	838

Schedule of Condensed Balance Sheet

Balance Sheet as of September 30, 2015



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

	(in millions)
ASSETS
Current assets:
Cash and cash equivalents	$	29	$	1	$	—	$	404	$	—		$	434
Restricted cash	—		—		—		2		—			2
Accounts receivable, net	—		—		—		2,615		—			2,615
Intercompany receivables, current	—		1,079		434		4,232		(5,745		)	—
Inventories	—		—		—		1,187		—			1,187
Other current assets	—		—		5		624		—			629
Current assets held for sale	—		—		—		187		—			187
Total current assets	29		1,080		439		9,251		(5,745		)	5,054
Long-term assets:
Intercompany receivables, long-term	—		813		992		1,578		(3,383		)	—
Property, net	—		—		—		3,010		—			3,010
Investments in affiliates	—		—		—		93		—			93
Investments in subsidiaries	7,128		7,088		3,059		—		(17,275		)	—
Intangible assets, net	—		—		—		1,304		—			1,304
Other long-term assets	5		—		29		1,297		—			1,331
Total long-term assets	7,133		7,901		4,080		7,282		(20,658		)	5,738
Total assets	$	7,162	$	8,981	$	4,519	$	16,533	$	(26,403	)	$	10,792
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Short-term debt	$	—	$	—	$	60	$	364	$	—		$	424
Accounts payable	—		—		—		2,327		—			2,327
Intercompany payables, current	4,041		551		898		251		(5,741		)	—
Accrued liabilities	21		—		11		1,150		—			1,182
Current liabilities held for sale	—		—		—		95		—			95
Total current liabilities	4,062		551		969		4,187		(5,741		)	4,028
Long-term liabilities:
Long-term debt	784		—		1,898		16		—			2,698
Intercompany payables, long-term	—		1,302		1,040		1,042		(3,384		)	—
Pension benefit obligations	—		—		—		898		—			898
Other long-term liabilities	—		—		13		381		—			394
Total long-term liabilities	784		1,302		2,951		2,337		(3,384		)	3,990
Total liabilities	4,846		1,853		3,920		6,524		(9,125		)	8,018
Total Delphi shareholders’ equity	2,316		7,128		599		9,551		(17,278		)	2,316
Noncontrolling interest	—		—		—		458		—			458
Total shareholders’ equity	2,316		7,128		599		10,009		(17,278		)	2,774
Total liabilities and shareholders’ equity	$	7,162	$	8,981	$	4,519	$	16,533	$	(26,403	)	$	10,792

Balance Sheet as of December 31, 2014



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

	(in millions)
ASSETS
Current assets:
Cash and cash equivalents	$	9	$	1	$	—	$	849	$	—		$	859
Restricted cash	—		—		—		1		—			1
Accounts receivable, net	—		—		—		2,400		—			2,400
Intercompany receivables, current	88		198		1,397		2,046		(3,729		)	—
Inventories	—		—		—		1,013		—			1,013
Other current assets	—		—		—		567		—			567
Current assets held for sale	—		—		—		384		—			384
Total current assets	97		199		1,397		7,260		(3,729		)	5,224
Long-term assets:
Intercompany receivables, long-term	—		775		947		1,519		(3,241		)	—
Property, net	—		—		—		3,021		—			3,021
Investments in affiliates	—		—		—		98		—			98
Investments in subsidiaries	5,215		6,071		1,644		—		(12,930		)	—
Intangible assets, net	—		—		—		1,384		—			1,384
Other long-term assets	—		—		42		466		—			508
Long-term assets held for sale	—		—		—		511		—			511
Total long-term assets	5,215		6,846		2,633		6,999		(16,171		)	5,522
Total assets	$	5,312	$	7,045	$	4,030	$	14,259	$	(19,900	)	$	10,746
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Short-term debt	$	—	$	—	$	—	$	34	$	—		$	34
Accounts payable	2		—		—		2,276		—			2,278
Intercompany payables, current	2,800		536		89		303		(3,728		)	—
Accrued liabilities	—		—		29		1,192		—			1,221
Current liabilities held for sale	—		—		—		356		—			356
Total current liabilities	2,802		536		118		4,161		(3,728		)	3,889
Long-term liabilities:
Long-term debt	—		—		2,398		19		—			2,417
Intercompany payables, long-term	—		1,294		1,001		947		(3,242		)	—
Pension benefit obligations	—		—		—		1,002		—			1,002
Other long-term liabilities	—		—		11		379		—			390
Long-term liabilities held for sale	—		—		—		35		—			35
Total long-term liabilities	—		1,294		3,410		2,382		(3,242		)	3,844
Total liabilities	2,802		1,830		3,528		6,543		(6,970		)	7,733
Total Delphi shareholders’ equity	2,510		5,215		502		7,213		(12,930		)	2,510
Noncontrolling interest	—		—		—		503		—			503
Total shareholders’ equity	2,510		5,215		502		7,716		(12,930		)	3,013
Total liabilities and shareholders’ equity	$	5,312	$	7,045	$	4,030	$	14,259	$	(19,900	)	$	10,746

Schedule of Condensed Cash Flow Statement

Statement of Cash Flows for the Nine Months Ended September 30, 2015



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

	(in millions)
Net cash (used in) provided by operating activities from continuing operations	$	(15	)	$	100		$	—		$	1,044		$	(100	)	$	1,029
Net cash used in operating activities from discontinued operations	—			—			—			(21		)	—			(21		)
Net cash (used in) provided by operating activities	(15		)	100			—			1,023			(100		)	1,008
Cash flows from investing activities:
Capital expenditures	—			—			—			(539		)	—			(539		)
Proceeds from sale of property / investments	—			—			—			7			—			7
Net proceeds from divestiture of discontinued operations	—			—			—			730			—			730
Proceeds from business divestitures, net of $7 payment in 2015	—			—			—			18			—			18
Cost of business, investment and technology acquisitions, net of cash acquired	—			—			—			(38		)	—			(38		)
Deposit for acquisition of HellermannTyton	—			—			—			(844		)	—			(844		)
Increase in restricted cash	—			—			—			(1		)	—			(1		)
Loans to affiliates	—			(853		)	(342		)	(1,237		)	2,432			—
Repayments of loans from affiliates	—			—			135			—			(135		)	—
Investments in subsidiaries	(753		)	—			—			—			753			—
Net cash (used in) provided by investing activities from continuing operations	(753		)	(853		)	(207		)	(1,904		)	3,050			(667		)
Net cash used in investing activities from discontinued operations	—			—			—			(68		)	—			(68		)
Net cash (used in) provided by investing activities	(753		)	(853		)	(207		)	(1,972		)	3,050			(735		)
Cash flows from financing activities:
Net proceeds under other short-term debt agreements	—			—			—			399			—			399
Repayment of senior notes	—			—			(546		)	—			—			(546		)
Proceeds from issuance of senior notes, net of issuance costs	753			—			—			—			—			753
Dividend payments of consolidated affiliates to minority shareholders	—			—			—			(63		)	—			(63		)
Proceeds from borrowings from affiliates	1,332			—			853			247			(2,432		)	—
Payments on borrowings from affiliates	(135		)	—			—			—			135			—
Investment from parent	—			753			—			—			(753		)	—
Dividends paid to affiliates	—			—			(100		)	—			100			—
Repurchase of ordinary shares	(946		)	—			—			—			—			(946		)
Distribution of cash dividends	(216		)	—			—			—			—			(216		)
Taxes withheld and paid on employees' restricted share awards	—			—			—			(58		)	—			(58		)
Net cash provided by (used in) financing activities	788			753			207			525			(2,950		)	(677		)
Effect of exchange rate fluctuations on cash and cash equivalents	—			—			—			(41		)	—			(41		)
Increase (decrease) in cash and cash equivalents	20			—			—			(465		)	—			(445		)
Cash and cash equivalents at beginning of period	9			1			—			894			—			904
Cash and cash equivalents at end of period	$	29		$	1		$	—		$	429		$	—		$	459
Cash and cash equivalents of discontinued operations	$	—		$	—		$	—		$	25		$	—		$	25
Cash and cash equivalents of continuing operations	$	29		$	1		$	—		$	404		$	—		$	434

Statement of Cash Flows for the Nine Months Ended September 30, 2014



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

	(in millions)
Net cash provided by operating activities from continuing operations	$	37		$	—		$	—		$	1,178		$	—		$	1,215
Net cash provided by operating activities from discontinued operations	—			—			—			47			—			47
Net cash provided by operating activities	37			—			—			1,225			—			1,262
Cash flows from investing activities:
Capital expenditures	—			—			—			(601		)	—			(601		)
Proceeds from sale of property	—			—			—			7			—			7
Decrease in restricted cash	—			—			—			1			—			1
Loans to affiliates	—			—			(745		)	(848		)	1,593			—
Repayments of loans from affiliates	—			—			55			254			(309		)	—
Return of investments in subsidiaries	—			—			270			—			(270		)	—
Net cash (used in) provided by investing activities from continuing operations	—			—			(420		)	(1,187		)	1,014			(593		)
Net cash used in investing activities from discontinued operations	—			—			—			(64		)	—			(64		)
Net cash (used in) provided by investing activities	—			—			(420		)	(1,251		)	1,014			(657		)
Cash flows from financing activities:
Net proceeds under other short-term debt agreements	—			—			—			9			—			9
Repayments under long-term debt agreements	—			—			(164		)	—			—			(164		)
Repayment of senior notes	—			—			(526		)	—			—			(526		)
Proceeds from issuance of senior notes, net of issuance costs	—			—			691			—			—			691
Dividend payments of consolidated affiliates to minority shareholders	—			—			—			(61		)	—			(61		)
Proceeds from borrowings from affiliates	920			144			529			—			(1,593		)	—
Payments on borrowings from affiliates	(55		)	(144		)	(110		)	—			309			—
Capital distributions to affiliates	—			—			—			(270		)	270			—
Repurchase of ordinary shares	(662		)	—			—			—			—			(662		)
Distribution of cash dividends	(228		)	—			—			—			—			(228		)
Taxes withheld and paid on employees' restricted share awards	—			—			—			(8		)	—			(8		)
Net cash (used in) provided by financing activities	(25		)	—			420			(330		)	(1,014		)	(949		)
Effect of exchange rate fluctuations on cash and cash equivalents	—			—			—			(19		)	—			(19		)
Increase (decrease) in cash and cash equivalents	12			—			—			(375		)	—			(363		)
Cash and cash equivalents at beginning of period	7			—			—			1,382			—			1,389
Cash and cash equivalents at end of period	$	19		$	—		$	—		$	1,007		$	—		$	1,026
Cash and cash equivalents of discontinued operations	$	—		$	—		$	—		$	19		$	—		$	19
Cash and cash equivalents of continuing operations	$	19		$	—		$	—		$	988		$	—		$	1,007

Segment Reporting (Tables)

Schedule of Segment Reporting Information, by Segment

Included below are sales and operating data for Delphi’s segments for the three and nine months ended September 30, 2015 and 2014.



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

	(in millions)
For the Three Months Ended September 30, 2015:
Net sales	$	1,941	$	1,057	$	675	$	(42	)	$	3,631
Depreciation & amortization	$	67	$	45	$	19	$	—		$	131
Adjusted operating income	$	263	$	124	$	83	$	—		$	470
Operating income	$	245	$	101	$	115	$	—		$	461
Equity income	$	5	$	—	$	—	$	—		$	5
Net income attributable to noncontrolling interest	$	8	$	5	$	—	$	—		$	13



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

	(in millions)
For the Three Months Ended September 30, 2014:
Net sales	$	1,993	$	1,117		$	704	$	(52	)	$	3,762
Depreciation & amortization	$	67	$	50		$	20	$	—		$	137
Adjusted operating income	$	249	$	114		$	82	$	—		$	445
Operating income	$	221	$	104		$	67	$	—		$	392
Equity income (loss)	$	6	$	(1	)	$	—	$	—		$	5
Net income attributable to noncontrolling interest	$	8	$	6		$	—	$	—		$	14



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

	(in millions)
For the Nine Months Ended September 30, 2015:
Net sales	$	6,063	$	3,281	$	2,070	$	(128	)	$	11,286
Depreciation & amortization	$	202	$	134	$	58	$	—		$	394
Adjusted operating income	$	819	$	399	$	250	$	—		$	1,468
Operating income	$	765	$	357	$	266	$	—		$	1,388
Equity income	$	10	$	—	$	—	$	—		$	10
Net income attributable to noncontrolling interest	$	25	$	23	$	—	$	—		$	48



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

	(in millions)
For the Nine Months Ended September 30, 2014:
Net sales	$	6,269	$	3,402		$	2,201	$	(151	)	$	11,721
Depreciation & amortization	$	197	$	149		$	60	$	—		$	406
Adjusted operating income	$	812	$	365		$	251	$	—		$	1,428
Operating income	$	753	$	316		$	225	$	—		$	1,294
Equity income (loss)	$	16	$	(1	)	$	—	$	—		$	15
Net income attributable to noncontrolling interest	$	25	$	24		$	—	$	—		$	49


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

Schedule of Segment Reporting Adjusted OI to Net Income By Segment

The reconciliation of Adjusted Operating Income to Operating Income includes restructuring, other project and integration costs related to acquisitions and other portfolio transactions, asset impairments and gains (losses) on business divestitures. The reconciliation of Adjusted Operating Income to net income attributable to Delphi for the three and nine months ended September 30, 2015 and 2014 are as follows:



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

	(in millions)
For the Three Months Ended September 30, 2015:
Adjusted operating income	$	263		$	124		$	83		$	—	$	470
Restructuring	(13		)	(19		)	(4		)	—		(36		)
Other acquisition and portfolio project costs	(5		)	(4		)	(3		)	—		(12		)
Gain (loss) on business divestitures, net	—			—			39			—		39
Operating income	$	245		$	101		$	115		$	—	461
Interest expense												(30		)
Other income (expense), net												(11		)
Income from continuing operations before income taxes and equity income												420
Income tax expense												(61		)
Equity income, net of tax												5
Income from continuing operations												364
Income from discontinued operations, net of tax												54
Net income												418
Net income attributable to noncontrolling interest												14
Net income attributable to Delphi												$	404



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

	(in millions)
For the Three Months Ended September 30, 2014:
Adjusted operating income	$	249		$	114		$	82		$	—	$	445
Restructuring	(24		)	(9		)	(13		)	—		(46		)
Other acquisition and portfolio project costs	(3		)	—			—			—		(3		)
Asset impairments	(1		)	(1		)	(2		)	—		(4		)
Operating income	$	221		$	104		$	67		$	—	392
Interest expense												(33		)
Other income (expense), net												5
Income from continuing operations before income taxes and equity income												364
Income tax expense												(56		)
Equity income, net of tax												5
Income from continuing operations												313
Income from discontinued operations, net of tax												12
Net income												325
Net income attributable to noncontrolling interest												20
Net income attributable to Delphi												$	305



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

	(in millions)
For the Nine Months Ended September 30, 2015:
Adjusted operating income	$	819		$	399		$	250		$	—	$	1,468
Restructuring	(22		)	(33		)	(14		)	—		(69		)
Other acquisition and portfolio project costs	(15		)	(9		)	(6		)	—		(30		)
Asset impairments	(3		)	—			(3		)	—		(6		)
Gain (loss) on business divestitures, net	(14		)	—			39			—		25
Operating income	$	765		$	357		$	266		$	—	1,388
Interest expense												(92		)
Other income (expense), net												(67		)
Income from continuing operations before income taxes and equity income												1,229
Income tax expense												(202		)
Equity income, net of tax												10
Income from continuing operations												1,037
Income from discontinued operations, net of tax												277
Net income												1,314
Net income attributable to noncontrolling interest												56
Net income attributable to Delphi												$	1,258



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

	(in millions)
For the Nine Months Ended September 30, 2014:
Adjusted operating income	$	812		$	365		$	251		$	—	$	1,428
Restructuring	(51		)	(48		)	(22		)	—		(121		)
Other acquisition and portfolio project costs	(6		)	—			—			—		(6		)
Asset impairments	(2		)	(1		)	(4		)	—		(7		)
Operating income	$	753		$	316		$	225		$	—	1,294
Interest expense												(101		)
Other income (expense), net												(9		)
Income from continuing operations before income taxes and equity income												1,184
Income tax expense												(181		)
Equity income, net of tax												15
Income from continuing operations												1,018
Income from discontinued operations, net of tax												54
Net income												1,072
Net income attributable to noncontrolling interest												65
Net income attributable to Delphi												$	1,007

Discontinued Operations (Tables)

Schedule of Reconciliation of Major Classes of Assets and Liabilities of Discontinued Operations

The following table summarizes the carrying value of the major classes of assets and liabilities of discontinued operations:



	September 30, 2015		December 31, 2014

	(in millions)
Cash and cash equivalents	$	25	$	45
Accounts receivable, net	58		228
Inventories, net	21		91
Property, net	72		322
Investments in affiliates	—		130
Intangible assets, net	1		18
Other assets	10		61
Total assets of the discontinued operations classified as held for sale	$	187	$	895

Accounts payable	$	77	$	303
Accrued liabilities	12		53
Other liabilities	6		35
Total liabilities of the discontinued operations classified as held for sale	$	95	$	391

Schedule of Reconciliation of Major Classes of Profit or Loss of Discontinued Operations

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



	Three Months Ended September 30,						Nine Months Ended September 30,
	2015			2014			2015			2014

	(in millions)
Net sales	$	66		$	382		$	821		$	1,150
Cost of sales	60			347			748			1,040
Selling, general and administrative	3			11			25			35
Amortization	—			1			1			5
Restructuring	—			1			2			3
Other income and (expense) items that are not major, net	—			—			—			1
Income from discontinued operations before income taxes and equity income	3			22			45			68
Income tax benefit (expense) on discontinued operations	5			(7		)	(11		)	(19		)
Equity (loss) income from discontinued operations, net of tax	(1		)	(3		)	(1		)	5
Gain on divestiture of discontinued operations, net of tax	47			—			332			—
Impairment loss	—			—			(88		)	—
Income from discontinued operations, net of tax	54			12			277			54
Income from discontinued operations attributable to noncontrolling interests	1			6			8			16
Net income from discontinued operations attributable to Delphi	$	53		$	6		$	269		$	38

General (Details)

5 Months Ended

8 Months Ended

11 Months Ended

May 19, 2011

Aug. 19, 2009

Nov. 22, 2011

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Formation of PLC

May 19, 2011

Formation of LLP

Aug. 19, 2009

Initial Offering Period

November 22, 2011

Significant Accounting Policies (Details) (USD $)

In Millions, unless otherwise specified

3 Months Ended

9 Months Ended

Sep. 30, 2015

Sep. 30, 2014

Sep. 30, 2015

Sep. 30, 2014

Dec. 31, 2014

Significant Accounting Policies [Line Items]

Investment Income, Dividend

$ 5

$ 13

Cost method investments

23

0

Intangible Assets, Net (Excluding Goodwill)

664

728

Amortization of Intangible Assets

23

24

70

71

Goodwill

640

656

GM

Significant Accounting Policies [Line Items]

Accounts and Other Receivables

334

301

VW

Significant Accounting Policies [Line Items]

Accounts and Other Receivables

212

187

Customer Concentration Risk |
Total Net Sales |
GM & VW

Significant Accounting Policies [Line Items]

Percentage of Total Net Sales

23.00%

25.00%

22.00%

25.00%

Customer Concentration Risk |
Total Net Sales |
GM

Significant Accounting Policies [Line Items]

Percentage of Total Net Sales

15.00%

17.00%

14.00%

16.00%

Customer Concentration Risk |
Total Net Sales |
VW

Significant Accounting Policies [Line Items]

Percentage of Total Net Sales

8.00%

9.00%

Other Long-Term Assets

Significant Accounting Policies [Line Items]

Cost method investments

23

0

KDAC |
Discontinued Operations

Significant Accounting Policies [Line Items]

Investment Income, Dividend

$ 10

Inventories (Details) (USD $)

In Millions, unless otherwise specified

Sep. 30, 2015

Dec. 31, 2014

Inventory Disclosure [Abstract]

Productive material

$ 684

$ 562

Work-in-process

96

104

Finished goods

407

347

Total

$ 1,187

$ 1,013

Assets Current Assets (Details) (USD $)

In Millions, unless otherwise specified

Sep. 30, 2015

Dec. 31, 2014

Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]

Value added tax receivable

$ 186

$ 191

Deferred income taxes

177

171

Prepaid insurance and other expenses

97

59

Reimbursable engineering costs

70

55

Notes receivable

24

28

Income and other taxes receivable

39

34

Deposits to vendors

8

Derivative financial instruments (Note 14)

5

0

Other

23

21

Total

$ 629

$ 567

Assets Non Current assets (Details) (USD $)

In Millions, unless otherwise specified

Sep. 30, 2015

Dec. 31, 2014

Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]

Deferred income taxes

$ 237

$ 232

Debt issuance costs (Note 8)

34

42

Income and other taxes receivable

79

67

Reimbursable engineering costs

49

73

Value added tax receivable

23

28

Cost method investments

23

0

Acquisition deposit (Note 17)

820

0

Other

66

Total

$ 1,331

$ 508

Liabilities Other Liabilities, Current (Details) (USD $)

In Millions, unless otherwise specified

Sep. 30, 2015

Dec. 31, 2014

Other Liabilities Disclosure [Abstract]

Payroll-related obligations

$ 245

$ 243

Employee benefits, including current pension obligations

84

127

Income and other taxes payable

207

259

Warranty obligations (Note 6)

68

64

Restructuring (Note 7)

55

80

Customer deposits

28

34

Deferred income taxes

8

Derivative financial instruments (Note 14)

115

64

Accrued interest

15

30

Other

357

312

Total

$ 1,182

$ 1,221

Liabilities Other Liabilities, Non Current (Details) (USD $)

In Millions, unless otherwise specified

Sep. 30, 2015

Dec. 31, 2014

Other Liabilities Disclosure [Abstract]

Environmental (Note 10)

$ 4

Extended disability benefits

11

Warranty obligations (Note 6)

80

82

Restructuring (Note 7)

10

17

Payroll-related obligations

8

10

Accrued income taxes

28

29

Deferred income taxes

169

162

Derivative financial instruments (Note 14)

38

40

Other

46

35

Total

$ 394

$ 390

Warranty Obligations (Details) (USD $)

In Millions, unless otherwise specified

9 Months Ended

Sep. 30, 2015

Movement in Standard and Extended Product Warranty, Increase (Decrease) [Roll Forward]

Accrual balance at beginning of period

$ 146

Provision for estimated warranties incurred during the period

55

Provision for changes in estimate for pre-existing warranties

0

Settlements made during the period (in cash or in kind)

(48)

Foreign currency translation and other

(5)

Accrual balance at end of period

$ 148

Restructuring Narrative (Details) (USD $)

In Millions, unless otherwise specified

3 Months Ended

9 Months Ended

Sep. 30, 2015

Sep. 30, 2014

Sep. 30, 2015

Sep. 30, 2014

Restructuring Cost and Reserve [Line Items]

Restructuring

$ 36

$ 46

$ 69

$ 121

Restructuring, Cash Expenditures

95

109

Discontinued Operations |
Thermal Systems

Restructuring Cost and Reserve [Line Items]

Restructuring

1

2

3

Powertrain Systems

Restructuring Cost and Reserve [Line Items]

Restructuring

19

9

33

48

Powertrain Systems |
Europe, Middle East & Africa

Restructuring Cost and Reserve [Line Items]

Restructuring

$ 32

Restructuring Restructuring Costs by Segment (Details) (USD $)

In Millions, unless otherwise specified

3 Months Ended

9 Months Ended

Sep. 30, 2015

Sep. 30, 2014

Sep. 30, 2015

Sep. 30, 2014

Restructuring Cost and Reserve [Line Items]

Restructuring

$ 36

$ 46

$ 69

$ 121

Electrical / Electronic Architecture

Restructuring Cost and Reserve [Line Items]

Restructuring

13

24

22

51

Powertrain Systems

Restructuring Cost and Reserve [Line Items]

Restructuring

19

9

33

48

Electronics And Safety

Restructuring Cost and Reserve [Line Items]

Restructuring

$ 4

$ 13

$ 14

$ 22

Restructuring Restructuring Liability (Details) (USD $)

In Millions, unless otherwise specified

3 Months Ended

9 Months Ended

Sep. 30, 2015

Sep. 30, 2014

Sep. 30, 2015

Sep. 30, 2014

Restructuring Reserve [Roll Forward]

Beginning Balance

$ 97

Restructuring Charges

36

46

69

121

Payments made during the period

(95)

(109)

Foreign currency and other

(6)

Ending Balance

65

Employee Termination Benefits Liability

Restructuring Reserve [Roll Forward]

Beginning Balance

95

Restructuring Charges

67

Payments made during the period

(93)

Foreign currency and other

(6)

Ending Balance

63

Other Exit Costs Liability

Restructuring Reserve [Roll Forward]

Beginning Balance

2

Restructuring Charges

2

Payments made during the period

(2)

Foreign currency and other

0

Ending Balance

$ 2

Debt Debt Outstanding (Details) (USD $)

In Millions, unless otherwise specified

9 Months Ended

0 Months Ended

9 Months Ended

0 Months Ended

9 Months Ended

Sep. 30, 2015

Dec. 31, 2014

Sep. 30, 2015

Notes Payable, Other Payables

Dec. 31, 2014

Notes Payable, Other Payables

Sep. 30, 2015

Notes Payable, Other Payables

Senior Notes, 5.875% Due 2019

May 17, 2011

Notes Payable, Other Payables

Senior Notes, 5.875% Due 2019

Sep. 30, 2015

Notes Payable, Other Payables

Senior Notes, 6.125% Due 2021

Dec. 31, 2014

Notes Payable, Other Payables

Senior Notes, 6.125% Due 2021

May 17, 2011

Notes Payable, Other Payables

Senior Notes, 6.125% Due 2021

Sep. 30, 2015

Notes Payable, Other Payables

Senior Notes, 5.000% Due 2023

Dec. 31, 2014

Notes Payable, Other Payables

Senior Notes, 5.000% Due 2023

Feb. 14, 2013

Notes Payable, Other Payables

Senior Notes, 5.000% Due 2023

Mar. 3, 2014

Notes Payable, Other Payables

Senior Notes, 4.150% Due 2024

Sep. 30, 2015

Notes Payable, Other Payables

Senior Notes, 4.150% Due 2024

Dec. 31, 2014

Notes Payable, Other Payables

Senior Notes, 4.150% Due 2024

Mar. 3, 2014

Notes Payable, Other Payables

Senior Notes, 4.150% Due 2024

Mar. 10, 2015

Notes Payable, Other Payables

Euro-Denominated Senior Notes, 1.500% Due 2025

Sep. 30, 2015

Notes Payable, Other Payables

Euro-Denominated Senior Notes, 1.500% Due 2025

Mar. 10, 2015

Notes Payable, Other Payables

Euro-Denominated Senior Notes, 1.500% Due 2025

Dec. 31, 2014

Notes Payable, Other Payables

Euro-Denominated Senior Notes, 1.500% Due 2025

Sep. 30, 2015

Loans Payable

Tranche A, Due 2018

Dec. 31, 2014

Loans Payable

Tranche A, Due 2018

Sep. 30, 2015

Accounts Receivable Factoring

Dec. 31, 2014

Accounts Receivable Factoring

Sep. 30, 2015

Line of Credit

Revolver

Dec. 31, 2014

Line of Credit

Revolver

Debt Instrument [Line Items]

Unamortized Discount

$ 5

$ 2

Accounts receivable factoring

242

0

Revolving credit facility

60

0

Senior Notes

0

500

800

698

784

0

Tranche A Term Loan, due 2018

400

Capital leases and other

138

53

Total debt

3,122

2,451

Less: current portion

(424)

(34)

Long-term debt

$ 2,698

$ 2,417

Debt Instrument, Interest Rate, Stated Percentage

5.875%

6.125%

5.00%

4.15%

1.50%

Debt Instrument, Maturity Date

May 15, 2019

May 15, 2021

Feb. 15, 2023

Mar. 15, 2024

Mar. 10, 2025

Debt Credit Agreement (Details) (USD $)

In Millions, unless otherwise specified

3 Months Ended

9 Months Ended

3 Months Ended

9 Months Ended

12 Months Ended

9 Months Ended

12 Months Ended

9 Months Ended

12 Months Ended

0 Months Ended

12 Months Ended

9 Months Ended

12 Months Ended

9 Months Ended

12 Months Ended

Sep. 30, 2015

Sep. 30, 2014

Sep. 30, 2015

Sep. 30, 2014

Mar. 31, 2013

Amended and Restated Credit Agreement

Sep. 30, 2014

Amended and Restated Credit Agreement

Sep. 30, 2015

Amended and Restated Credit Agreement

Sep. 30, 2015

Amended and Restated Credit Agreement

Minimum

Sep. 30, 2015

Amended and Restated Credit Agreement

Maximum

Sep. 30, 2015

Amended and Restated Credit Agreement

JPMorgan Chase Bank, N.A.

Sep. 30, 2015

Amended and Restated Credit Agreement

Secured Debt

Sep. 30, 2015

Tranche A, Due 2018

Loans Payable

Dec. 31, 2014

Tranche A, Due 2018

Loans Payable

Dec. 31, 2012

Tranche A, Due 2018

JPMorgan Chase Bank, N.A.

Sep. 30, 2015

Tranche A, Due 2018

JPMorgan Chase Bank, N.A.

Loans Payable

LIBOR

Dec. 31, 2014

Tranche A, Due 2018

JPMorgan Chase Bank, N.A.

Loans Payable

LIBOR

Sep. 30, 2015

Tranche A, Due 2018

JPMorgan Chase Bank, N.A.

Loans Payable

Administrative Agents Alternate Base Rate

Dec. 31, 2014

Tranche A, Due 2018

JPMorgan Chase Bank, N.A.

Loans Payable

Administrative Agents Alternate Base Rate

Mar. 31, 2013

Tranche A, Due 2018

Loans Payable

JPMorgan Chase Bank, N.A.

Sep. 30, 2015

Revolver

Line of Credit

Dec. 31, 2014

Revolver

Line of Credit

May 17, 2011

Revolver

JPMorgan Chase Bank, N.A.

Dec. 31, 2012

Revolver

JPMorgan Chase Bank, N.A.

Sep. 30, 2015

Revolver

Revolving Credit Facility

JPMorgan Chase Bank, N.A.

Sep. 30, 2015

Revolver

Revolving Credit Facility

JPMorgan Chase Bank, N.A.

LIBOR

Dec. 31, 2014

Revolver

Revolving Credit Facility

JPMorgan Chase Bank, N.A.

LIBOR

Sep. 30, 2015

Revolver

Revolving Credit Facility

JPMorgan Chase Bank, N.A.

Administrative Agents Alternate Base Rate

Dec. 31, 2014

Revolver

Revolving Credit Facility

JPMorgan Chase Bank, N.A.

Administrative Agents Alternate Base Rate

Sep. 30, 2015

Revolver

Revolving Credit Facility

JPMorgan Chase Bank, N.A.

Line of Credit

Administrative Agents Alternate Base Rate

Mar. 31, 2011

Credit Agreement

Secured Debt

JPMorgan Chase Bank, N.A.

Line of Credit Facility [Line Items]

Credit Agreement on Senior Secured Facilities

$ 575

$ 1,500

$ 3,000

Line of Credit Facility, Increase, Additional Borrowings

574

2,400

1,300

Payments of Debt Issuance Costs

14

Loss on extinguishment of debt

0

(52)

(34)

(1)

Unamortized Debt Issuance Costs

15

Borrowings

60

0

60

Letters of Credit Issued

8

Basis spread of variable rate

1.00%

0.00%

1.00%

0.00%

Contingent change in Appplicable Rate

0.00%

2.25%

Borrowings

$ 400

Rates effective

1.25%

3.25%

Covenant Compliance, Maximum Ratio of Indebtedness to EBITDA

275.00%

Debt Senior Notes (Details)

0 Months Ended

3 Months Ended

9 Months Ended

0 Months Ended

9 Months Ended

0 Months Ended

9 Months Ended

0 Months Ended

9 Months Ended

May 17, 2011

USD ($)

Sep. 30, 2015

USD ($)

Sep. 30, 2014

USD ($)

Sep. 30, 2015

USD ($)

Sep. 30, 2014

USD ($)

Sep. 30, 2015

Notes Payable, Other Payables

Senior Notes, 5.875% Due 2019

Sep. 30, 2014

Notes Payable, Other Payables

Senior Notes, 5.875% Due 2019

USD ($)

May 17, 2011

Notes Payable, Other Payables

Senior Notes, 5.875% Due 2019

USD ($)

Sep. 30, 2015

Notes Payable, Other Payables

Senior Notes, 6.125% Due 2021

USD ($)

May 17, 2011

Notes Payable, Other Payables

Senior Notes, 6.125% Due 2021

Feb. 14, 2013

Notes Payable, Other Payables

Senior Notes, 5.000% Due 2023

USD ($)

Sep. 30, 2015

Notes Payable, Other Payables

Senior Notes, 5.000% Due 2023

Mar. 3, 2014

Notes Payable, Other Payables

Senior Notes, 4.150% Due 2024

USD ($)

Sep. 30, 2015

Notes Payable, Other Payables

Senior Notes, 4.150% Due 2024

Mar. 3, 2014

Notes Payable, Other Payables

Senior Notes, 4.150% Due 2024

USD ($)

Mar. 10, 2015

Notes Payable, Other Payables

Euro-Denominated Senior Notes, 1.500% Due 2025

USD ($)

Sep. 30, 2015

Notes Payable, Other Payables

Euro-Denominated Senior Notes, 1.500% Due 2025

Mar. 10, 2015

Notes Payable, Other Payables

Euro-Denominated Senior Notes, 1.500% Due 2025

Mar. 10, 2015

Designated as Hedging Instrument

Net Investment Hedging

Notes Payable, Other Payables

Euro-Denominated Senior Notes, 1.500% Due 2025

EUR (€)

Debt Instrument [Line Items]

Senior notes issued

$ 500,000,000

$ 800,000,000

$ 700,000,000

€ 700,000,000

Debt Instrument, Interest Rate, Stated Percentage

5.875%

6.125%

5.00%

4.15%

1.50%

Debt Instrument, Maturity Date

May 15, 2019

May 15, 2021

Feb. 15, 2023

Mar. 15, 2024

Mar. 10, 2025

Debt Issuance Costs

23,000,000

12,000,000

6,000,000

5,000,000

Senior Notes Net Proceeds

1,000,000,000

Loss on extinguishment of debt

$ 0

$ (52,000,000)

$ (34,000,000)

$ (33,000,000)

$ (52,000,000)

Debt Instrument, Price

99.649%

99.54%

Debt Instrument, Interest Rate, Effective Percentage

4.193%

1.55%

Debt Other Financing (Details)

In Millions, unless otherwise specified

3 Months Ended

9 Months Ended

3 Months Ended

9 Months Ended

Sep. 30, 2015

USD ($)

Sep. 30, 2015

USD ($)

Sep. 30, 2014

USD ($)

Dec. 31, 2014

USD ($)

Sep. 30, 2015

Accounts Receivable Factoring

USD ($)

Dec. 31, 2014

Accounts Receivable Factoring

USD ($)

Sep. 30, 2015

Interest Expense

USD ($)

Sep. 30, 2015

Interest Expense

USD ($)

Sep. 30, 2015

EMEA

EUR (€)

Sep. 30, 2015

HellermannTyton Group PLC

EMEA

USD ($)

Schedule of Debt [Line Items]

Maximum Funding From European Factoring Program

€ 400

Accounts receivable factoring borrowings

242

0

Receivables Factored Qualifying As Sales

21

75

Expenses Incurred in Conjunction with Off Balance Sheet Factoring

1

Capital leases and other

138

53

80

Interest Paid

$ 96

$ 99

Pension Benefits Narrative (Details) (USD $)

In Millions, unless otherwise specified

9 Months Ended

Sep. 30, 2015

Dec. 31, 2014

Compensation and Retirement Disclosure [Abstract]

Defined Benefit Pension Plan, Postemployment Benefit Period

5 years