DELPHI 2015 Annual Report Download - page 110

Table of Contents
88
The table below summarizes the activity in the product warranty liability for the years ended December 31, 2015 and
2014:
Year Ended December 31,
2015 2014
(in millions)
Accrual balance at beginning of year ......................................................................................... $ 146 $ 160
Provision for estimated warranties incurred during the year................................................. 72 53
Changes in estimate for pre-existing warranties.................................................................... (11)(4)
Settlements made during the year (in cash or in kind)........................................................... (70)(56)
Foreign currency translation and other .................................................................................. (6)(7)
Accrual balance at end of year.................................................................................................... $ 131 $ 146
10. 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 $177 million during the year ended December 31, 2015. 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. These charges include the recognition of approximately $68 million of
employee-related and other costs related to the initiation of a plant closure of a European manufacturing site within the
Powertrain Systems segment in the fourth quarter of 2015. Future cash payments for this restructuring action are expected to be
principally complete by the end of 2017.
During the year ended December 31, 2014, Delphi recorded employee-related and other restructuring charges totaling
approximately $140 million, which include the recognition of approximately $35 million of employee-related and other costs
related to the initiation of a workforce reduction at a European manufacturing site within the Powertrain Systems segment.
During the year ended December 31, 2013, Delphi recorded employee related and other restructuring charges totaling
approximately $137 million, which were primarily related to European restructuring programs, as well as to programs resulting
from the integration of the Motorized Vehicles Division of FCI (“MVL”), which was acquired in the third quarter of 2012.
Additionally, the Company recorded $3 million, $4 million and $8 million of restructuring costs within discontinued
operations related to the Thermal Systems business during the years ended December 31, 2015, 2014 and 2013, respectively.
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 $133 million and $162 million in the years ended December 31, 2015 and
December 31, 2014, respectively.
The following table summarizes the restructuring charges recorded for the years ended December 31, 2015, 2014 and
2013 by operating segment:
Year Ended December 31,
2015 2014 2013
(in millions)
Electrical/Electronic Architecture................................................................... $ 37 $ 57 $ 28
Powertrain Systems......................................................................................... 115 55 53
Electronics and Safety..................................................................................... 25 28 56
Total............................................................................................................ $ 177 $ 140 $ 137