Annual report pursuant to Section 13 and 15(d)

OPERATING SEGMENTS FINANCIAL INFORMATION (Details) Reportable Operating Segments, EBITDA Reconciliation to GAAP

v3.19.3.a.u2
OPERATING SEGMENTS FINANCIAL INFORMATION (Details) Reportable Operating Segments, EBITDA Reconciliation to GAAP - USD ($)
$ in Millions
 3 Months Ended 12 Months Ended
Dec. 31, 2019
Sep. 29, 2019
Jun. 30, 2019
Mar. 31, 2019
Dec. 31, 2018
Sep. 30, 2018
Jul. 01, 2018
Apr. 01, 2018
Dec. 31, 2019
Dec. 31, 2018
Dec. 31, 2017
Operating results:                      
Net sales $ 5,578 $ 5,768 $ 6,221 $ 6,004 $ 6,126 $ 5,943 $ 6,132 $ 5,570 $ 23,571 [1] $ 23,771 [1] $ 20,428 [1]
Research, development and engineering expenses                 1,001 902 754
Equity, royalty and interest income from investees                 330 394 357 [2]
Interest income                 46 35 18
Segment Reporting Information Income (Loss) before Interest Expense and Income Taxes Excluding Asset Impairments and Restructuring Actions and Other Charges                 3,731    
Severance Costs                 119 [3] 0 0
Segment EBITDA                 3,612 3,476 3,026
Depreciation and Amortization [4]                 669 609 580
Amortization of Debt Discount                 3 2 3
Interest Expense                 109 114 81
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest                 2,834 2,753 2,365
Statement of Financial Position [Abstract]                      
Net assets 9,258       9,220       9,258 9,220 8,574
Investments and advances to equity method investees 1,237       1,222       1,237 1,222 1,156
Capital expenditures                 700 709 506
Engine                      
Operating results:                      
Net sales                 10,056 10,566 8,953
Research, development and engineering expenses                 337 311 280
Equity, royalty and interest income from investees                 200 238 219 [2]
Interest income                 15 11 6
Segment Reporting Information Income (Loss) before Interest Expense and Income Taxes Excluding Asset Impairments and Restructuring Actions and Other Charges                 1,472    
Severance Costs [3]                 18    
Segment EBITDA                 1,454 1,446 1,143
Depreciation and Amortization [4]                 202 190 184
Statement of Financial Position [Abstract]                      
Net assets 1,094       1,265       1,094 1,265 1,180
Investments and advances to equity method investees 575       561       575 561 531
Capital expenditures                 240 254 188
Distribution                      
Operating results:                      
Net sales                 8,071 7,828 7,058
Research, development and engineering expenses                 28 20 19
Equity, royalty and interest income from investees                 52 46 44 [2]
Interest income                 15 13 6
Segment Reporting Information Income (Loss) before Interest Expense and Income Taxes Excluding Asset Impairments and Restructuring Actions and Other Charges                 693    
Severance Costs [3]                 37    
Segment EBITDA                 656 563 500
Depreciation and Amortization [4]                 115 109 116
Statement of Financial Position [Abstract]                      
Net assets 2,536       2,677       2,536 2,677 2,446
Investments and advances to equity method investees 296       278       296 278 267
Capital expenditures                 136 133 101
Components                      
Operating results:                      
Net sales                 6,914 7,166 5,889
Research, development and engineering expenses                 300 272 241
Equity, royalty and interest income from investees                 40 54 40 [2]
Interest income                 8 5 3
Segment Reporting Information Income (Loss) before Interest Expense and Income Taxes Excluding Asset Impairments and Restructuring Actions and Other Charges                 1,117    
Severance Costs [3]                 20    
Segment EBITDA                 1,097 1,030 917
Depreciation and Amortization [4]                 222 185 163
Statement of Financial Position [Abstract]                      
Net assets 2,911       2,878       2,911 2,878 2,811
Investments and advances to equity method investees 193       206       193 206 194
Capital expenditures                 191 182 127
Power Systems                      
Operating results:                      
Net sales                 4,460 4,626 4,058
Research, development and engineering expenses                 230 230 214
Equity, royalty and interest income from investees                 38 56 54 [2]
Interest income                 8 6 3
Segment Reporting Information Income (Loss) before Interest Expense and Income Taxes Excluding Asset Impairments and Restructuring Actions and Other Charges                 524    
Severance Costs [3]                 12    
Segment EBITDA                 512 614 411
Depreciation and Amortization [4]                 118 119 117
Statement of Financial Position [Abstract]                      
Net assets 2,245       2,262       2,245 2,262 2,137
Investments and advances to equity method investees 171       177       171 177 164
Capital expenditures                 107 129 90
New Power                      
Operating results:                      
Net sales                 38 7 0
Research, development and engineering expenses                 106 69 0
Equity, royalty and interest income from investees                 0 0 0 [2]
Interest income                 0 0 0
Segment Reporting Information Income (Loss) before Interest Expense and Income Taxes Excluding Asset Impairments and Restructuring Actions and Other Charges                 (148)    
Severance Costs [3]                 1    
Segment EBITDA                 (149) (90) 0
Depreciation and Amortization [4]                 12 6 0
Statement of Financial Position [Abstract]                      
Net assets 472       138       472 138 0
Investments and advances to equity method investees 2       0       2 0 0
Capital expenditures                 26 11 0
Total Segment                      
Operating results:                      
Net sales                 29,539 30,193 25,958
Research, development and engineering expenses                 1,001 902 754
Equity, royalty and interest income from investees                 330 394 357 [2]
Interest income                 46 35 18
Segment Reporting Information Income (Loss) before Interest Expense and Income Taxes Excluding Asset Impairments and Restructuring Actions and Other Charges                 3,658    
Severance Costs [3]                 88    
Segment EBITDA                 3,570 3,563 2,971
Depreciation and Amortization [4]                 669 609 580
Statement of Financial Position [Abstract]                      
Net assets 9,258       9,220       9,258 9,220 8,574
Investments and advances to equity method investees $ 1,237       $ 1,222       1,237 1,222 1,156
Capital expenditures                 700 709 506
Intersegment Eliminations                      
Operating results:                      
Net sales [5]                 (5,968) (6,422) (5,530)
Non-Segment Items                      
Operating results:                      
Segment Reporting Information Income (Loss) before Interest Expense and Income Taxes Excluding Asset Impairments and Restructuring Actions and Other Charges [5]                 73    
Severance Costs [3],[5]                 31    
Segment EBITDA [5]                 42 (87) 55
External Sales                      
Operating results:                      
Net sales                 23,571 23,771 20,428
External Sales | Engine                      
Operating results:                      
Net sales                 7,570 8,002 6,661
External Sales | Distribution                      
Operating results:                      
Net sales                 8,040 7,807 7,029
External Sales | Components                      
Operating results:                      
Net sales                 5,253 5,331 4,363
External Sales | Power Systems                      
Operating results:                      
Net sales                 2,670 2,625 2,375
External Sales | New Power                      
Operating results:                      
Net sales                 38 6 0
External Sales | Total Segment                      
Operating results:                      
Net sales                 23,571 23,771 20,428
Intersegment sales | Engine                      
Operating results:                      
Net sales                 2,486 2,564 2,292
Intersegment sales | Distribution                      
Operating results:                      
Net sales                 31 21 29
Intersegment sales | Components                      
Operating results:                      
Net sales                 1,661 1,835 1,526
Intersegment sales | Power Systems                      
Operating results:                      
Net sales                 1,790 2,001 1,683
Intersegment sales | New Power                      
Operating results:                      
Net sales                 0 1 0
Intersegment sales | Total Segment                      
Operating results:                      
Net sales                 5,968 6,422 5,530
Intersegment sales | Intersegment Eliminations                      
Operating results:                      
Net sales [5]                 $ (5,968) $ (6,422) (5,530)
Tax Legislation Impact | Engine                      
Operating results:                      
Tax Legislation Impact to JV Earnings                     (23)
Tax Legislation Impact | Distribution                      
Operating results:                      
Tax Legislation Impact to JV Earnings                     (4)
Tax Legislation Impact | Components                      
Operating results:                      
Tax Legislation Impact to JV Earnings                     $ (12)
[1]
Includes sales to nonconsolidated equity investees of $1,191 million, $1,267 million and $1,174 million for the years ended December 31, 2019, 2018 and 2017, respectively.
[2] U.S. tax legislation passed in December 2017 decreased our equity earnings at certain equity investees, negatively impacting our "Equity, royalty and interest income from investees" by $23 million, $4 million and $12 million for the Engine, Distribution and Components segments, respectively. See Note 5, "INCOME TAXES," for additional information.
[3]
See Note 4 "RESTRUCTURING ACTIONS," for additional information.
[4]
Depreciation and amortization, as shown on a segment basis, excludes the amortization of debt discount and deferred costs included in the Consolidated Statements of Net Income as "Interest expense." The amortization of debt discount and deferred costs were $3 million, $2 million and $3 million for the years ended 2019, 2018 and 2017, respectively. A portion of depreciation expense is included in "Research, development and engineering expense."
[5] Includes intersegment sales, intersegment profit in inventory eliminations and unallocated corporate expenses. The year ended December 31, 2019, includes a $31 million restructuring charge related to corporate functions. There were no significant unallocated corporate expenses for the