Quarterly report pursuant to Section 13 or 15(d)

OPERATING SEGMENTS (Details)

v3.20.2
OPERATING SEGMENTS (Details) - USD ($)
$ in Millions
 3 Months Ended 6 Months Ended
Jun. 28, 2020
Jun. 30, 2019
Jun. 28, 2020
Jun. 30, 2019
Segment reporting        
NET SALES (a) (Note 3) [1] $ 3,852 $ 6,221 $ 8,863 $ 12,225
Research, development and engineering expenses 189 251 427 488
Equity, royalty and interest income from investees 115 96 244 188
Interest income 4 12 11 24
Segment EBITDA 549 1,058 1,395 2,091
Depreciation and amortization 164 [2] 158 [2] 332 [3] 314 [3]
Less: Interest expense 23 29 46 61
INCOME BEFORE INCOME TAXES 362 871 1,017 1,716
Amortization of Debt Discount (Premium)     1 1
Engine        
Segment reporting        
NET SALES (a) (Note 3) 1,423 2,703 3,581 5,356
Research, development and engineering expenses 65 88 145 166
Equity, royalty and interest income from investees 84 62 162 118
Interest income 1 4 5 8
Segment EBITDA 150 416 515 854
Depreciation and amortization 51 [2] 51 [2] 104 [3] 101 [3]
Distribution        
Segment reporting        
NET SALES (a) (Note 3) 1,605 2,028 3,419 4,029
Research, development and engineering expenses 4 7 11 14
Equity, royalty and interest income from investees 11 12 32 23
Interest income 1 4 2 8
Segment EBITDA 160 172 318 343
Depreciation and amortization 30 [2] 28 [2] 61 [3] 57 [3]
Components        
Segment reporting        
NET SALES (a) (Note 3) 1,150 1,846 2,652 3,707
Research, development and engineering expenses 55 75 123 150
Equity, royalty and interest income from investees 12 11 33 21
Interest income 1 2 2 4
Segment EBITDA 141 297 420 622
Depreciation and amortization 47 [2] 47 [2] 95 [3] 93 [3]
Power Systems        
Segment reporting        
NET SALES (a) (Note 3) 777 1,203 1,661 2,280
Research, development and engineering expenses 41 57 95 113
Equity, royalty and interest income from investees 9 11 18 26
Interest income 1 2 2 4
Segment EBITDA 91 173 168 311
Depreciation and amortization 32 [2] 30 [2] 64 [3] 59 [3]
New Power        
Segment reporting        
NET SALES (a) (Note 3) 10 8 20 11
Research, development and engineering expenses 24 24 53 45
Equity, royalty and interest income from investees (1) 0 (1) 0
Interest income 0 0 0 0
Segment EBITDA (38) (33) (81) (62)
Depreciation and amortization 4 [2] 2 [2] 8 [3] 4 [3]
Total Segments        
Segment reporting        
NET SALES (a) (Note 3) 4,965 7,788 11,333 15,383
Research, development and engineering expenses 189 251 427 488
Equity, royalty and interest income from investees 115 96 244 188
Interest income 4 12 11 24
Segment EBITDA 504 1,025 1,340 2,068
Depreciation and amortization 164 [2] 158 [2] 332 [3] 314 [3]
Intersegment Eliminations        
Segment reporting        
NET SALES (a) (Note 3) (1,113) [4] (1,567) [4] (2,470) [5] (3,158) [5]
Non-segment items        
Segment reporting        
Segment EBITDA 45 [4] 33 [4] 55 [5] 23 [5]
External Sales        
Segment reporting        
NET SALES (a) (Note 3) 3,852 6,221 8,863 12,225
External Sales | Engine        
Segment reporting        
NET SALES (a) (Note 3) 937 2,073 2,516 4,057
External Sales | Distribution        
Segment reporting        
NET SALES (a) (Note 3) 1,601 2,015 3,408 4,008
External Sales | Components        
Segment reporting        
NET SALES (a) (Note 3) 876 1,401 1,991 2,802
External Sales | Power Systems        
Segment reporting        
NET SALES (a) (Note 3) 428 724 928 1,347
External Sales | New Power        
Segment reporting        
NET SALES (a) (Note 3) 10 8 20 11
External Sales | Total Segments        
Segment reporting        
NET SALES (a) (Note 3) 3,852 6,221 8,863 12,225
Intersegment sales | Engine        
Segment reporting        
NET SALES (a) (Note 3) 486 630 1,065 1,299
Intersegment sales | Distribution        
Segment reporting        
NET SALES (a) (Note 3) 4 13 11 21
Intersegment sales | Components        
Segment reporting        
NET SALES (a) (Note 3) 274 445 661 905
Intersegment sales | Power Systems        
Segment reporting        
NET SALES (a) (Note 3) 349 479 733 933
Intersegment sales | New Power        
Segment reporting        
NET SALES (a) (Note 3) 0 0 0 0
Intersegment sales | Total Segments        
Segment reporting        
NET SALES (a) (Note 3) 1,113 1,567 2,470 3,158
Intersegment sales | Intersegment Eliminations        
Segment reporting        
NET SALES (a) (Note 3) $ (1,113) [4] $ (1,567) [4] $ (2,470) [5] $ (3,158) [5]
[1] (a) Includes sales to nonconsolidated equity investees of $338 million and $595 million for the three and six months ended June 28, 2020, compared with $317 million and $602 million for the comparable periods in 2019.
[2] (2) Depreciation and amortization, as shown on a segment basis, excludes the amortization of debt discount and deferred costs included in the Condensed Consolidated Statements of Net Income as "Interest expense." A portion of depreciation expense is included in "Research, development and engineering expenses."
[3] (2) Depreciation and amortization, as shown on a segment basis, excludes the amortization of debt discount and deferred costs included in the Condensed Consolidated Statements of Net Income as "Interest expense." The amortization of debt discount and deferred costs was $1 million and $1 million for the six months ended June 28, 2020 and June 30, 2019, respectively. A portion of depreciation expense is included in "Research, development and engineering expenses."
[4] (1) Includes intersegment sales, intersegment profit in inventory eliminations and unallocated corporate expenses. There were no significant unallocated corporate expenses for the three months ended June 28, 2020 and June 30, 2019.
[5] (1) Includes intersegment sales, intersegment profit in inventory eliminations and unallocated corporate expenses. There were no significant unallocated corporate expenses for the six months ended June 28, 2020 and June 30, 2019.