Segments

The components that management establishes for purposes of making decisions about an enterprise’s operating matters are referred to as “operating segments.” We manage our operations globally through four operating segments: Light Vehicle Driveline, Commercial Vehicle, Off-Highway and Power Technologies.

We report the results of our operating segments and related disclosures about each of our segments on the basis that is used internally for evaluating segment performance and deciding how to allocate resources to those segments. The primary measure of operating results is segment EBITDA. The most significant impact on our ongoing results of operations as a result of applying fresh start accounting following our emergence from bankruptcy was higher depreciation and amortization. Management believes by using segment EBITDA, a performance measure which excludes depreciation and amortization, the comparability of results is enhanced. In addition, segment EBITDA is an important measure since the financial covenants in our debt agreements are based, in part, on EBITDA. Our segments are charged for corporate and other shared administrative costs.

Segment information —



	2013							2012
Three Months Ended September 30,	External Sales		Inter-Segment Sales			Segment EBITDA		External Sales		Inter-Segment Sales			Segment EBITDA
LVD	$	629	$	31		$	67	$	659	$	46		$	68
Power Technologies	257		5			39		242		6			29
Commercial Vehicle	465		29			52		471		34			45
Off-Highway	318		12			40		343		12			48
Eliminations and other			(77		)					(98		)
Total	$	1,669	$	—		$	198	$	1,715	$	—		$	190

Nine Months Ended September 30,
LVD	$	1,921	$	97		$	179	$	2,121	$	148		$	207
Power Technologies	778		16			114		772		17			106
Commercial Vehicle	1,421		93			154		1,535		106			163
Off-Highway	1,025		36			127		1,187		44			153
Eliminations and other			(242		)					(315		)
Total	$	5,145	$	—		$	574	$	5,615	$	—		$	629

Reconciliation of segment EBITDA to consolidated net income —



	Three Months Ended September 30,						Nine Months Ended September 30,
	2013			2012			2013			2012
Segment EBITDA	$	198		$	190		$	574		$	629
Corporate expense and other items, net				(1		)	(3		)	(8		)
Depreciation	(41		)	(46		)	(123		)	(140		)
Amortization of intangibles	(22		)	(22		)	(65		)	(66		)
Restructuring	(8		)	(6		)	(14		)	(30		)
Strategic transaction expenses and other items				(1		)	(6		)	(6		)
Write off of deferred financing costs							(2		)
Recognition of unrealized gain on payment-in-kind note receivable							5
Impairment and loss on sale of assets										(6		)
Stock compensation expense	(5		)	(3		)	(14		)	(12		)
Interest expense	(27		)	(22		)	(69		)	(63		)
Interest income	8			6			20			17
Income from continuing operations before income taxes	103			95			303			315
Income tax expense	34			33			96			97
Equity in earnings of affiliates	3			(2		)	10			4
Income from continuing operations	72			60			217			222
Loss from discontinued operations	(1		)	—			—			—
Net income	$	71		$	60		$	217		$	222