Segments

We are a global provider of high-technology products to virtually every major vehicle and engine manufacturer in the world. We also serve the stationary industrial market. Our technologies include drive and motion products (axles, driveshafts, planetary hub drives, power-transmission products, tire-management products, transmissions, and motors, power inverters and controls systems for electric vehicles); sealing solutions (gaskets, seals, heat shields, and fuel-cell plates); thermal-management technologies (transmission and engine oil cooling, battery and electronics cooling, and exhaust-gas heat recovery); and fluid-power products (pumps, valves, motors, and controls). We serve our global light vehicle, medium/heavy vehicle and off-highway markets through four operating segments – Light Vehicle Driveline Technologies (Light Vehicle), Commercial Vehicle Driveline Technologies (Commercial Vehicle), Off-Highway Drive and Motion Technologies (Off-Highway) and Power Technologies, which is the center of excellence for sealing and thermal-management technologies that span all customers in our on-highway and off-highway markets. These operating segments have global responsibility and accountability for business commercial activities and financial performance.

Dana evaluates the performance of its operating segments based on external sales and segment EBITDA. Segment EBITDA is a primary driver of cash flows from operations and a measure of our ability to maintain and continue to invest in our operations and provide shareholder returns. Our segments are charged for corporate and other shared administrative costs. Segment EBITDA may not be comparable to similarly titled measures reported by other companies.

Segment information —



	2018							2017
Three Months Ended June 30,	External Sales		Inter-Segment Sales			Segment EBITDA		External Sales		Inter-Segment Sales			Segment EBITDA
Light Vehicle	$	873	$	36		$	92	$	803	$	34		$	93
Commercial Vehicle	411		28			41		357		24			30
Off-Highway	485		3			79		395		1			57
Power Technologies	285		6			39		285		3			41
Eliminations and other			(73		)					(62		)
Total	$	2,054	$	—		$	251	$	1,840	$	—		$	221

Six Months Ended June 30,
Light Vehicle	$	1,823	$	69		$	195	$	1,564	$	63		$	182
Commercial Vehicle	811		54			75		686		47			58
Off-Highway	977		5			151		723		1			102
Power Technologies	581		11			84		568		7			91
Eliminations and other			(139		)					(118		)
Total	$	4,192	$	—		$	505	$	3,541	$	—		$	433

Upon our adoption of ASU 2017-07 on January 1, 2018, we changed our measurement of segment profit to exclude the non-service cost components of pension and OPEB costs. See Note 1 for additional information on ASU 2017-07. Prior period segment EBITDA amounts have not been recast due to the insignificance of the adjustments. Had the prior period amounts been recast to conform with the current presentation, segment EBITDA for the second quarter and the first half of 2017 would have been $93 and $182 for Light Vehicle, $30 and $59 for Commercial Vehicle, $57 and $102 for Off-Highway and $43 and $94 for Power Technologies.

Prior to the third quarter of 2017, our Crossville, Tennessee distribution center rolled up within our Commercial Vehicle operating segment for purposes of inter-segment sales reporting. Beginning in the third quarter of 2017, the distribution center has been split between our Commercial Vehicle and Off-Highway operating segments. This change in management reporting has resulted in a decrease in the inter-segment sales reported by our Off-Highway operating segment. Prior period amounts have been recast to conform with the current presentation. This change in management reporting had no impact on segment reporting of external sales or segment EBITDA.

Reconciliation of segment EBITDA to consolidated net income —



	Three Months Ended June 30,						Six Months Ended June 30,
	2018			2017			2018			2017
Segment EBITDA	$	251		$	221		$	505		$	433
Corporate expense and other items, net	(5		)	(4		)	(11		)	(11		)
Depreciation	(60		)	(55		)	(124		)	(104		)
Amortization of intangibles	(2		)	(3		)	(5		)	(6		)
Non-service cost components of pension and OPEB costs	(4		)				(7		)
Restructuring	(7		)	(10		)	(8		)	(12		)
Stock compensation expense	(5		)	(6		)	(9		)	(10		)
Strategic transaction expenses, net of transaction breakup fee income	(8		)	(6		)	(7		)	(17		)
Acquisition related inventory adjustments				(8		)				(14		)
Other items	(5		)	(2		)	(5		)	(3		)
Impairment of indefinite-lived intangible asset	(20		)				(20		)
Adjustment in fair value of disposal group held for sale	3						3
Amounts attributable to previously divested/closed operations				3						3
Earnings before interest and income taxes	138			130			312			259
Loss on extinguishment of debt				(6		)				(6		)
Interest expense	(23		)	(27		)	(47		)	(54		)
Interest income	2			2			5			5
Earnings before income taxes	117			99			270			204
Income tax expense (benefit)	(4		)	31			44			61
Equity in earnings of affiliates	6			5			12			10
Net income	$	127		$	73		$	238		$	153