Impact of COVID-19 Pandemic

6 Months Ended

Jul. 03, 2021

Unusual or Infrequent Items, or Both [Abstract]

Impact of COVID-19 Pandemic

Impact of COVID-19 Pandemic

Although industry production has improved relative to 2020, production remains below recent historic levels. It is likely that, for a period of time, the global automotive industry will continue to be impacted by the COVID-19 pandemic, particularly through supply shortages, ongoing costs related to personal protective equipment and higher labor costs reflecting inefficiencies and increased absenteeism. The most significant supply shortage relates to semiconductor chips, which is impacting global industry production, resulting in cancellations of planned production. Further, a resurgence of the virus or its variants, including corresponding "stay at home" or similar government orders impacting industry production, could impact the Company's financial results.

The accompanying condensed consolidated financial statements reflect estimates and assumptions made by management as of July 3, 2021, and for the six months then ended. Such estimates and assumptions affect, among other things, the Company's goodwill; long-lived asset and indefinite-lived intangible asset valuations; inventory valuations; valuations of deferred income taxes and income tax contingencies; and credit losses related to the Company's financial instruments. Events and circumstances arising after July 3, 2021, including those resulting from the impact of the COVID-19 pandemic, will be reflected in management's estimates and assumptions in future periods.