Company: APTV
Filing Date: 2025-07-31
Form Type: 10-Q
Source: 0001521332-25-000040
Chunk: 93

Company: Aptiv PLC
Filing Date: 2025-07-31
Form: 10-Q
Item: Item 1
Chunk 93
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 of 15%, as established by the OECD. Many countries have enacted legislation consistent with the Framework effective at the beginning of 2024. The OECD continues to release additional guidance on these rules. The Company has proactively responded to these tax policy changes and will continue to closely monitor developments. Our effective tax rate for the six months ended June 30, 2025 includes an unfavorable impact from the enacted Framework.

On January 15, 2025, the OECD released Administrative Guidance (the “Guidance) on Article 9.1 of the Global Anti-Base Erosion Model Rules (the “Model Rules”) which amends the Pillar Two Framework. Jurisdictions that have adopted the Framework may implement and administer their domestic laws consistent with the Model Rules and Guidance. The Guidance eliminates the tax basis in certain deferred tax assets including tax credit carryforwards for purposes of the global minimum tax established under the Framework. As a result, the Company no longer expects to obtain significant benefits from the tax incentive granted to its Swiss subsidiary in 2023. Accordingly, the Company recognized an increase to valuation allowances of $294 million to reduce the related deferred tax asset during the six months ended June 30, 2025. No other deferred tax assets are impacted by the Guidance. 

On July 4, 2025, the One Big Beautiful Bill Act (the “Act”) was enacted into law. The Act includes changes to U.S. tax law that will be applicable to Aptiv beginning in 2025, with additional provisions applying in subsequent years. Included in these changes are favorable adjustments to deductions for interest, qualified property, and research and development expenditures, as well as reforms to the international tax framework. We are in the process of evaluating the impact of the Act on our consolidated financial statements.

Refer to Note 11. Income Taxes to the consolidated financial statements contained herein for additional information.

Equity LossThree Months Ended June 30,20252024Favorable/(unfavorable)(in millions)Equity loss, net of tax$11 $34 $23  Six Months Ended June 30, 20252024Favorable/(unfavorable) (in millions)Equity loss, net of tax$21 $103 $82 

Equity loss, net of tax reflects the Company’s interest in the results of ongoing operations of entities accounted for as equity method investments. The decrease in equity losses recognized by Aptiv during the three and six months ended June 30,