Company: APTV
Filing Date: 2025-02-07
Form Type: 10-K
Source: 0001521332-25-000010
Chunk: 124

Company: Aptiv PLC
Filing Date: 2025-02-07
Form: 10-K
Item: Item 7A
Chunk 124
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% in relation to the Mexican Peso, approximately 6% in relation to the Euro and approximately 1% in relation to the Chinese Yuan Renminbi from December 31, 2023.

As described in Note 17. Derivatives and Hedging Activities to the audited consolidated financial statements included herein, in order to manage certain translational exposure, we have designated the 2024 Euro-denominated Senior Notes and the 2016 Euro-denominated Senior Notes as net investment hedges of the foreign currency exposure of our investments in certain Euro-denominated subsidiaries, and had designated the 2015 Euro-denominated Senior Notes prior to being redeemed in December 2024. We have also entered into forward contracts designated as net investment hedges of the foreign currency exposure of our investments in certain Chinese Yuan Renminbi-denominated subsidiaries. The effective portion of the gains or losses on instruments designated as net investment hedges are recognized within the cumulative translation adjustment component in the consolidated statements of comprehensive income to offset changes in the value of the net investment in these foreign currency-denominated operations.

In some instances, we choose to reduce our transactional exposures through financial instruments (hedges) that provide offsets or limits to our exposures. Currently, our most significant hedged currency exposures relate to the Mexican Peso, Chinese Yuan Renminbi, Polish Zloty, British Pound and Hungarian Forint. As of December 31, 2024 and 2023 the net fair value liability of all financial instruments, including hedges and underlying transactions, with exposure to currency risk was approximately $925 million and $507 million, respectively. The potential change in fair value for such financial instruments from a hypothetical 10% adverse change in quoted currency exchange rates would be a loss of approximately $21 million and a gain of approximately $23 million as of December 31, 2024 and 2023, respectively. The potential change in fair value from a hypothetical 10% favorable change in quoted currency exchange rates would be a loss of approximately $21 million and $9 million as of December 31, 2024 and 2023, respectively. The impact of a 10% change in rates on fair value differs from a 10% change in the net fair value liability due to the existence of hedges. The model assumes a parallel shift in currency exchange rates; however, currency exchange rates rarely move in the same direction. The assumption that currency exchange rates change in a parallel fashion may overstate the impact of changing currency exchange rates on assets