##### Table of Contents



UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549


FORM 10-Q

|       |  |                                                                                          
|------ |  | -----------------------------------------------------------------------------------------
|[X]    |  | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
	 SECURITIES EXCHANGE ACT OF 1934
|      
|       |  | For the quarterly period ended March 31, 2000                                            
|       |  | OR                                                                                       
|      
|[    ] |  | TRANSITION REPORT PURSUANT TO SECTION 13 OF THE SECURITIES 
	EXCHANGE ACT OF 1934        

For
 the transition period from  to

Commission file No. 1-14787

DELPHI AUTOMOTIVE SYSTEMS CORPORATION

(Exact name of registrant as specified in its
charter)


|                                                                |  |                                      
|--------------------------------------------------------------- |  | -------------------------------------
|                                                               
|                                                               
|                                                               
|                                                               
|Delaware                                                        |  | 38-3430473                           
|(State or other jurisdiction of incorporation
	or organization) |  | (IRS employer
	identification number)
|                                                               
|                                                               
|                                                               
|                                                               
|                                                               
|5725 Delphi Drive, Troy, Michigan                               |  | 48098                                
|(Address of principal executive offices)                        |  | (Zip code)                           

Registrants telephone number, including area code (248) 813-2000

Indicate by check mark whether the registrant (1) has filed
all reports required to be filed by Section 13 or 15(d)
 of the Securities Exchange Act of 1934 during the preceding
12 months (or for such shorter period that the registrant
was required to file such reports), and (2) has been subject
 to such filing requirements for the past
90 days.       Yes 
X     No

As of March 31, 2000, 563 million shares of the
registrants $0.01 par value common stock were outstanding.





---

TABLE OF CONTENTS



|                                                                                              |  |  |  |  |  |  |  | 
|--------------------------------------------------------------------------------------------- |  |  |  |  |  |  |  | 
|DELPHI AUTOMOTIVE SYSTEMS CORPORATION                                                        
|PART I. FINANCIAL INFORMATION                                                                
|ITEM 1. FINANCIAL STATEMENTS                                                                 
|DELPHI AUTOMOTIVE SYSTEMS CORPORATION                                                        
|CONSOLIDATED STATEMENTS OF INCOME (Unaudited)                                                
|DELPHI AUTOMOTIVE SYSTEMS CORPORATION                                                        
|CONSOLIDATED BALANCE SHEETS                                                                  
|DELPHI AUTOMOTIVE SYSTEMS CORPORATION CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)      
|NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)                                       
|ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|PART II. OTHER INFORMATION                                                                   
|SIGNATURE                                                                                    
|EXHIBIT INDEX                                                                                



---








DELPHI AUTOMOTIVE SYSTEMS CORPORATION


INDEX

|                                                                                               |                                                                                                       |      |    |   | 
|---------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------- | ---- | -- | - | 
|                                                                                               |                                                                                                       | Page
|                                                                                               |                                                                                                       |     
|Part I  Financial Information                                                                 |                                                                                                       |      |    |  
|Item 1. Financial Statements                                                                   |                                                                                                       |      |    |  
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                               | Consolidated Statements of Income (Unaudited) for the Three
	Months Ended March 31, 2000 and 1999     |      |    | 3 | 
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                               | Consolidated Balance Sheets at March 31, 2000 (Unaudited)
	and December 31, 1999                      |      |    | 4 | 
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                               | Consolidated Statements of Cash Flows (Unaudited) for the Three
	Months Ended March 31, 2000 and 1999 |      |    | 5 | 
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                               | Notes to Consolidated Financial Statements (Unaudited)                                                |      |    | 6 | 
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                              
|Item 2. Managements Discussion and Analysis of
	Financial Condition and Results of Operations |                                                                                                       |      | 10 |  
|                                                                                              
|Part II  Other Information                                                                    |                                                                                                       |      |    |  
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                              
|Item 1. Legal Proceedings                                                                      |                                                                                                       |      | 14 |  
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                              
|Item 6. Exhibits and Reports on Form 8-K                                                       |                                                                                                       |      | 14 |  
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                              
|Signature                                                                                      |                                                                                                       |      | 15 |  

2



---



##### Table of Contents








PART I.  FINANCIAL INFORMATION







ITEM 1.  FINANCIAL STATEMENTS







DELPHI AUTOMOTIVE SYSTEMS CORPORATION







CONSOLIDATED STATEMENTS OF INCOME (Unaudited)


|                            |                                                                   |                          |     |       |       |   |     |       |       | 
|--------------------------- | ----------------------------------------------------------------- | ------------------------ | --- | ----- | ----- | - | --- | ----- | ----- | 
|                            |                                                                   |                         
|                            |                                                                   | Three Months Ended      
|                            |                                                                   | March 31,               
|                            |                                                                   |                         
|                            |                                                                   | 2000                     |     | 1999 
|                            |                                                                   |                          |     |      
|                            |                                                                   |                         
|                            |                                                                   | (in millions, except per
|                            |                                                                   | share amounts)          
|                           
|                           
|                           
|                           
|Net sales:                  |                                                                   |                          |     |       |       |   |     |      
|                           
|                           
|                           
|                           
|                            | General Motors and affiliates                                     |                          | $   | 5,570 |       |   | $   | 5,853 |      
|                           
|                           
|                           
|                           
|                            | Other customers                                                   |                          |     | 2,234 |       |   |     | 1,616 |      
|                            |                                                                   |                          |     |       |       |   |     |      
|                            |                                                                   | Total net sales          |     |       | 7,804 |   |     |       | 7,469 | 
|                            |                                                                   |                          |     |       |       |   |     |      
|Less operating expenses:    |                                                                   |                          |     |       |       |   |     |      
|                           
|                           
|                           
|                           
|                            | Cost of sales, excluding items listed below                       |                          |     | 6,596 |       |   |     | 6,391 |      
|                           
|                           
|                           
|                           
|                            | Selling, general and administrative                               |                          |     | 459   |       |   |     | 384   |      
|                           
|                           
|                           
|                           
|                            | Depreciation and amortization                                     |                          |     | 232   |       |   |     | 237   |      
|                           
|                           
|                           
|                           
|                            | Acquisition-related in-process research and development
	(Note 2) |                          |     | 51    |       |   |     |      |      
|                            |                                                                   |                          |     |       |       |   |     |      
|                            |                                                                   | Total operating expenses |     |       | 7,338 |   |     |       | 7,012 | 
|                            |                                                                   |                          |     |       |       |   |     |      
|Operating income            |                                                                   |                          | 466 |       |       |   | 457 |      
|                           
|                           
|                           
|                           
|Less interest expense       |                                                                   |                          | 40  |       |       |   | 24  |      
|                           
|                           
|                           
|                           
|Other income, net           |                                                                   |                          | 34  |       |       |   | 25  |      
|                            |                                                                   |                          |     |       |       |   |     |      
|Income before income taxes  |                                                                   |                          | 460 |       |       |   | 458 |      
|                           
|                           
|                           
|                           
|Income tax expense          |                                                                   |                          | 170 |       |       |   | 174 |      
|                            |                                                                   |                          |     |       |       |   |     |      
|Net income                  |                                                                   | $                        | 290 |       |       | $ | 284 |      
|                            |                                                                   |                          |     |       |       |   |     |      
|Earnings per share (Note 1) |                                                                   |                          |     |       |       |   |     |      
|                           
|                           
|                           
|                           
|                            | Basic and diluted                                                 |                          | $   | 0.51  |       |   | $   | 0.55  |      
|                            |                                                                   |                          |     |       |       |   |     |      

See notes to consolidated financial statements.

3



---



##### Table of Contents








DELPHI AUTOMOTIVE SYSTEMS CORPORATION







CONSOLIDATED BALANCE SHEETS


|                                           |                                                                                            |                               |                            |              |       |        |        |       |       |        | 
|------------------------------------------ | ------------------------------------------------------------------------------------------ | ----------------------------- | -------------------------- | ------------ | ----- | ------ | ------ | ----- | ----- | ------ | 
|                                           |                                                                                            | March 31,                     |                            |             
|                                           |                                                                                            | 2000                          |                            | December 31,
|                                           |                                                                                            | (Unaudited)                   |                            | 1999        
|                                           |                                                                                            |                               |                            |             
|                                           |                                                                                            |                              
|                                           |                                                                                            | (in millions)                
|                                          
|                                          
|                                          
|                                          
|ASSETS                                     |                                                                                            |                               |                            |              |       |        |        |      
|                                          
|                                          
|                                          
|                                          
|Current assets:                            |                                                                                            |                               |                            |              |       |        |        |      
|                                          
|                                          
|                                          
|                                          
|                                           | Cash and cash equivalents                                                                  |                               | $                          | 916          |       |        | $      | 1,546 |      
|                                          
|                                          
|                                          
|                                          
|                                           | Accounts receivable, net:                                                                  |                               |                            |              |       |        |        |       |      
|                                          
|                                          
|                                          
|                                          
|                                           |                                                                                            | General Motors and affiliates |                            |              | 3,958 |        |        |       | 3,817 |       
|                                          
|                                          
|                                          
|                                          
|                                           |                                                                                            | Other customers               |                            |              | 1,903 |        |        |       | 1,555 |       
|                                          
|                                          
|                                          
|                                          
|                                           | Inventories, net (Note 3)                                                                  |                               |                            | 1,811        |       |        |        | 1,749 |      
|                                          
|                                          
|                                          
|                                          
|                                           | Deferred income taxes                                                                      |                               |                            | 941          |       |        |        | 1,071 |      
|                                          
|                                          
|                                          
|                                          
|                                           | Prepaid expenses and other                                                                 |                               |                            | 156          |       |        |        | 73    |      
|                                           |                                                                                            |                               |                            |              |       |        |        |      
|                                           |                                                                                            |                               | Total current assets       |              |       | 9,685  |        |       |       | 9,811  | 
|                                          
|                                          
|                                          
|                                          
|Long-term assets:                          |                                                                                            |                               |                            |              |       |        |        |      
|                                          
|                                          
|                                          
|                                          
|                                           | Property, net                                                                              |                               |                            | 5,604        |       |        |        | 5,106 |      
|                                          
|                                          
|                                          
|                                          
|                                           | Deferred income taxes                                                                      |                               |                            | 1,945        |       |        |        | 1,930 |      
|                                          
|                                          
|                                          
|                                          
|                                           | Other                                                                                      |                               |                            | 1,746        |       |        |        | 1,503 |      
|                                           |                                                                                            |                               |                            |              |       |        |        |      
|Total assets                               |                                                                                            | $                             | 18,980                     |              |       | $      | 18,350 |      
|                                           |                                                                                            |                               |                            |              |       |        |        |      
|                                          
|LIABILITIES AND STOCKHOLDERS EQUITY       |                                                                                            |                               |                            |              |       |        |        |      
|                                          
|                                          
|                                          
|                                          
|Current liabilities:                       |                                                                                            |                               |                            |              |       |        |        |      
|                                          
|                                          
|                                          
|                                          
|                                           | Notes payable and current portion of long-term debt                                        |                               | $                          | 1,282        |       |        | $      | 117   |      
|                                          
|                                          
|                                          
|                                          
|                                           | Accounts payable                                                                           |                               |                            | 3,362        |       |        |        | 3,096 |      
|                                          
|                                          
|                                          
|                                          
|                                           | Pension benefits                                                                           |                               |                            | 274          |       |        |        | 1,091 |      
|                                          
|                                          
|                                          
|                                          
|                                           | Postretirement benefits other than pensions                                                |                               |                            | 539          |       |        |        | 1,012 |      
|                                          
|                                          
|                                          
|                                          
|                                           | Accrued liabilities                                                                        |                               |                            | 1,423        |       |        |        | 1,421 |      
|                                           |                                                                                            |                               |                            |              |       |        |        |      
|                                           |                                                                                            |                               | Total current liabilities  |              |       | 6,880  |        |       |       | 6,737  | 
|                                          
|                                          
|                                          
|                                          
|Long-term liabilities:                     |                                                                                            |                               |                            |              |       |        |        |      
|                                          
|                                          
|                                          
|                                          
|                                           | Long-term debt                                                                             |                               |                            | 1,645        |       |        |        | 1,640 |      
|                                          
|                                          
|                                          
|                                          
|                                           | Pension benefits                                                                           |                               |                            | 912          |       |        |        | 858   |      
|                                          
|                                          
|                                          
|                                          
|                                           | Postretirement benefits other than pensions                                                |                               |                            | 4,448        |       |        |        | 4,339 |      
|                                          
|                                          
|                                          
|                                          
|                                           | Other                                                                                      |                               |                            | 1,661        |       |        |        | 1,576 |      
|                                           |                                                                                            |                               |                            |              |       |        |        |      
|                                           |                                                                                            |                               | Total liabilities          |              |       | 15,546 |        |       |       | 15,150 | 
|                                           |                                                                                            |                               |                            |              |       |        |        |      
|Stockholders equity (Note 4):             |                                                                                            |                               |                            |              |       |        |        |      
|                                          
|                                          
|                                          
|                                          
|                                           | Common stock, $0.01 par value, 1,350 million shares
	authorized, 565 million shares issued |                               |                            | 6            |       |        |        | 6     |      
|                                          
|                                          
|                                          
|                                          
|                                           | Additional paid-in capital                                                                 |                               |                            | 2,601        |       |        |        | 2,601 |      
|                                          
|                                          
|                                          
|                                          
|                                           | Retained earnings                                                                          |                               |                            | 1,215        |       |        |        | 964   |      
|                                          
|                                          
|                                          
|                                          
|                                           | Accumulated translation adjustments                                                        |                               |                            | (343         | )     |        |        | (324  | )    
|                                          
|                                          
|                                          
|                                          
|                                           | Treasury stock, at cost (2 million and 3 million shares
	 in 2000 and 1999, respectively)  |                               |                            | (45          | )     |        |        | (47   | )    
|                                           |                                                                                            |                               |                            |              |       |        |        |      
|                                           |                                                                                            |                               | Total stockholders equity |              |       | 3,434  |        |       |       | 3,200  | 
|                                           |                                                                                            |                               |                            |              |       |        |        |      
|Total liabilities and stockholders equity |                                                                                            | $                             | 18,980                     |              |       | $      | 18,350 |      
|                                           |                                                                                            |                               |                            |              |       |        |        |      

See notes to consolidated financial statements.

4



---



##### Table of Contents








DELPHI AUTOMOTIVE SYSTEMS CORPORATION


CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

|                                                                  |                                                                                   |                                                         |                                           |       |        |        |     |       |        |        |  
|----------------------------------------------------------------- | --------------------------------------------------------------------------------- | ------------------------------------------------------- | ----------------------------------------- | ----- | ------ | ------ | --- | ----- | ------ | ------ | -
|                                                                  |                                                                                   |                                                        
|                                                                  |                                                                                   | Three Months Ended                                     
|                                                                  |                                                                                   | March 31,                                              
|                                                                  |                                                                                   |                                                        
|                                                                  |                                                                                   | 2000                                                    |                                           | 1999 
|                                                                  |                                                                                   |                                                         |                                           |      
|                                                                  |                                                                                   |                                                        
|                                                                  |                                                                                   | (in millions)                                          
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|Cash flows from operating activities:                             |                                                                                   |                                                         |                                           |       |        |        |     |      
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|                                                                  | Net income                                                                        |                                                         | $                                         | 290   |        |        | $   | 284   |       
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|                                                                  | Adjustments to reconcile net income to net cash used in operating
	 activities:   |                                                         |                                           |       |        |        |     |       |       
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|                                                                  |                                                                                   | Depreciation and amortization                           |                                           |       | 232    |        |     |       | 237    |       
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|                                                                  |                                                                                   | Acquisition-related in-process research and development |                                           |       | 51     |        |     |       |       |       
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|                                                                  | Changes in operating assets and liabilities:                                      |                                                         |                                           |       |        |        |     |       |       
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|                                                                  |                                                                                   | Accounts receivable, net                                |                                           |       | (295   | )      |     |       | (4,174 | )     
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|                                                                  |                                                                                   | Inventories, net                                        |                                           |       | 71     |        |     |       | 222    |       
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|                                                                  |                                                                                   | Prepaid expenses and other                              |                                           |       | 70     |        |     |       | (106   | )     
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|                                                                  |                                                                                   | Deferred income taxes                                   |                                           |       | 121    |        |     |       | (162   | )     
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|                                                                  |                                                                                   | Accounts payable                                        |                                           |       | 98     |        |     |       | 256    |       
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|                                                                  |                                                                                   | Accrued liabilities                                     |                                           |       | (1,314 | )      |     |       | 267    |       
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|                                                                  |                                                                                   | Other long-term liabilities                             |                                           |       | 160    |        |     |       | 312    |       
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|                                                                  |                                                                                   | Other                                                   |                                           |       | (4     | )      |     |       | 28     |       
|                                                                  |                                                                                   |                                                         |                                           |       |        |        |     |      
|                                                                  |                                                                                   |                                                         | Net cash used in operating activities     |       |        | (520   | )   |       |        | (2,836 | )
|                                                                  |                                                                                   |                                                         |                                           |       |        |        |     |      
|Cash flows from investing activities:                             |                                                                                   |                                                         |                                           |       |        |        |     |      
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|                                                                  | Capital expenditures                                                              |                                                         |                                           | (275  | )      |        |     | (235  | )     
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|                                                                  | Cost of acquisitions, net of cash acquired                                        |                                                         |                                           | (897  | )      |        |     |      |       
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|                                                                  | Other                                                                             |                                                         |                                           | (28   | )      |        |     | 69    |       
|                                                                  |                                                                                   |                                                         |                                           |       |        |        |     |      
|                                                                  |                                                                                   |                                                         | Net cash used in investing activities     |       |        | (1,200 | )   |       |        | (166   | )
|                                                                  |                                                                                   |                                                         |                                           |       |        |        |     |      
|Cash flows from financing activities:                             |                                                                                   |                                                         |                                           |       |        |        |     |      
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|                                                                  | Proceeds from issuance of common stock                                            |                                                         |                                           |      |        |        |     | 1,621 |       
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|                                                                  | Proceeds from issuance of debt securities and borrowings under
	credit facilities |                                                         |                                           | 1,155 |        |        |     | 1,527 |       
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|                                                                  | Dividend payments                                                                 |                                                         |                                           | (39   | )      |        |     |      |       
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|                                                                  | Purchase of treasury stock                                                        |                                                         |                                           | (7    | )      |        |     |      |       
|                                                                  |                                                                                   |                                                         |                                           |       |        |        |     |      
|                                                                  |                                                                                   |                                                         | Net cash provided by financing activities |       |        | 1,109  |     |       |        | 3,148  |  
|                                                                  |                                                                                   |                                                         |                                           |       |        |        |     |      
|Effect of exchange rate fluctuations on cash and cash equivalents |                                                                                   |                                                         | (19                                       | )     |        |        | (18 | )    
|                                                                  |                                                                                   |                                                         |                                           |       |        |        |     |      
|(Decrease) increase in cash and cash equivalents                  |                                                                                   |                                                         | (630                                      | )     |        |        | 128 |      
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|                                                                  | Cash and cash equivalents at beginning of period                                  |                                                         |                                           | 1,546 |        |        |     | 995   |       
|                                                                  |                                                                                   |                                                         |                                           |       |        |        |     |      
|                                                                  | Cash and cash equivalents at end of period                                        |                                                         | $                                         | 916   |        |        | $   | 1,123 |       
|                                                                  |                                                                                   |                                                         |                                           |       |        |        |     |      

See notes to consolidated financial statements.

5



---



##### Table of Contents



DELPHI AUTOMOTIVE SYSTEMS CORPORATION






NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)


1.  BASIS OF PRESENTATION

General  Delphi Automotive Systems
Corporation (Delphi) is a world-leading supplier of
automotive components, integrated systems and modules to the
automotive industry. We became a publicly-held company on
February 5, 1999 through an initial public offering (the
IPO), and achieved our independence from General
Motors Corporation (GM) on May 28, 1999 through
the distribution of Delphi shares owned by GM (the
Spin-Off).

The consolidated financial statements and notes thereto included
in this report should be read in conjunction with our
consolidated financial statements and notes thereto included in
our 1999 Annual Report on Form 10-K filed with the
Securities and Exchange Commission. The consolidated financial
statements include the accounts of Delphi and its wholly owned
and majority owned subsidiaries.

All intercompany transactions and balances between Delphi
businesses have been eliminated. In the opinion of management,
all adjustments, consisting of only normal recurring items, which
 are necessary for a fair presentation have been included. The
results for interim periods are not necessarily indicative of
results which may be expected from any other interim period or
for the full year and may not necessarily reflect the
consolidated results of operations, financial position and cash
flows of Delphi in the future.

Certain prior period amounts have been reclassified to conform
with the current period presentation.

Earnings Per Share Basic earnings per share
amounts were computed using weighted average shares outstanding
for each respective period. Diluted earnings per share also
reflect the weighted average impact from the date of issuance of
all potentially dilutive securities during the periods presented
unless the inclusion would have an antidilutive effect. Diluted
shares outstanding include the impact of stock options granted,
including dilutive securities issued concurrent with the IPO in
February 1999 and stock options issued in connection with the
concurrent cancellation of GM stock options held by Delphi
employees at the date of the Spin-Off. Actual weighted average
shares outstanding used in calculating basic and diluted earnings
 per share were:

|                                    |  |                    |         |      |  |  |         | 
|----------------------------------- |  | ------------------ | ------- | ---- |  |  | ------- | 
|                                    |  |                   
|                                    |  | Three Months Ended
|                                    |  | March 31,         
|                                    |  |                   
|                                    |  | 2000               |         | 1999
|                                    |  |                    |         |     
|                                    |  |                   
|                                    |  | (in thousands)    
|                                   
|                                   
|                                   
|                                   
|Weighted average shares outstanding |  |                    | 562,546 |      |  |  | 520,555 | 
|                                   
|                                   
|                                   
|                                   
|Effect of dilutive securities       |  |                    | 2,976   |      |  |  | 180     | 
|                                    |  |                    |         |      |  |  |         | 
|Diluted shares outstanding          |  |                    | 565,522 |      |  |  | 520,735 | 
|                                    |  |                    |         |      |  |  |         | 

If the 100 million shares issued in the IPO were assumed to
be outstanding since January 1, 1999, the weighted average
shares outstanding would have been 565 million during the
three months ended March 31, 1999. On this basis, basic and
diluted earnings per share would have been $0.50 for the three
months ended March 31, 1999.

The Delphi Board of Directors declared a dividend on Delphi
common stock of $0.07 per share on March 15, 2000, payable
on April 24, 2000 to holders of record on March 24,
2000.

2.  ACQUISITIONS

Lucas Diesel Systems

On January 7, 2000, Delphi completed the purchase of Lucas
Diesel Systems from TRW Inc. for $0.8 billion, net of cash
acquired. Lucas Diesel Systems, now Delphi Diesel Systems, is one
 of the worlds largest producers of diesel fuel-injection
systems for light, medium and heavy-duty vehicles. The
acquisition was accounted for using the purchase method of
accounting and, therefore, the purchase price

6



---



##### Table of Contents





In connection with this acquisition, Delphi recognized a one
time, non-cash charge to earnings of $51 million
($32 million after-tax) resulting from acquisition-related
in-process research and development that had not reached
technological feasibility and had no future alternative use. The
acquisition-related in-process research and development primarily
 related to development of the diesel fuel injector common rail
technology for light, medium and heavy-duty vehicles. The fair
value of acquisition-related in-process research and development
was determined using the income approach. The income approach
measures the current value of an asset by calculating the present
 value of its future economic benefits such as cash earnings,
cost savings, tax deductions, and proceeds from disposition. The
discount rates used in calculating the present value of the
components of the project ranged from 17% to 20%. At the
valuation date, there were components of the project at various
stages of completion ranging from approximately 30% to 85%. Such
components are anticipated to be completed at varying times
through 2007 at an estimated cost of approximately
$54 million.

The cash purchase price of $871 million has been reduced by
cash acquired and increased by debt assumed to arrive at the
preliminary purchase price allocation that follows (in millions):

|                                                                         |                                   |   |     |     | 
|------------------------------------------------------------------------ | --------------------------------- | - | --- | --- | 
|                                                                        
|                                                                        
|                                                                        
|                                                                        
|Consideration paid to former owner, net of cash acquired of
	$38 million |                                   | $ | 828 |    
|                                                                        
|                                                                        
|                                                                        
|                                                                        
|Estimated fees and expenses                                              |                                   |   | 6   |    
|                                                                         |                                   |   |     |    
|                                                                         | Cash cost of acquisition          |   |     | 834 | 
|                                                                        
|                                                                        
|                                                                        
|                                                                        
|Debt assumed                                                             |                                   |   | 8   |    
|                                                                         |                                   |   |     |    
|                                                                         | Total cost of acquisition         |   | $   | 842 | 
|                                                                         |                                   |   |     |    
|Property, plant and equipment                                            |                                   | $ | 449 |    
|                                                                        
|                                                                        
|                                                                        
|                                                                        
|Net working capital                                                      |                                   |   | 80  |    
|                                                                        
|                                                                        
|                                                                        
|                                                                        
|Other assets purchased and liabilities assumed                           |                                   |   | (12 | )  
|                                                                        
|                                                                        
|                                                                        
|                                                                        
|In-process research and development                                      |                                   |   | 51  |    
|                                                                        
|                                                                        
|                                                                        
|                                                                        
|Goodwill                                                                 |                                   |   | 274 |    
|                                                                         |                                   |   |     |    
|                                                                         | Total preliminary cost allocation |   | $   | 842 | 
|                                                                         |                                   |   |     |    

The purchase price and related allocation are preliminary and may
 be revised up to one year from the date of acquisition. Delphi
can provide no assurances as to whether any revisions to the
preliminary purchase price and related allocation will be
significant. Adjustments to the purchase price and related
preliminary allocation may occur as a result of obtaining more
information regarding asset valuations, liabilities assumed,
purchase price adjustments pursuant to the purchase agreement and
 revisions of preliminary estimates of fair values made at the
date of purchase. We are evaluating how the acquired operations
will be integrated into our overall business strategy and are in
the process of developing a plan for restructuring those
operations. It is possible that our integration plan, when
finalized, will impact the preliminary purchase price allocation.

Automotive Products Distribution
 Services

On February 28, 2000, Delphi completed the acquisition of
Automotive Products Distribution Services (APDS) for
$63 million. APDS is a leading European distributor of
automotive aftermarket products for passenger cars and commercial
 vehicles with 1999 sales of $175 million. The acquisition
was accounted for using the purchase method of accounting, and
accordingly, the preliminary allocation of purchase price to
assets and liabilities has been reflected in the consolidated
balance sheet. The results of operations of APDS are included
within the consolidated financial statements from the acquisition
 date. The $25 million excess of the consideration given
over the fair value of net assets acquired has been recorded as
goodwill and is being amortized over 20 years.

7



---



##### Table of Contents





|   |                 
|-- | ----------------
|3. | INVENTORIES, NET

Inventories decreased by $71 million (prior to the addition
of $133 million of inventories included in the assets of
businesses acquired during first quarter 2000). The net inventory
 balances consisted of:

|                                                                            |                           |               |       |              |  |   |       |       | 
|--------------------------------------------------------------------------- | ------------------------- | ------------- | ----- | ------------ |  | - | ----- | ----- | 
|                                                                            |                           | March 31,     |       | December 31,
|                                                                            |                           | 2000          |       | 1999        
|                                                                            |                           |               |       |             
|                                                                            |                           |              
|                                                                            |                           | (in millions)
|                                                                           
|                                                                           
|                                                                           
|                                                                           
|Productive material, work-in-process and supplies                           |                           | $             | 1,746 |              |  | $ | 1,878 |      
|                                                                           
|                                                                           
|                                                                           
|                                                                           
|Finished goods                                                              |                           |               | 457   |              |  |   | 263   |      
|                                                                            |                           |               |       |              |  |   |       |      
|                                                                            | Total inventories at FIFO |               |       | 2,203        |  |   |       | 2,141 | 
|                                                                           
|                                                                           
|                                                                           
|                                                                           
|Less allowance to adjust the carrying value of certain
	inventories to LIFO |                           |               | (392  | )            |  |   | (392  | )    
|                                                                            |                           |               |       |              |  |   |       |      
|                                                                            | Total inventories, net    |               | $     | 1,811        |  |   | $     | 1,749 | 
|                                                                            |                           |               |       |              |  |   |       |      

4.  STOCKHOLDERS EQUITY

Changes in stockholders equity for the three months ended
March 31, 2000 were:

|                           |                                                           |                            |     |            |  |          |   |               |  |          |       |               |  |        |       |     |   |   |      |     |   |   |     |   |  |   |       |     |     | 
|-------------------------- | --------------------------------------------------------- | -------------------------- | --- | ---------- |  | -------- | - | ------------- |  | -------- | ----- | ------------- |  | ------ | ----- | --- | - | - | ---- | --- | - | - | --- | - |  | - | ----- | --- | --- | 
|                           |                                                           |                            |     |            |  |          |   |               |  |          |       |              
|                           |                                                           | Common Stock               |     | Additional |  |          |   | Other         |  |          |       | Total        
|                           |                                                           |                            |     | Paid-in    |  | Retained |   | Comprehensive |  | Treasury |       | Stockholders
|                           |                                                           | Shares                     |     | Amount     |  | Capital  |   | Earnings      |  | Income   |       | Stock         |  | Equity
|                           |                                                           |                            |     |            |  |          |   |               |  |          |       |               |  |       
|                           |                                                           |                           
|                           |                                                           | (in millions)             
|                          
|                          
|                          
|                          
|Balance at January 1, 2000 |                                                           |                            | 565 |            |  | $        | 6 |               |  | $        | 2,601 |               |  | $      | 964   |     |   | $ | (324 | )   |   | $ | (47 | ) |  | $ | 3,200 |    
|                          
|                          
|                          
|                          
|                           | Net income                                                |                            |     |            |  |          |   |               |  |          |       |               |  |        |       | 290 |   |   |      |     |   |   |     |   |  |   |       | 290 |    
|                          
|                          
|                          
|                          
|                           | Foreign currency translation adjustments, net of tax      |                            |     |            |  |          |   |               |  |          |       |               |  |        |       |     |   |   |      | (19 | ) |   |     |   |  |   |       | (19 | )  
|                           |                                                           |                            |     |            |  |          |   |               |  |          |       |               |  |        |       |     |   |   |      |     |   |   |     |   |  |   |       |    
|                           |                                                           | Total comprehensive income |     |            |  |          |   |               |  |          |       |               |  |        |       |     |   |   |      |     |   |   |     |   |  |   |       |     | 271 | 
|                          
|                          
|                          
|                          
|                           | Net shares issued (reacquired) for employee benefit plans |                            |     |            |  |          |   |               |  |          |       |               |  |        |       |     |   |   |      |     |   |   |     | 2 |  |   |       | 2   |    
|                          
|                          
|                          
|                          
|                           | Dividends                                                 |                            |     |            |  |          |   |               |  |          |       |               |  |        |       | (39 | ) |   |      |     |   |   |     |   |  |   |       | (39 | )  
|                           |                                                           |                            |     |            |  |          |   |               |  |          |       |               |  |        |       |     |   |   |      |     |   |   |     |   |  |   |       |    
|Balance at March 31, 2000  |                                                           |                            | 565 |            |  | $        | 6 |               |  | $        | 2,601 |               |  | $      | 1,215 |     |   | $ | (343 | )   |   | $ | (45 | ) |  | $ | 3,434 |    
|                           |                                                           |                            |     |            |  |          |   |               |  |          |       |               |  |        |       |     |   |   |      |     |   |   |     |   |  |   |       |    

5.  SEGMENT REPORTING

Selected information regarding Delphis product sectors is
as follows:

|                            |                                |                 |   |              |       |            |   |          |       |       |   |       |       |  |   |      |      |   |   |       |       | 
|--------------------------- | ------------------------------ | --------------- | - | ------------ | ----- | ---------- | - | -------- | ----- | ----- | - | ----- | ----- |  | - | ---- | ---- | - | - | ----- | ----- | 
|                            |                                |                 |   | Safety,      |       |            |   |          |       |      
|                            |                                | Electronics &   |   | Thermal &    |       |            |   |          |       |      
|                            |                                | Mobile          |   | Electrical   |       | Dynamics & |   |          |       |      
|                            |                                | Communication   |   | Architecture |       | Propulsion |   | Other(b) |       | Total
|                            |                                |                 |   |              |       |            |   |          |       |      
|                            |                                |                
|                            |                                | (in millions)  
|                           
|                           
|                           
|                           
|For the Three Months Ended: |                                |                 |   |              |       |            |   |          |       |       |   |       |       |  |   |      |      |   |   |      
|March 31, 2000              |                                |                 |   |              |       |            |   |          |       |       |   |       |       |  |   |      |      |   |   |      
|                           
|                           
|                           
|                           
|                            | Net sales to GM and affiliates |                 | $ | 1,023        |       |            | $ | 1,813    |       |       | $ | 2,734 |       |  | $ |     |      |   | $ | 5,570 |      
|                           
|                           
|                           
|                           
|                            | Net sales to other customers   |                 |   | 261          |       |            |   | 862      |       |       |   | 1,111 |       |  |   |     |      |   |   | 2,234 |      
|                           
|                           
|                           
|                           
|                            | Inter-sector net sales         |                 |   | 108          |       |            |   | 34       |       |       |   | 7     |       |  |   | (149 | )    |   |   |      |      
|                            |                                |                 |   |              |       |            |   |          |       |       |   |       |       |  |   |      |      |   |   |      
|                            |                                | Total net sales |   | $            | 1,392 |            |   | $        | 2,709 |       |   | $     | 3,852 |  |   | $    | (149 | ) |   | $     | 7,804 | 
|                            |                                |                 |   |              |       |            |   |          |       |       |   |       |       |  |   |      |      |   |   |      
|                            | Operating income (loss)        |                 | $ | 141          |       |            | $ | 207      |       |       | $ | 188   | (a)   |  | $ | (19  | )    |   | $ | 517   | (a)  
|                            |                                |                 |   |              |       |            |   |          |       |       |   |       |       |  |   |      |      |   |   |      
|March 31, 1999              |                                |                 |   |              |       |            |   |          |       |       |   |       |       |  |   |      |      |   |   |      
|                           
|                           
|                           
|                           
|                            | Net sales to GM and affiliates |                 | $ | 1,090        |       |            | $ | 1,937    |       |       | $ | 2,826 |       |  | $ |     |      |   | $ | 5,853 |      
|                           
|                           
|                           
|                           
|                            | Net sales to other customers   |                 |   | 187          |       |            |   | 723      |       |       |   | 706   |       |  |   |     |      |   |   | 1,616 |      
|                           
|                           
|                           
|                           
|                            | Inter-sector net sales         |                 |   | 76           |       |            |   | 53       |       |       |   | 2     |       |  |   | (131 | )    |   |   |      |      
|                            |                                |                 |   |              |       |            |   |          |       |       |   |       |       |  |   |      |      |   |   |      
|                            |                                | Total net sales |   | $            | 1,353 |            |   | $        | 2,713 |       |   | $     | 3,534 |  |   | $    | (131 | ) |   | $     | 7,469 | 
|                            |                                |                 |   |              |       |            |   |          |       |       |   |       |       |  |   |      |      |   |   |      
|                            | Operating income (loss)        |                 | $ | 158          |       |            | $ | 216      |       |       | $ | 124   |       |  | $ | (41  | )    |   | $ | 457   |      
|                            |                                |                 |   |              |       |            |   |          |       |       |   |       |       |  |   |      |      |   |   |      



| |     |                                                                                                                                
| | --- | -------------------------------------------------------------------------------------------------------------------------------
| | (a) | Excludes the one-time, non-cash charge of $51 million
	resulting from acquisition-related in-process research and
	development.
|
| | (b) | Other includes activity not allocated to the product sectors and
	elimination of inter-sector transactions.                    

8



---



##### Table of Contents



6.  COMMITMENTS AND CONTINGENCIES

Delphi is from time to time subject to various legal actions and
claims incidental to its business, including those arising out of
 alleged defects, breach of contracts, product warranties,
employment-related matters and environmental matters. Litigation
is subject to many uncertainties, and the outcome of individual
litigated matters is not predictable with assurance. After
discussions with counsel, it is the opinion of management that
the outcome of such matters will not have a material adverse
impact on our consolidated financial position, results of
operations or cash flows.

In the normal course of business, we extend credit on open
account to our customers. From time to time, we also invest in
joint ventures with a variety of business partners. Although
Delphi is affected by the financial well-being of the automotive
industry as a whole, we believe that the credit risk associated
with trade receivables and investments in our joint ventures is
mitigated by our customer base and ongoing control procedures to
monitor the credit worthiness of customers and business partners.
 As of March 31, 2000, one customer/business partner
was experiencing financial challenges. Delphis balance
sheet as of March 31, 2000 includes accounts receivable of
$31 million and investments in joint ventures relating to
this customer/business partner, the value of which may be
impacted by the future performance of this customer/business
partner.

9



---



##### Table of Contents








ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL


CONDITION AND RESULTS OF OPERATIONS


Overview

Delphis first quarter 2000 results set a fast pace for our
second year as an independent company. We added to our strong
base of business by increasing non-GM sales 30% on a comparable
basis over the first quarter of 1999. Other highlights from the
quarter included the completion of the acquisition of Lucas
Diesel Systems (now Delphi Diesel Systems) for $0.8 billion
and a $0.6 billion voluntary contribution to our hourly
pension plan. In addition, Delphi established a new aggressive
growth business line structure that will include core automotive
technologies, non-core technologies and industry-related service
businesses. The new structure is aimed at giving autonomy to
product lines with annual growth potential of 25%-30%.
Mobile-Multimedia will be the first business line placed in this
new structure and will continue to report to the Electronics
& Mobile Communication sector.

Results of Operations

The following managements discussion and analysis of
financial condition and results of operations (MD&A) should
be read in conjunction with the MD&A included in our Annual
Report on Form 10-K for the fiscal year ended
December 31, 1999.

Three Months Ended
March 31, 2000 versus Three Months Ended March 31, 1999

Net Sales.Consolidated net sales and changes in net sales
 by product sector and in total for the three months ended
March 31, 2000 and 1999 were:

|                                          |                        |                    |       |       |  |        |       |       |  |   |     |     | 
|----------------------------------------- | ---------------------- | ------------------ | ----- | ----- |  | ------ | ----- | ----- |  | - | --- | --- | 
|                                          |                        |                    |       |      
|                                          |                        | Three Months Ended |       |      
|                                          |                        | March 31,          |       |      
|                                          |                        |                    |       |      
|Product Sector                            |                        | 2000               |       | 1999  |  | Change
|                                          |                        |                    |       |       |  |       
|                                          |                        |                   
|                                          |                        | (in millions)     
|                                         
|                                         
|                                         
|                                         
|Electronics & Mobile Communication        |                        | $                  | 1,392 |       |  | $      | 1,353 |       |  | $ | 39  |    
|                                         
|                                         
|                                         
|                                         
|Safety, Thermal & Electrical Architecture |                        |                    | 2,709 |       |  |        | 2,713 |       |  |   | (4  | )  
|                                         
|                                         
|                                         
|                                         
|Dynamics & Propulsion                     |                        |                    | 3,852 |       |  |        | 3,534 |       |  |   | 318 |    
|                                         
|                                         
|                                         
|                                         
|Eliminations                              |                        |                    | (149  | )     |  |        | (131  | )     |  |   | (18 | )  
|                                          |                        |                    |       |       |  |        |       |       |  |   |     |    
|                                          | Consolidated net sales |                    | $     | 7,804 |  |        | $     | 7,469 |  |   | $   | 335 | 
|                                          |                        |                    |       |       |  |        |       |       |  |   |     |    

Our consolidated net sales for the first three months of 2000
increased $335 million, or 4.5% over the comparable period
of 1999. Our increased net sales reflect continued growth in
revenue from ongoing operations, strong North American sales and
increased European sales, largely a result of the Delphi Diesel
Systems acquisition. Our non-GM sales increased
$618 million, 30% on a comparable basis, over first quarter
1999, while sales to GM declined slightly, principally due to the
 re-sourcing of unprofitable products. Approximately one-third of
 our non-GM sales growth resulted from acquisitions. Sales growth
 from volume and mix improvements was partially offset by the
impact of continued price pressures that resulted in price
reductions of approximately $129 million, or 1.7%, for the
first quarter of 2000.

Mobile Multimedia, our recently established aggressive growth
business line, generated sales growth exceeding 350%, increasing
first quarter sales from $7 million in 1999 to
$32 million in 2000.

Gross Margin.Our gross margin was 15.5% for the first
three months of 2000 compared to a gross margin of 14.4% for the
comparable period of 1999. The improvement reflects the results
of our continuing cost reduction efforts and lean manufacturing
initiatives that are being implemented in response to industry
pricing pressures. In fact, each of our product sectors achieved
material and manufacturing cost savings, which, in the aggregate,
 exceeded total price reductions during the first three months of
 2000.

10



---



##### Table of Contents



Selling, General and Administrative.The increase in
selling, general and administrative expenses, compared to 1999
amounts, primarily represents incremental costs required as a
result of our efforts to pursue business with non-GM customers
and the incremental expenses related to Delphi Diesel Systems.

Depreciation and Amortization.Depreciation and
amortization expense for first quarter 2000 was consistent with
the first quarter 1999 expense.

Acquisition-Related In-Process Research and Development.
Delphi recognized a one-time, non-cash charge to earnings of
$51 million ($32 million after-tax) resulting from
acquisition-related in-process research and development that had
not reached technological feasibility and had no future
alternative use, as explained more fully in Note 2 to the
consolidated financial statements.

Operating Income.Operating income was $466 million
for the first three months of 2000 compared to
$457 million for the first three months of 1999. Our
operating income by product sector, excluding the one-time,
non-cash charge of $51 million resulting from
acquisition-related in-process research and development included
in the Dynamics & Propulsion sector was:

|                                          |                        |                    |     |      |  |   |     |     | 
|----------------------------------------- | ---------------------- | ------------------ | --- | ---- |  | - | --- | --- | 
|                                          |                        |                   
|                                          |                        | Three Months Ended
|                                          |                        | March 31,         
|                                          |                        |                   
|Product Sector                            |                        | 2000               |     | 1999
|                                          |                        |                    |     |     
|                                          |                        |                   
|                                          |                        | (in millions)     
|                                         
|                                         
|                                         
|                                         
|Electronics & Mobile Communication        |                        | $                  | 141 |      |  | $ | 158 |    
|                                         
|                                         
|                                         
|                                         
|Safety, Thermal & Electrical Architecture |                        |                    | 207 |      |  |   | 216 |    
|                                         
|                                         
|                                         
|                                         
|Dynamics & Propulsion                     |                        |                    | 188 |      |  |   | 124 |    
|                                         
|                                         
|                                         
|                                         
|Other                                     |                        |                    | (19 | )    |  |   | (41 | )  
|                                          |                        |                    |     |      |  |   |     |    
|                                          | Total operating income |                    | $   | 517  |  |   | $   | 457 | 
|                                          |                        |                    |     |      |  |   |     |    

The improvement in operating income reflects increased sales as
discussed above, continuing cost reduction efforts and the
results of the continued rollout of lean manufacturing
initiatives around the world.

Taxes.Our effective tax rate for the first quarter of
2000 was 37% compared to 38% for the comparable period of 1999.
The decreased effective income tax rate primarily reflects
results from tax planning actions initiated subsequent to the
Spin-Off.

Net Income.Net income totaled $290 million for the
first three months of 2000 compared to $284 million for the
three months ended March 31, 1999. Excluding the one-time,
non-cash charge of $51 million ($32 million after-tax)
resulting from acquisition-related in-process research and
development, net income for the first three months of 2000 would
have been $322 million, a 13% increase over 1999.

Earnings Per Share.Basic and diluted earnings per share
was $0.51 for the first quarter of 2000. Excluding the one-time,
non-cash charge of $51 million ($32 million after-tax)
resulting from acquisition-related in-process research and
development, earnings per share would have been $0.57 per share
compared to $0.55 for the first quarter of 1999. If the
100 million shares issued in the IPO were assumed to be
outstanding since January 1, 1999, the weighted average
shares outstanding would have been 565 million during the
three months ended March 31, 1999. On this basis, basic and
diluted earnings per share would have been $0.50 for the three
months ended March 31, 1999; therefore, on a comparable
basis, first quarter 2000 earnings per share of $0.57 represents
a 14% increase.

Liquidity and Capital Resources

Liquidity

Our net liquidity, measured as cash and marketable securities
less total debt, was $(2.0) billion at March 31, 2000
compared to $(0.2) billion at December 31, 1999. The
ratio of our total debt to total capital, which consists of total
 debt plus stockholders equity, was 46% at March 31,
2000 and 35% at December 31, 1999. The change in our net
liquidity and ratio of total debt to total capital was due to our
 continued generation of strong operating cash flows, offset by
uses of cash of $0.9 billion for acquisitions, a

11



---



##### Table of Contents





Requirements for working capital, capital expenditures, dividends
 and repayment of debt securities are expected to be funded from
operations, supplemented as needed by short-term or long-term
borrowings available under our Credit Facilities or the
commercial paper program, if required.

Extension of Payment Terms

In accordance with a master separation agreement to which Delphi
and GM are parties (the Separation Agreement),
effective January 1, 1999, payment terms for our accounts
receivable from GM were modified such that payments are generally
 due to us on the second day of the second month following the
date of shipment by Delphi. Previous payment terms generally
required GM to make accounts receivable payments in the month
following shipment by Delphi. When the change in payment terms
was implemented, our accounts receivable increased by
approximately $2.1 billion. In order to mitigate the impact
of the change in accounts receivable payment terms, we have
successfully extended payment terms with many of our suppliers.
Over time, we expect to negotiate similar extended terms with our
 remaining suppliers.

Debt Capitalization and
Available Financing Sources

During 1999, Delphi entered into two financing arrangements with
a syndicate of lenders providing for an aggregate of
$3.0 billion in available revolving credit facilities (the
Credit Facilities). The terms of the Credit
Facilities provide for a five-year revolving credit line in the
amount of $1.5 billion, which expires January 2004, and
 a 364-day revolving credit line, which expires December 2000.
Also during 1999, we entered into a commercial paper program
providing up to $1.5 billion of borrowing ability. As of
March 31, 2000, the outstanding balance under our commercial
 paper program was $1.1 billion. As of March 31, 2000,
we had no amounts outstanding under our Credit Facilities.

Cash Flows

Operating Activities.Net cash used in operating
activities was $520 million and $2.8 billion for the
three months ended March 31, 2000 and 1999, respectively.
The use of cash in the first quarter of 2000 included a
$0.6 billion voluntary contribution to our hourly pension
plan and advances to GM of $0.7 billion related to estimated
 amounts for retirements above the estimate used in generating
the initial allocation of pension and other postretirement
benefits. The use of cash in the first quarter of 1999 also
reflected the settlement of certain accounts receivable with GM
and the change in payment terms described above.

Investing Activities.Cash flows used in investing
activities totaled $1.2 billion and $0.2 billion for
the three months ended March 31, 2000 and 1999, respectively. The
 use of cash in the first quarter of 2000 reflects the
acquisitions of Lucas Diesel Systems and APDS for
$0.9 billion and capital expenditures related to ongoing
operations.

Financing Activities.Net cash provided by financing
activities was $1.1 billion compared to $3.1 billion
for the three months ended March 31, 2000 and 1999,
respectively. Cash provided by financing activities for the first
 quarter of 2000 included borrowings under our commercial paper
program used to fund pension contributions and to make advances
to GM for pension and other postretirement benefits. Cash
provided by financing activities for the first three months of
1999 included net borrowings on our short term and long-term
revolving credit facilities and the proceeds from our initial
public offering in February 1999. The proceeds from our
initial public offering were used for general corporate purposes.

12



---



##### Table of Contents



Dividends.On March 15, 2000, the Delphi Board of
Directors declared a quarterly dividend on Delphi common stock of
 $0.07 per share, payable on April 24, 2000 to holders of
record on March 24, 2000. The dividend declared on
December 7, 1999 was paid on January 13, 2000.

Pension and Other Postretirement Benefits

Under the terms of the Separation Agreement, pension plan assets
and liabilities and other postretirement benefit liabilities
related to Delphis U.S. salaried active and inactive
employees retiring after January 1, 1999 were assumed by
Delphi. The Delphi salaried pension and other postretirement
benefit plans were established and are being administered under
the same terms that existed for the GM plans at the time of the
Spin-Off. Delphis consolidated financial statements as of
December 31, 1999 and 1998 reflected the assets and
liabilities related to U.S. salaried employees that Delphi
assumed pursuant to the Separation Agreement, and exclude
employee benefit obligations and any assets related to employees
retired prior to the effective date of the Separation Agreement.

In accordance with the terms of the Separation Agreement,
Delphis consolidated balance sheet at December 31,
1998 reflected an obligation to GM equal to the projected benefit
 obligation for U.S. hourly employees, using applicable pension
actuarial assumptions, less an amount equal to the level of plan
assets that would be received by Delphi under applicable laws and
 regulations, had the plan transfer occurred on January 1,
1999. Under the Separation Agreement, this obligation was subject
 to a contingency provision to the extent certain terms
negotiated with hourly represented employees, and the actual
number of Delphi hourly employees who retired differed from the
terms and the number of retirements assumed by the parties at the
 time of Spin-Off.

Until May 28, 1999, Delphis U.S. hourly employees
continued to participate in the defined benefit pension plan and
other postretirement benefit plans administered by GM, on a
multi-employer plan basis. Effective May 28, 1999, pension
and other postretirement benefit obligations relating to certain
U.S. hourly employees were assumed by Delphi. However, under the
terms of the Separation Agreement, including the effects
resulting from the completion of required labor negotiations,
Delphi hourly employees who retired on or before January 1,
2000 were treated as GM retirees for purposes of pension and
other postretirement benefit obligations.

An adjustment to GMs initial investment in Delphi of
$0.6 billion was recorded in 1999, based on an actuarial
estimate of the effect on the pension and other postretirement
obligations of the known negotiated terms and an updated estimate
 of the Delphi employees who retired under benefit plans
administered by GM. Retirements above the estimate used in
generating the initial allocation of pension and other
postretirement benefits could also result in cash payments to GM,
 the amount and timing of which have not yet been determined and
agreed upon by Delphi and GM. At December 31, 1999, Delphi
estimated such payments could total $1.6 billion,
$0.7 billion of which was advanced during the first quarter
of 2000. Any change in this estimate of the payments required
under the contingency provision, which are determinable within
one year of the Spin-Off (May 28, 2000), will be recorded as
 an adjustment to GMs initial investment in Delphi.

Forward-Looking Statements

The Private Securities Litigation Reform Act of 1995 (the
Act) provides a safe harbor for forward-looking
statements made by us or on our behalf. Delphi and its
representatives may periodically make written or oral statements
that are forward-looking, including statements
included in this report and other filings with the Securities and
 Exchange Commission and in reports to our stockholders. All
statements which address operating performance, events or
developments that we expect or anticipate may occur in the
future, including statements relating to volume growth, awarded
sales contracts and earnings per share growth or statements
expressing general optimism about future operating results, are
forward-looking statements. These statements are made on the
basis of managements views and assumptions; as a result,
there can be no assurance that managements expectations
will necessarily come to pass. A list of factors which could
impact future events and performance is included in the Delphi
Automotive Systems Corporation 1999 Annual Report on
Form 10-K filed with the Securities and Exchange Commission,
 and incorporated herein by this reference.

13



---



##### Table of Contents








PART II. OTHER INFORMATION


ITEM 1. LEGAL PROCEEDINGS

We are involved in routine litigation incidental to the conduct
of our business. We do not believe that any of the litigation to
which we are currently a party will have a material adverse
effect on our business or financial condition.

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

(a)  EXHIBITS

|        |       |              |  |                                                                                                      
|------- | ----- | ------------ |  | -----------------------------------------------------------------------------------------------------
|Exhibit |       |             
|Number  |       | Exhibit Name
|        |       |             
|        | 10(a) |              |  | Form of Change in Control Agreement between Delphi and its
	officers (filed but not
	included herein)
|        | 27    |              |  | Financial data schedule (for SEC information only)                                                   
|        | 99    |              |  | Press release dated April 12, 2000 regarding quarterly
	earnings (filed but not included herein)     

(b)  REPORTS ON FORM 8-K

January 19, 2000 Form 8-K regarding Delphis 1999
fourth quarter earnings.

14



---



##### Table of Contents








SIGNATURE


Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned hereunto duly authorized.



| |                                      
| | -------------------------------------
| | DELPHI AUTOMOTIVE SYSTEMS CORPORATION
| |                                      

| |             
| | ------------
| | (Registrant)

|               |  |  |  |                                                                        |  | 
|-------------- |  |  |  | ---------------------------------------------------------------------- |  | 
|April 12, 2000 |  |  |  | /s/ PAUL R. FREEPaul R. Free, Chief Accounting
	Officer and Controller |  | 

15



---



##### Table of Contents








EXHIBIT INDEX


|        |       |              |  |                                                                     
|------- | ----- | ------------ |  | --------------------------------------------------------------------
|Exhibit |       |             
|Number  |       | Exhibit Name
|        |       |             
|        | 10(a) |              |  | Form of Change in Control Agreement between Delphi and its
	officers
|        | 27    |              |  | Financial data schedule (for SEC information only)                  
|        | 99    |              |  | Press release dated April 12, 2000 regarding quarterly
	earnings    

16