EDGAR 10-K Filing

Company CIK: 26780
Filing Year: 2025
Filename: 26780_10-K_2025_0001437749-25-004554.json

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ITEM 1. BUSINESS
Item 1. Business
General
Dana Incorporated (Dana), with history dating back to 1904, is headquartered in Maumee, Ohio. We are a world leader in providing power-conveyance and energy-management solutions for vehicles and machinery. The company's portfolio improves the efficiency, performance, and sustainability of light vehicles, commercial vehicles, and off-highway equipment. From axles, driveshafts, transmissions, sealing and thermal products to electrification products including motors, inverters, controllers, e-sealing, e-thermal and digital solutions, we enable the propulsion of internal combustion engine (ICE), hybrid and electric powered vehicles by supplying nearly every major vehicle manufacturer in the world. We also serve the stationary industrial market. As of December 31, 2024 we employed approximately 39,600 people and operated in 30 countries.
The terms “Dana,” “we,” “our” and “us” are references to Dana. These references include the subsidiaries of Dana unless otherwise indicated or the context requires otherwise.
Overview of our Business
We have aligned our organization around four operating segments: Light Vehicle Drive Systems (Light Vehicle), Commercial Vehicle Drive and Motion Systems (Commercial Vehicle), Off-Highway Drive and Motion Systems (Off-Highway) and Power Technologies. These operating segments have global responsibility and accountability for business commercial activities and financial performance.
External sales by operating segment for the years ended December 31, 2024, 2023 and 2022 were as follows:
Dollars
% of Total
Dollars
% of Total
Dollars
% of Total
Light Vehicle
$ 4,224
41.1 %
$ 4,035
38.2 %
$ 4,090
40.3 %
Commercial Vehicle
2,005
19.5 %
2,092
19.8 %
1,979
19.5 %
Off-Highway
2,767
26.9 %
3,185
30.2 %
2,946
29.0 %
Power Technologies
1,288
12.5 %
1,243
11.8 %
1,141
11.2 %
Total
$ 10,284
$ 10,555
$ 10,156
Refer to Segment Results of Operations in Item 7 and Note 19 to our consolidated financial statements in Item 8 for further financial information about our operating segments.
Our business is diversified across end-markets, products and customers. The following table summarizes the markets, products and largest customers of each of our operating segments as of December 31, 2024:
Segment
Markets
Products
Largest
Customers
Light Vehicle
Light vehicle market:
Axles
Ford Motor Company
Light trucks (full frame)
Driveshafts
Stellantis N.V.*
Sport utility vehicles
ICE, hybrid and e-transmissions
Toyota Motor Corporation
Crossover utility vehicles
e-Axle systems
Tata Motors Ltd (including
Utility vans
e-Transmission systems
Jaguar Land Rover)
Sports cars
Inverters
Renault-Nissan-Mitsubishi
Super sports cars
Electric motors
Alliance
Controllers
Volkswagen AG
Commercial Vehicle
Commercial vehicle market:
Axles
PACCAR Inc
Medium duty trucks
Driveshafts
Traton SE
Heavy duty trucks
Hybrid and e-transmissions
AB Volvo
Buses
e-Axle systems
Daimler Truck AB
Specialty vehicles e-Transmission systems Ford Motor Company
Inverters
CNH Industrial N.V.
Electric motors
Controllers
Off-Highway
Off-Highway market:
Axles, hub drives and driveshafts
Deere & Company
Construction
ICE, hybrid and e-transmissions
Oshkosh Corporation
Agricultural
e-Axle systems
AGCO Corporation
Mining
e-Transmission systems
CNH Industrial N.V.
Forestry
e-Hub drive systems
Manitou Group
Material handling
Inverters
Terex Corporation
Industrial stationary Electric motors
Lawn care and recreational
Controllers
Power Technologies
Light vehicle market
ICE sealing and thermal
General Motors Company
Commercial vehicle market
e-Sealing
Ford Motor Company
Off-Highway market
e-Thermal cooling systems Cummins Inc.
Industrial stationary market
Battery cooling Stellantis N.V.
Electronics cooling
Volkswagen AG
Hydrogen fuel cell cooling (including Traton SE)
New power industrial cooling
Mercedes-Benz Group AG
* Via a directed supply relationship
Geographic Operations
We maintain administrative and operational organizations in North America, Europe, South America and Asia Pacific to support our operating segments, assist with the management of affiliate relations and facilitate financial and statutory reporting and tax compliance on a worldwide basis. Our operations are located in the following countries:
North America
Europe
South America
Asia Pacific
Canada
Belgium
Netherlands
Argentina
Australia
México
Finland
Norway
Brazil
China
United States
France
South Africa
Colombia
India
Germany
Spain
Japan
Hungary
Sweden
New Zealand
Ireland
Switzerland
Singapore
Italy
Turkey
South Korea
Lithuania
United Kingdom
Thailand
Our non-U.S. subsidiaries and affiliates manufacture and sell products similar to those we produce in the United States. Operations outside the U.S. may be subject to a greater risk of changing political, economic and social environments, changing governmental laws and regulations, currency revaluations and market fluctuations than our domestic operations. See the discussion of risk factors in Item 1A.
Sales reported by our non-U.S. subsidiaries comprised $5,609, or 55%, of our 2024 consolidated sales of $10,284. A summary of sales and long-lived assets by geographic region can be found in Note 19 to our consolidated financial statements in Item 8.
Customer Dependence
We are largely dependent on light vehicle, medium- and heavy-duty vehicle and off-highway original equipment manufacturer (OEM) customers. Ford Motor Company (Ford) and Stellantis N.V. (Stellantis) were the only individual customers accounting for 10% or more of our consolidated sales in one or more of the past three years. As a percentage of total sales from operations, our sales to Ford were approximately 23% in 2024, 20% in 2023 and 19% in 2022. Our sales to Stellantis (via a directed supply relationship) were approximately 8% in 2024, 9% in 2023 and 11% in 2022. Volkswagen AG (including Traton SE), PACCAR, Inc and Toyota Motor Corporation were our third, fourth and fifth largest customers in 2024. Our 10 largest customers collectively accounted for approximately 58% of our sales in 2024.
Loss of all or a substantial portion of our sales to Ford, Stellantis or other large volume customers would have a significant adverse effect on our financial results until such lost sales volume could be replaced and there is no assurance that any such lost volume would be replaced.
Sources and Availability of Raw Materials
We use a variety of raw materials in the production of our products, including steel and products containing steel, stainless steel, forgings, castings, bearings, semiconductors, and magnets and related rare earth materials. Other commodity purchases include aluminum, brass, copper and plastics. These materials are typically available from multiple qualified sources in quantities sufficient for our needs. However, some of our operations remain dependent on single sources for certain raw materials.
While our suppliers have generally been able to support our needs, our operations may experience shortages and delays in the supply of raw material from time to time due to strong market demand, capacity limitations, supply chain disruptions, short lead times, production schedule increases from our customers and other problems experienced by the suppliers. A significant or prolonged shortage of critical components from any of our suppliers could adversely impact our ability to meet our production schedules and to deliver our products to our customers in a timely manner.
Seasonality
Our businesses are generally not seasonal. However, in the light vehicle market, our sales are closely related to the production schedules of our OEM customers and those schedules have historically been weakest in the third quarter of the year due to a large number of model year changeovers that occur during this period. Additionally, third-quarter production schedules in Europe are typically impacted by summer vacation schedules and fourth-quarter production is affected globally by year-end holidays.
Backlog
A substantial amount of the new business we are awarded by OEMs is granted well in advance of a program launch. These awards typically extend through the life of the given program. This backlog of new business does not represent firm orders. We estimate future sales from new business using the projected volume under these programs.
Competition
Within each of our markets, we compete with a variety of independent suppliers and distributors, as well as with the in-house operations of certain OEMs. With a focus on product innovation, we differentiate ourselves through efficiency and performance, reliability, materials and processes, sustainability and product extension.
The following table summarizes our principal competitors by operating segment as of December 31, 2024:
Segment
Principal Competitors
Light Vehicle
American Axle & Manufacturing Holdings, Inc.
Magna International Inc.
BorgWarner Inc.
Schaeffler AG
Hofer Powertrain GmbH
Valeo SE
Jing-Jin Electric Technologies Co. Ltd.
ZF Friedrichshafen AG
Linamar Corporation Vertically integrated OEM operations
Commercial Vehicle
Allison Transmission Holdings, Inc.
Eugen Klein GmbH
BorgWarner Inc.
Hendrickson Holdings, LLC
Cummins Inc.
Linamar Corporation
Danfoss A/S
Tirsan Kardan A.Ş.
Eaton Corporation plc ZF Friedrichshafen AG
Ege Endüstri ve Ticaret A.S. Vertically integrated OEM operations
Off-Highway
Bonfiglioli Riduttori S.p.A.
Kohler Co.
Carraro S.p.A.
SEW-Eurodrive GmbH
Comer Industries S.p.A.
Zapi S.p.A.
Danfoss A/S ZF Friedrichshafen AG
Kessler+Co
Vertically integrated OEM operations
Power Technologies
Denso Corporation
Mahle GmbH
ElringKlinger AG
Tenneco Inc.
Freudenberg Group
Valeo SE
Hanon Systems
YinLun Co., LTD
Intellectual Property
Our proprietary driveline and power technologies product lines have strong identities in the markets we serve. Throughout these product lines, we manufacture and sell our products under a number of patents that have been obtained over a period of years and expire at various times. We consider each of these patents to be of value and aggressively protect our rights in key markets. We are involved with many product lines and the loss or expiration of any particular patent would not materially affect our sales and profits.
We own or have licensed numerous trademarks that are registered or subject to pending applications in many jurisdictions. For example, our Spicer®, Spicer ElectrifiedTM, Victor Reinz®, Long®, GrazianoTM and Dana TM4TM trademarks are widely recognized in their market segments. We regard our trademarks as valuable assets and strategically pursue available protection of these rights.
Engineering and Research and Development
Since our introduction of the automotive universal joint in 1904, we have been focused on technological innovation. Our objective is to be an essential partner to our customers and we remain highly focused on offering superior product quality, technologically advanced products, world-class service and competitive prices. To enhance quality and reduce costs, we use statistical process control, cellular manufacturing, flexible regional production and assembly, global sourcing and extensive employee training.
We engage in ongoing engineering and research and development activities to improve the reliability, performance and cost-effectiveness of our existing products and to design and develop innovative products that meet customer requirements for new applications. We integrate related operations to create a more innovative environment, speed product development, maximize efficiency and improve communication and information sharing among our research and development operations. Our research and development costs were $229 in 2024, $237 in 2023 and $201 in 2022. Total engineering expenses including research and development were $360 in 2024, $369 in 2023 and $321 in 2022.
As a leading global supplier in the mobility sector, the company is committed to driving innovation and enhancing the performance, efficiency, and safety of transportation solutions across all major mobility markets. Our engineering and research and development efforts focus on creating advanced technologies that meet the evolving needs of customers while addressing environmental challenges and improving driving experience. Our research and development initiatives are centered on enhancing the efficiency, performance, and safety of mobility. This includes advancements in powertrain systems, vehicle dynamics and thermal management. We continue to maintain a balanced approach to innovation by investing strategically in both internal combustion (ICE) and electric vehicle (EV) technologies. Our ICE developments focus on improving fuel efficiency, reducing emissions and ensuring compliance with global regulatory standards. Concurrently our EV investments are improving the range, performance, and sustainability of electric vehicles. Dana has also embraced the use of artificial intelligence (AI) and machine learning (ML) technologies to enhance both the research and development process and the products we develop. These technologies are integrated into our product design and testing phases to accelerate development and into our products to provide real-time optimization of performance.
Human Capital
Our talented people power a customer-centric organization that is continuously improving the performance and efficiency of vehicles and machines around the globe. The following table summarizes our employees by operating segment and geographical region as of December 31, 2024:
Segment
Employees
Region
Employees
Light Vehicle
13,200
North America
15,100
Off-Highway
10,900
Europe
10,600
Commercial Vehicle
7,400
Asia Pacific
9,600
Power Technologies
5,700
South America
4,300
Technical and administrative
2,400
Total
39,600
Total
39,600
We are “People Finding A Better Way” in everything we do, guided by our values: Value Others, Inspire Innovation, Grow Responsibly, and Win Together. We value people by treating others with respect and putting safety, inclusion, and integrity at the heart of everything we do.
Safety - The health and safety of employees remain our highest priority and we believe our company has an essential responsibility to safeguard life, health, property, and the environment for the well-being of all involved. Through a commitment to proactive processes, we actively promote and pursue safety in all that we do. This is achieved through a consistent commitment to excellence in, health, safety, security management, and risk elimination. Dana’s health, safety and security programs ensure that all employees receive training, guidance, and assistance in safety awareness and risk prevention. An implemented, verified, audited, and communicated occupational health and safety management system reflects Dana’s internal and external commitment to all our stakeholders in identifying and reducing the health and safety risk of our employees around the world. Dana has developed robust safety systems, including detailed work instructions and processes for standard and non-standard work, as well as regular layer process audits to ensure that we carefully consider safety in each of our work functions.
Compensation and Benefits - We are committed to providing all employees with quality and competitive compensation and benefit programs that focus on all aspects of wellbeing - physical, mental, and financial. We benchmark our plans globally to ensure competitiveness and value. We utilize standards, processes and programs to ensure competitiveness and value globally, while allowing for differences based upon region and geography. Our programs are designed to attract and retain employees and motivate and reward performance in order to drive superior results. Some examples include base and variable pay, health benefits, life insurance, employee assistance programs, paid time off, and retirement and savings plans.
Culture and Inclusion - Our vision is to maintain a diverse and inclusive, global organization that develops, fosters, and attracts great people whose perspectives are encouraged, heard, valued, and supported. At Dana, we are proud to have an employee-centric organization that challenges the status quo by ensuring our business policies, processes and culture allow us to continuously build upon our diverse strengths to further grow a strong, inclusive work environment. Dana has a network of Business Resource Groups (BRGs) to empower employees and enhance Dana’s ability to develop, retain, and attract top talent. These BRGs are executive leadership-supported, employee-led initiatives with the mission to inspire growth and innovation and foster belonging for all employees. BRGs provide employees opportunities for development, mentoring, networking, and utilizing their talents in ways that positively impact the business. Our BRGs currently include the African American Resource Group (AARG), Connected Cultures, Dana Alumni, Dana Women’s Network (DAWN), Green Team, LGBTQ+A, Military and Veterans, and New to Dana (NTD).
Ethics and Compliance - All Dana employees are expected to follow Dana’s Standards of Business Conduct, which includes a range of subjects, from respect in the workplace and use of corporate assets to gifts and conflicts of interest, as well as protection of confidential information. Our employee on-boarding process involves a written acknowledgement of the receipt and review of the standards. All salaried employees globally must complete a series of online ethics and compliance training modules as part of the onboarding process, and additional ethics and compliance trainings annually thereafter on subjects such as workplace harassment, trade compliance, anti-trust, and data privacy, and complete an annual business conduct certification. We also maintain a global Ethics and Compliance Helpline which is available in multiple languages and can be used to anonymously report concerns.
Talent Development and Training - Dana has invested in and integrated SuccessFactors, an industry-leading human resource information system, as our global system of record. This platform supports integrated performance management and learning and development. Key features include a consistent talent review and calibration process with detailed reporting capabilities. Performance review is a yearlong process including three phases: goal setting, continuous feedback, and year-end rating and calibration. This increases commitment and adaptability to aligned personal and business objectives. Our learning resources blend subscription and custom content, offering hundreds of thousands of learning assets. Global administrators support the creation, assignment, and reporting of learning progress. Learning resources are accessible through both self-guided and assigned learning paths and are included in the talent development and performance review process. Training completion is tracked and includes automated reminders to enhance accountability and compliance, particularly for mandatory training such as cybersecurity.
Environmental Compliance
We make capital expenditures in the normal course of business as necessary to ensure that our facilities are in compliance with applicable environmental laws and regulations. The cost of environmental compliance has not been a material part of capital expenditures and did not have a material adverse effect on our earnings or competitive position in 2024.
Available Information
Our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports filed pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 as amended (Exchange Act) are available, free of charge, on or through our Internet website at http://www.dana.com/investors as soon as reasonably practicable after we electronically file such materials with, or furnish them to, the SEC. Copies of any materials we file with the SEC can also be obtained free of charge through the SEC’s website at http://www.sec.gov. We also post our Corporate Governance Guidelines, Standards of Business Conduct for Members of the Board of Directors, Board Committee membership lists and charters, Standards of Business Conduct and other corporate governance materials on our Internet website. Copies of these posted materials are also available in print, free of charge, to any stockholder upon request from: Dana Incorporated, Investor Relations, P.O. Box 1000, Maumee, Ohio 43537, or via telephone in the U.S. at 800-537-8823 or e-mail at InvestorRelations@dana.com. The inclusion of our website address in this report is an inactive textual reference only and is not intended to include or incorporate by reference the information on our website into this report.

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ITEM 1A. RISK FACTORS
Item 1A. Risk Factors
We are impacted by events and conditions that affect the light vehicle, commercial vehicle and off-highway markets that we serve, as well as by factors specific to Dana. Among the risks that could materially adversely affect our business, financial condition or results of operations are the following, many of which are interrelated.
Risk Factors Related to the Markets We Serve
A downturn in the global economy could have a substantial adverse effect on our business.
Our business is tied to general economic and industry conditions as demand for vehicles depends largely on the strength of the economy, employment levels, consumer confidence levels, the availability and cost of credit and the cost of fuel. These factors have had and could continue to have a substantial impact on our business. Adverse global economic conditions could also cause our customers and suppliers to experience severe economic constraints in the future, including bankruptcy, which could have a material adverse impact on our financial position and results of operations.
Our results of operations could be adversely affected by climate change, natural catastrophes or public health crises, in the locations in which we, our customers or our suppliers operate.
There is global scientific consensus that emissions of greenhouse gases (GHG) continue to alter the composition of Earth’s atmosphere in ways that are affecting and are expected to continue to affect the global climate. These considerations may lead to new international, national, regional, or local legislative or regulatory responses. Various stakeholders, including legislators and regulators, shareholders, and non-governmental organizations, as well as companies in many business sectors, including Dana, are continuing to look for ways to reduce GHG emissions. The regulation of GHG emissions from certain stationary or mobile sources or the imposition of carbon pricing mechanisms could result in additional costs to Dana in the form of taxes or emission allowances, facilities improvements, and energy costs, which would increase Dana’s operating costs through higher utility, transportation, and materials costs. Because the impact of any future climate change-related legislative, regulatory, or product standard requirements on Dana’s global businesses and products is dependent on the timing and design of mandates or standards, Dana is unable to predict their potential impact at this time. The potential physical impacts of climate change on Dana’s facilities, suppliers, and customers and therefore on Dana’s operations are highly uncertain and will be particular to the circumstances developing in various geographic regions. These may include extreme weather events and long-term changes in temperature levels and water availability. These potential physical effects may adversely affect the demand for Dana’s products and the cost, production, sales, and financial performance of Dana’s operations.
A natural disaster could disrupt our operations, or our customers’ or suppliers’ operations and could adversely affect our results of operations and financial condition. Although we have continuity plans designed to mitigate the impact of natural disasters on our operations, those plans may be insufficient, and any catastrophe may disrupt our ability to manufacture and deliver products to our customers, resulting in an adverse impact on our business and results of operations.
In addition, our global operations expose us to risks associated with public health crises, such as epidemics and pandemics, which could harm our business and cause our operating results to suffer. Pandemics, such as the novel coronavirus disease (COVID) pandemic, may have an adverse effect on our business, results of operations, cash flows and financial condition. Efforts to combat a pandemic can be complicated by viral variants and uneven access to, and acceptance and effectiveness of, vaccines globally. Pandemics may negatively impact the global economy, disrupt our operations as well as those of our customers, suppliers, and the global supply chains in which we participate, and create significant volatility and disruption of financial markets. The extent of the impact of a pandemic on our business and financial performance, including our ability to execute our near-term and long-term operational, strategic, and capital structure initiatives, will depend on the duration and severity of the pandemic, which are uncertain and cannot be predicted.
We may face facility closure requirements and other operational restrictions with respect to some or all of our locations for prolonged periods of time due to, among other factors, evolving and increasingly stringent governmental restrictions including public health directives, quarantine policies or social distancing measures. We operate as part of the complex integrated global supply chains of our largest customers. As a pandemic dissipates at varying times and rates in different regions around the world, there could be a prolonged negative impact on these global supply chains. Our ability to continue operations at specific facilities will be impacted by the interdependencies of the various participants of these global supply chains, which are largely beyond our direct control. A prolonged shut down of these global supply chains would have a material adverse effect on our business, results of operations, cash flows and financial condition.
Rising interest rates could have a substantial adverse effect on our business
Rising interest rates could have a dampening effect on overall economic activity, the financial condition of our customers and the financial condition of the end customers who ultimately create demand for the products we supply, all of which could negatively affect demand for our products. An increase in interest rates could make it difficult for us to obtain financing at attractive rates, impacting our ability to execute on our growth strategies or future acquisitions.
We could be adversely impacted by the loss of any of our significant customers, changes in their requirements for our products or changes in their financial condition.
We are reliant upon sales to several significant customers. Sales to our ten largest customers accounted for 58% of our overall sales in 2024. Changes in our business relationships with any of our large customers or in the timing, size and continuation of their various programs could have a material adverse impact on us.
The loss of any of these customers, the loss of business with respect to one or more of their vehicle models on which we have high component content, or a significant decline in the production levels of such vehicles would negatively impact our business, results of operations and financial condition. Pricing pressure from our customers also poses certain risks. Inability on our part to offset pricing concessions with cost reductions would adversely affect our profitability. We are continually bidding on new business with these customers, as well as seeking to diversify our customer base, but there is no assurance that our efforts will be successful. Further, to the extent that the financial condition of our largest customers deteriorates, including possible bankruptcies, mergers or liquidations, or their sales otherwise decline, our financial position and results of operations could be adversely affected.
We may be adversely impacted by changes in international legislative and political conditions.
We operate in 30 countries around the world and we depend on significant foreign suppliers and customers. Legislative and political activities within the countries where we conduct business, particularly in emerging markets and less developed countries, could adversely impact our ability to operate in those countries. The political situation in a number of countries in which we operate could create instability in our contractual relationships with no effective legal safeguards for resolution of these issues, or potentially result in the seizure of our assets. We operate in Argentina, where trade-related initiatives and other government restrictions limit our ability to optimize operating effectiveness. At December 31, 2024, our net asset exposure related to Argentina was approximately $52, including $21 of net fixed assets.
We may be adversely impacted by changes in trade policies and proposed or imposed tariffs, including but not limited to, the imposition of new tariffs by the U.S. government on imports to the U.S. and/or the imposition of retaliatory tariffs by foreign countries.
Section 232 of the Trade Expansion Act of 1962, as amended (the Trade Act), gives the executive branch of the U.S. government broad authority to restrict imports in the interest of national security by imposing tariffs. Tariffs imposed on imported steel and aluminum could raise the costs associated with manufacturing our products. We work with our customers to recover a portion of any increased costs, and with our suppliers to defray costs, associated with tariffs. While we have been successful in the past recovering a significant portion of costs increases, there is no assurance that cost increases resulting from trade policies and tariffs will not adversely impact our profitability. Our sales may also be adversely impacted if tariffs are assessed directly on the products we produce or on our customers’ products containing content sourced from us.
We may be adversely impacted by the strength of the U.S. dollar relative to the currencies in the other countries in which we do business.
Approximately 55% of our sales in 2024 were from operations located in countries other than the U.S. Currency variations can have an impact on our results (expressed in U.S. dollars). Currency variations can also adversely affect margins on sales of our products in countries outside of the U.S. and margins on sales of products that include components obtained from affiliates or other suppliers located outside of the U.S. Strengthening of the U.S. dollar against the euro and currencies of other countries in which we have operations could have an adverse effect on our results reported in U.S. dollars. We use a combination of natural hedging techniques and financial derivatives to mitigate foreign currency exchange rate risks. Such hedging activities may be ineffective or may not offset more than a portion of the adverse financial impact resulting from currency variations.
We may be adversely impacted by new laws, regulations or policies of governmental organizations related to increased fuel economy standards and reduced greenhouse gas emissions, or changes in existing ones.
The markets and customers we serve are subject to substantial government regulation, which often differs by state, region and country. These regulations, and proposals for additional regulation, are advanced primarily out of concern for the environment (including concerns about global climate change and its impact) and energy independence. We anticipate that the number and extent of these regulations, and the costs to comply with them, will increase significantly in the future.
In the U.S., vehicle fuel economy and greenhouse gas emissions are regulated under a harmonized national program administered by the National Highway Traffic Safety Administration and the Environmental Protection Agency (EPA). Other governments in the markets we serve are also creating new policies to address these same issues, including the European Union, Brazil, China and India. These government regulatory requirements could significantly affect our customers by altering their global product development plans and substantially increasing their costs, which could result in limitations on the types of vehicles they sell and the geographical markets they serve. Any of these outcomes could adversely affect our financial position and results of operations.
Company-Specific Risk Factors
We have taken, and continue to take, cost-reduction actions. Although our process includes planning for potential negative consequences, the cost-reduction actions may expose us to additional production risk and could adversely affect our sales, profitability and ability to retain and attract employees.
We have been reducing costs in all of our businesses and have discontinued product lines, exited businesses, consolidated manufacturing operations and positioned operations in lower cost locations. The impact of these cost-reduction actions on our sales and profitability may be influenced by many factors including our ability to successfully complete these ongoing efforts, our ability to generate the level of cost savings we expect or that are necessary to enable us to effectively compete, delays in implementation of anticipated workforce reductions, decline in employee morale and the potential inability to meet operational targets due to our inability to retain or recruit key employees.
We may not realize any or all of our estimated cost savings, which would have a negative effect on our results of operations.
On November 25, 2024, we announced cost reduction actions that include substantial reductions in selling, general and administrative costs across all the company’s businesses and engineering expenses. Any cost savings that we realize from such efforts may differ materially from our estimates, which involve risks, uncertainties, assumptions and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such estimates. In addition, any cost savings that we realize may be offset, in whole or in part, by reductions in net sales, or through increases in other expenses. Our cost reduction actions are subject to numerous risks and uncertainties that may change at any time. We cannot assure you that cost reductions will be completed as anticipated or that the benefits we expect will be achieved on a timely basis or at all.
We depend on our subsidiaries for cash to satisfy the obligations of the company.
Our subsidiaries conduct all of our operations and own substantially all of our assets. Our cash flow and our ability to meet our obligations depend on the cash flow of our subsidiaries. In addition, the payment of funds in the form of dividends, intercompany payments, tax sharing payments and otherwise may be subject to restrictions under the laws of the countries of incorporation of our subsidiaries or the by-laws of the subsidiary.
Labor stoppages or work slowdowns at Dana, key suppliers or our customers could result in a disruption in our operations and have a material adverse effect on our businesses.
We and our customers rely on our respective suppliers to provide parts needed to maintain production levels. We all rely on workforces represented by labor unions. Workforce disputes that result in work stoppages or slowdowns could disrupt operations of all of these businesses, which in turn could have a material adverse effect on the supply of, or demand for, the products we supply our customers.
We could be adversely affected if we are unable to recover portions of commodity (including costs of steel and other raw materials), labor, transportation and energy costs from our customers.
Commodity, labor, transportation and energy costs have been volatile over the past several years creating pressure on our profit margins. We continue to work with our customers to recover a portion of our material cost increases. While we have been successful in the past recovering a significant portion of such cost increases, there is no assurance that increases in commodity costs, which can be impacted by a variety of factors, including changes in trade laws and tariffs, will not adversely impact our profitability in the future. We may also experience labor shortages in certain geographies and increased competition for qualified candidates. These shortages could adversely affect our ability to meet customer demand and increase labor costs, which would reduce our profitability. Standard freight may increase due to shipping container and truck driver shortages and port congestion attributable to global supply chain disruptions resulting from regional and global pandemics and conflicts. We may also incur significant premium freight, resulting from frequent changes in customer order patterns. If we are unable to pass labor, transportation and energy cost increases on to our customer base or otherwise mitigate the costs, our profit margin could be adversely affected.
We could be adversely affected if we experience shortages of components from our suppliers or if disruptions in the supply chain lead to parts shortages for our customers.
A substantial portion of our annual cost of sales is driven by the purchase of goods and services. To manage and minimize these costs, we have been consolidating our supplier base. As a result, we are dependent on single sources of supply for some components of our products. We select our suppliers based on total value (including price, delivery and quality), taking into consideration their production capacities and financial condition, and we expect that they will be able to support our needs. However, there is no assurance that adverse financial conditions, including bankruptcies of our suppliers, reduced levels of production, natural disasters or other problems experienced by our suppliers will not result in shortages or delays in their supply of components to us or even in the financial collapse of one or more such suppliers. If we were to experience a significant or prolonged shortage of critical components from any of our suppliers, particularly those who are sole sources, and were unable to procure the components from other sources, we would be unable to meet our production schedules for some of our key products and to ship such products to our customers in a timely fashion, which would adversely affect our sales, profitability and customer relations.
Adverse economic conditions, natural disasters and other factors can similarly lead to financial distress or production problems for other suppliers to our customers which can create disruptions to our production levels. Any such supply-chain induced disruptions to our production are likely to create operating inefficiencies that will adversely affect our sales, profitability and customer relations.
Our profitability and results of operations may be adversely affected by program launch difficulties.
The launch of new business is a complex process, the success of which depends on a wide range of factors, including the production readiness of our manufacturing facilities and manufacturing processes and those of our suppliers, as well as factors related to tooling, equipment, employees, initial product quality and other factors. Our failure to successfully launch material new or takeover business could have an adverse effect on our profitability and results of operations.
We use important intellectual property in our business. If we are unable to protect our intellectual property or if a third party makes assertions against us or our customers relating to intellectual property rights, our business could be adversely affected.
We own important intellectual property, including patents, trademarks, copyrights and trade secrets, and are involved in numerous licensing arrangements. Our intellectual property plays an important role in maintaining our competitive position in a number of the markets that we serve. Our competitors may develop technologies that are similar or superior to our proprietary technologies or design around the patents we own or license. Further, as we expand our operations in jurisdictions where the protection of intellectual property rights is less robust, the risk of others duplicating our proprietary technologies increases, despite efforts we undertake to protect them. Developments or assertions by or against us relating to intellectual property rights, and any inability to protect these rights, could have a material adverse impact on our business and our competitive position.
We could encounter unexpected difficulties integrating acquisitions and operating joint ventures.
We acquired businesses in the past, and we may complete additional acquisitions and investments in the future that complement or expand our businesses. The success of this strategy will depend on our ability to successfully complete these transactions or arrangements, to integrate the businesses acquired in these transactions and to develop satisfactory working arrangements with our strategic partners in the joint ventures. We could encounter unexpected difficulties in completing these transactions and integrating the acquisitions with our existing operations. We also may not realize the degree or timing of benefits anticipated when we entered into a transaction.
Several of our joint ventures operate pursuant to established agreements and, as such, we do not unilaterally control the joint venture. There is a risk that the partners’ objectives for the joint venture may not be aligned with ours, leading to potential differences over management of the joint venture that could adversely impact its financial performance and consequent contribution to our earnings. Additionally, inability on the part of our partners to satisfy their contractual obligations under the agreements could adversely impact our results of operations and financial position. Certain of our joint venture partners have the ability to put their ownership interests to Dana at fair value. If a joint venture partner were to put its ownership interest to Dana, it could cause Dana to outlay significant amounts of cash to purchase the joint venture partner's ownership interest in addition to increased future cash outlays required to fund 100% of the operations on a go-forward basis, reducing available funds for other strategic initiatives and capital investments. (See Note 8 to our consolidated financial statements in Item 8 for additional information on redeemable noncontrolling interests.)
We may fail to consummate or realize the value of dispositions and other strategic initiatives and such transactions and initiatives may be disruptive to our operations and adversely impact our results.
We announced on November 25, 2024 strategic initiatives that included initiating the sale process for our Off-Highway business, however, there can be no assurance that the sale process for our Off-Highway business will result in a transaction. Factors that could cause this event not to occur include, but are not limited to, a failure to obtain necessary regulatory approvals, a deterioration in the Dana’s business or prospects, adverse developments in key markets, adverse developments in the U.S. or global capital markets, credit markets or economies generally or a failure to execute a sale of the Off-Highway business on acceptable terms. Moreover, any sale and separation process, including complex carve-out and transition activities, may be time consuming and disruptive to Dana’s business operations, could divert the attention of management and the Board from Dana’s business, could impair Dana’s ability to attract, retain and motivate key employees, could impact
Dana’s relationships with suppliers and/or customers, could negatively affect Dana’s credit ratings and ability raise future capital and could expose Dana to potential litigation in connection with the sale process and the standalone business. If we are unable to effectively manage these risks, our results may be adversely affected.
We could be adversely impacted by the costs of environmental, health, safety and product liability compliance.
Our operations are subject to environmental laws and regulations in the U.S. and other countries that govern emissions to the air; discharges to water; the generation, handling, storage, transportation, treatment and disposal of waste materials; and the cleanup of contaminated properties. Historically, environmental costs related to our former and existing operations have not been material. However, there is no assurance that the costs of complying with current environmental laws and regulations, or those that may be adopted in the future, will not increase and adversely impact us.
There is also no assurance that the costs of complying with current laws and regulations, or those that may be adopted in the future, that relate to health, safety and product liability matters will not adversely impact us. There is also a risk of warranty and product liability claims, as well as product recalls, if our products fail to perform to specifications or cause property damage, injury or death. (See Notes 14 and 15 to our consolidated financial statements in Item 8 for additional information on product liabilities and warranties.)
A failure of our information technology infrastructure could adversely impact our business and operations.
We recognize the increasing volume of cyber attacks and employ commercially practical efforts to provide reasonable assurance that the risks of such attacks are appropriately mitigated. Each year, we evaluate the threat profile of our industry to stay abreast of trends and to provide reasonable assurance our existing countermeasures will address any new threats identified. Despite our implementation of security measures, our IT systems and those of our service providers are vulnerable to circumstances beyond our reasonable control including acts of terror, acts of government, natural disasters, civil unrest and denial of service attacks which may lead to the theft of our intellectual property, trade secrets or business disruption. To the extent that any disruption or security breach results in a loss or damage to our data or an inappropriate disclosure of confidential information, it could cause significant damage to our reputation, affect our relationships with our customers, suppliers and employees, lead to claims against the company and ultimately harm our business. Additionally, we may be required to incur significant costs to protect against damage caused by these disruptions or security breaches in the future.
We participate in certain multi-employer pension plans which are not fully funded.
We contribute to certain multi-employer defined benefit pension plans for certain of our union-represented employees in the U.S. in accordance with our collective bargaining agreements. Contributions are based on hours worked except in cases of layoff or leave where we generally contribute based on 40 hours per week for a maximum of one year. The plans are not fully funded as of December 31, 2024. We could be held liable to the plans for our obligation, as well as those of other employers, due to our participation in the plans. Contribution rates could increase if the plans are required to adopt a funding improvement plan, if the performance of plan assets does not meet expectations or as a result of future collectively bargained wage and benefit agreements. (See Note 11 to our consolidated financial statements in Item 8 for additional information on multi-employer pension plans.)
Changes in interest rates and asset returns could increase our pension funding obligations and reduce our profitability.
We have unfunded obligations under certain of our defined benefit pension and other postretirement benefit plans. The valuation of our future payment obligations under the plans and the related plan assets are subject to significant adverse changes if the credit and capital markets cause interest rates and projected rates of return to decline. Such declines could also require us to make significant additional contributions to our pension plans in the future. A material increase in the unfunded obligations of these plans could also result in a significant increase in our pension expense in the future.
We may incur additional tax expense or become subject to additional tax exposure.
Our provision for income taxes and the cash outlays required to satisfy our income tax obligations in the future could be adversely affected by numerous factors. These factors include changes in the level of earnings in the tax jurisdictions in which we operate, changes in the valuation of deferred tax assets and liabilities, changes in our plans to repatriate the earnings of our non-U.S. operations to the U.S. and changes in tax laws and regulations.
Our income tax returns are subject to examination by federal, state and local tax authorities in the U.S. and tax authorities outside the U.S. The results of these examinations and the ongoing assessments of our tax exposures could also have an adverse effect on our provision for income taxes and the cash outlays required to satisfy our income tax obligations.
An inability to provide products with the technology required to satisfy customer requirements would adversely impact our ability to successfully compete in our markets.
The vehicular markets in which we operate are undergoing significant technological change, with increasing focus on electrified and autonomous vehicles. These and other technological advances could render certain of our products obsolete. Maintaining our competitive position is dependent on our ability to develop commercially-viable products and services that support the future technologies embraced by our customers.
We could be adversely impacted by increased competition in the markets we serve.
The mobility industry is beginning to shift away from petroleum fuel vehicles ("ICE" vehicles) and migrate to alternate fuel vehicles (as a group "EV-based vehicles"). As the market transitions from ICE vehicles to EV-based vehicles, the Company anticipates its content per vehicle opportunity will increase up to three-fold on a dollar basis. The Company's primary driveline content on ICE vehicles includes axles and driveshafts. As the market transitions to EV-based vehicles we anticipate losing driveshaft content but adding additional driveline content in the form of gearboxes, e-motors, e-axles, power electronics, and software controls. We anticipate a similar three-fold opportunity in thermal and sealing products, as current ICE-vehicle content is replaced with EV-based vehicle content including metallic bipolar plates, battery cold plates and power electronic cooling modules. With the increased content opportunity presented by EV-based vehicles, we are beginning to see increased competition when it comes to bidding on new customer programs. The number of competitors bidding on EV-based vehicle programs is higher than what we historically experienced on ICE vehicle programs. In addition, our OEM customers continue to assess which EV-based components they will vertically integrate and for which programs. A significant increase in competition for EV-based vehicle programs from existing and new market entrants could negatively impact our sales and profitability. A significant increase in vertical integration of EV-based vehicle components by our OEM customers could negatively impact our sales and profitability.
We could be adversely impacted by an extended transition period away from petroleum fuel vehicles to alternate fuel vehicles.
As the market transitions from ICE vehicles to EV-based vehicles, we will continue to experience elevated levels of research and development costs, capital investment and inventory levels. During the transition period, we will need to maintain production capacity to meet both ICE and EV-related customer demand, requiring incremental capital investment and reducing our ability to operate at scale. In addition, we will need to maintain incremental levels of inventory to satisfy ICE and EV-related customer demand, as raw materials and components used in the production of ICE and EV-related products are largely unique. An extended transition period could negatively impact our profitability, cash flows and financial position.
Failure to appropriately anticipate and react to the cyclical and volatile nature of production rates and customer demands in our business can adversely impact our results of operations.
Our financial performance is directly related to production levels of our customers. In several of our markets, customer production levels are prone to significant cyclicality, influenced by general economic conditions, changing consumer preferences, regulatory changes, and other factors. Oftentimes the rapidity of the downcycles and upcycles can be severe. Successfully executing operationally during periods of extreme downward and upward demand pressures can be challenging. Our inability to recognize and react appropriately to the production cycles inherent in our markets can adversely impact our operating results.
Our continued success is dependent on being able to retain and attract requisite talent.
Sustaining and growing our business requires that we continue to retain, develop and attract people with the requisite skills. With the vehicles of the future expected to undergo significant technological change, having qualified people savvy in the right technologies will be a key factor in our ability to develop the products necessary to successfully compete in the future. As a global organization, we are also dependent on our ability to attract and maintain a diverse work force that is fully engaged supporting our company’s objectives and initiatives.
Failure to maintain effective internal controls could adversely impact our business, financial condition and results of operations.
Regulatory provisions governing the financial reporting of U.S. public companies require that we maintain effective disclosure controls and internal controls over financial reporting across our operations in 30 countries. Effective internal controls are designed to provide reasonable assurance of compliance, and, as such, they can be susceptible to human error, circumvention or override, and fraud. Failure to maintain adequate, effective internal controls could result in potential financial misstatements or other forms of noncompliance that have an adverse impact on our results of operations, financial condition or organizational reputation.
Our working capital requirements may negatively affect our liquidity.
Our working capital requirements can vary significantly, depending in part on the level, variability and timing of our customers’ orders and production schedules and availability of raw materials and components from our suppliers. As production volumes increase, our working capital requirements to support the higher volumes generally increase. If our working capital needs exceed our cash flows from operations, we look to our cash and cash equivalents balances and unused capacity of our Revolving Facility to satisfy those needs, as well as other potential sources of additional capital, which may not be available on satisfactory terms or in adequate amounts.
Developments in the financial markets or downgrades to Dana's credit rating could restrict our access to capital and increase financing costs.
At December 31, 2024, Dana had consolidated debt obligations of $2,630, with cash and cash equivalents of $494 and unused revolving credit capacity of $1,140. Our ability to grow the business and satisfy debt service obligations is dependent, in part, on our ability to gain access to capital at competitive costs. External factors beyond our control can adversely affect capital markets - either tightening availability of capital or increasing the cost of available capital. Failure on our part to maintain adequate financial performance and appropriate credit metrics can also affect our ability to access capital at competitive prices.
Increased scrutiny from the public, investors, and others regarding our environmental, social, and governance ("ESG") practices could impact our reputation.
We have a board committee and an executive officer position with responsibility for sustainability, additional dedicated employee resources, a cross-functional/business sustainability leadership team to further develop and implement an enterprise-wide sustainability strategy, and we have published a sustainability report. Our sustainability report includes our policies and practices on a variety of ESG matters, including the value creation opportunities provided by our products; diversity, equity, and inclusion; employee health and safety; community giving; and human capital management. These efforts may result in increased investor, media, employee, and other stakeholder attention to such initiatives, and such stakeholders may not be satisfied with our ESG practices or initiatives. Additionally, organizations that inform investors on ESG matters have developed rating systems for evaluating companies on their approach to ESG. Unfavorable ratings may lead to negative investor sentiment, which could negatively impact our stock price and our ability to access capital at competitive prices. Any failure, or perceived failure, to respond to ESG concerns could harm our business and reputation.
Risk Factors Related to our Securities
Provisions in our Restated Certificate of Incorporation and Bylaws may discourage a takeover attempt.
Certain provisions of our Restated Certificate of Incorporation and Bylaws, as well as the General Corporation Law of the State of Delaware, may have the effect of delaying, deferring or preventing a change in control of Dana. Such provisions, including those governing the nomination of directors, limiting who may call special stockholders’ meetings and eliminating stockholder action by written consent, may make it more difficult for other persons, without the approval of our board of directors, to make a tender offer or otherwise acquire substantial amounts of common stock or to launch other takeover attempts that a stockholder might consider to be in such stockholder’s best interest.

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ITEM 1B. UNRESOLVED STAFF COMMENTS
Item 1B. Unresolved Staff Comments
None.

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ITEM 2. PROPERTIES
Item 2. Properties
Light
Vehicle
Commercial
Vehicle
Off-Highway
Power
Technologies
Total
Manufacturing and assembly plants
As of December 31, 2024, we had eighty-three major manufacturing and assembly plants. In addition, we had nine aftermarket sales and services facilities supporting our mobility customers and twenty-one service and assembly facilities supporting our stationary equipment customers.
Our world headquarters is located in Maumee, Ohio. This facility and other facilities in the greater Detroit, Michigan and Maumee, Ohio areas house functions that have global or North American regional responsibility for finance and accounting, tax, treasury, risk management, legal, human resources, procurement and supply chain management, communications and information technology. We operate numerous other management, marketing and administrative facilities globally.

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ITEM 3. LEGAL PROCEEDINGS
Item 3. Legal Proceedings
We are a party to various pending judicial and administrative proceedings that arose in the ordinary course of business. After reviewing the currently pending lawsuits and proceedings (including the probable outcomes, reasonably anticipated costs and expenses and our established reserves for uninsured liabilities), we do not believe that any liabilities that may result from these proceedings are reasonably likely to have a material adverse effect on our liquidity, financial condition or results of operations. Legal proceedings are also discussed in Note 14 to our consolidated financial statements in Item 8.
PART II

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ITEM 4. MINE SAFETY DISCLOSURE

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ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
Market information - Our common stock trades on the New York Stock Exchange (NYSE) under the symbol "DAN."
Holders of common stock - Based on reports by our transfer agent, there were approximately 2,292 registered holders of our common stock on February 3, 2025.
Reference is made to the Equity Compensation Plan Information section of Item 12 for certain information regarding our equity compensation plans.
Stockholder return - The following graph shows the cumulative total shareholder return for our common stock since December 31, 2019. The graph compares our performance to that of the Standard & Poor’s 500 Stock Index (S&P 500) and the Dow Jones US Auto Parts Index. The comparison assumes $100 was invested at the closing price on December 31, 2019. Each of the returns shown assumes that all dividends paid were reinvested.
Performance chart
Index
12/31/2019
12/31/2020
12/31/2021
12/31/2022
12/31/2023
12/31/2024
Dana Incorporated
$ 100.00
$ 108.30
$ 128.71
$ 87.44
$ 86.81
$ 70.51
S&P 500
100.00
118.40
152.39
124.79
157.59
197.02
Dow Jones US Auto Parts Index
100.00
117.51
142.18
104.59
104.54
80.91
Issuer's purchases of equity securities - No shares of our common stock were repurchased under the program during 2024.
Trading arrangements - During the three months ended December 31, 2024, none of the Company’s directors or executive officers adopted, modified or terminated any contract, instruction or written plan for the purchase or sale of Company securities that was intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) or any non-Rule 10b5-1 trading agreement.
Annual meeting - We will hold an annual meeting of shareholders on April 24, 2025.

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ITEM 6. SELECTED FINANCIAL DATA
Item 6. [Reserved]

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ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Dollars in millions)
Discussion and analysis of our results of operations pertaining to 2023 compared to 2022 not included in this Form 10-K can be found in Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations" of our Annual Report on Form 10-K for the year ended December 31, 2023. The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the financial statements and accompanying notes in Item 8.
Management Overview
We are a global provider of high-technology products to virtually every major vehicle manufacturer in the world. We also serve the stationary industrial market. Our technologies include drive systems (axles, driveshafts, transmissions, and wheel and track drives); motion systems (winches, slew drives, and hub drives); electrodynamic technologies (motors, inverters, software and control systems, battery-management systems, and fuel cell plates); sealing solutions (gaskets, seals, cam covers, and oil pan modules); thermal-management technologies (transmission and engine oil cooling, battery and electronics cooling, charge air cooling, and thermal-acoustical protective shielding); and digital solutions (active and passive system controls and descriptive and predictive analytics). We serve our global light vehicle, medium/heavy vehicle and off-highway markets through four business units - Light Vehicle Drive Systems (Light Vehicle), Commercial Vehicle Drive and Motion Systems (Commercial Vehicle), Off-Highway Drive and Motion Systems (Off-Highway) and Power Technologies, which is the center of excellence for sealing and thermal-management technologies that span all customers in our on-highway and off-highway markets. We have a diverse customer base and geographic footprint which minimizes our exposure to individual market and segment declines. In 2024, 48% of our sales came from North American operations and 52% from operations throughout the rest of the world. Our sales by operating segment were Light Vehicle - 41%, Commercial Vehicle - 19%, Off-Highway - 27% and Power Technologies - 13%.
Operational and Strategic Initiatives
Our strategy builds on our strong technology foundation and leverages our resources across the organization while driving a customer-centric focus, expanding our global markets, and delivering innovative solutions for the mobility markets we serve.
Central to our strategy is leveraging our core operations. This foundational element enables us to infuse strong operational disciplines throughout the strategy, making it practical, actionable, and effective. We are achieving improved profitability by actively improving our cost structure and gaining efficiencies across all of our operations and functions.
Our customers remain at the center of our value system. These relationships are strengthened as we are physically located where we need to be in order to provide unparalleled service. We prioritize our customers’ needs as we engineer solutions that differentiate their products while making it easier to do business by streamlining our commercial organization. Our customer-centric focus has uniquely positioned us to win more than our fair share of new business and capitalize on future customer outsourcing initiatives.
Dana has embarked on a strategic plan to focus on core on-highway markets and accelerate value creation by improving its cost structure, increasing its efficiency, and creating a more focused and nimble Dana through the planned divestiture of our Off-Highway business.
Capital Structure Initiatives
In addition to investing in our business, we plan to prioritize a balanced allocation of capital while maintaining a strong balance sheet.
Shareholder return initiatives - When evaluating capital structure initiatives, we balance our growth opportunities with maintaining a strong balance sheet and returning capital to shareholders via dividends and share repurchases. Except for three quarters in 2020, when we temporarily suspended dividends to common shareholders in response to the global COVID pandemic, we have paid quarterly dividends to our common shareholders since the first quarter of 2012. We also utilize share repurchases to provide returns to our shareholders. We repurchased $25 common shares in 2022.
Financing initiatives - Our current portfolio of unsecured senior notes is structured such that no more than $440 of senior notes comes due in any calendar year, with no maturities until the second quarter of 2025. In addition, during 2023 we extended the maturity of our $1,150 revolving credit facility to March 2028. See Note 12 to our consolidated financial statements in Item 8 for additional information.
Other Initiatives
Aftermarket opportunities - We have a global group dedicated to identifying and developing aftermarket growth opportunities that leverage the capabilities within our existing businesses - targeting increased future aftermarket sales. Powered by recognized brands such as Dana®, Spicer®, Spicer Electrified™, Victor Reinz®, Glaser®, GWB®, Thompson®, Tru-Cool®, SVL®, and Transejes™, Dana delivers a broad range of aftermarket solutions - including genuine, all makes, and value lines - servicing passenger, commercial and off-highway vehicles across the globe.
Selective acquisitions - Although transformational opportunities will be considered when strategically and economically attractive, our acquisition focus is principally directed at “bolt-on” or adjacent acquisition opportunities that have a strategic fit with our existing core businesses, particularly opportunities that support our enterprise strategy and enhance the value proposition of our product offerings. Any potential acquisition will be evaluated in the same manner we currently consider customer program opportunities and other uses of capital - with a disciplined financial approach designed to ensure profitable growth and increased shareholder value.
Segments
Through December 2024, we managed our operations globally through four operating segments. Our Light Vehicle and Power Technologies segments primarily support light vehicle original equipment manufacturers (OEMs) with products for light trucks, SUVs, CUVs, vans and passenger cars. Our Commercial Vehicle segment supports the OEMs of on-highway commercial vehicles (primarily trucks and buses), while our Off-Highway segment supports OEMs of off-highway vehicles (primarily wheeled vehicles used in construction, mining and agricultural applications).
In the first quarter of 2025, our Power Technologies segment will be integrated into our Light Vehicle and Commercial Vehicle segments, streamlining the business, enhancing our go-to-market approach and serving our customers more efficiently. The OEM-facing business will be integrated into our Light Vehicle segment while the aftermarket business will be integrated into our Commercial Vehicle segment.
Trends in Our Markets
We serve our customers in three core global end markets: light vehicle, primarily full frame trucks and SUVs; commercial vehicle, including medium-and heavy-duty trucks and busses; and off-highway, including construction, mining, and agriculture equipment. Each of our end-markets has unique cyclical dynamics and market drivers. These cycles are impacted by periods of investment where end-user vehicle fleets are refreshed or expanded in reaction to demand usage patterns, regulatory changes, or when the age of vehicles in service reach their useful life. Key market drivers include regional economic growth rates; cost and availability of end customer financing; industrial output; commodity production and pricing; and residential and nonresidential construction rates. Our multi-market coverage and broad customer base help provide stability across the cycles while mitigating secular variability.
Light vehicle markets - Our driveline business is weighted more heavily to the truck and SUV segments of the light-vehicle market versus the passenger-car segment. Our vehicle content is greater on rear-wheel drive, four-wheel drive, and all-wheel drive vehicles, as well as hybrid and electric vehicles. During 2024, light-truck markets showed marginal improvement across all regions except Europe, which was down slightly from 2023. The outlook for 2025 reflects global light-truck production being relatively stable across all regions in comparison with the prior year.
Commercial vehicle markets - Our primary business is driveline systems for medium and heavy-duty trucks and busses, including the emerging market for hybrid and electric vehicles. Key regional markets are North America, South America (primarily Brazil) and Asia Pacific. During 2024, production of Class-8 trucks in North America decreased 3% from 2023 reflecting lower demand driven by lower freight volumes and rates. Medium-duty truck production in North America experienced a modest 4% year-over-year increase from 2023. The outlook for 2025 is for a moderate decrease in production from the prior year. Outside of North America, production of medium- and heavy-duty trucks in South America increased 41% over 2023, reflecting improved economic conditions in the region. The 2025 outlook for South America reflects a modest decrease in production from the prior year. Production of medium- and heavy-duty trucks in Asia Pacific, driven by China and India, decreased 5% in 2024. The 2025 outlook for Asia Pacific is for a modest increase in production from the prior year.
Off-highway markets - Our off-highway business has a large presence outside of North America, with 65% of its 2024 sales coming from products manufactured in Europe; however, a large portion of these products are utilized in vehicle production outside the region. The construction equipment segment of the off-highway market is closely related to global economic growth and infrastructure investment. The global construction equipment market softened in 2024 with production declining 5% from 2023. The outlook for 2025 is for continued market weakness, with moderate production declines in North America and Europe and relative stability in Asia Pacific compared to the prior year. End-user investment in the mining equipment segment is driven by prices for commodity products produced by underground mining. The global mining equipment market has been mostly stable over the past several years as industry participants have maintained vehicle inventory levels to match commodity output. The outlook for 2025 is for a modest decline in global production from the prior year. The agriculture equipment market is the third of our key off-highway segments. Like the underground mining segment, investment in agriculture equipment is primarily driven by prices for farm commodities. Farm commodity price decreases in 2024 spurred a 8% decrease in agriculture equipment production. The outlook for 2025 is for a moderate decrease in global end-market demand relative to the prior year.
Foreign currency - With 55% of our 2024 sales coming from outside the U.S., international currency movements can have a significant effect on our sales and results of operations. The euro zone countries and India accounted for 47% and 10% of our 2024 non-U.S. sales, respectively, while Brazil and China accounted for 9% and 8%, respectively. Although sales in South Africa are less than 5% of our non-U.S. sales, the rand has been volatile and significantly impacted sales from time to time. International currencies weakened against the U.S. dollar in 2024, decreasing 2024 sales by $49. A weaker Brazilian real, Chinese renminbi and Indian rupee, were partially offset by a stronger euro.
Argentina has experienced significant inflationary pressures the past several years, contributing to significant devaluation of its currency among other economic challenges. Our Argentine operation supports our Light Vehicle operating segment. Our sales in Argentina for 2024 of approximately $227 are 2% of our consolidated sales and our net asset exposure related to Argentina was approximately $52, including $21 of net fixed assets, at December 31, 2024. During the second quarter of 2018, we determined that Argentina's economy met the GAAP definition of a highly inflationary economy. In assessing Argentina's economy as highly inflationary we considered its three-year cumulative inflation rate along with other factors. As a result, effective July 1, 2018, the U.S. dollar is the functional currency for our Argentine operations, rather than the Argentine peso. Beginning July 1, 2018, peso-denominated monetary assets and liabilities are remeasured into U.S. dollars using current Argentine peso exchange rates with resulting translation gains or losses included in results of operations. Nonmonetary assets and liabilities are remeasured into U.S. dollar using historic Argentine peso exchange rates. Reference is made to Note 1 of our consolidated financial statements in Item 8 for additional information.
Commodity costs - The cost of our products may be significantly impacted by changes in raw material commodity prices, the most important to us being those of various grades of steel, aluminum, copper, brass and rare earth materials. The effects of changes in commodity prices are reflected directly in our purchases of commodities and indirectly through our purchases of products such as castings, forgings, bearings, batteries and component parts that include commodities. Most of our major customer agreements provide for the sharing of significant commodity price changes with those customers based on the movement in various published commodity indexes. Where such formal agreements are not present, we have historically been successful implementing price adjustments that largely compensate for the inflationary impact of material costs. Material cost changes will customarily have some impact on our financial results as customer pricing adjustments typically lag commodity price changes. Lower commodity prices increased year-over-year earnings by $13 in 2024. Material recovery pricing actions decreased year-over-year earnings by $53 in 2024.
Sales, Earnings and Cash Flow Outlook
Outlook
Sales
$9,525 - $10,025
$ 10,284
$ 10,555
$ 10,156
Adjusted EBITDA
$925 - $1,025
$
$
$
Net cash provided by operating activities
$500 - $600
$
$
$
Purchases of property, plant and equipment
~3% of sales
$
$
$
Free Cash Flow
$175 - $275
$
$ (25 )
$
Adjusted EBITDA and free cash flow are non-GAAP financial measures. See the Non-GAAP Financial Measures discussion below for definitions of our non-GAAP financial measures and reconciliations to the most directly comparable U.S. generally accepted accounting principles (GAAP) measures. We have not provided a reconciliation of our adjusted EBITDA outlook to the most comparable GAAP measure of net income. Providing net income guidance is potentially misleading and not practical given the difficulty of projecting event driven transactional and other non-core operating items that are included in net income, including restructuring actions, asset impairments and certain income tax adjustments. The accompanying reconciliations of these non-GAAP measures with the most comparable GAAP measures for the historical periods presented are indicative of the reconciliations that will be prepared upon completion of the periods covered by the non-GAAP guidance.
On November 25, 2024, we announced that we are pursuing a sale of our Off-Highway business. While the sale process continues to advance, there can be no assurance that it will result in a transaction. Our 2025 outlook includes a full twelve months of operations for our Off-Highway business.
Our 2025 sales outlook is $9,525 to $10,025, reflecting declining global market demand and currency headwinds, partially offset by $150 of net new business backlog. Based on our current sales and exchange rate outlook for 2025, we expect international currencies to be a modest headwind to sales primarily due to a weaker euro. At sales levels in our current outlook for 2025, a 5% movement on the euro would impact our annual sales by approximately $120. A 5% change on the Chinese renminbi, Indian rupee or Brazilian real rates would impact our annual sales in each of those countries by approximately $25. At our current sales outlook for 2025, we expect full year 2025 adjusted EBITDA to approximate $925 to $1,025. Adjusted EBITDA margin is expected to be 10.0% at the midpoint of our guidance range, a 140 basis-point improvement over 2024, reflecting the impact of significant cost savings actions and improved operational performance, partially offset by the impact of lower end-market demand and net material cost recoveries. With commodity costs continuing to abate during 2025, Adjusted EBITDA margin will be negatively impacted by net material cost recoveries on both a dollar and percentage basis. We expect to generate free cash flow of $225 at the midpoint of our guidance range reflecting the benefit of higher year-over-year adjusted EBITDA, lower capital spending and improved working capital efficiency.
Among our operational and strategic initiatives is continued focus on and investment in product technology - delivering products and technology that are key to bringing solutions to issues of paramount importance to our customers. Our success on this front is measured, in part, by our sales backlog - net new business awarded that will be launching over the next three years, adding to our base annual sales. This backlog excludes replacement business and represents incremental sales associated with new programs for which we have received formal customer awards. At December 31, 2024, our sales backlog of net new business for the 2025 through 2027 period was $650. We expect to realize $150 of our sales backlog in 2025, with incremental sales backlog of $300 and $200 being realized in 2026 and 2027, respectively. Our sales backlog is primarily attributable to our on-highway end markets.
Consolidated Results of Operations
Summary Consolidated Results of Operations (2024 versus 2023)
% of
% of
Increase/
Dollars
Net Sales
Dollars
Net Sales
(Decrease)
Net sales
$ 10,284
$ 10,555
$ (271 )
Cost of sales
9,408
91.5 %
9,655
91.5 %
(247 )
Gross margin
8.5 %
8.5 %
(24 )
Selling, general and administrative expenses
5.1 %
5.2 %
(25 )
Amortization of intangibles
-
Restructuring charges, net
Loss on disposal group previously held for sale
(26 )
(26 )
Other income (expense), net
(11 )
(14 )
Earnings before interest and income taxes
(90 )
Loss on extinguishment of debt
-
(1 )
Interest income
(2 )
Interest expense
Earnings before income taxes
(98 )
Income tax expense
Equity in earnings (loss) of affiliates
(9 )
Net income (loss)
(49 )
(97 )
Less: Noncontrolling interests net income
(1 )
Less: Redeemable noncontrolling interests net loss
(13 )
(12 )
(1 )
Net income (loss) attributable to the parent company
$ (57 )
$
$ (95 )
Sales - The following table shows changes in our sales by geographic region.
Amount of Change Due To
Increase/
Currency
Organic
(Decrease)
Effects
Divestiture
Change
North America
$ 4,970
$ 4,752
$
$ (4 )
$ (5 )
$
Europe
3,146
3,550
(404 )
(415 )
South America
(40 )
Asia Pacific
1,389
1,522
(133 )
(16 )
(117 )
Total
$ 10,284
$ 10,555
$ (271 )
$ (49 )
$ (5 )
$ (217 )
Sales in 2024 were $271 lower than in 2023. Weaker international currencies decreased sales by $49, principally due to a weaker Brazilian real, Chinese renminbi and Indian rupee, partially offset by a stronger euro. The organic sales decrease of $217, or 2%, resulted from declining global construction/mining and agricultural equipment markets, which were partially offset by having a full year of production on a full-frame light-truck customer program that launched and was ramping up production in the first quarter of last year and the conversion of sales backlog. Pricing actions and recoveries, including material commodity price and inflationary cost adjustments, increased sales by $94.
The North America organic sales increase of 5% was driven principally by having a full year of production on a full-frame light-truck customer program that launched and was ramping up production in the first quarter of last year, the conversion of sales backlog and net customer pricing and cost recovery actions. Excluding currency effects, sales in Europe were down 12% compared with 2023. With our significant Off-Highway presence in the region, weaker construction/mining and agricultural equipment markets were a major factor. Organic sales in this operating segment were down 13% compared with 2023. Excluding currency effects, sales in South America were up 12% compared with 2023, reflecting improved medium- and heavy-duty truck production volumes. Excluding currency effects, sales in Asia Pacific decreased 8% compared to 2023, reflecting lower electric vehicle related product sales.
Cost of sales and gross margin - Cost of sales for 2024 decreased $247, or 3%, when compared to 2023. Cost of sales as a percent of sales was flat with the previous year. Incremental margins resulting from higher material cost savings of $132, operational efficiencies of $72, lower premium freight costs of $32, lower incentive compensation expense of $16, lower commodity costs of $13, lower program launch costs of $9 and lower spending on electrification initiatives of $5 were offset by unfavorable product mix, non-material inflation of $165 and higher warranty expense of $5. Commodity costs are primarily driven by certain grades of steel and aluminum. Non-material inflation includes higher labor, energy and transportation rates.
Gross margin of $876 for 2024 decreased $24 from 2023. Gross margin as a percent of sales was 8.5% in both 2024 and 2023. The gross margin as a percent of sales was driven principally by the cost of sales factors referenced above. Material cost recovery mechanisms with our customers lag material cost changes by our suppliers by approximately 90 days. With commodity costs abating during 2024, gross margin was negatively impacted by net material cost recoveries on both a dollar and percentage basis. The recovery of non-material inflation is not specifically provided for in our current contracts with customers resulting in prolonged negotiations and indeterminate recoveries.
Selling, general and administrative expenses (SG&A) - SG&A expenses in 2024 were $524 (5.1% of sales) as compared to $549 (5.2% of sales) in 2023. SG&A expenses were $25 lower in 2024 due to lower incentive compensation and lower professional services and consulting costs, partially offset by increased information technology expenses.
Amortization of intangibles - Amortization expense was $13 in both 2024 and 2023. See Note 2 of our consolidated financial statements in Item 8 for additional information.
Restructuring charges, net - Net restructuring charges were $76 in 2024 and $25 in 2023. See Note 3 of our consolidated financial statements in Item 8 for additional information.
Loss on disposal group previously held for sale - In February 2024, we entered into a definitive agreement to sell our European hydraulics business to HPIH S.à r.l. We classified the disposal group as held for sale, recognizing a $26 loss to date to adjust the carrying value of net assets to fair value less estimated costs to sell. The transaction was not completed by the date set forth in the definitive agreement. The assets of the European hydraulics business are no longer held for sale and have been reclassified as held and used at the lower of their adjusted carrying value or fair value at the date the held for sale criteria was no longer met.
Other income (expense), net - The following table shows the major components of other income (expense), net.
Non-service cost components of pension and OPEB costs
$ (18 )
$ (13 )
Government assistance
Foreign exchange gain (loss)
(11 )
(13 )
Strategic transaction expenses
(9 )
(5 )
Loss on sale of property, plant and equipment
(6 )
(1 )
Other, net
Other income (expense), net
$ (11 )
$
We continue to account for Argentina as a highly inflationary economy and remeasure the financial statements of our Argentine subsidiaries as if their functional currency was the U.S. dollar. The foreign exchange loss in 2023 was primarily due to the Argentine government significantly devaluing the Argentine peso during the fourth quarter of 2023. Continued devaluation of the Argentine peso was the primary driver of the foreign exchange loss in 2024. Strategic transaction expenses relate primarily to costs incurred in connection with acquisition and divestiture related activities, including costs to complete the transaction and post-closing integration costs, and other strategic initiatives. Strategic transaction expenses in 2024 and 2023 were primarily attributable to investigating potential acquisitions and business ventures, divestitures and other strategic initiatives.
Loss on extinguishment of debt - On June 9, 2023 we redeemed $200 of our April 2025 Notes. The $1 loss on extinguishment of debt is comprised of the write-off of previously deferred financing costs associated with the April 2025 Notes. See Note 12 of our consolidated financial statements in Item 8 for additional information.
Interest income and interest expense - Interest income was $15 in 2024 and $17 in 2023. Interest expense increased from $154 in 2023 to $161 in 2024, due to higher average outstanding borrowings and higher average interest rates. Average effective interest rates, inclusive of amortization of debt issuance costs, approximated 5.9% in 2024 and 5.6% in 2023.
Income tax expense - Income tax expense was $139 in 2024 and $121 in 2023. During 2024, we recorded tax expense of $22 for valuation allowances related to foreign jurisdictions and tax expense of $11 due to revisions in our assertions on unremitted earnings in foreign jurisdictions. During 2023, we recorded tax expense of $19 for income tax reserves associated with prior tax years in foreign jurisdictions. In addition, we recorded net benefit of $55 on the intercompany sale of intangible assets to the U.S. See Note 16 to our consolidated financial statements in Item 8 for additional information.
Equity in earnings of affiliates - Net earnings (loss) from equity investments was earnings of $10 in 2024 and a loss of $9 in 2023. Net earnings (loss) from Dongfeng Dana Axle Co., Ltd. (DDAC) were earnings of $3 in 2024 and a loss of $16 in 2023. DDAC’s 2023 results were negatively impacted by valuation allowances being recorded against certain deferred tax assets.
Segment Results of Operations (2024 versus 2023)
Light Vehicle
Segment
Segment
EBITDA
Sales
EBITDA
Margin
$ 4,035
$
5.3 %
Volume and mix
Performance
Currency effects
(6 )
(2 )
$ 4,224
$
7.4 %
Light Vehicle sales in 2024, exclusive of currency effects, were 5% higher than 2023, reflecting a full year of production on a full-frame light-truck customer program that launched and was ramping up production in the first quarter of 2023, the conversion of sale backlog and the benefit of net customer pricing and cost recovery actions, partially offset by mixed global markets. Year-over-year North America full-frame light-truck production increased 1% while light-truck production in Europe decreased 2%. Year-over-year South America and Asia Pacific light-truck production increased 7% and 1%, respectively. Net customer pricing and cost recovery actions increased year-over-year sales by $90.
Light Vehicle segment EBITDA increased by $102 in 2024. Higher sales volumes provided a year-over-year earnings benefit of $16 (15% incremental margin). The year-over-year performance-related earnings increase was driven by net customer pricing and cost recovery actions of $90, operational efficiencies of $62, higher material cost savings of $50, lower premium freight costs of $16, lower program launch costs of $10, lower incentive compensation expense of $8 and commodity cost decreases of $2. Offsetting these performance-related earnings increases were inflationary cost increases of $134 and higher spending on electrification initiatives of $16.
Commercial Vehicle
Segment
Segment
EBITDA
Sales
EBITDA
Margin
$ 2,092
$
4.2 %
Volume and mix
(61 )
(53 )
Performance
Currency effects
(34 )
(3 )
$ 2,005
$
3.3 %
Commercial Vehicle sales in 2024, exclusive of currency effects, were 3% lower than 2023 reflecting mixed global markets being partially offset by the conversion of sales backlog and net customer pricing and cost recovery actions. Year-over-year Class 8 production in North America was down 3% while Classes 5-7 were up 4%. Year-over-year medium/heavy-truck production in Europe and Asia Pacific were down 23% and 5%, respectively, while medium/heavy-truck production in South America was up 41%. Net customer pricing and cost recovery actions increased year-over-year sales by $8.
Commercial Vehicle segment EBITDA decreased $20 in 2024. Lower sales volumes and unfavorable product mix decreased earnings by $53 (87% decremental margin). The year-over-year performance-related earnings increase was driven by higher material cost savings of $27, lower spending on electrification initiatives of $24, lower premium freight costs of $9, net customer pricing and cost recovery actions of $8, lower incentive compensation expense of $8 and commodity cost decreases of $2. Partially offsetting these performance-related earnings increases were inflationary cost increases of $19, operational inefficiencies of $16, higher warranty expense of $6 and higher program launch costs of $1.
Off-Highway
Segment
Segment
EBITDA
Sales
EBITDA
Margin
$ 3,185
$
14.6 %
Volume and mix
(387 )
(110 )
Divestiture
(5 )
Performance
(22 )
Currency effects
(4 )
(1 )
$ 2,767
$
15.1 %
Off-Highway sales in 2024, exclusive of currency and divestiture effects, were 13% lower than 2023 reflecting softening global markets and the impact of net customer pricing and cost recovery actions. Year-over-year global construction/mining equipment and agricultural equipment markets are softening, especially in Europe. Year-over-year construction/mining equipment and agricultural equipment production in Europe were down 12% and 24%, respectively. Net customer pricing and cost recovery actions decreased year-over-year sales by $22.
Off-Highway segment EBITDA decreased $46 in 2024. Lower sales volumes decreased year-over-year earnings by $110 (28% decremental margin). The year-over-year performance-related earnings increase was driven by operational efficiencies of $41, higher material costs savings of $33, commodity cost decreases of $13, lower premium freight costs of $6, lower incentive compensation of $5 and lower warranty expense of $2. Partially offsetting these performance-related earning increases were net customer pricing and cost recovery actions of $22, inflationary cost increases of $11 and higher program launch costs of $2.
Power Technologies
Segment
Segment
EBITDA
Sales
EBITDA
Margin
$ 1,243
$
7.2 %
Volume and mix
(12 )
Performance
Currency effects
(5 )
$ 1,288
$
7.1 %
Power Technologies primarily serves the light-vehicle market but also sells product to the medium/heavy-truck and off-highway markets. Power Technologies sales in 2024, exclusive of currency effects, were 4% higher than 2023, reflecting the conversion of sales backlog and the benefit of net customer pricing actions, partially offset by weaker global markets. Year-over-year light vehicle engine production in North America and Europe were down 1% and 5%, respectively. Net customer pricing and cost recovery actions increased year-over-year sales by $18.
Power Technologies segment EBITDA increased by $3 in 2024. The EBITDA benefit of higher sales volumes was offset by unfavorable product mix in 2024. The year-over-year performance-related earnings increase was driven by higher material cost savings of $22, net customer pricing and cost recovery actions of $18, lower incentive compensation expense of $5, lower program launch costs of $2, lower spending on electrification initiatives of $2 and lower premium freight costs of $1. These performance-related earnings increases were partially offset by operational inefficiencies of $18, inflationary cost increases of $12, commodity cost increases of $4 and higher warranty expense of $1.
Non-GAAP Financial Measures
Adjusted EBITDA
We have defined adjusted EBITDA as net income (loss) before interest, income taxes, depreciation, amortization, equity grant expense, restructuring expense, non-service cost components of pension and other postretirement benefits (OPEB) costs and other adjustments not related to our core operations (gain/loss on debt extinguishment, pension settlements, divestitures, impairment, etc.). Adjusted EBITDA is a measure of our ability to maintain and continue to invest in our operations and provide shareholder returns. We use adjusted EBITDA in assessing the effectiveness of our business strategies, evaluating and pricing potential acquisitions and as a factor in making incentive compensation decisions. In addition to its use by management, we also believe adjusted EBITDA is a measure widely used by securities analysts, investors and others to evaluate financial performance of our company relative to other Tier 1 automotive suppliers. Adjusted EBITDA should not be considered a substitute for earnings before income taxes, net income (loss) or other results reported in accordance with GAAP. Adjusted EBITDA may not be comparable to similarly titled measures reported by other companies.
The following table provides a reconciliation of net income (loss) to adjusted EBITDA.
Net income (loss)
$ (49 )
$
Equity in earnings (loss) of affiliates
(9 )
Income tax expense
Earnings before income taxes
Depreciation and amortization
Restructuring charges, net
Interest expense, net
Loss on extinguishment of debt
Supplier capacity charge
Distressed supplier costs
Loss on disposal group previously held for sale
Other*
Adjusted EBITDA
$
$
*
Other includes stock compensation expense, non-service cost components of pension and OPEB costs, strategic transaction expenses and other items. See Note 19 of our consolidated financial statements in Item 8 for additional details.
Free Cash Flow
We have defined free cash flow as cash provided by operating activities less purchases of property, plant and equipment. We believe free cash flow is useful to investors in evaluating the operational cash flow of the company inclusive of the spending required to maintain the operations. Free cash flow is not intended to represent nor be an alternative to the measure of net cash provided by operating activities reported in accordance with GAAP. Free cash flow may not be comparable to similarly titled measures reported by other companies.
The following table reconciles net cash flows provided by operating activities to free cash flow.
Net cash provided by operating activities
$
$
Purchases of property, plant and equipment
(380 )
(501 )
Free cash flow
$
$ (25 )
Liquidity
The following table provides a reconciliation of cash and cash equivalents to liquidity, a non-GAAP measure, at December 31, 2024:
Cash and cash equivalents
$
Additional cash availability from Revolving Facility
1,140
Total liquidity
$ 1,634
We had availability of $1,140 at December 31, 2024 under our Revolving Facility after deducting $10 of outstanding letters of credit.
The components of our December 31, 2024 consolidated cash balance were as follows:
U.S.
Non-U.S.
Total
Cash and cash equivalents
$ -
$
$
Cash and cash equivalents held at less than wholly-owned subsidiaries
Consolidated cash balance
$
$
$
A portion of the non-U.S. cash and cash equivalents is utilized for working capital and other operating purposes. Several countries have local regulatory requirements that restrict the ability of our operations to repatriate this cash. Beyond these restrictions, there are practical limitations on repatriation of cash from certain subsidiaries because of the resulting tax withholdings and subsidiary by-law restrictions which could limit our ability to access cash and other assets.
At December 31, 2024, we were in compliance with the covenants of our financing agreements. Under the Revolving Facility and our senior notes, we are required to comply with certain incurrence-based covenants customary for facilities of these types. The incurrence-based covenants in the Revolving Facility permit us to, among other things, (i) issue foreign subsidiary indebtedness, (ii) incur general secured indebtedness subject to a pro forma first lien net leverage ratio not to exceed 1.50:1.00 in the case of first lien debt and a pro forma secured net leverage ratio of 2.50:1.00 in the case of other secured debt and (iii) incur additional unsecured debt subject to a pro forma total net leverage ratio not to exceed 3.50:1.00, tested at the time of incurrence. We may also make dividend payments in respect of our common stock as well as certain investments and acquisitions subject to a pro forma total net leverage ratio of 2.75:1.00. In addition, the Revolving Facility is subject to a financial covenant requiring us to maintain a first lien net leverage ratio not to exceed 2.00:1.00. The indentures governing the senior notes include other incurrence-based covenants that may subject us to additional specified limitations.
From time to time, depending upon market, pricing and other conditions, as well as our cash balances and liquidity, we may seek to acquire our senior notes or other indebtedness or our common stock through open market purchases, privately negotiated transactions, tender offers, exchange offers or otherwise, upon such terms and at such prices as we may determine (or as may be provided for in the indentures governing the notes), for cash, securities or other consideration. In addition, we may enter into sale-leaseback transactions related to certain of our real estate holdings and factor receivables. There can be no assurance that we will pursue any such transactions in the future, as the pursuit of any alternative will depend upon numerous factors such as market conditions, our financial performance and the limitations applicable to such transactions under our financing and governance documents.
The principal sources of liquidity available for our future cash requirements are expected to be (i) cash flows from operations, (ii) cash and cash equivalents on hand and (iii) borrowings from our Revolving Facility. We believe that our overall liquidity and operating cash flow will be sufficient to meet our anticipated cash requirements for capital expenditures, working capital, debt obligations and other commitments during the next twelve months. While uncertainty surrounding the current economic environment could adversely impact our business, based on our current financial position, we believe it is unlikely that any such effects would preclude us from maintaining sufficient liquidity.
In November 2024, we announced we are exploring the divestiture of our Off-Highway business. We expect that a portion of any cash proceeds received from a sale transaction would be used to repay or redeem a portion of our outstanding indebtedness.
Cash Flow
Cash provided by changes in working capital
$
$
Other cash provided by operations
Net cash provided by operating activities
Net cash used in investing activities
(352 )
(528 )
Net cash provided by (used in) financing activities
(90 )
Net increase in cash, cash equivalents and restricted cash
$
$
The table above summarizes our consolidated statement of cash flows.
Operating activities - Exclusive of working capital, other cash provided by operations was $423 in 2024 and $406 in 2023. The year-over-year increase is primarily attributable to the impact of higher year-over-year operating earnings and lower year-over-year cash payments made to a distressed supplier, partially offset by higher year-over-year cash paid for interest, income taxes and restructuring activities.
Working capital provided cash of $27 in 2024 and $70 in 2023. Cash of $94 and $12 was provided by receivables in 2024 and 2023, respectively. Cash of $55 was provided by lower inventory levels in 2024 while cash of $42 was used to fund higher inventory levels during 2023. Decreases in accounts payable and other net liabilities used cash of $122 in 2024 while increases in accounts payable and other net liabilities provided cash of $100 in 2023.
Investing activities - Expenditures for property plant and equipment were $380 and $501 in 2024 and 2023. Elevated capital spending in 2023 was driven by the high volume of new program launches in that year.
Financing activities - During 2023, we made net repayments of $25 on our Revolving Facility. During 2023, we completed the issuance of €425 of our July 2031 Notes, paying financings costs of $7. Also during 2023, we redeemed $200 of our April 2025 Notes. During 2023, we paid financing costs of $2 to amend our credit and guaranty agreement, extending the Revolving Facility maturity to March 14, 2028. We used cash of $58 in both 2024 and 2023 for dividend payments to common stockholders. Distributions to noncontrolling interests totaled $20 in 2024 and $10 in 2023. Hydro-Québec made cash contributions to Dana TM4 of $18 in 2024 and $22 in 2023. During 2024, we received $11 from Hydro-Québec, which represents deferred purchase consideration associated with their acquisition of a 45% ownership interest in SME S.p.A. from Dana.
Off-Balance Sheet Arrangements
In connection with the divestiture of our Structural Products business in 2010, leases covering three U.S. facilities were assigned to a U.S. affiliate of the new owner, Metalsa S.A. de C.V. (Metalsa). Under the terms of the sale agreement, we guarantee the affiliate’s performance under the leases, which run through June 2025, including approximately $6 of annual payments. In the event of a required payment by Dana as guarantor, we are entitled to pursue full recovery from Metalsa of the amounts paid under the guarantee and to take possession of the leased property.
Contractual Obligations
We are obligated to make future cash payments in fixed amounts under various agreements. The following table summarizes our significant contractual obligations as of December 31, 2024.
Payments Due by Period
Contractual Cash Obligations
Total
2026 - 2027
2028 - 2029
After 2029
Long-term debt(1)
$ 2,529
$
$
$
$ 1,191
Interest payments(2)
Operating leases(3)
Financing leases(4)
Unconditional purchase obligations(5)
Pension contribution(6)
Retiree health care benefits(7)
Uncertain income tax positions(8)
-
Total contractual cash obligations
$ 4,282
$
$
$ 1,041
$ 1,599
______________________________________________________
Notes:
(1)
Principal payments on long-term debt.
(2)
Interest payments are based on long-term debt in place at December 31, 2024 and the interest rates applicable to such obligations.
(3)
Operating lease obligations, including interest, related to real estate, manufacturing and material handling equipment, vehicles and other assets.
(4)
Finance lease obligations, including interest, related to real estate and manufacturing and material handling equipment. Excluded from this table are $52 of undiscounted minimum lease payments for leases that have not yet commenced. See Note 6 of our consolidated financial statements in Item 8 for additional discussion.
(5)
Unconditional purchase obligations are comprised of commitments for the procurement of fixed assets, the purchase of raw materials and the fulfillment of other contractual obligations.
(6)
This amount represents estimated 2025 minimum required contributions to our global defined benefit pension plans. We have not estimated pension contributions beyond 2025 due to the significant impact that return on plan assets and changes in discount rates might have on such amounts.
(7)
This amount represents estimated payments under our retiree health care programs. Obligations under the retiree health care programs are not fixed commitments and will vary depending on various factors, including the level of participant utilization and inflation. Our estimates of the payments to be made in the future consider recent payment trends and certain of our actuarial assumptions.
(8)
We are not able to reasonably estimate the timing of payments related to uncertain tax positions because the timing of settlement is uncertain. The above table does not reflect unrecognized tax benefits at December 31, 2024 of $112. See Note 16 of our consolidated financial statements in Item 8 for additional discussion.
Contingencies
For a summary of litigation and other contingencies, see Note 14 of our consolidated financial statements in Item 8. Based on information available to us at the present time, we do not believe that any liabilities beyond the amounts already accrued that may result from these contingencies will have a material adverse effect on our liquidity, financial condition or results of operations.
Critical Accounting Estimates
The preparation of our consolidated financial statements in accordance with GAAP requires us to use estimates and make judgments and assumptions about future events that affect the reported amounts of assets, liabilities, revenue, expenses and the related disclosures. Considerable judgment is often involved in making these determinations. Critical estimates are those that require the most difficult, subjective or complex judgments in the preparation of the financial statements and the accompanying notes. We evaluate these estimates and judgments on a regular basis. We believe our assumptions and estimates are reasonable and appropriate. However, the use of different assumptions could result in significantly different results and actual results could differ from those estimates. The following discussion of accounting estimates is intended to supplement the Summary of Significant Accounting Policies presented as Note 1 of our consolidated financial statements in Item 8.
Income taxes - Accounting for income taxes is complex, in part because we conduct business globally and therefore file income tax returns in numerous tax jurisdictions. Significant judgment is required in determining the income tax provision, uncertain tax positions, deferred tax assets and liabilities and the valuation allowances recorded against our net deferred tax assets. A valuation allowance is provided when, in our judgment based upon available information, it is more likely than not that a portion of such deferred tax assets will not be realized. To make this assessment, we consider the historical and projected future taxable income or loss by tax jurisdiction. We consider all components of comprehensive income and weigh the positive and negative evidence, putting greater reliance on objectively verifiable historical evidence than on projections of future profitability that are dependent on actions that have not taken place as of the assessment date. We also consider changes to historical profitability of actions that occurred through the date of assessment and objectively verifiable effects of material forecasted events that would have a sustained effect on future profitability, as well as the effect on historical profits of nonrecurring events. We also incorporate the changes to historical and prospective income from tax planning strategies that are prudent and feasible.
In the ordinary course of business, there are many transactions and calculations where the ultimate tax determination is less than certain. We are regularly under audit by the various applicable tax authorities. Although the outcome of tax audits is always uncertain, we believe that we have appropriate support for the positions taken on our tax returns and that our annual tax provisions include amounts sufficient to pay assessments, if any, upon final determination by the taxing authorities. Nonetheless, the amounts ultimately paid, if any, upon resolution of the issues raised by the taxing authorities may differ materially from the amounts accrued for each year. See additional discussion of our deferred tax assets and liabilities in Note 16 of our consolidated financial statements in Item 8.
Retiree benefits - Accounting for pension benefits and other postretirement benefits (OPEB) involves estimating the cost of benefits to be provided well into the future and generally attributing that cost to the time period each employee works. These plan expenses and obligations are dependent on assumptions developed by us in consultation with our outside advisers such as actuaries and other consultants and are generally calculated independently of funding requirements. The assumptions used, including inflation, discount rates, investment returns, mortality rates, turnover rates, retirement rates, future compensation levels and health care cost trend rates, have a significant impact on plan expenses and obligations. These assumptions are regularly reviewed and modified when appropriate based on historical experience, current trends and future outlook. Changes in one or more of the underlying assumptions could result in a material impact to our consolidated financial statements in any given period. If actual experience differs from expectations, our financial position and results of operations in future periods could be affected.
Mortality rates are based in part on the company's plan experience and actuarial estimates. The inflation assumption is based on an evaluation of external market indicators, while retirement and turnover rates are based primarily on actual plan experience. Health care cost trend rates are developed based on our actual historical claims experience, the near-term outlook and an assessment of likely long-term trends. For our largest plans, discount rates are based upon the construction of a yield curve which is developed based on a subset of high-quality fixed-income investments (those with yields between the 40th and 90th percentiles). The projected cash flows are matched to this yield curve and a present value developed which is then calibrated to develop a single equivalent discount rate. Pension benefits are funded through deposits with trustees that satisfy, at a minimum, the applicable funding regulations. For our largest defined benefit pension plans, expected investment rates of return are based on input from the plans’ investment advisers regarding our expected investment portfolio mix, historical rates of return on those assets, projected future asset class returns, the impact of active management and long-term market conditions and inflation expectations. We believe that the long-term asset allocation on average will approximate the targeted allocation and we regularly review the actual asset allocation to periodically re-balance the investments to the targeted allocation when appropriate. OPEB and the majority of our non-U.S. pension benefits are funded as they become due.
Actuarial gains or losses may result from changes in assumptions or when actual experience is different from that which was expected. Under the applicable standards, those gains and losses are not required to be immediately recognized in our results of operations as income or expense, but instead are deferred as part of AOCI and amortized into our results of operations over future periods.
U.S. retirement plans - Our U.S. defined benefit pension plans comprise 63% of our consolidated defined benefit pension obligations at December 31, 2024. These plans are frozen and no service-related costs are being incurred. Changes in our net obligations are principally attributable to changing discount rates and the performance of plan assets.
Rising discount rates decrease the present value of future pension obligations - a 25 basis point increase in the discount rate would decrease our U.S. pension liability by about $10. As indicated above, when establishing the expected long-term rate of return on our U.S. pension plan assets, we consider historical performance and forward looking return estimates reflective of our portfolio mix and investment strategy. Based on the most recent analysis of projected portfolio returns, we concluded that the use of a 6.00% expected return in 2025 is appropriate for our U.S. pension plans. See Note 11 to our consolidated financial statements in Item 8 for information about the investing and allocation objectives related to our U.S. pension plan assets.
We use a full yield curve approach to estimate the service (where applicable) and interest components of the annual cost of our pension and other postretirement benefit plans. This method estimates interest and service expense using the specific spot rates, from the yield curve, that relate to projected cash flows. We believe this method is a more precise measurement of interest and service costs by improving the correlation between the projected cash flows and the corresponding interest rates. The determination of the projected benefit obligation at year end is unchanged.
At December 31, 2024, we have $135 of unrecognized losses relating to our U.S. pension plans. Actuarial gains and losses, which are primarily the result of changes in the discount rate and other assumptions and differences between actual and expected asset returns, are deferred in AOCI and amortized to expense following the corridor approach. We use the average remaining service period of active participants unless almost all of the plan’s participants are inactive, in which case we use the average remaining life expectancy of inactive participants.
Based on the current funded status of our U.S. plans, we expect to make contributions of $5 during 2025.
See Note 11 of our consolidated financial statements in Item 8 for additional discussion of our pension and OPEB obligations.
Acquisitions - From time to time, we make strategic acquisitions that have a material impact on our consolidated results of operations or financial position. We allocate the purchase price of acquired businesses to the identifiable tangible and intangible assets acquired, liabilities assumed and any redeemable noncontrolling interests or noncontrolling interests based upon their estimated fair values as of the acquisition date. We determine the estimated fair values using information available to us and engage independent third-party valuation specialists when necessary. Estimating fair values can be complex and subject to significant business judgment. We believe the assumptions and estimates we have made in the past have been reasonable and appropriate, they were based, in part, on historical experience and information obtained from management of the acquired companies and were inherently uncertain. Critical estimates in valuing certain of the intangible assets we have acquired included, but were not limited to, future expected cash flows from product sales, customer contracts and acquired technologies, and discount rates. The discount rates used to discount expected future cash flows to present value were typically derived from a weighted-average cost of capital analysis and adjusted to reflect inherent risks. Unanticipated events and circumstances may occur that could affect either the accuracy or validity of such assumptions, estimates or actual results. Generally, we have, if necessary, up to one year from the acquisition date to finalize our estimates of acquisition date fair values.
Redeemable noncontrolling interests - Redeemable noncontrolling interests reflected as of the balance sheet date are the greater of the redeemable noncontrolling interest balances adjusted for comprehensive income items and distributions or the redemption values. Redeemable noncontrolling interest adjustments of redemption value are recorded in retained earnings. We estimate the fair value of the redemption value using an income based approach based on discounted cash flow projections. In determining fair value using discounted cash flow projections, we make significant assumptions and estimates about the extent and timing of future cash flows, including revenue growth rates, projected EBITDA, discount rate, capital expenditures and terminal growth rate. See additional discussion of redeemable noncontrolling interests in Note 8 of our consolidated financial statements in Item 8.
Goodwill and other indefinite-lived intangible assets - Our goodwill and other indefinite-lived intangible assets are tested for impairment annually as of October 31 for all of our reporting units, and more frequently if events or circumstances warrant such a review. We make significant assumptions and estimates about the extent and timing of future cash flows, including revenue growth rates, projected gross margins, discount rates, and exit earnings multiples. The cash flows are estimated over a significant future period of time, which makes those estimates and assumptions subject to a high degree of uncertainty. Our utilization of market valuation models requires us to make certain assumptions and estimates regarding the applicability of those models to our assets and businesses. We use our internal forecasts, which we update quarterly, to make our cash flow projections. These forecasts are based on our knowledge of our customers’ production forecasts, our assessment of market growth rates, net new business, material and labor cost estimates, cost recovery agreements with customers and our estimate of savings expected from our restructuring activities.
The most likely factors that would significantly impact our forecasts are changes in customer production levels and loss of significant portions of our business. We believe that the assumptions and estimates used in the assessment of the goodwill and other indefinite-lived intangible assets as of October 31, 2024 were reasonable.
Long-lived assets with definite lives - We perform impairment assessments on our property, plant and equipment and our definite-lived intangible assets whenever events and circumstances indicate that the carrying amounts of the assets may not be recoverable. When indications are present, we compare the estimated future undiscounted net cash flows of the operations to which the assets relate to the carrying amounts of such assets. We utilize the cash flow projections discussed above for property, plant and equipment and amortizable intangibles. We group the assets and liabilities at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities and evaluate the asset group against the undiscounted future cash flows using the life of the primary assets. If the carrying amounts of the long-lived assets are not recoverable from future cash flows and exceed their fair value, an impairment loss is recognized to reduce the carrying amounts of the long-lived assets to their fair value. Fair value is determined based on discounted cash flows, third-party appraisals or other methods that provide appropriate estimates of value. Determining whether a triggering event has occurred, performing the impairment analysis and estimating the fair value of the assets require numerous assumptions and a considerable amount of management judgment.
Investments in affiliates - We had aggregate investments in affiliates of $126 at December 31, 2024 and $123 at December 31, 2023. We monitor our investments in affiliates for indicators of other-than-temporary declines in value on an ongoing basis in accordance with GAAP. If we determine that an other-than-temporary decline in value has occurred, we recognize an impairment loss, which is measured as the difference between the recorded carrying value and the fair value of the investment. Fair value is generally determined using the discounted cash flows (an income approach) or guideline public company (a market approach) methods.
Warranty - Costs related to product warranty obligations are estimated and accrued at the time of sale with a charge against cost of sales. Warranty accruals are evaluated and adjusted as appropriate based on occurrences giving rise to potential warranty exposure and associated experience. Warranty accruals and adjustments require significant judgment, including a determination of our involvement in the matter giving rise to the potential warranty issue or claim, our contractual requirements, estimates of units requiring repair and estimates of repair costs. If actual experience differs from expectations, our financial position and results of operations in future periods could be affected.
Contingency reserves - We have numerous other loss exposures, such as product liability, environmental liability and matters involving litigation. Establishing loss reserves for these matters requires the use of estimates and judgment regarding risk of exposure and ultimate liability. Product liability claims are generally estimated based on historical experience and the estimated costs associated with specific events giving rise to potential field campaigns or recalls. We consider the most probable method of remediation, current laws and regulations and existing technology in estimating our environmental liabilities. In the case of legal contingencies, estimates are made of the likely outcome of legal proceedings and potential exposure where reasonably determinable based on the information presently known to us. New information and other developments in these matters could materially affect our recorded liabilities.

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ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Item 7A. Quantitative and Qualitative Disclosures about Market Risk
We are exposed to fluctuations in foreign currency exchange rates, commodity prices for products we use in our manufacturing and interest rates. To reduce our exposure to these risks, we maintain risk management controls to monitor these risks and take appropriate actions to attempt to mitigate such forms of market risks.
Foreign currency exchange rate risk - Our foreign currency exposures are primarily associated with intercompany and third party sales and purchase transactions, cross-currency intercompany loans and external debt. We use forward contracts to manage our foreign currency exchange rate risk associated with a portion of our forecasted foreign currency-denominated sales and purchase transactions and with certain foreign currency-denominated assets and liabilities. We also use currency swaps, including fixed-to-fixed cross-currency interest rate swaps, to manage foreign currency exchange rate risk associated with our intercompany loans and external debt. Foreign currency exposures are reviewed quarterly, at a minimum, and natural offsets are considered prior to entering into derivative instruments.
Changes in the fair value of derivative instruments treated as cash flow hedges are reported in other comprehensive income (loss) (OCI). Deferred gains and losses are reclassified to earnings in the same period in which the underlying transactions affect earnings. Specifically, with respect to the cross-currency interest rate swap, to the extent we recognize an exchange gain or loss on the underlying external debt, we reclassify an offsetting portion from OCI to earnings in the same period.
Changes in the fair value of derivative instruments not treated as cash flow hedges are recognized in earnings in the period in which those changes occur. Changes in the fair value of derivative instruments associated with product-related transactions are recorded in cost of sales, while those associated with non-product transactions are recorded in other income (expense), net. See Note 13 of our consolidated financial statements in Item 8.
The following table summarizes the sensitivity of the fair value of our derivative instruments, including forward contracts and currency swaps, at December 31, 2024 to a 10% change in foreign exchange rates.
10% Increase
10% Decrease
in Rates
in Rates
Gain (Loss)
Gain (Loss)
Foreign currency rate sensitivity:
Currency swaps
$ (60 )
$
Forward contracts
$ (54 )
$
At December 31, 2024, of the $2,282 total notional amount of foreign currency derivatives, approximately 42% represents the aggregate of fixed-to-fixed cross-currency interest rate swaps while the remaining 58% primarily represents forward contracts associated with our forecasted foreign currency-denominated sales, purchase transactions and hedges of inter-company loans that are not deemed to be permanent in nature.
To manage our global liquidity objectives, we periodically execute intercompany loans, some of which are foreign currency-denominated. With respect to such intercompany loans, the total notional amount outstanding at December 31, 2024 is approximately $1,070. Depending on the specific objective of each intercompany loan arrangement, certain intercompany loans may be hedged while others remain unhedged for strategic reasons. The decision to hedge the loan, to designate the loan itself as a hedge or not to hedge the loan is dependent on management's underlying strategy. Of the approximately $1,070 of foreign currency-denominated intercompany loans outstanding at December 31, 2024, $288, or 27%, has been hedged by one of our fixed-to-fixed cross-currency swaps whereby we have protected the income statement from exchange rate risk. Of the remaining 73% of such outstanding intercompany loans, $386 has been hedged by foreign currency forwards and the remaining balances have not been hedged.
To align our cash requirements with availability by currency, we also periodically issue external debt that is denominated in a currency other than the functional currency of the issuing entity. As of December 31, 2024, we had $200 of external U.S. dollar debt, issued by a euro-functional entity, all of which has been hedged by our fixed-to-fixed cross-currency interest rate swaps. Such swaps are treated as cash flow hedges whereby the changes in fair value are recorded in OCI to the extent the hedges remain effective.
Commodity price risk - We do not utilize derivative contracts to manage commodity price risk. Our overall strategy is to pass through commodity risk to our customers in our pricing agreements. A substantial portion of our customer agreements include contractual provisions for the pass-through of commodity price movements. In instances where the risk is not covered contractually, we have generally been able to adjust customer pricing to recover commodity cost increases.

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ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
Item 8. Financial Statements and Supplementary Data
Report of Independent Registered Public Accounting Firm
To the Board of Directors and Stockholders of Dana Incorporated
Opinions on the Financial Statements and Internal Control over Financial Reporting
We have audited the accompanying consolidated balance sheets of Dana Incorporated and its subsidiaries (the “Company”) as of December 31, 2024 and 2023, and the related consolidated statements of operations, of comprehensive income, of stockholders’ equity and of cash flows for each of the three years in the period ended December 31, 2024, including the related notes and schedule of valuation and qualifying accounts and reserves for each of the three years in the period ended December 31, 2024 appearing under Item 8 (collectively referred to as the “consolidated financial statements”). We also have audited the Company's internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2024 in conformity with accounting principles generally accepted in the United States of America. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control - Integrated Framework (2013) issued by the COSO.
Basis for Opinions
The Company's management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in Management’s Report on Internal Control over Financial Reporting appearing under Item 9A. Our responsibility is to express opinions on the Company’s consolidated financial statements and on the Company's internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.
Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.
Definition and Limitations of Internal Control over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Critical Audit Matters
The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that (i) relates to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
Fair Value of Redeemable Noncontrolling Interests
As described in Note 8 to the consolidated financial statements, Hydro-Québec owns a 45% redeemable noncontrolling interest in Dana TM4 Inc., Dana TM4 Electric Holdings BV, and Dana TM4 USA, LLC. The terms of the joint venture agreement provide Hydro-Québec with the right to put all, and not less than all, of its ownership interests in Dana TM4 Inc., Dana TM4 Electric Holdings BV, and Dana TM4 USA, LLC to the Company at fair value. Redeemable noncontrolling interests reflected as of the balance sheet date are the greater of the redeemable noncontrolling interest balances adjusted for comprehensive income (loss) items and distributions or the redemption values. Management estimates the fair value of the redemption value using an income based approach based on discounted cash flow projections. In determining the fair value using discounted cash flow projections, management makes significant assumptions and estimates about the extent and timing of future cash flows, including revenue growth rates, projected EBITDA, discount rate, capital expenditures and terminal growth rate. The fair value of the redeemable noncontrolling interests was $189 million as of December 31, 2024.
The principal considerations for our determination that performing procedures relating to the fair value of redeemable noncontrolling interests is a critical audit matter are (i) the significant judgment by management when developing the fair value estimate of the redeemable noncontrolling interests; (ii) a high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating management’s significant assumptions related to revenue growth rates, projected EBITDA, discount rate, capital expenditures, and terminal growth rate; and (iii) the audit effort involved the use of professionals with specialized skill and knowledge.
Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included testing the effectiveness of controls relating to management’s fair value estimate of redeemable noncontrolling interests, including controls over management’s development of significant assumptions. These procedures also included, among others (i) testing management’s process for developing the fair value estimate of the redeemable noncontrolling interests; (ii) evaluating the appropriateness of the discounted cash flow model used by management; (iii) testing the completeness and accuracy of underlying data used in the discounted cash flow model; and (iv) evaluating the reasonableness of the significant assumptions used by management related to revenue growth rates, projected EBITDA, discount rate, capital expenditures, and terminal growth rate. Evaluating management’s assumptions related to revenue growth rates, projected EBITDA, and capital expenditures involved evaluating whether the assumptions used by management were reasonable considering (i) the current and past performance of the underlying operating entity; (ii) the consistency with external market and industry data; and (iii) whether the assumptions were consistent with evidence obtained in other areas of the audit. Professionals with specialized skill and knowledge were used to assist in evaluating (i) the appropriateness of the discounted cash flow model and (ii) the reasonableness of the discount rate and terminal growth rate assumptions.
/s/ PricewaterhouseCoopers LLP
Toledo, Ohio
February 20, 2025
We have served as the Company’s auditor since 1916.
Dana Incorporated
Consolidated Statement of Operations
(In millions, except per share amounts)
Net sales
$ 10,284 $ 10,555 $ 10,156
Costs and expenses
Cost of sales
9,408 9,655 9,393
Selling, general and administrative expenses
524 549 495
Amortization of intangibles
13 13 14
Restructuring charges, net
76 25 (1 )
Loss on disposal group previously held for sale
(26 )
Impairment of goodwill
(191 )
Other income (expense), net
(11 ) 3 22
Earnings before interest and income taxes
226 316 86
Loss on extinguishment of debt
(1 )
Interest income
15 17 11
Interest expense
161 154 128
Earnings (loss) before income taxes
80 178 (31 )
Income tax expense
139 121 284
Equity in earnings (loss) of affiliates
10 (9 ) 4
Net income (loss)
(49 ) 48 (311 )
Less: Noncontrolling interests net income
21 22 15
Less: Redeemable noncontrolling interests net loss
(13 ) (12 ) (84 )
Net income (loss) attributable to the parent company
$ (57 ) $ 38 $ (242 )
Net income (loss) per share available to common stockholders
Basic
$ (0.39 ) $ 0.26 $ (1.69 )
Diluted
$ (0.39 ) $ 0.26 $ (1.69 )
Weighted-average common shares outstanding
Basic
145.2 144.4 143.6
Diluted
145.2 144.6 143.6
The accompanying notes are an integral part of the consolidated financial statements.
Dana Incorporated
Consolidated Statement of Comprehensive Income
(In millions)
Net income (loss)
$ (49 ) $ 48 $ (311 )
Other comprehensive income (loss), net of tax:
Currency translation adjustments
(117 ) 30 (102 )
Hedging gains and losses
(49 ) (1 ) 17
Defined benefit plans
8 (16 ) 53
Other comprehensive income (loss)
(158 ) 13 (32 )
Total comprehensive income (loss)
(207 ) 61 (343 )
Less: Comprehensive income attributable to noncontrolling interests
(18 ) (22 ) (10 )
Less: Comprehensive loss attributable to redeemable noncontrolling interests
16 10 95
Comprehensive income (loss) attributable to the parent company
$ (209 ) $ 49 $ (258 )
The accompanying notes are an integral part of the consolidated financial statements.
Dana Incorporated
Consolidated Balance Sheet
(In millions, except share and per share amounts)
Assets
Current assets
Cash and cash equivalents
$ 494 $ 529
Accounts receivable
Trade, less allowance for doubtful accounts of $15 in 2024 and $16 in 2023
1,195 1,371
Other
261 280
Inventories
1,547 1,676
Other current assets
206 247
Total current assets
3,703 4,103
Goodwill
250 263
Intangibles
150 182
Deferred tax assets
560 516
Other noncurrent assets
189 140
Investments in affiliates
126 123
Operating lease assets
293 327
Property, plant and equipment, net
2,214 2,311
Total assets
$ 7,485 $ 7,965
Liabilities, redeemable noncontrolling interests and equity
Current liabilities
Short-term debt
$ 8 $ 22
Current portion of long-term debt
214 35
Accounts payable
1,522 1,756
Accrued payroll and employee benefits
236 288
Taxes on income
69 86
Current portion of operating lease liabilities
44 42
Other accrued liabilities
468 373
Total current liabilities
2,561 2,602
Long-term debt, less debt issuance costs of $19 in 2024 and $24 in 2023
2,389 2,598
Noncurrent operating lease liabilities
258 284
Pension and postretirement obligations
295 334
Other noncurrent liabilities
397 319
Total liabilities
5,900 6,137
Commitments and contingencies (Note 14)
Redeemable noncontrolling interests
189 191
Parent company stockholders' equity
Preferred stock, 50,000,000 shares authorized, $0.01 par value, no shares outstanding
- -
Common stock, 450,000,000 shares authorized, $0.01 par value, 144,993,614 and 144,386,484 shares outstanding
2 2
Additional paid-in capital
2,282 2,255
Retained earnings
204 317
Treasury stock, at cost (837,803 and 474,981 shares)
(13 ) (9 )
Accumulated other comprehensive loss
(1,142 ) (990 )
Total parent company stockholders' equity
1,333 1,575
Noncontrolling interests
63 62
Total equity
1,396 1,637
Total liabilities, redeemable noncontrolling interests and equity
$ 7,485 $ 7,965
The accompanying notes are an integral part of the consolidated financial statements.
Dana Incorporated
Consolidated Statement of Cash Flows
(In millions)
Operating activities
Net income (loss)
$ (49 ) $ 48 $ (311 )
Depreciation
401 393 365
Amortization
21 23 23
Amortization of deferred financing charges
6 5 5
Write-off of deferred financing costs
Earnings of affiliates, net of dividends received
(7 ) 11 23
Stock compensation expense
30 26 19
Deferred income taxes
(29 ) (104 ) 153
Pension expense, net
1 3 (1 )
Impairment of goodwill
Change in working capital
27 70 199
Loss on disposal group previously held for sale
Change in other noncurrent assets and liabilities
25 11 9
Other, net
(2 ) (11 ) (26 )
Net cash provided by operating activities
450 476 649
Investing activities
Purchases of property, plant and equipment
(380 ) (501 ) (440 )
Proceeds from sale of property, plant and equipment
11 2 3
Purchases of marketable securities
(15 )
Proceeds from maturities of marketable securities
Settlements of undesignated derivatives
(5 ) (13 ) (8 )
Other, net
22 (16 ) 4
Net cash used in investing activities
(352 ) (528 ) (426 )
Financing activities
Net change in short-term debt
(14 ) (30 ) 33
Proceeds from long-term debt
1 458 2
Repayment of long-term debt
(37 ) (209 ) (24 )
Deferred financing payments
(9 )
Dividends paid to common stockholders
(58 ) (58 ) (58 )
Repurchases of common stock
(25 )
Distributions to noncontrolling interests
(20 ) (10 ) (9 )
Collection of note receivable from redeemable noncontrolling interest
Contributions from redeemable noncontrolling interests
18 22 51
Payments to acquire noncontrolling interests
(4 )
Other, net
9 (4 ) (8 )
Net cash provided by (used in) financing activities
(90 ) 160 (42 )
Net increase in cash, cash equivalents and restricted cash
8 108 181
Cash, cash equivalents and restricted cash - beginning of period
563 442 287
Effect of exchange rate changes on cash balances
(59 ) 13 (26 )
Cash, cash equivalents and restricted cash - end of period
$ 512 $ 563 $ 442
The accompanying notes are an integral part of the consolidated financial statements.
Dana Incorporated
Consolidated Statement of Stockholders’ Equity
(In millions)
Parent Company Stockholders'
Accumulated
Parent
Additional
Other
Company
Non-
Preferred
Common
Paid-In
Retained
Treasury
Comprehensive
Stockholders'
controlling
Total
Stock
Stock
Capital
Earnings
Stock
Loss
Equity
Interests
Equity
Balance, December 31, 2021
$ - $ 2 $ 2,427 $ 662 $ (184 ) $ (985 ) $ 1,922 $ 53 $ 1,975
Net income (loss)
(242 ) (242 ) 15 (227 )
Other comprehensive loss
(16 ) (16 ) (5 ) (21 )
Common stock dividends and dividend equivalents ($0.40 per share)
1 (58 ) (57 ) (57 )
Common stock share repurchases
(25 ) (25 ) (25 )
Retirement of treasury shares
(216 ) 216 - -
Distributions to noncontrolling interests
- (9 ) (9 )
Purchase of noncontrolling interests
- (2 ) (2 )
Redeemable noncontrolling interests adjustment to redemption value
(41 ) (41 ) (41 )
Stock compensation
17 17 17
Stock withheld for employees taxes
(7 ) (7 ) (7 )
Balance, December 31, 2022
- 2 2,229 321 - (1,001 ) 1,551 52 1,603
Net income
38 38 22 60
Other comprehensive income
11 11 11
Common stock dividends and dividend equivalents ($0.40 per share)
(58 ) (58 ) (58 )
Distributions to noncontrolling interests
- (12 ) (12 )
Redeemable noncontrolling interests adjustment to redemption value
16 16 16
Stock compensation
26 26 26
Stock withheld for employees taxes
(9 ) (9 ) (9 )
Balance, December 31, 2023
- 2 2,255 317 (9 ) (990 ) 1,575 62 1,637
Net income (loss)
(57 ) (57 ) 21 (36 )
Other comprehensive loss
(152 ) (152 ) (3 ) (155 )
Common stock dividends and dividend equivalents ($0.40 per share)
(60 ) (60 ) (60 )
Distributions to noncontrolling interests
- (17 ) (17 )
Redeemable noncontrolling interests adjustment to redemption value
4 4 4
Stock compensation
27 27 27
Stock withheld for employees taxes
(4 ) (4 ) (4 )
Balance, December 31, 2024
$ - $ 2 $ 2,282 $ 204 $ (13 ) $ (1,142 ) $ 1,333 $ 63 $ 1,396
The accompanying notes are an integral part of the consolidated financial statements.
Dana Incorporated
Index to Notes to the Consolidated
Financial Statements
Page
1.
Organization and Summary of Significant Accounting Policies
2.
Goodwill and Other Intangible Assets
3.
Restructuring of Operations
4.
Inventories
5.
Supplemental Balance Sheet and Cash Flow Information
6.
Leases
7.
Stockholders' Equity
8.
Redeemable Noncontrolling Interests
9.
Earnings per Share
10.
Stock Compensation
11.
Pension and Postretirement Benefit Plans
12.
Financing Agreements
13.
Fair Value Measurements and Derivatives
14.
Commitments and Contingencies
15.
Warranty Obligations
16.
Income Taxes
17.
Other Income (Expense), Net
18.
Revenue from Contracts with Customers
19.
Segments, Geographical Area and Major Customer Information
20.
Equity Affiliates
Notes to the Consolidated Financial Statements
(In millions, except share and per share amounts)
Note 1. Organization and Summary of Significant Accounting Policies
General
Dana Incorporated (Dana) is headquartered in Maumee, Ohio, and was incorporated in Delaware in 2007. As a global provider of high technology driveline (axles, driveshafts and transmissions); sealing and thermal-management products; and motors, power inverters, and control systems for electric vehicles, our customer base includes virtually every major vehicle manufacturer in the global light vehicle, medium/heavy vehicle, and off-highway markets.
The terms "Dana," "we," "our" and "us," when used in this report are references to Dana. These references include the subsidiaries of Dana unless otherwise indicated or the context requires otherwise.
Summary of significant accounting policies
Basis of presentation - Our consolidated financial statements include the accounts of all subsidiaries where we hold a controlling financial interest. All significant intercompany balances and transactions have been eliminated in consolidation. Investments in 20 to 50%-owned affiliates, which are not required to be consolidated, are generally accounted for under the equity method. Equity in earnings of these investments is presented separately in the consolidated statement of operations, net of tax. Investments in less-than-20%-owned companies are generally included in the financial statements at the cost of our investment. Dividends, royalties and fees from these cost basis affiliates are recorded in income when received. Certain items previously reported in specific financial statement captions have been reclassified to conform to the current presentation.
Held for sale - We classify long-lived assets or disposal groups as held for sale in the period: management commits to a plan to sell; the long-lived asset or disposal group is available for immediate sale in its present condition subject only to terms that are usual and customary for sales of such long-lived assets or disposal groups; an active program to locate a buyer and other actions required to complete the plan to sell have been initiated; the sale is probable within one year; the asset or disposal group is being actively marketed for sale at a price that is reasonable in relation to its current fair value; and it is unlikely that significant changes to the plan will be made or that the plan will be withdrawn. Long-lived assets and disposal groups classified as held for sale are measured at the lower of their carrying amount or fair value less costs to sell. If held for sale criteria is no longer met, assets are reclassified as held and used at the lower of their adjusted carrying value or fair value.
Discontinued operations - The results of operations of a component or a group of components that either has been disposed of or is classified as held for sale is reported in discontinued operations if the disposal represents a strategic shift that has (or will have) a major effect on operations and financial results.
Estimates - Our consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States (GAAP), which require the use of estimates, judgments and assumptions that affect the amounts reported in our consolidated financial statements and accompanying disclosures. We believe our assumptions and estimates are reasonable and appropriate. However, due to the inherent uncertainties in making estimates, actual results could differ from those estimates.
Fair value measurements - A three-tier fair value hierarchy is used to prioritize the inputs to valuation techniques used to measure fair value. The three levels of inputs are as follows: Level 1 inputs (highest priority) include unadjusted quoted prices in active markets for identical instruments. Level 2 inputs include quoted prices for similar instruments that are observable either directly or indirectly. Level 3 inputs (lowest priority) include unobservable inputs in which there is little or no market data, which require management to develop its own assumptions. Classification within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement.
The inputs we use in our valuation techniques include market data or assumptions that we believe market participants would use in pricing an asset or liability, including assumptions about risk when appropriate. Our valuation techniques include a combination of observable and unobservable inputs. When available, we use quoted market prices to determine the fair value (market approach). In the absence of active markets for the identical assets or liabilities, such measurements involve developing assumptions based on market observable data and, in the absence of such data, we consider the amount and timing of estimated future cash flows and assumed discount rates reflecting varying degrees of credit risk that is consistent with what market participants would use in a hypothetical transaction that occurs at the measurement date (income approach). Fair values may not represent actual values of the financial instruments that could be realized as of the balance sheet date or that will be realized in the future.
Cash and cash equivalents - Cash and cash equivalents includes cash on hand, demand deposits and short-term cash investments that are highly liquid in nature and have maturities of three months or less when purchased.
Inventories - Inventories are valued at the lower of cost or net realizable value. Cost is determined using the average or first-in, first-out (FIFO) cost method.
Property, plant and equipment - Property, plant and equipment are recorded at cost. Depreciation is recognized over the estimated useful lives using primarily the straight-line method for financial reporting purposes and accelerated depreciation methods for federal income tax purposes. Useful lives of newly acquired assets are generally twenty to thirty years for buildings and building improvements, five to ten years for machinery and equipment, three to five years for tooling and office equipment and three to ten years for furniture and fixtures. If assets are impaired, their value is reduced via an increase in accumulated depreciation.
Leases - Our global lease portfolio represents leases of real estate, including manufacturing, assembly and office facilities, while the remainder represents leases of personal property, including manufacturing, material handling and IT equipment. We have lease agreements with lease and non-lease components, which are accounted for separately. Leases with an initial term of twelve months or less are not recorded on the balance sheet, and we recognize lease expense for these leases on a straight-line basis over the lease term. Generally, we use our incremental borrowing rate in determining the present value of lease payments, unless there is a rate stated in the lease agreement.
Pre-production costs related to long-term supply arrangements - The costs of tooling used to make products sold under long-term supply arrangements are capitalized as part of property, plant and equipment and depreciated over their useful lives if we own the tooling or if we fund the purchase but our customer owns the tooling and grants us the irrevocable right to use the tooling over the contract period. If we have a contractual right to bill our customers, costs incurred in connection with the design and development of tooling are carried as a component of other accounts receivable until invoiced. Design and development costs related to customer products are deferred if we have an agreement to collect such costs from the customer; otherwise, they are expensed when incurred. At December 31, 2024, the machinery and equipment component of property, plant and equipment includes $22 of our tooling related to long-term supply arrangements. Also at December 31, 2024, other accounts receivable includes $78 and other noncurrent assets includes $32 of costs related to tooling, design and development costs that we have a contractual right to collect from our customers.
Goodwill - We test goodwill for impairment annually as of October 31 and more frequently if events occur or circumstances change that would warrant an interim review. Goodwill impairment testing is performed at the reporting unit level, which is the operating segment in the case of our Off-Highway goodwill. A multi-step impairment test is performed on goodwill. In Step 0, we have the option to evaluate various qualitative factors to determine the likelihood of impairment. This qualitative assessment may include, but is not limited to, reviewing factors such as macroeconomic conditions, industry and market considerations, cost factors, entity-specific financial performance and other events, such as changes in the Company’s management, strategy and primary customer base. If we determine that the fair value is more likely than not less than the carrying value, then we are required to perform Step 1. If we do not elect to perform Step 0, we can voluntarily proceed directly to Step 1. In Step 1, we estimate the fair value of the reporting units using a model that incorporates various valuation methodologies, including discounted cash flow projections and multiples of current earnings. In determining fair value using discounted cash flow projections, we make significant assumptions and estimates about the extent and timing of future cash flows, including revenue growth rates, projected segment EBITDA, discount rates, and terminal growth rates. If the estimated fair value of the reporting unit exceeds its carrying value, the goodwill is considered not impaired. If the carrying value of the reporting unit exceeds its estimated fair value, a goodwill impairment charge is recorded for the difference. See Note 2 for more information about goodwill.
Intangible assets - Intangible assets include the value of core technology, trademarks and trade names and customer relationships. Core technology and customer relationships have definite lives while the majority of our trademarks and trade names have indefinite lives. Definite-lived intangible assets are amortized over their useful life using the straight-line method of amortization and are periodically reviewed for impairment indicators. Amortization of core technology is charged to cost of sales. Amortization of trademarks and trade names and customer relationships is charged to amortization of intangibles. Fully amortized intangible assets are retired at the end of their economic useful life. Indefinite-lived intangible assets are tested for impairment annually and more frequently if impairment indicators exist. See Note 2 for more information about intangible assets.
Investments in affiliates - Investments in affiliates include investments accounted for under the equity and cost methods. We monitor our investments in affiliates for indicators of other-than-temporary declines in value on an ongoing basis in accordance with GAAP. Indicators include, but are not limited to, current economic and market conditions, operating performance of the affiliate, including current earnings trends and undiscounted cash flows, and other affiliate-specific information. If we determine that an other-than-temporary decline in value has occurred, we recognize an impairment loss, which is measured as the excess of the investment's recorded carrying value over its fair value. The fair value determination, particularly for investments in privately-held companies, requires significant judgment to determine appropriate estimates and assumptions. Changes in these estimates and assumptions could affect the calculation of the fair value of the investments and determination of whether any identified impairment is other than temporary. See Note 20 for further information about our investment in affiliates.
Tangible asset impairments - We review the carrying value of depreciable long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset group may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of the assets to the undiscounted future net cash flows expected to be generated by the assets. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds their fair value. Assets to be disposed of are reported at the lower of their carrying amount or fair value less costs to sell and are no longer depreciated.
Other long-lived assets and liabilities - We discount our workers’ compensation obligations by applying blended risk-free rates that are appropriate for the duration of the projected cash flows. The use of risk-free rates is considered appropriate given that other risks affecting the volume and timing of payments have been considered in developing the probability-weighted projected cash flows. The blended risk-free rates are revised annually to consider incremental cash flow projections.
Supplier finance programs - We facilitate voluntary supplier finance programs to provide certain suppliers the opportunity to sell their right to Dana payment obligations to participating financial institutions. Under these programs, Dana agrees to pay the participating financial institutions the stated amount of confirmed invoices from its designated suppliers on the original maturity dates of the invoices. Participation by suppliers in these programs have no impact on the payment terms and amounts due from Dana. Dana does not have an economic interest in a supplier's participation in the program and is not a party to the agreement between the supplier and the financial institutions. In connection with these programs, Dana does not pledge assets or other forms of guarantees as security for the committed payment to the participating financial institutions. Confirmed obligations are presented as accounts payable within total current liabilities on the consolidated balance sheet.
Financial instruments - The carrying values of cash and cash equivalents, trade receivables, notes receivable and short-term borrowings approximate fair value. Borrowings under our credit facilities are carried at historical cost and adjusted for principal payments and foreign currency fluctuations.
Derivatives - Foreign currency forward contracts and currency swaps are carried at fair value. We enter into these contracts to manage our exposure to the impact of currency fluctuations on certain foreign currency-denominated assets and liabilities and on a portion of our forecasted purchase and sale transactions. On occasion, we also enter into net investment hedges to protect the translated U.S. dollar value of our investment in certain foreign subsidiaries. We also periodically enter into fixed-to-fixed cross-currency swaps on foreign currency-denominated external or intercompany debt instruments to reduce our exposure to foreign currency exchange rate risk. We do not use derivatives for trading or speculative purposes and we do not hedge all of our exposures.
For derivative instruments designated as cash flow hedges, at the cash flow hedge’s inception and on an ongoing basis, the company formally assesses whether the cash flow hedging instruments have been highly effective in offsetting changes in the cash flows of the hedged transactions and whether those cash flow hedging instruments may be expected to remain highly effective in future periods. Changes in the fair value of currency-related contracts treated as cash flow hedges are deferred and included as a component of other comprehensive income (loss) (OCI). For our fixed-to-fixed cross-currency swaps, a review of critical terms is performed each period to establish that an assumption of effectiveness remains appropriate. Deferred gains and losses are reclassified to earnings in the same periods in which the underlying transactions affect earnings.
Changes in the fair value of contracts treated as net investment hedges are recorded in the cumulative translation adjustment (CTA) component of OCI. Amounts recorded in CTA are deferred until such time as the investment in the associated subsidiary is substantially liquidated. Changes in the fair value of contracts not treated as cash flow hedges or as net investment hedges are recognized in other income (expense), net in the period in which those changes occur.
We may also use fixed-to-floating or floating-to-fixed interest rate swaps or other similar derivatives to manage exposure to fluctuations in interest rates and to adjust the mix of our fixed-rate and variable-rate debt. As a fair value hedge of the underlying debt, changes in the fair values of the swap and the underlying debt are recorded in interest expense. No such fixed-to-floating or floating-to-fixed swaps were outstanding at December 31, 2024. See Note 13 for additional information.
Cash flows associated with designated derivatives are classified within the same category as the item being hedged on the consolidated statement of cash flows. Cash flows associated with undesignated derivatives are included in the investing category on the consolidated statement of cash flows.
Warranty - Costs related to product warranty obligations are estimated and accrued at the time of sale with a charge against cost of sales. Warranty accruals are evaluated and adjusted as appropriate based on occurrences giving rise to potential warranty exposure and associated experience. Warranty accruals and adjustments require significant judgment, including a determination of our involvement in the matter giving rise to the potential warranty issue or claim, our contractual requirements, estimates of units requiring repair and estimates of repair costs.
Environmental compliance and remediation - Environmental expenditures that relate to current operations are expensed or capitalized as appropriate. Expenditures that relate to existing conditions caused by past operations that do not contribute to our current or future revenue generation are expensed. Liabilities are recorded when environmental assessments and/or remedial efforts are probable and the costs can be reasonably estimated. We consider the most probable method of remediation, current laws and regulations and existing technology in determining our environmental liabilities.
Pension and other postretirement defined benefits - Net pension and postretirement benefits expenses and the related liabilities are determined on an actuarial basis. These plan expenses and obligations are dependent on management’s assumptions developed in consultation with our actuaries. We review these actuarial assumptions at least annually and make modifications when appropriate. With the input of independent actuaries and other relevant sources, we believe that the assumptions used are reasonable; however, changes in these assumptions, or experience different from that assumed, could impact our financial position, results of operations or cash flows.
Postemployment benefits - Costs to provide postemployment benefits to employees are accounted for on an accrual basis. Obligations that do not accumulate or vest are recorded when payment is probable and the amount can be reasonably estimated. For those obligations that accumulate or vest and the amount can be reasonably estimated, expense and the related liability are recorded as service is rendered.
Equity-based compensation - We measure compensation cost arising from the grant of share-based awards to employees at fair value. We recognize such costs in income over the period during which the requisite service is provided, usually the vesting period. The grant date fair value is estimated using valuation techniques that require the input of management estimates and assumptions.
Government assistance - We account for separate legally enforceable agreements with governments and government agencies where the agreement provides for the government to determine whether Dana will receive assistance and the amount of assistance by applying a contribution accounting model by analogy. The primary forms of government assistance received includes cash grants based on making qualifying capital investments over a specified period of time; cash grants based on creating new jobs, increasing and maintaining qualifying employee headcount over a specified period of time; and cash grants based on investing in specified research and development activities. The agreements include imposed conditions that must be satisfied for us to retain grant proceeds received. Imposed conditions include providing documentation supporting qualified expenditures have been made and may include providing documentation that specified employment levels have been achieved. Imposed conditions related to employment levels typically range from one to five years. Amounts received or receivable from these cash grants are deferred as a liability until such time as we have satisfied all imposed conditions documented in the agreement with the government. Deferred amounts are recorded in other accrued liabilities and other noncurrent liabilities as appropriate. Government assistance received for making qualifying capital investments is realized by reducing the associated fixed assets so long as we have satisfied all imposed conditions by the time the associated fixed assets are placed into service. All other government assistance is realized in other income (expense), net once all imposed conditions have been satisfied. See Notes 5 and 17 for additional information.
Revenue recognition - Sales are recognized when products are shipped and risk of loss has transferred to the customer. We accrue for warranty costs, sales returns and other allowances based on experience and other relevant factors when sales are recognized. Adjustments are made as new information becomes available. Shipping and handling fees billed to customers are included in sales, while costs of shipping and handling are included in cost of sales. Taxes collected from customers are excluded from revenues and credited directly to obligations to the appropriate governmental agencies. See Note 18 for additional information.
Foreign currency translation - The financial statements of subsidiaries and equity affiliates outside the U.S. located in non-highly inflationary economies are measured using the currency of the primary economic environment in which they operate as the functional currency, which typically is the local currency. Transaction gains and losses resulting from translating assets and liabilities of these entities into the functional currency are included in other income (expense), net or in equity in earnings of affiliates. When translating into U.S. dollars, income and expense items are translated at average monthly rates of exchange, while assets and liabilities are translated at the rates of exchange at the balance sheet date. Translation adjustments resulting from translating the functional currency into U.S. dollars are deferred and included as a component of accumulated other comprehensive income (loss) (AOCI) in stockholders’ equity. For operations whose functional currency is the U.S. dollar, nonmonetary assets are translated into U.S. dollars at historical exchange rates and monetary assets are translated at current exchange rates with translation gains and losses included in other income (expense), net.
We continue to account for Argentina as a highly inflationary economy and remeasure the financial statements of our Argentine subsidiaries as if their functional currency was the U.S. dollar.
Income taxes - In the ordinary course of business there is inherent uncertainty in quantifying our income tax positions. We assess our income tax positions and record tax assets or liabilities for all years subject to examination based upon management’s evaluation of the facts and circumstances and information available at the reporting dates. For those tax positions where it is more likely than not that a tax benefit will be sustained, we have recorded the largest amount of tax benefit with a greater than 50% likelihood of being realized upon ultimate settlement with a taxing authority that has full knowledge of all relevant information. For those income tax positions where it is not more likely than not that a tax benefit will be sustained, no tax benefit has been recognized in the financial statements. Where applicable, the related interest cost has also been recognized as a component of the income tax provision.
A valuation allowance is provided when, in our judgment based upon available information, it is more likely than not that a portion of such deferred tax assets will not be realized. To make this assessment, we consider the historical and projected future taxable income or loss by tax jurisdiction. We consider all components of comprehensive income and weigh the positive and negative evidence, putting greater reliance on objectively verifiable historical evidence than on projections of future profitability that are dependent on actions that have not taken place as of the assessment date. We also consider changes to historical profitability of actions that occurred through the date of assessment and objectively verifiable effects of material forecasted events that would have a sustained effect on future profitability, as well as the effect on historical profits of nonrecurring events. We also incorporate the changes to historical and prospective income from tax planning strategies that are prudent and feasible.
Research and development - Research and development costs include expenditures for research activities relating to product development and improvement. Salaries, fringes and occupancy costs, including building, utility and overhead costs, comprise the vast majority of these expenses and are expensed as incurred. Research and development expenses were $229, $237 and $201 in 2024, 2023 and 2022.
Recently adopted accounting pronouncements
On December 31, 2024 we adopted Accounting Standards Update (ASU) 2023-07, Segment Reporting (Topic 280). The guidance enhances reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. See Note 19 for more information.
Recently issued accounting pronouncements
In November 2024, the Financial Accounting Standards Board (FASB) issued ASU 2024-03, Disaggregation of Income Statement Expenses (Subtopic 220-40), which requires public entities to disclose detailed components of income statement expenses, such as inventory purchases, employee compensation, depreciation and amortization within relevant expense captions. Companies are also required to explain amounts not disaggregated and define and disclose total selling expenses. The guidance is effective for fiscal years beginning after December 15, 2026, and interim periods beginning after December 15, 2027. We are currently evaluating the impact of the guidance on our financial statement disclosures.
In December 2023, the FASB issued ASU 2023-09, Improvements to Income Tax Disclosures. This guidance requires disaggregated income tax disclosures on the rate reconciliation and income taxes paid. The guidance becomes effective for annual periods beginning after December 15, 2024, with early adoption permitted. We are currently evaluating the impact of the guidance on our financial statement disclosures.
Note 2. Goodwill and Other Intangible Assets
Goodwill - Our goodwill is tested for impairment annually as of October 31 for all of our reporting units, and more frequently if events or circumstances warrant such a review. For our 2024 annual impairment test, we performed a Step 0 qualitative approach for the Off-Highway reporting unit. Based on the results of the qualitative assessment, we determined that it is more likely than not that the fair value of our Off-Highway reporting unit exceeded its carrying value and as such, our goodwill was not considered impaired as of October 31, 2024.
We evaluated macro-economic conditions during the third quarter of 2022, including the impact of the Federal Reserve further increasing the risk-free interest rate, as well as the negative impact of sustained higher commodity costs, non-material cost increases and operational inefficiencies attributable to continued global supply chain disruptions. We believe that these conditions were factors in our market capitalization falling below the book value of net assets as of September 30, 2022. Accordingly, we concluded a triggering event had occurred and performed an interim goodwill impairment analyses for our Commercial Vehicle and Off-Highway reporting units.
Based on the results of our interim impairment analyses, we concluded that the carrying value exceeded fair value of our Commercial Vehicle reporting unit and we recorded a goodwill impairment charge of $191, representing a full impairment of goodwill assigned to the Commercial Vehicle reporting unit. Our analysis for the Off-Highway reporting unit indicated that the fair value exceeded the carrying value by a substantial amount and, accordingly, no impairment charge was required.
Changes in the carrying amount of goodwill by segment -
Off-Highway
Balance, December 31, 2022
$ 259
Currency impact
Balance, December 31, 2023
Impaired as part of disposal group previously held for sale
(2 )
Currency impact
(11 )
Balance, December 31, 2024
$ 250
Non-amortizable intangible assets - Our non-amortizable intangible assets include a portion of our trademarks and trade names. Non-amortizable trademarks and trade names consist of the Dana®, Spicer® and TM4® trademarks and trade names utilized in our Commercial Vehicle and Off-Highway segments. We value trademarks and trade names using a relief from royalty method which is based on revenue streams. No impairment was recorded during the three years ended December 31, 2024 in connection with the required annual assessment for trademarks and trade names.
Amortizable intangible assets - Our amortizable intangible assets include core technology, customer relationships and a portion of our trademarks and trade names. Core technology includes the proprietary know-how and expertise that is inherent in our products and manufacturing processes. Customer relationships include the established relationships with our customers and the related ability of these customers to continue to generate future recurring revenue and income. Amortizable trademarks and trade names include the Graziano™, Fairfield® and Brevini® trademarks and trade names utilized in our Off-Highway segment.
These assets are tested for impairment whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. We group the assets and liabilities at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities and evaluate the asset group against the undiscounted future cash flows. We use our internal forecasts, which we update quarterly, to develop our cash flow projections. These forecasts are based on our knowledge of our customers’ production forecasts, our assessment of market growth rates, net new business, material and labor cost estimates, cost recovery agreements with customers and our estimate of savings expected from our restructuring activities. The most likely factors that would significantly impact our forecasts are changes in customer production levels and loss of significant portions of our business. Our valuation is applied over the life of the primary assets within the asset groups. If the undiscounted cash flows do not indicate that the carrying amount of the asset group is recoverable, an impairment charge is recorded if the carrying amount of the asset group exceeds its fair value based on discounted cash flow analyses or appraisals. There were no impairments recorded during the three years ended December 31, 2024 , 2023, and 2022.
Components of other intangible assets (excluding fully-amortized other intangible assets) -
December 31, 2024
December 31, 2023
Weighted
Average
Gross
Accumulated
Net
Gross
Accumulated
Net
Useful Life
Carrying
Impairment and
Carrying
Carrying
Impairment and
Carrying
(years)
Amount
Amortization
Amount
Amount
Amortization
Amount
Amortizable intangible assets
Core technology
10 $ 59 $ (35 ) $ 24 $ 71 $ (38 ) $ 33
Trademarks and trade names
13 23 (14 ) 9 28 (14 ) 14
Customer relationships
12 116 (69 ) 47 125 (63 ) 62
Non-amortizable intangible assets
Trademarks and trade names
70 70 73 73
$ 268 $ (118 ) $ 150 $ 297 $ (115 ) $ 182
During 2024, fully amortized intangible assets were written off and have been excluded from the table above.
The net carrying amounts of intangible assets, other than goodwill, attributable to each of our operating segments at December 31, 2024 were as follows: Light Vehicle - $11, Commercial Vehicle - $51, Off-Highway - $85, and Power Technologies - $3.
Amortization expense related to amortizable intangible assets -
Charged to cost of sales
$ 8 $ 10 $ 9
Charged to amortization of intangibles
13 13 14
Total amortization
$ 21 $ 23 $ 23
The following table provides the estimated aggregate pre-tax amortization expense related to intangible assets for each of the next five years based on December 31, 2024 exchange rates. Actual amounts may differ from these estimates due to such factors as currency translation, customer turnover, impairments, additional intangible asset acquisitions and other events.
Amortization expense
$ 19 $ 17 $ 16 $ 11 $ 7
Note 3. Restructuring of Operations
Our restructuring activities include rationalizing our operating footprint by consolidating facilities, positioning operations in lower cost locations, and headcount reduction initiatives focused on reducing operating and overhead costs. Restructuring expense includes costs associated with current and previously announced actions and is comprised of contractual and noncontractual separation costs and exit costs, including certain operating costs of facilities that we are in the process of closing.
During 2024, we announced actions to consolidate certain manufacturing facilities along with global headcount reductions focused on reducing engineering and overhead costs in response to market dynamics, including delays in the adoption of electric vehicles.
Accrued restructuring costs and activity, including noncurrent portion -
Employee
Termination
Exit
Benefits
Costs
Total
Balance, December 31, 2021
$ 11 $ - $ 11
Charges to restructuring
2 2 4
Adjustments of accruals
(5 ) (5 )
Cash payments
(6 ) (2 ) (8 )
Balance, December 31, 2022
2 - 2
Charges to restructuring
17 8 25
Cash payments
(9 ) (8 ) (17 )
Balance, December 31, 2023
10 - 10
Charges to restructuring
65 13 78
Adjustments of accruals
(2 ) (2 )
Cash payments
(22 ) (12 ) (34 )
Currency impact
(1 ) (1 )
Balance, December 31, 2024
$ 50 $ 1 $ 51
At December 31, 2024, accrued employee termination benefits include costs to reduce approximately 1,300 employees to be completed over the next year.
Note 4. Inventories
Inventory components at December 31 -
Raw materials
$ 629 $ 681
Work in process and finished goods
918 995
Total
$ 1,547 $ 1,676
Note 5. Supplemental Balance Sheet and Cash Flow Information
Supplemental balance sheet information at December 31 -
Other current assets:
Prepaid expenses
$ 141 $ 155
Restricted cash
9 23
Other
56 69
Total
$ 206 $ 247
Other noncurrent assets:
Deferred customer incentives
$ 28 $ 34
Pre-production costs receivable
32 24
Pension assets, net of related obligations
11 12
Restricted cash
9 11
Deferred financing costs
4 5
Other
105 54
Total
$ 189 $ 140
Property, plant and equipment, net:
Land and improvements to land
$ 180 $ 198
Buildings and building fixtures
550 576
Machinery and equipment
3,856 3,815
Software and hardware
367 366
Construction in progress
482 450
Finance lease right-of-use assets
97 55
Total cost
5,532 5,460
Less: accumulated depreciation
(3,318 ) (3,149 )
Net
$ 2,214 $ 2,311
Other accrued liabilities (current):
Non-income taxes payable
$ 59 $ 57
Warranty reserves
59 53
Contract liabilities
25 50
Accrued interest
43 50
Accrued customer rebates
24 27
Payable under forward contracts
41 12
Restructuring costs
51 10
Environmental
4 3
Deferred government assistance
Other expense accruals
159 111
Total
$ 468 $ 373
Other noncurrent liabilities:
Income tax liability
$ 80 $ 81
Interest rate swap market valuation
5 20
Deferred income tax liability
53 34
Workplace injury costs
13 13
Warranty reserves
64 63
Deferred government assistance
17 16
Other noncurrent liabilities
165 92
Total
$ 397 $ 319
Cash, cash equivalents and restricted cash at -
December 31, 2024
December 31, 2023
December 31, 2022
December 31, 2021
Cash and cash equivalents
$ 494 $ 529 $ 425 $ 268
Restricted cash included in other current assets
9 23 7 9
Restricted cash included in other noncurrent assets
9 11 10 10
Total cash, cash equivalents and restricted cash
$ 512 $ 563 $ 442 $ 287
Supplemental cash flow information -
Change in working capital:
Change in accounts receivable
$ 94 $ 12 $ (81 )
Change in inventories
55 (42 ) (99 )
Change in accounts payable
(154 ) (88 ) 343
Change in accrued payroll and employee benefits
(37 ) 73 36
Change in accrued income taxes
(4 ) 54 10
Change in other current assets and liabilities
73 61 (10 )
Net
$ 27 $ 70 $ 199
Cash paid during the period for:
Interest
$ 159 $ 128 $ 117
Income taxes
172 148 132
Noncash investing and financing activities:
Purchases of property, plant and equipment held in accounts payable
$ 48 $ 48 $ 74
Stock compensation plans
27 26 17
Noncash dividends declared
1 1 1
Supplier finance programs information -
Confirmed obligations outstanding at the beginning of the year
$ 69
Invoices confirmed during the year
Confirmed invoices paid during the year
(249 )
Confirmed obligations outstanding at the end of the year
$ 63
Note 6. Leases
Our leases generally have remaining lease terms of one year to twenty years, some of which include options to extend the leases for up to forty years. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants.
The following table provides a summary of the location and amounts related to finance leases recognized in the consolidated balance sheet. Short-term lease costs were insignificant as of December 31, 2024, 2023, and 2022.
Classification
Finance lease right-of-use assets
Property, plant and equipment, net
$ 97 $ 55
Finance lease liabilities
Current portion of long-term debt
14 7
Finance lease liabilities
Long-term debt
79 42
Components of lease expense -
Operating lease cost
$ 67 $ 65 $ 58
Finance lease cost:
Amortization of right-of-use assets
$ 11 $ 8 $ 9
Interest on lease liabilities
3 2 2
Total finance lease cost
$ 14 $ 10 $ 11
Supplemental cash flow information related to leases -
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases
$ 66 $ 62 $ 60
Operating cash flows from finance leases
3 2 2
Financing cash flows from finance leases
10 8 9
Right-of-use assets obtained in exchange for lease obligations:
Operating leases
$ 29 $ 61 $ 111
Finance leases
58 5 6
Supplemental balance sheet information related to leases -
Weighted-average remaining lease term (years):
Operating leases
9 10
Finance leases
8 12
Weighted-average discount rate:
Operating leases
7.4 % 7.2 %
Finance leases
6.5 % 5.1 %
Maturities -
Operating Leases
Finance Leases
$ 64 $ 20
57 19
49 19
40 14
34 11
Thereafter
182 37
Total lease payments
426 120
Less: interest
124 27
Present value of lease liabilities
$ 302 $ 93
Finance lease payments presented in the table above exclude approximately $52 of undiscounted minimum lease payments for non-cancellable equipment leases with various banks signed in 2024 but commencing in 2025. These leases generally have lease terms of five years.
Note 7. Stockholders' Equity
Preferred Stock
We are authorized to issue 50,000,000 shares of Dana preferred stock, par value $0.01 per share. There were no preferred shares outstanding at December 31, 2024 or 2023.
Common Stock
We are authorized to issue 450,000,000 shares of Dana common stock, par value $0.01 per share. At December 31, 2024, there were 145,831,417 shares of our common stock issued and 144,993,614 shares outstanding, net of 837,803 in treasury shares. Treasury shares include those shares withheld at cost to satisfy tax obligations from stock awards issued under our stock compensation plan in addition to shares repurchased through share repurchase programs.
Our Board of Directors declared a cash dividend of ten cents per share of common stock in all four quarters of 2024. Aggregate 2024 cash dividends paid totaled $58. Dividends accrue on restricted stock units (RSUs) granted under our stock compensation program and will be paid in cash or additional units when the underlying units vest.
Treasury stock - On December 17, 2022, we retired 13,477,933 shares of treasury stock. The $216 excess of the cost of the treasury stock over the common stock par value, based on the weighted-average pool price of our treasury shares at the date of retirement, was charged to additional paid-in capital.
Changes in each component of AOCI of the parent -
Parent Company Stockholders
Accumulated
Foreign
Defined
Other
Currency
Benefit
Comprehensive
Translation
Hedging
Plans
Loss
Balance, December 31, 2021
$ (809 ) $ 4 $ (180 ) $ (985 )
Other comprehensive income (loss):
Currency translation adjustments
(88 ) (88 )
Holding gains and losses
76 76
Reclassification of amount to net income (a)
(56 ) (56 )
Net actuarial gains
62 62
Reclassification adjustment for net actuarial losses included in net periodic benefit cost (b)
11 11
Tax benefit (expense)
2 (3 ) (20 ) (21 )
Other comprehensive income (loss)
(86 ) 17 53 (16 )
Balance, December 31, 2022
(895 ) 21 (127 ) (1,001 )
Other comprehensive income (loss):
Currency translation adjustments
27 27
Holding gains and losses
22 22
Reclassification of amount to net income (a)
(23 ) (23 )
Net actuarial losses
(25 ) (25 )
Reclassification adjustment for net actuarial losses included in net periodic benefit cost (b)
3 3
Tax benefit
7 7
Other comprehensive income (loss)
27 (1 ) (15 ) 11
Balance, December 31, 2023
(868 ) 20 (142 ) (990 )
Other comprehensive income (loss):
Currency translation adjustments
(110 ) (110 )
Holding gains and losses
(28 ) (28 )
Reclassification of amount to net income (a)
(31 ) (31 )
Net actuarial gains
4 4
Reclassification adjustment for net actuarial losses included in net periodic benefit cost (b)
6 6
Tax benefit (expense)
1 10 (4 ) 7
Other comprehensive income (loss)
(109 ) (49 ) 6 (152 )
Balance, December 31, 2024
$ (977 ) $ (29 ) $ (136 ) $ (1,142 )
___________________________________________________
Notes:
(a)
Realized gains and losses from currency-related forward contracts associated with forecasted transactions or from other derivative instruments treated as cash flow hedges are reclassified from AOCI into the same line item in the consolidated statement of operations in which the underlying forecasted transaction or other hedged item is recorded. See Note 13 for additional details.
(b)
See Note 11 for additional details.
Note 8. Redeemable Noncontrolling Interests
Hydro-Québec owns a 45% redeemable noncontrolling interest in Dana TM4 Inc., Dana TM4 Electric Holdings BV and Dana TM4 USA, LLC. The terms of the joint venture agreement provide Hydro-Québec with the right to put all, and not less than all, of its ownership interests in Dana TM4 Inc., Dana TM4 Electric Holdings BV and Dana TM4 USA, LLC to Dana at fair value.
Redeemable noncontrolling interests reflected as of the balance sheet date are the greater of the redeemable noncontrolling interest balances adjusted for comprehensive income (loss) items and distributions or the redemption values. Redeemable noncontrolling interest adjustments of redemption value are recorded in retained earnings. We estimate the fair value of the redemption value using an income based approach based on discounted cash flow projections. In determining fair value using discounted cash flow projections, we make significant assumptions and estimates about the extent and timing of future cash flows, including revenue growth rates, projected EBITDA, discount rate, capital expenditures and terminal growth rate.
On May 6, 2024, Hydro-Québec provided Dana with its put notice. Subsequent to May 6, 2024, Dana will no longer attribute net income (loss) and other comprehensive income (loss) items of Dana TM4 Inc., Dana TM4 Electric Holdings BV and Dana TM4 USA, LLC to Hydro-Québec's redeemable noncontrolling interest. Closure of the transaction will proceed in accordance with the provisions of the shareholders agreement.
Reconciliation of changes in redeemable noncontrolling interests -
Balance, beginning of period
$ 191 $ 195
Capital contribution from redeemable noncontrolling interest
18 22
Adjustment to redemption value
(4 ) (16 )
Other
Comprehensive income (loss) adjustments:
Net loss attributable to redeemable noncontrolling interests
(13 ) (12 )
Other comprehensive income (loss) attributable to redeemable noncontrolling interests
(3 ) 2
Balance, end of period
$ 189 $ 191
Note 9. Earnings per Share
Reconciliation of the numerators and denominators of the earnings per share calculations -
Net income (loss) available to common stockholders - Numerator basic and diluted
$ (57 ) $ 38 $ (242 )
Denominator:
Weighted-average common shares outstanding - Basic
145.2 144.4 143.6
Employee compensation-related shares, including stock options
0.2
Weighted-average common shares outstanding - Diluted
145.2 144.6 143.6
The share count for diluted earnings per share is computed on the basis of the weighted-average number of common shares outstanding plus the effects of dilutive common stock equivalents (CSEs) outstanding during the period. We excluded 0.1 million CSEs from the calculations of diluted earnings per share for the years 2023 and 2022 as the effect of including them would have been anti-dilutive. In addition, we excluded CSEs that satisfied the definition of potentially dilutive shares of 0.2 million and 0.7 million for 2024 and 2022 because the net loss position made these anti-dilutive.
Note 10. Stock Compensation
2021 Omnibus Incentive Plan
The 2021 Omnibus Incentive Plan (the Plan) authorizes the grant of stock options, stock appreciation rights (SARs), RSUs and performance share units (PSUs) through April 2031. Cash-settled awards do not count against the number of shares available for award under the Plan. At December 31, 2024, there were 4.3 million shares available for future grants. Shares of common stock to be issued under the Plan are made available from authorized and unissued Dana common stock.
Award activity - (shares in millions)
RSUs
PSUs
Grant-Date
Grant-Date
Shares
Fair Value*
Shares
Fair Value*
December 31, 2023
1.9 $ 20.05 0.7 $ 21.70
Granted
2.9 11.25 0.7 13.23
Vested
(1.0 ) 20.08 (0.5 ) 18.83
Expired
(0.6 ) 14.95 (0.1 ) 12.20
December 31, 2024
3.2 12.76 0.8 13.59
* Weighted-average per share
Total stock compensation expense
$ 30 $ 26 $ 19
Total grant-date fair value of awards vested
31 33 19
Cash received from exercise of stock options
Cash paid to settle SARs and RSUs
4 5 4
Intrinsic value of stock options and SARs exercised
Intrinsic value of RSUs and PSUs vested
21 30 21
Compensation expense is generally measured based on the fair value at the date of grant and is recognized on a straight-line basis over the vesting period. For RSUs and PSUs, the fair value is based on the closing market price of our common stock at the date of grant. Awards that are settled in cash are subject to liability accounting. Accordingly, the fair value of such awards is remeasured at the end of each reporting period until settled or expired. We had accrued $2 for cash-settled awards at both December 31, 2024 and 2023. During 2024 we issued 0.8 million and 0.2 million shares of common stock based on vesting of RSUs and PSUs, respectively. At December 31, 2024, the total unrecognized compensation cost related to the nonvested awards granted and expected to vest was $28. This cost is expected to be recognized over a weighted-average period of 1.4 years.
Stock options and stock appreciation rights - The exercise price of each option or SAR equals the closing market price of our common stock on the date of grant. SARs are settled in cash for the difference between the market price on the date of exercise and the exercise price. We have not granted stock options or SARs since 2013. At December 31, 2024, there were no outstanding stock options or SARs as they have all been exercised or expired.
Restricted stock units and performance shares units - Each RSU or PSU granted represents the right to receive one share of Dana common stock or, at the election of Dana (for units awarded to board members) or for employees located outside the U.S. (for employee awarded units), cash equal to the market value per share. All RSUs contain dividend equivalent rights. RSUs granted to non-employee directors vest on the first anniversary date of the grant and those granted to employees pro-rata vest over three years. PSUs granted to employees vest if specified performance goals are achieved during the respective performance period, generally three years.
Under the 2024, 2023, and 2022 stock compensation award programs, the number of PSUs that ultimately vest is contingent on achieving specified financial targets and specified total shareholder return targets relative to peer companies. For the portions of the awards based on financial metrics, we estimated the fair value at grant date based on the closing market price of our common stock at the date of grant adjusted for the value of assumed dividends over the period because the awards are not dividend protected. The estimated grant date value is accrued over the performance period and adjusted as appropriate based on performance relative to the target. For the portion of the PSU award based on shareholder returns, we estimated the fair value at grant date using various assumptions as part of a Monte Carlo simulation. The expected term represents the period from the grant date to the end of the performance period. The risk-free interest rate was based on U.S. Treasury constant maturity rates at the grant date. The dividend yield was calculated using our historical approach calculated by dividing the expected annual dividend by the average stock price over the prior year. The estimated volatility was based on observed historical volatility of daily stock returns for the 3-year period preceding the grant date.
PSUs
Expect term (in years)
3.0 3.0
Risk-free interest rate
4.39 % 4.28 %
Dividend yield
2.7 % 2.5 %
Expected volatility
47.7 % 67.0 %
Cash incentive awards - Our 2021 Omnibus Incentive Plan provides for cash incentive awards. We make awards annually to certain eligible employees designated by Dana, including certain executive officers. Awards under the plan are primarily based on achieving certain financial performance goals. The financial performance goals of the plan are established annually by the Board of Directors.
Under the 2024 annual incentive program, participants were eligible to receive cash awards based on achieving earnings, net new business and cash flow performance goals. Under the 2023 and 2022 annual incentive programs, participants were eligible to receive cash awards based on achieving earnings, sales and cash flow performance goals. We accrued $57, $98 and $37 of expense in 2024, 2023 and 2022 for the expected cash payments under these programs.
Note 11. Pension and Postretirement Benefit Plans
We sponsor various defined benefit, qualified and nonqualified, pension plans covering eligible employees. Other postretirement benefits (OPEB), including medical and life insurance, are provided for certain employees upon retirement.
We also sponsor various defined contribution plans that cover the majority of our employees. Under the terms of the qualified defined contribution retirement plans, employee and employer contributions may be directed into a number of diverse investments. None of these qualified defined contribution plans allow direct investment in our stock.
Components of net periodic benefit cost (credit) and other amounts recognized in OCI -
Pension Benefits
U.S.
Non-U.S.
U.S.
Non-U.S.
U.S.
Non-U.S.
Interest cost
$ 26 $ 13 $ 28 $ 14 $ 16 $ 8
Expected return on plan assets
(29 ) (3 ) (31 ) (3 ) (28 ) (2 )
Service cost
6 6 7
Amortization of net actuarial loss
7 2 7 8 5
Settlements
Curtailment
(1 )
Net periodic benefit cost (credit)
7 18 4 16 (4 ) 18
Recognized in OCI:
Amount due to net actuarial (gains) losses
6 (9 ) 2 15 20 (66 )
Reclassification adjustment for net actuarial losses in net periodic benefit cost
(7 ) (2 ) (7 ) (8 ) (5 )
Total recognized in OCI
(1 ) (11 ) (5 ) 15 12 (71 )
Net recognized in benefit cost (credit) and OCI
$ 6 $ 7 $ (1 ) $ 31 $ 8 $ (53 )
OPEB
U.S.
Non-U.S.
U.S.
Non-U.S.
U.S.
Non-U.S.
Interest cost
$ - $ 2 $ 1 $ 2 $ - $ 2
Service cost
Amortization of net actuarial gain
(1 ) (2 ) (4 ) (2 )
Net periodic benefit cost (credit)
(1 ) - 1 (2 ) - -
Recognized in OCI:
Amount due to net actuarial (gains) losses
(1 ) 8 (1 ) (15 )
Reclassification adjustment for net actuarial gain in net periodic benefit cost
1 2 4 2
Total recognized in OCI
- 2 - 12 (1 ) (13 )
Net recognized in benefit cost (credit) and OCI
$ (1 ) $ 2 $ 1 $ 10 $ (1 ) $ (13 )
Our U.S. defined benefit pension plans are frozen and no additional service cost is being accrued. The service cost component for international plans is included in cost of sales and selling, general and administrative expenses. Other components of net periodic benefit cost (credit) are included in other income (expense), net in our consolidated income statement. Actuarial gains and losses resulting from plan remeasurement are recognized in AOCI in the period of remeasurement. We use the corridor approach for purposes of systematically amortizing deferred gains or losses as a component of net periodic benefit cost into the income statement in future reporting periods. The amortization period used is generally the average remaining service period of active participants in the plan unless almost all of the plan’s participants are inactive, in which case we use the average remaining life expectancy of the inactive participants.
Funded status - The following tables provide reconciliations of the changes in benefit obligations, plan assets and funded status.
Pension Benefits
OPEB
U.S.
Non-U.S.
U.S.
Non-U.S.
U.S.
Non-U.S.
U.S.
Non-U.S.
Reconciliation of benefit obligation:
Obligation at beginning of period
$ 549 $ 330 $ 557 $ 296 $ 3 $ 55 $ 2 $ 48
Interest cost
26 13 28 14 2 1 2
Service cost
6 6
Actuarial (gain) loss
(21 ) (10 ) 12 17 (1 ) 8
Benefit payments
(46 ) (14 ) (48 ) (16 ) (4 ) (4 )
Amendments
(2 )
Settlements
3 (4 ) (1 )
Translation adjustments
(27 ) 14 (4 ) 1
Obligation at end of period
$ 511 $ 294 $ 549 $ 330 $ 2 $ 47 $ 3 $ 55
Pension Benefits
OPEB
U.S.
Non-U.S.
U.S.
Non-U.S.
U.S.
Non-U.S.
U.S.
Non-U.S.
Reconciliation of fair value of plan assets:
Fair value at beginning of period
$ 530 $ 69 $ 537 $ 59 $ - $ - $ - $ 1
Actual return on plan assets
2 2 41 5
Employer contributions
7 15 18 4 4
Benefit payments
(46 ) (14 ) (48 ) (16 ) (4 ) (4 )
Settlements
(4 ) (1 )
Translation adjustments
(7 ) 4 (1 )
Fair value at end of period
$ 493 $ 61 $ 530 $ 69 $ - $ - $ - $ -
Funded status at end of period
$ (18 ) $ (233 ) $ (19 ) $ (261 ) $ (2 ) $ (47 ) $ (3 ) $ (55 )
Amounts recognized in the balance sheet -
Pension Benefits
OPEB
U.S.
Non-U.S.
U.S.
Non-U.S.
U.S.
Non-U.S.
U.S.
Non-U.S.
Amounts recognized in the consolidated balance sheet:
Noncurrent assets
$ 9 $ 2 $ 11 $ 1 $ - $ - $ - $ -
Current liabilities
(12 ) (12 ) (4 ) (4 )
Noncurrent liabilities
(27 ) (223 ) (30 ) (250 ) (2 ) (43 ) (3 ) (51 )
Net amount recognized
$ (18 ) $ (233 ) $ (19 ) $ (261 ) $ (2 ) $ (47 ) $ (3 ) $ (55 )
Amounts recognized in AOCI -
Pension Benefits
OPEB
U.S.
Non-U.S.
U.S.
Non-U.S.
U.S.
Non-U.S.
U.S.
Non-U.S.
Amounts recognized in AOCI:
Net actuarial loss (gain)
$ 135 $ 9 $ 136 $ 20 $ - $ (31 ) $ - $ (33 )
AOCI before tax
135 9 136 20 - (31 ) - (33 )
Deferred taxes
19 (3 ) 18 (7 ) 8 8
Net
$ 154 $ 6 $ 154 $ 13 $ - $ (23 ) $ - $ (25 )
The net actuarial loss for U.S. pension plans for 2024 was primarily due to the actual return on assets underperforming the expected asset return, partially offset by an increase in discount rates. The actuarial gain for non-U.S. plans was due to an increase in discount rates. The actuarial gain for OPEB for 2024 was primarily due to an increase in the discount rates.
The net actuarial loss for pension for 2023 was primarily due to a decrease in discount rates, partially offset due to the actual return on assets exceeding the expected asset return. The actuarial loss for OPEB for 2023 was primarily due to a decrease in the discount rates.
Aggregate funding levels - The following table presents information regarding the aggregate funding levels of our defined benefit pension plans at December 31:
U.S.
Non-U.S.
U.S.
Non-U.S.
Plans with fair value of plan assets in excess of obligations:
Accumulated benefit obligation
$ 385 $ 23 $ 416 $ 31
Projected benefit obligation
385 23 416 32
Fair value of plan assets
394 26 427 33
Plans with obligations in excess of fair value of plan assets:
Accumulated benefit obligation
$ 126 $ 245 $ 133 $ 270
Projected benefit obligation
126 271 133 298
Fair value of plan assets
99 35 103 36
Fair value of pension plan assets -
Fair Value Measurements at December 31, 2024
U.S.
Non-U.S.
Asset Category
Total
Level 1
Level 2
Level 3
NAV (a)
Level 1
Level 2
Level 3
Equity securities:
U.S. all cap (b)
$ 25 $ 25 $ - $ - $ - $ - $ - $ -
U.S. large cap
26 26
EAFE composite
12 12
Emerging markets
9 9
Fixed income securities:
Corporate bonds
345 177 168
U.S. Treasury strips
11 11
Non-U.S. government securities
16 3 13
Emerging market debt
7 7
Collateralized mortgage obligations
9 9
Alternative investments:
Insurance contracts (c)
50 5 45
Real estate
11 11
Other
3 3
Cash and cash equivalents
30 30
Total
$ 554 $ 25 $ 230 $ 5 $ 233 $ - $ 16 $ 45
Fair Value Measurements at December 31, 2023
U.S.
Non-U.S.
Asset Category
Total
Level 1
Level 2
Level 3
NAV (a)
Level 1
Level 2
Level 3
Equity securities:
U.S. all cap (b)
$ 25 $ 25 $ - $ - $ - $ - $ - $ -
U.S. large cap
26 26
EAFE composite
14 14
Emerging markets
10 10
Fixed income securities:
Corporate bonds
379 190 189
U.S. Treasury strips
7 7
Non-U.S. government securities
19 2 17
Emerging market debt
8 8
Alternative investments:
Insurance contracts (c)
54 6 48
Real estate
11 11
Other
4 4
Cash and cash equivalents
42 42
Total
$ 599 $ 25 $ 241 $ 6 $ 258 $ - $ 21 $ 48
________________________________
Notes:
(a)
Certain assets are measured at fair value using the net asset value (NAV) per share (or its equivalent) practical expedient and have not been classified in the fair value hierarchy.
(b)
This category comprises a combination of small-, mid- and large-cap equity stocks that are allocated at the investment manager's discretion. Investments include common and preferred securities as well as equity funds that invest in these instruments.
(c)
This category comprises contracts placed with insurance companies where the underlying assets are invested in fixed interest securities.
U.S.
Non-U.S.
U.S.
Non-U.S.
Insurance
Insurance
Insurance
Insurance
Reconciliation of Level 3 Assets
Contracts
Contracts
Contracts
Contracts
Fair value at beginning of period
$ 6 $ 48 $ 6 $ 43
Actual gains relating to assets still held at the reporting date
2 5
Purchases, sales and settlements
(1 ) (2 ) (1 )
Currency impact
(3 ) 1
Fair value at end of period
$ 5 $ 45 $ 6 $ 48
Valuation Methods
Equity securities - The fair value of equity securities held directly by the trust is based on quoted market prices. When the equity securities are held in commingled funds that are not publicly traded, the fair value of our interest in the fund is its NAV as determined by quoted market prices for the underlying holdings.
Fixed income securities - The fair value of fixed income securities held directly by the trust is based on a bid evaluation process with input from independent pricing sources. When the fixed income securities are held in commingled funds that are not publicly traded, the fair value of our interest in the fund is its NAV as determined by a similar valuation of the underlying holdings.
Insurance contracts - The values shown for insurance contracts are the amounts reported by the insurance company and approximate the fair values of the underlying investments.
Real estate - The investments in real estate represent ownership interests in commingled funds and partnerships that invest in real estate. The investment managers determine the NAV of these ownership interests using the fair value of the underlying real estate which is obtained via independent third party appraisals prepared on a periodic basis. Assumptions used to value the properties are updated quarterly. For the component of the real estate portfolio under development, the investments are carried at cost until they are completed and valued by a third party appraiser.
Cash and cash equivalents - The fair value of cash and cash equivalents is set equal to its amortized cost.
The methods described above may produce a fair value that may not be indicative of net realizable value or reflective of future fair values. Furthermore, while we believe the valuation methods are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different fair value measurement at the reporting date.
Investment policy - Target asset allocations of U.S. pension plans are established through an investment policy, which is updated periodically and reviewed by an Investment Committee, comprised of certain company officers. The investment policy allows for a flexible asset allocation mix which is intended to provide appropriate diversification to lessen market volatility while assuming a reasonable level of economic risk.
Our policy recognizes that properly managing the relationship between pension assets and pension liabilities serves to mitigate the impact of market volatility on our funding levels. The investment policy permits plan assets to be invested in a number of diverse categories, including a Growth Portfolio, an Immunizing Portfolio and a Liquidity Portfolio. These sub-portfolios are intended to balance the generation of incremental returns with the management of overall risk.
The Growth Portfolio is invested in a diversified pool of assets in order to generate an incremental return with an acceptable level of risk. The Immunizing Portfolio is a hedging portfolio that may be comprised of fixed income securities and overlay positions. This portfolio is designed to offset changes in the value of the pension liability due to changes in interest rates. The Liquidity Portfolio is a cash portfolio designed to meet short-term liquidity needs and reduce the plans’ overall risk. As a result of our diversification strategies, there are no significant concentrations of risk within the portfolio of investments.
The allocations among portfolios are adjusted as needed to meet changing objectives and constraints and to manage the risk of adverse changes in the unfunded positions of our plans. At December 31, 2024, the U.S. plans had targets of 21% for the Growth Portfolio (U.S. and non-U.S. equities, high-yield fixed income, real estate, emerging market debt and cash), 77% for the Immunizing Portfolio (long duration U.S. Treasury strips, corporate bonds and cash) and 2% for the Liquidity Portfolio (cash and short-term securities). The assets held at December 31, 2024 by the U.S. plans were invested 21% in the Growth Portfolio, 76% in the Immunizing Portfolio and 3% in the Liquidity Portfolio.
Significant assumptions - The significant weighted-average assumptions used in the measurement of pension benefit obligations at December 31 of each year and the net periodic benefit cost for each year are as follows:
U.S.
Non-U.S.
U.S.
Non-U.S.
U.S.
Non-U.S.
Pension benefit obligations:
Discount rate
5.58 % 4.56 % 5.12 % 4.33 % 5.47 % 4.74 %
Net periodic benefit cost:
Discount rate
5.07 % 4.74 % 5.36 % 4.98 % 2.29 % 2.20 %
Rate of compensation increase
N/A 3.75 % N/A 3.68 % N/A 3.11 %
Expected return on plan assets
5.75 % 5.39 % 6.00 % 5.13 % 4.00 % 3.64 %
The pension plan discount rate assumptions are evaluated annually in consultation with our outside actuarial advisers. Long-term interest rates on high quality corporate debt instruments are used to determine the discount rate. For our largest plans, discount rates are developed using a discounted bond portfolio analysis, with appropriate consideration given to defined benefit payment terms and duration of the liabilities.
For pension and other postretirement benefit plans that utilize a full yield curve approach to estimate the interest and service components of net periodic benefit cost, we apply the specific spot rates along the yield curve used in the most recent remeasurement of the benefit obligation to the relevant projected cash flows. We believe this method improves the correlation between the projected cash flows and the corresponding interest rates and provides a more precise measurement of interest and service costs. Since the remeasurement of total benefit obligations is not affected, the resulting reduction in periodic benefit cost is offset by an increase in the actuarial loss.
The expected rate of return on plan assets was selected on the basis of our long-term view of return and risk assumptions for major asset classes. We define long-term as forecasts that span at least the next ten years. Our long-term outlook is influenced by a combination of return expectations by individual asset class, actual historical experience and our diversified investment strategy. We consult with and consider the opinions of financial professionals in developing appropriate capital market assumptions. Return projections are also validated using a simulation model that incorporates yield curves, credit spreads and risk premiums to project long-term prospective returns. The appropriateness of the expected rate of return is assessed on an annual basis and revised if necessary. We have a high percentage of total assets in fixed income securities since the benefit accruals are frozen for all of our U.S. pension plans. Based on this assessment, we have selected a 6.00% expected return on asset assumption for 2025 for our U.S. plans.
The significant weighted-average assumptions used in the measurement of OPEB obligations at December 31 of each year and the net periodic benefit cost for each year are as follows:
U.S.
Non-U.S.
U.S.
Non-U.S.
U.S.
Non-U.S.
OPEB benefit obligations:
Discount rate
5.62 % 4.99 % 5.19 % 5.01 % 5.54 % 5.44 %
Net periodic benefit cost:
Discount rate
5.18 % 5.32 % 5.48 % 5.64 % 2.84 % 3.34 %
Initial health care cost trend rate
N/A 2.91 % N/A 2.76 % N/A 2.48 %
Ultimate health care cost trend rate
N/A 4.17 % N/A 4.19 % N/A 4.09 %
Year ultimate reached
N/A 2032 N/A 2032 N/A 2032
The discount rate selection process was similar to the process used for the pension plans. Assumed health care cost trend rates have a significant effect on the health care obligation. To determine the trend rates, consideration is given to the plan design, recent experience and health care economics.
Estimated future benefit payments and contributions - Expected benefit payments by our pension and OPEB plans for each of the next five years and for the following five-year period are as follows:
Pension Benefits
OPEB
Year
U.S.
Non-U.S.
U.S.
Non-U.S.
$ 48 $ 18 $ - $ 4
48 18 4
47 17 4
46 19 4
44 21 4
2030 to 2034 202 113 1 18
Total
$ 435 $ 206 $ 1 $ 38
Pension benefits are funded through deposits with trustees that satisfy, at a minimum, the applicable funding regulations. OPEB benefits are funded as they become due. There are projected contributions of $5 and $17 to be made during 2025 for our U.S. plans and non-U.S. plans, respectively.
Multi-employer pension plans - We participate in the Steelworkers Pension Trust (SPT) multi-employer pension plan which provides pension benefits to certain of our U.S. employees represented by the United Steelworkers and United Automobile Workers unions. Contributions are made in accordance with our collective bargaining agreements and rates are generally based on hours worked. The collective bargaining agreements expire May 22, 2026. The trustees of the SPT have provided us with the latest data available for the plan year ended December 31, 2024. As of that date, the plan is not fully funded. We could be held liable to the plan for our obligations as well as those of other employers as a result of our participation in the plan.
Contribution rates could increase if the plan is required to adopt a funding improvement plan or a rehabilitation plan, if the performance of plan assets does not meet expectations or as a result of future collectively bargained wage and benefit agreements. If we choose to stop participating in the plan, we may be required to pay the plan an amount based on the underfunded status of the plan, referred to as a withdrawal liability.
The Pension Protection Act (PPA) defines a zone status for each plan. Plans in the green zone are at least 80% funded, plans in the yellow zone are at least 65% funded and plans in the red zone are generally less than 65% funded. The SPT plan has utilized extended amortization provisions to amortize its losses from 2008. The plan recertified its zone status after using the extended amortization provisions as allowed by law. The SPT plan has not implemented a funding improvement or rehabilitation plan, nor are such plans pending. Our contributions to the SPT exceeded 5% of the total contributions to the plan.
Employer
PPA
Identification
Zone Status
Funding Plan
Contributions by Dana
Pension
Number/
Pending/
Surcharge
Fund
Plan Number
Implemented
Imposed
SPT
23-6648508 / 499
Green
Green
No
$ 16 $ 17 $ 18 No
Note 12. Financing Agreements
Long-term debt at December 31 -
Interest Rate
Senior Notes due April 15, 2025
5.750%
*
$ 200 $ 200
Senior Notes due November 15, 2027
5.375%
400 400
Senior Notes due June 15, 2028
5.625%
400 400
Senior Euro Notes due July 15, 2029
3.000%
337 359
Senior Notes due September 1, 2030
4.250%
400 400
Senior Euro Notes due July 15, 2031
8.500%
440 469
Senior Notes due February 15, 2032
4.500%
350 350
Other indebtedness
95 79
Debt issuance costs
(19 ) (24 )
2,603 2,633
Less: Current portion of long-term debt
214 35
Long-term debt, less debt issuance costs
$ 2,389 $ 2,598
*
In conjunction with the issuance of the April 2025 Notes we entered into 8-year fixed-to-fixed cross-currency swaps which have the effect of economically converting the April 2025 Notes to euro-denominated debt at a fixed rate of 3.850%. See Note 13 for additional information.
Interest on the senior notes is payable semi-annually. Other indebtedness includes borrowings from various financial institutions and finance lease obligations.
Scheduled principal payments on long-term debt, excluding finance leases at December 31, 2024 -
Maturities
$ 200 $ - $ 400 $ 400 $ 337
Senior notes activity - On May 24, 2023, Dana Financing Luxembourg S.à.r.l. (Dana Financing), a wholly-owned subsidiary of Dana, completed the sale of €425 ($458 as of May 24, 2023) in senior unsecured notes ( July 2031 Notes) at 8.500%. The July 2031 Notes are fully and unconditionally guaranteed by Dana. The July 2031 Notes were issued through a private placement and will not be registered under the U.S. Securities Act of 1933, as amended (the Securities Act). The July 2031 Notes were offered only to qualified institutional buyers in reliance on Rule 144A under the Securities Act and, outside the United States, only to non-U.S. investors in reliance on Regulation S under the Securities Act. The July 2031 Notes rank equally with Dana's other unsecured senior notes. Interest on the notes is payable on January 15 and July 15 of each year, beginning on January 15, 2024. The July 2031 Notes will mature on July 15, 2031. Net proceeds of the offering totaled €419 ($451 as of May 24, 2023). Financing costs of €6 ($7 as of May 24, 2023) were recorded as deferred costs and are being amortized to interest expense over the life of the notes. The proceeds from the offering were used to redeem $200 of our April 2025 Notes and to make payments against borrowings on our Revolving Facility. On June 9, 2023 we redeemed $200 of our April 2025 Notes at a price equal to 100.00% plus accrued and unpaid interest. The $1 loss on extinguishment of debt is comprised of the write-off of previously deferred financing costs associated with the April 2025 Notes.
Senior notes redemption provisions - We may redeem some or all of the senior notes at the following redemption prices (expressed as percentages of principal amount), plus accrued and unpaid interest to the redemption date, if redeemed during the 12-month period commencing on the anniversary date of the senior notes in the year set forth below:
Redemption Price
April
November
June
July
September
July
February
Year
2025 Notes
2027 Notes
2028 Notes
2029 Notes
2030 Notes
2031 Notes
2032 Notes
100.000 % 100.000 % 101.406 % 101.500 %
100.000 % 100.000 % 100.750 %
100.000 % 100.000 % 100.000 % 102.125 % 104.250 %
100.000 % 100.000 % 101.417 % 102.125 % 102.250 %
100.000 % 100.708 % 100.000 % 101.500 %
100.000 % 100.000 % 100.750 %
100.000 % 100.000 %
100.000 %
Prior to May 1, 2026, we may redeem some or all of the September 2030 Notes at a redemption price equal to 100% of the aggregate principal amount thereof, plus accrued and unpaid interest, if any, to the redemption date plus a “make-whole” premium. We have not separated the make-whole premium from the underlying debt instrument to account for it as a derivative instrument as the economic characteristics and the risks of this embedded derivative are clearly and closely related to the economic characteristics and risks of the underlying debt.
At any time prior to July 15, 2026, we may redeem up to 40% of the aggregate principal amount of the July 2031 Notes in an amount not to exceed the amount of proceeds of one or more equity offerings, at a price equal to 108.500% of the principal amount thereof, plus accrued and unpaid interest, if any, to the redemption date, provided that at least 50% of the aggregate principal amount of the July 2031 Notes remain outstanding after the redemption. Prior to July 15, 2026, we may also redeem some or all of the July 2031 Notes at a redemption price equal to 100% of the aggregate principal amount thereof, plus accrued and unpaid interest, if any, to the redemption date plus a “make-whole” premium. We have not separated the make-whole premium from the underlying debt instrument to account for it as a derivative instrument as the economic characteristics and the risks of this embedded derivative are clearly and closely related to the economic characteristics and risks of the underlying debt.
At any time prior to February 15, 2025, we may redeem up to 40% of the aggregate principal amount of the February 2032 Notes in an amount not to exceed the amount of proceeds of one or more equity offerings, at a price equal to 104.500% of the principal amount thereof, plus accrued and unpaid interest, if any, to, but excluding, the redemption date, provided that at least 50% of the aggregate principal amount of the February 2032 Notes remains outstanding after the redemption. Prior to February 15, 2027, we may redeem some or all of the February 2032 Notes at a redemption price equal to 100% of the aggregate principal amount thereof, plus accrued and unpaid interest, if any, to the redemption date plus a “make-whole” premium. We have not separated the make-whole premium from the underlying debt instrument to account for it as a derivative instrument as the economic characteristics and the risks of this embedded derivative are clearly and closely related to the economic characteristics and risks of the underlying debt.
Credit agreement - On March 14, 2023, we amended our credit and guaranty agreement, extending its maturity to March 14, 2028. We recorded deferred fees of $2 related to the amendment. The deferred fees are being amortized over the life of the Revolving Facility. Deferred financing costs on our Revolving Facility are included in other noncurrent assets.
The Revolving Facility is guaranteed by all of our wholly-owned domestic subsidiaries subject to certain exceptions (the guarantors) and are secured by a first-priority lien on substantially all of the assets of Dana and the guarantors, subject to certain exceptions.
Advances under the Revolving Facility bear interest at a floating rate based on, at our option, the base rate or Term Secured Overnight Financing Rate (SOFR) (each as described in the credit and guaranty agreement) plus a margin as set forth below:
Margin
Total Net Leverage Ratio
Base Rate
SOFR Rate
Less than or equal to 1.00:1.00
0.25 % 1.25 %
Greater than 1.00:1.00 but less than or equal to 2.00:1.00
0.50 % 1.50 %
Greater than 2.00:1.00
0.75 % 1.75 %
Commitment fees are applied based on the average daily unused portion of the available amounts under the Revolving Facility as set forth below:
Total Net Leverage Ratio
Commitment Fee
Less than or equal to 1.00:1.00
0.250 %
Greater than 1.00:1.00 but less than or equal to 2.00:1.00
0.375 %
Greater than 2.00:1.00
0.500 %
Up to $275 of the Revolving Facility may be applied to letters of credit, which reduces availability. We pay a fee for issued and undrawn letters of credit in an amount per annum equal to the applicable margin for SOFR rate advances based on a quarterly average availability under issued and undrawn letters of credit under the Revolving Facility and a per annum fronting fee of 0.125%, payable quarterly.
At December 31, 2024, we had no outstanding borrowings under the Revolving Facility and had utilized $10 for letters of credit. We had availability at December 31, 2024 under the Revolving Facility of $1,140 after deducting the letters of credit.
Debt covenants - At December 31, 2024, we were in compliance with the covenants of our financing agreements. Under the Revolving Facility and the senior notes, we are required to comply with certain incurrence-based covenants customary for facilities of these types and, in the case of the Revolving Facility, a maintenance covenant tested on the last day of each fiscal quarter requiring us to maintain a first lien net leverage ratio not to exceed 2.00 to 1.00.
Note 13. Fair Value Measurements and Derivatives
In measuring the fair value of our assets and liabilities, we use market data or assumptions that we believe market participants would use in pricing an asset or liability including assumptions about risk when appropriate. Our valuation techniques include a combination of observable and unobservable inputs.
Fair value measurements on a recurring basis - Assets and liabilities that are carried in our balance sheet at fair value are as follows:
Fair Value
Category
Balance Sheet Location
Fair Value Level
December 31, 2024
December 31, 2023
Currency forward contracts
Cash flow hedges
Accounts receivable - Other
10 43
Cash flow hedges
Other accrued liabilities
28 7
Undesignated
Accounts receivable - Other
8 3
Undesignated
Other accrued liabilities
14 5
Currency swaps
Cash flow hedges
Other noncurrent assets
Cash flow hedges
Other noncurrent liabilities
Undesignated
Other noncurrent liabilities
5 9
Fair Value Level 1 assets and liabilities reflect quoted prices in active markets. Fair Value Level 2 assets and liabilities reflect the use of significant other observable inputs.
Fair value of financial instruments - The financial instruments that are not carried in our balance sheet at fair value are as follows:
Carrying
Fair
Carrying
Fair
Fair Value Level
Value
Value
Value
Value
Long-term debt
$ 2,510 $ 2,492 $ 2,582 $ 2,495
Foreign currency derivatives - Our foreign currency derivatives include forward contracts associated with forecasted transactions, primarily involving the purchases and sales of inventory through the next fifteen months, as well as currency swaps associated with certain recorded external notes payable and intercompany loans receivable and payable. Periodically, our foreign currency derivatives also include net investment hedges of certain of our investments in foreign operations.
We have executed fixed-to-fixed cross-currency swaps in conjunction with the issuance of certain notes to eliminate the variability in the functional-currency-equivalent cash flows due to changes in exchange rates associated with the forecasted principal and interest payments. All of the underlying designated financial instruments, and any subsequent replacement debt, have been designated as the hedged items in each respective cash flow hedge relationship, as shown in the table below. Designated as cash flow hedges of the forecasted principal and interest payments of the underlying designated financial instruments, or subsequent replacement debt, all of the swaps economically convert the underlying designated financial instruments into the functional currency of each respective holder. The impact of the interest rate differential between the inflow and outflow rates on all fixed-to-fixed cross-currency swaps is recognized during each period as a component of interest expense.
The following fixed-to-fixed cross-currency swaps were outstanding at December 31, 2024:
Underlying Financial Instrument
Derivative Financial Instrument
Description
Type
Face Amount
Rate
Notional Amount
Traded Amount
Inflow Rate
Outflow Rate
April 2025 Notes
Payable
$ 200 5.75 % $ 200 € 185 5.75 % 3.85 %
Luxembourg Intercompany Notes
Receivable
€ 93 3.85 % $ 100 € 93 5.75 % 3.85 %
Luxembourg Intercompany Notes
Receivable
€ 278 3.70 % € 278 $ 300 5.38 % 3.70 %
Undesignated 2026 Swap
$ 188 € 169 6.50 % 5.14 %
Undesignated Offset 2026 Swap
€ 169 $ 188 3.13 % 6.50 %
The designated swaps are expected to be highly effective in offsetting the corresponding currency-based changes in cash outflows related to the underlying designated financial instruments. Based on our qualitative assessment that the critical terms of all of the underlying designated financial instruments and all of the associated swaps match and that all other required criteria have been met, we do not expect to incur any ineffectiveness. As effective cash flow hedges, changes in the fair value of the swaps will be recorded in OCI during each period. Additionally, to the extent the swaps remain effective, the appropriate portion of AOCI will be reclassified to earnings each period as an offset to the foreign exchange gain or loss resulting from the remeasurement of the underlying designated financial instruments. See Note 12 for additional information about the April 2025 Notes. To the extent the swaps are no longer effective, changes in their fair values will be recorded in earnings.
The total notional amount of outstanding foreign currency forward contracts, involving the exchange of various currencies, was $1,331 at December 31, 2024 and $776 at December 31, 2023. The total notional amount of outstanding foreign currency swaps, including the fixed-to-fixed cross-currency swaps, was $951 at December 31, 2024 and $981 at December 31, 2023.
The following currency derivatives were outstanding at December 31, 2024:
Notional Amount (U.S. Dollar Equivalent)
Functional Currency
Traded Currency
Designated
Undesignated
Total
Maturity
U.S. dollar
Canadian dollar, Chinese renminbi, euro, Mexican peso, Thai baht, South African rand
$ 632 $ 36 $ 668 Dec-2025
Euro
U.S. dollar, Australian dollar, Swiss franc, Chinese renminbi, British pound, Hungarian forint, Indian rupee, Japanese yen, Mexican peso, New Zealand dollar, Swedish krona
324 32 356 Sep-2027
British pound
U.S. dollar, euro
18 4 22 Dec-2025
South African rand
U.S. dollar, euro, Thai baht
29 29 Feb-2025
Thai baht
U.S. dollar
6 12 18 Sep-2025
Canadian dollar
U.S. dollar
15 19 34 Aug-2025
Brazilian real
U.S. dollar, euro
61 24 85 Nov-2025
Indian rupee
U.S. dollar, euro, British pound
102 102 Dec-2025
Chinese renminbi
U.S. dollar, Canadian dollar, euro
7 7 Jan-2025
Mexican peso
U.S. dollar
5 5 Jan-2025
Swedish krona
euro
5 5 Jan-2025
Total forward contracts
1,056 275 1,331
U.S. dollar
euro
288 175 463 Nov-2027
Euro
U.S. dollar
300 188 488 Jun-2026
Total currency swaps
588 363 951
Total currency derivatives
$ 1,644 $ 638 $ 2,282
Designated cash flow hedges - With respect to contracts designated as cash flow hedges, changes in fair value during the period in which the contracts remain outstanding are reported in OCI to the extent such contracts remain effective. Effectiveness is measured by using regression analysis to determine the degree of correlation between the change in the fair value of the derivative instrument and the change in the associated foreign currency exchange rates. Changes in fair value of contracts not designated as cash flow hedges or as net investment hedges are recognized in other income (expense), net in the period in which the changes occur. Realized gains and losses from currency-related forward contracts associated with forecasted transactions or from other derivative instruments, including those that have been designated as cash flow hedges and those that have not been designated, are recognized in the same line item in the consolidated statement of operations in which the underlying forecasted transaction or other hedged item is recorded. Accordingly, amounts are potentially recorded in sales, cost of sales or, in certain circumstances, other income (expense), net.
The following table provides a summary of deferred gains (losses) reported in AOCI as well as the amount expected to be reclassified to income in one year or less:
Deferred Gain (Loss) in AOCI
December 31, 2024
December 31, 2023
Gain (loss) expected to be reclassified into income in one year or less
Forward Contracts
$ (35 ) $ 20 $ (35 )
Cross-Currency Swaps
(3 ) 1
Total
$ (38 ) $ 21 $ (35 )
The following table provides a summary of the location and amount of gains or losses recognized in the consolidated statement of operations associated with cash flow hedging relationships:
Derivatives Designated as Cash Flow Hedges
Total amounts of income and expense line items presented in the consolidated statement of operations in which the effects of cash flow hedges are recorded
Net sales
$ 10,284 $ 10,555 $ 10,156
Cost of sales
9,408 9,655 9,393
Other income (expense), net
(11 ) 3 22
(Gain) or loss on cash flow hedging relationships
Foreign currency forwards
Amount of (gain) loss reclassified from AOCI into income
Cost of sales
(11 ) (34 ) (7 )
Other income (expense), net
18 (8 ) (6 )
Cross-currency swaps
Amount of (gain) loss reclassified from AOCI into income
Other income (expense), net
(37 ) 19 (43 )
The amounts reclassified from AOCI into income for the cross-currency swaps represent an offset to a foreign exchange loss on our foreign currency-denominated intercompany and external debt instruments.
Certain of our hedges of forecasted transactions have not formally been designated as cash flow hedges. As undesignated forward contracts, the changes in the fair value of such contracts are included in earnings for the duration of the outstanding forward contract. Any realized gain or loss on the settlement of such contracts is recognized in the same period and in the same line item in the consolidated statement of operations as the underlying transaction. The following table provides a summary of the location and amount of gains or losses recognized in the consolidated statement of operations associated with undesignated hedging relationships.
Derivatives Not Designated as Hedging Instruments
Gain or (loss) recognized in income
Foreign currency forward contracts
Cost of sales
$ 4 $ - $ -
Other income (expense), net
2 (10 ) (13 )
Net investment hedges - We periodically designate derivative contracts or underlying non-derivative financial instruments as net investment hedges. With respect to contracts designated as net investment hedges, we apply the forward method, but for non-derivative financial instruments designated as net investment hedges, we apply the spot method. Under both methods, we report changes in fair value in the CTA component of OCI during the period in which the contracts remain outstanding to the extent such contracts and non-derivative financial instruments remain effective. During the second quarter of 2024, we entered into foreign currency forwards with a notional value of $100 that we designated as a net investment hedge of the foreign currency exposure related to a China renminbi denominated subsidiary. These forwards will mature in September 2025. During the third quarter of 2024, we entered into foreign currency forwards with a notional value of $122 that we designated as a net investment hedge of the foreign currency exposure related to a euro denominated subsidiary. These forwards will mature in November 2025.
Note 14. Commitments and Contingencies
Environmental liabilities - Accrued environmental liabilities were $15 and $6 at December 31, 2024 and 2023. We consider the most probable method of remediation, current laws and regulations and existing technology in estimating our environmental liabilities.
Guarantee of lease obligations - In connection with the divestiture of our Structural Products business in 2010, leases covering three U.S. facilities were assigned to a U.S. affiliate of Metalsa. Under the terms of the sale agreement, we will guarantee the affiliate’s performance under the leases, which run through June 2025, including approximately $6 of annual payments. In the event of a required payment by Dana as guarantor, we are entitled to pursue full recovery from Metalsa of the amounts paid under the guarantee and to take possession of the leased property.
Other legal matters - We are subject to various pending or threatened legal proceedings arising out of the normal course of business or operations. In view of the inherent difficulty of predicting the outcome of such matters, we cannot state what the eventual outcome of these matters will be. However, based on current knowledge and after consultation with legal counsel, we believe that any liabilities that may result from these proceedings will not have a material adverse effect on our liquidity, financial condition or results of operations.
Note 15. Warranty Obligations
We record a liability for estimated warranty obligations at the dates our products are sold. We record the liability based on our estimate of costs to settle future claims. Adjustments to our estimated costs at time of sale are made as claim experience and other new information becomes available. Obligations for service campaigns and other occurrences are recognized as adjustments to prior estimates when the obligation is probable and can be reasonably estimated.
Changes in warranty liabilities -
Balance, beginning of period
$ 116 $ 108 $ 107
Amounts accrued for current period sales
53 51 44
Adjustments of prior estimates
17 14 6
Settlements of warranty claims
(61 ) (56 ) (46 )
Currency impact
(2 ) (1 ) (3 )
Balance, end of period
$ 123 $ 116 $ 108
Note 16. Income Taxes
Income tax expense -
Current
U.S. federal and state
$ 16 $ 38 $ 19
Non-U.S.
152 187 112
Total current
168 225 131
Deferred
U.S. federal and state
(37 ) (94 ) 160
Non-U.S.
8 (10 ) (7 )
Total deferred
(29 ) (104 ) 153
Total expense
$ 139 $ 121 $ 284
We record interest and penalties related to uncertain tax positions as a component of income tax expense or benefit. Net interest expense for the periods presented herein is not significant.
Income before income taxes -
U.S. operations
$ (312 ) $ (246 ) $ (343 )
Non-U.S. operations
392 424 312
Earnings (loss) before income taxes
$ 80 $ 178 $ (31 )
Income tax audits - We conduct business globally and, as a result, file income tax returns in multiple jurisdictions that are subject to examination by taxing authorities throughout the world. With few exceptions, we are no longer subject to U.S. federal, state and local or foreign income tax examinations for years before 2008.
We are currently under audit by U.S. and foreign authorities for certain taxation years. When the issues related to these periods are settled, the total amounts of unrecognized tax benefits for all open tax years may be modified. Audit outcomes and the timing of the audit settlements are subject to uncertainty and we cannot make an estimate of the impact on our financial position at this time.
GILTI Policy Elections - The SEC staff has indicated that a company should make and disclose certain policy elections related to accounting for global intangible low-taxed income (GILTI). As to whether we will recognize deferred taxes for basis differences expected to reverse as GILTI or account for the effect of GILTI as a period cost when incurred, we intend to account for the tax effect of GILTI as a period cost. As to the realizability of the tax benefit provided by net operating losses, we are electing to utilize the tax law ordering approach. Recent macroeconomic factors have resulted in losses in the United States. A valuation allowance has been provided for deferred tax assets where GILTI is not a source of income; however, the GILTI tax law ordering approach provides positive evidence for certain other deferred tax assets without a valuation allowance.
Foreign income repatriation - We continue to analyze and adjust the estimated impact of the non-U.S. income and withholding tax liabilities based on the amount and source of these earnings, as well as the expected means through which those earnings may be taxed. We recognized net expense of $18 in 2024, $7 in 2023 and net benefit of $1 in 2022, related to future income taxes and non-U.S. withholding taxes on repatriations from operations that are not permanently reinvested. We also paid withholding taxes of $12, $12 and $6 during 2024, 2023 and 2022 related to the actual transfer of funds to the U.S. The unrecognized tax liability associated with the operations in which we are permanently reinvested is $47 at December 31, 2024.
Effective tax rate reconciliation -
$
%
$
%
$
%
U.S. federal income tax rate
16 21 37 21 (7 ) 21
Adjustments resulting from:
State and local income taxes, net of federal benefit
1 1 (5 ) (3 ) (6 ) 19
Non-U.S. income / expense
16 20 35 20 (2 ) 7
Credits and tax incentives
13 16 9 5 (27 ) 87
U.S. tax and withholding tax on non-US earnings
41 51 41 23 42 (135 )
Intercompany sale of certain operating assets
(54 ) (30 ) (1 ) 3
Settlement and return adjustments
4 5 23 13 (7 ) 23
Enacted change in tax rates
3 4 (4 ) 13
Goodwill impairment
47 (151 )
Miscellaneous items
3 3 7 4 (6 ) 19
Valuation allowance adjustments
42 53 28 15 255 (822 )
Effective income tax rate
139 174 121 68 284 (916 )
During 2024, we recorded tax expense of $22 for valuation allowances related to foreign jurisdictions and tax expense of $11 due to revisions in our assertions on unremitted earnings in foreign jurisdictions.
During 2023, we recorded tax expense of $19 for income tax reserves associated with prior tax years in foreign jurisdictions. In addition, we recorded net benefit of $55 on the intercompany sale of intangible assets to the U.S.
During 2022, we recognized tax expense of $240 to record valuation allowance in the U.S., which includes $189 on U.S. federal credits and attributes and $51 related to U.S. state attributes. In addition, we recorded a tax benefit of $32 to adjust U.S. tax credits. A pre-tax goodwill impairment charge of $191 with an associated income tax benefit of $2 was also recorded.
Deferred tax assets and liabilities - Temporary differences and carryforwards give rise to the following deferred tax assets and liabilities.
Net operating loss carryforwards
$ 272 $ 218
Postretirement benefits, including pensions
53 65
Research and development costs
269 238
Expense accruals
104 65
Other tax credits recoverable
209 217
Capital loss carryforwards
43 53
Inventory reserves
44 37
Postemployment and other benefits
4 5
Intangibles
50 56
Leasing activities
86 77
Other
110 75
Total
1,244 1,106
Valuation allowances
(667 ) (550 )
Deferred tax assets
577 556
Unremitted earnings
(35 ) (16 )
Depreciation
(36 ) (58 )
Deferred tax liabilities
(71 ) (74 )
Net deferred tax assets
$ 506 $ 482
We have generated deferred tax assets in foreign jurisdictions where realization of the future economic benefits were, in previous reporting periods, considered so remote that the benefits were not recognized. As of December 31, 2023 the unrecognized deferred tax asset was $88. In 2024, we concluded that the future economic benefits of the tax assets are no longer remote and therefore, deferred tax assets of $96 were recognized as of December 31, 2024. We also concluded that it is not more likely than not that the tax benefits associated with the deferred tax assets will be realized; therefore, offsetting valuation allowances were recognized.
Carryforwards - Our deferred tax assets include benefits expected from the utilization of net operating loss (NOL), capital loss and credit carryforwards in the future. The following table identifies the net operating loss deferred tax asset components and the related allowances that existed at December 31, 2024. Due to time limitations on the ability to realize the benefit of the carryforwards, additional portions of these deferred tax assets may become unrealizable in the future.
Deferred
Earliest
Tax
Valuation
Carryforward
Year of
Asset
Allowance
Period
Expiration
Net operating losses
U.S. state
$ 51 $ (51 ) Various
Brazil
10 (4 ) Unlimited
France
5 (5 ) Unlimited
Australia
14 Unlimited
Italy
19 (19 ) Unlimited
Germany
4 (4 ) Unlimited
Sweden
8 (8 ) Unlimited
South Africa
7 (7 ) Unlimited
U.K.
21 (21 ) Unlimited
Luxembourg
68 (68 ) Various
Canada
64 (58 ) 20
China
1 (1 ) 5
Total
$ 272 $ (246 )
In addition to the NOL carryforwards listed in the table above, we have deferred tax assets related to capital loss carryforwards of $43 which are fully offset with valuation allowances at December 31, 2024. We also have deferred tax assets of $219 related to other credit carryforwards which are largely offset with valuation allowances of $207 at December 31, 2024. The capital losses can generally be carried forward indefinitely while the other credits are generally available for 10 to 20 years.
Unrecognized tax benefits - Unrecognized tax benefits are the difference between a tax position taken, or expected to be taken, in a tax return and the benefit recognized for accounting purposes. Interest income or expense, as well as penalties relating to income tax audit adjustments and settlements, are recognized as components of income tax expense or benefit. Interest of $20 and $21 was accrued on the uncertain tax positions at December 31, 2024 and 2023.
Reconciliation of gross unrecognized tax benefits -
Balance, beginning of period
$ 112 $ 102 $ 126
Decrease related to expiration of statute of limitations
(7 ) (8 ) (6 )
Decrease related to prior years tax positions
(6 ) (5 ) (43 )
Decrease related to settlements
(4 )
Increase related to prior years tax positions
4 5 7
Increase related to current year tax positions
13 18 18
Balance, end of period
$ 112 $ 112 $ 102
We anticipate that the change in our gross unrecognized tax benefits will not be significant in the next twelve months as a result of examinations in various jurisdictions. The settlement of these matters will not impact the effective tax rate. Gross unrecognized tax benefits of $85 would impact the effective tax rate if recognized. If other open matters are settled with the IRS or other taxing jurisdictions, the total amounts of unrecognized tax benefits for open tax years may be modified.
Note 17. Other Income (Expense), Net
Non-service cost components of pension and OPEB costs
$ (18 ) $ (13 ) $ (7 )
Government assistance
11 16 8
Foreign exchange gain (loss)
(11 ) (13 ) 4
Strategic transaction expenses
(9 ) (5 ) (8 )
Loss on sale of property, plant and equipment
(6 ) (1 ) (2 )
Other, net
22 19 27
Other income (expense), net
$ (11 ) $ 3 $ 22
Foreign exchange gains and losses on cross-currency intercompany loan balances that are not of a long-term investment nature are included above. Foreign exchange gains and losses on intercompany loans that are permanently invested are reported in OCI. We continue to account for Argentina as a highly inflationary economy and remeasure the financial statements of our Argentine subsidiaries as if their functional currency was the U.S. dollar. The foreign exchange loss in 2023 was primarily due to the Argentine government significantly devaluing the Argentine peso during the fourth quarter of 2023. Continued devaluation of the Argentine peso was the primary driver of the foreign exchange loss in 2024.
Strategic transaction expenses relate primarily to costs incurred in connection with acquisition and divestiture related activities, including costs to complete the transaction and post-closing integration costs. Strategic transaction expenses in 2024, 2023 and 2022 were primarily attributable to investigating potential acquisitions and business ventures, divestitures and other strategic initiatives.
Note 18. Revenue from Contracts with Customers
We generate revenue from selling production parts to original equipment manufacturers (OEMs) and service parts to OEMs and aftermarket customers. While we provide production and service parts to certain OEMs under awarded multi-year programs, these multi-year programs do not contain any commitment to volume by the customer. As such, individual customer releases or purchase orders represent the contract with the customer. Our customer contracts do not provide us with an enforceable right to payment for performance completed to date throughout the contract term. As such, we recognize part sales revenue at the point in time when the parts are shipped, and risk of loss has transferred to the customer. We have elected to continue to include shipping and handling fees billed to customers in revenue, while including costs of shipping and handling in costs of sales. Taxes collected from customers are excluded from revenues and credited directly to obligations to the appropriate government agencies. Payment terms with our customers are established based on industry and regional practices and generally do not exceed 180 days.
We continually seek new business opportunities and at times provide incentives to our customers for new program awards. We evaluate the underlying economics of each payment made to our customers to determine the proper accounting by understanding the nature of the payment, the rights and obligations in the contract, and other relevant facts and circumstances. Upfront payments to our customers are capitalized if we determine that the payments are incremental and incurred only if the new business is obtained and we expect to recover these amounts from the customer over the term of the new business program. We recognize a reduction to revenue as products that the upfront payments are related to are transferred to the customer, based on the total amount of products expected to be sold over the term of the program. We evaluate the amounts capitalized each period for recoverability and expense any amounts that are no longer expected to be recovered. We had $4 and $5 recorded in other current assets and $28 and $34 recorded in other noncurrent assets at December 31, 2024 and December 31, 2023.
Certain of our customer contracts include rebate incentives. We estimate expected rebates and accrue the corresponding refund liability, as a reduction of revenue, at the time covered product is sold to the customer based on anticipated customer purchases during the rebate period and contractual rebate percentages. Refund liabilities are included in other accrued liabilities on our consolidated balance sheet. We provide standard fitness for use warranties on the products we sell, accruing for estimated costs related to product warranty obligations at time of sale. See Note 15 for additional information.
Contract liabilities are primarily comprised of cash deposits made by customers with cash in advance payment terms. Generally, our contract liabilities turn over frequently given our relatively short production cycles. Contract liabilities were $25 and $50 at December 31, 2024 and December 31, 2023. Contract liabilities are included in other accrued liabilities on our consolidated balance sheet.
Disaggregation of revenue -
The following table disaggregates revenue for each of our operating segments by geographical market:
Light Vehicle
North America
$ 2,767 $ 2,606 $ 2,976
Europe
615 568 403
South America
286 272 217
Asia Pacific
556 589 494
Total
$ 4,224 $ 4,035 $ 4,090
Commercial Vehicle
North America
$ 1,113 $ 1,143 $ 987
Europe
296 314 274
South America
440 404 524
Asia Pacific
156 231 194
Total
$ 2,005 $ 2,092 $ 1,979
Off-Highway
North America
$ 353 $ 361 $ 361
Europe
1,794 2,174 1,939
South America
24 23 17
Asia Pacific
596 627 629
Total
$ 2,767 $ 3,185 $ 2,946
Power Technologies
North America
$ 737 $ 642 $ 599
Europe
441 494 443
South America
29 32 30
Asia Pacific
81 75 69
Total
$ 1,288 $ 1,243 $ 1,141
Total
North America
$ 4,970 $ 4,752 $ 4,923
Europe
3,146 3,550 3,059
South America
779 731 788
Asia Pacific
1,389 1,522 1,386
Total
$ 10,284 $ 10,555 $ 10,156
Note 19. Segments, Geographical Area and Major Customer Information
We are a global provider of high-technology products to virtually every major vehicle manufacturer in the world. We also serve the stationary industrial market. Our technologies include drive systems (axles, driveshafts, transmissions, and wheel and track drives); motion systems (winches, slew drives, and hub drives); electrodynamic technologies (motors, inverters, software and control systems, battery-management systems, and fuel cell plates); sealing solutions (gaskets, seals, cam covers, and oil pan modules); thermal-management technologies (transmission and engine oil cooling, battery and electronics cooling, charge air cooling, and thermal-acoustical protective shielding); and digital solutions (active and passive system controls and descriptive and predictive analytics). We serve our global light vehicle, medium/heavy vehicle and off-highway markets through four operating segments - Light Vehicle Drive Systems (Light Vehicle), Commercial Vehicle Drive and Motion Systems (Commercial Vehicle), Off-Highway Drive and Motion Systems (Off-Highway) and Power Technologies, which is the center of excellence for sealing and thermal-management technologies that span all customers in our on-highway and off-highway markets. These operating segments have global responsibility and accountability for business commercial activities and financial performance. Dana’s Chairman and Chief Executive Officer is its chief operating decision maker (CODM).
Dana’s CODM evaluates the performance of its operating segments based on external sales and segment EBITDA. Segment EBITDA is a primary driver of cash flows from operations and a measure of our ability to maintain and continue to invest in our operations and provide shareholder returns. Our segments are charged for corporate and other shared administrative costs. Segment EBITDA may not be comparable to similarly titled measures reported by other companies.
Segment information -
Light
Commercial
Power
Vehicle
Vehicle
Off-Highway
Technologies
Corporate
Total
External sales
$ 4,224 $ 2,005 $ 2,767 $ 1,288 $ 10,284
Inter-segment sales
187 112 65 25 389
4,411 2,117 2,832 1,313 10,673
Reconciliation of sales
Elimination of inter-segment sales
(389 )
Total consolidated sales
$ 10,284
Less:
Cost of sales
3,980 1,948 2,287 1,148
Selling, general and administrative expenses
122 98 141 74
Other segment items (a)
5 (4 ) 15 1
Segment EBITDA
$ 314 $ 67 $ 419 $ 92 $ 892
Purchases of property, plant and equipment
$ 182 $ 68 $ 66 $ 46 $ 18 $ 380
Segment net assets (b)
$ 285 $ 358 $ 460 $ 188 $ (71 ) $ 1,220
Light
Commercial
Power
Vehicle
Vehicle
Off-Highway
Technologies
Corporate
Total
External sales
$ 4,035 $ 2,092 $ 3,185 $ 1,243 $ 10,555
Inter-segment sales
190 124 61 25 400
4,225 2,216 3,246 1,268 10,955
Reconciliation of sales
Elimination of inter-segment sales
(400 )
Total consolidated sales
$ 10,555
Less:
Cost of sales
3,866 2,034 2,627 1,108
Selling, general and administrative expenses
131 108 165 74
Other segment items (a)
(16 ) 13 11 3
Segment EBITDA
$ 212 $ 87 $ 465 $ 89 $ 853
Purchases of property, plant and equipment
$ 184 $ 106 $ 65 $ 120 $ 26 $ 501
Segment net assets (b)
$ 339 $ 354 $ 485 $ 181 $ (68 ) $ 1,291
Light
Commercial
Power
Vehicle
Vehicle
Off-Highway
Technologies
Corporate
Total
External sales
$ 4,090 $ 1,979 $ 2,946 $ 1,141 $ 10,156
Inter-segment sales
166 110 64 28 368
4,256 2,089 3,010 1,169 10,524
Reconciliation of sales
Elimination of inter-segment sales
(368 )
Total consolidated sales
$ 10,156
Less:
Cost of sales
3,982 1,947 2,489 1,013
Selling, general and administrative expenses
115 104 135 63
Other segment items (a)
(1 ) 5 18 1
Segment EBITDA
$ 158 $ 43 $ 404 $ 94 $ 699
Purchases of property, plant and equipment
$ 201 $ 67 $ 73 $ 64 $ 35 $ 440
Segment net assets (b)
$ 291 $ 305 $ 494 $ 143 $ (88 ) $ 1,145
(a)
Other segment items primarily include foreign exchange gains and losses, government assistance, export incentives and the benefit of utilizing non-refundable tax credits purchased at a discount.
(b)
Segment net assets include accounts receivable - trade, inventories and accounts payable.
Reconciliation of segment EBITDA to consolidated net income (loss) -
Segment EBITDA
$ 892 $ 853 $ 699
Corporate expense and other items, net
(7 ) (8 ) 1
Depreciation
(401 ) (393 ) (365 )
Amortization
(21 ) (23 ) (23 )
Non-service cost components of pension and OPEB costs
(18 ) (13 ) (7 )
Restructuring charges, net
(76 ) (25 ) 1
Stock compensation expense
(30 ) (26 ) (19 )
Strategic transaction expenses
(9 ) (5 ) (8 )
Loss on sale of property, plant and equipment
(6 ) (1 ) (2 )
Loss on disposal group previously held for sale
(26 )
Supplier capacity charge
(46 )
Distressed supplier costs
(44 )
Amounts attributable to previously divested/closed operations
(9 ) (2 )
Impairment of goodwill
(191 )
Other items
(17 ) 1 2
Earnings before interest and income taxes
226 316 86
Loss on extinguishment of debt
(1 )
Interest income
15 17 11
Interest expense
161 154 128
Earnings (loss) before income taxes
$ 80 $ 178 $ (31 )
Reconciliation of segment net assets to consolidated total assets -
Segment net assets
$ 1,220 $ 1,291 $ 1,145
Accounts payable
1,522 1,756 1,838
Cash and cash equivalents
494 529 425
Accounts receivable - Other
261 280 202
Other current assets
206 247 219
Goodwill
250 263 259
Intangibles
150 182 201
Deferred tax assets
560 516 397
Other noncurrent assets
189 140 123
Investments in affiliates
126 123 136
Operating lease assets
293 327 311
Property, plant and equipment, net
2,214 2,311 2,193
Total assets
$ 7,485 $ 7,965 $ 7,449
Geographic information - Of our 2024 consolidated net sales, the U.S., Italy, India, Brazil, Germany and China account for 45%, 14%, 6%, 5%, 5% and 4%, respectively. No other country accounted for 5% or more of our consolidated net sales during the past three years. Sales are attributed to the location of the product entity recording the sale. Long-lived assets represent property, plant and equipment and operating lease assets.
Net Sales
Long-Lived Assets
North America
United States
$ 4,675 $ 4,492 $ 4,668 $ 1,140 $ 1,203 $ 1,185
Other North America
295 260 255 213 221 187
Total
4,970 4,752 4,923 1,353 1,424 1,372
Europe
Italy
1,434 1,705 1,535 222 237 219
Germany
499 549 494 129 154 131
Other Europe
1,213 1,296 1,030 363 331 302
Total
3,146 3,550 3,059 714 722 652
South America
Brazil
527 488 606 90 119 102
Other South America
252 243 182 24 24 22
Total
779 731 788 114 143 124
Asia Pacific
India
581 634 554 172 173 183
China
438 503 484 88 106 105
Other Asia Pacific
370 385 348 66 70 68
Total
1,389 1,522 1,386 326 349 356
Total
$ 10,284 $ 10,555 $ 10,156 $ 2,507 $ 2,638 $ 2,504
Sales to major customers - Ford and Stellantis N.V. were the only individual customers to whom sales have exceeded 10% of our consolidated sales in one or more of the past three years. Sales to Ford were $2,409 (23%) in 2024, $2,138 (20%) in 2023 and $1,978 (19%) in 2022. Sales to Stellantis N.V. (via a directed supply relationship) were $789 (8%) in 2024, $918 (9%) in 2023 and $1,166 (11%) in 2022.
Note 20. Equity Affiliates
We have a number of investments in entities that engage in the manufacture and supply of vehicular parts (primarily axles, axle housing and driveshafts).
Dividends received from equity affiliates were $3, $3 and $32 in 2024, 2023 and 2022.
Equity method investments exceeding $5 at December 31, 2024 -
Ownership Percentage
Investment
Dongfeng Dana Axle Co., Ltd. (DDAC)
50%
$ 54
ROC-Spicer, Ltd. (ROC-Spicer)
50%
Axles India Limited (AIL)
48%
Tai Ya Investment (HK) Co., Limited (Tai Ya)
50%
All others as a group
Investments in equity affiliates
Investments in affiliates carried at cost
Investments in affiliates
$ 126
The carrying value of our equity method investments at December 31, 2024 was $5 morethan our share of the affiliates’ book values. The basis differences relate to our DDAC and ROC-Spicer investments and are primarily attributable to goodwill and property, plant and equipment.
Dana Incorporated
Schedule II
Valuation and Qualifying Accounts and Reserves
(In millions)
Amounts deducted from assets in the balance sheets -
Balance at beginning of period Amounts charged (credited) to income Allowance utilized Adjustments arising from change in currency exchange rates and other items Balance at end of period
Accounts Receivable - Allowance for Doubtful Accounts
$ 16 $ 1 $ (2 ) $ - $ 15
$ 11 $ 7 $ (2 ) $ - $ 16
$ 7 $ 4 $ - $ - $ 11
Deferred Tax Assets - Valuation Allowance
$ 550 $ 42 $ - $ 75 $ 667
$ 512 $ 28 $ - $ 10 $ 550
$ 258 $ 255 $ - $ (1 ) $ 512

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ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
Item 9. Changes In and Disagreements with Accountants on Accounting and Financial Disclosure
None.

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ITEM 9A. CONTROLS AND PROCEDURES
Item 9A. Controls and Procedures
Disclosure controls and procedures - Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of our disclosure controls and procedures (as such term is defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended, (the Exchange Act)) as of the end of the period covered by this report. Based on such evaluations, our Chief Executive Officer and Chief Financial Officer have concluded that, as of the end of such period, our disclosure controls and procedures are effective.
Management's report on internal control over financial reporting - Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rule 13a-15(f). Management, with the participation of the Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of our internal control over financial reporting based on the framework in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this evaluation, management has concluded that, as of December 31, 2024, our internal control over financial reporting was effective.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
PricewaterhouseCoopers LLP, an independent registered public accounting firm, has audited the effectiveness of our internal control over financial reporting as of December 31, 2024, as stated in its report which is included herein.
Changes in internal control over financial reporting - There has been no change in our internal control over financial reporting during the quarter ended December 31, 2024 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

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ITEM 9B. OTHER INFORMATION
Item 9B. Other Information
None.

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ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
Item 10. Directors, Executive Officers and Corporate Governance
Dana has adopted Standards of Business Conduct that apply to all of its officers and employees worldwide. Dana also has adopted Standards of Business Conduct for the Board of Directors. Both documents are available on Dana’s Internet website at http://www.dana.com/investors.
Dana has adopted an Insider Trading Policy governing the purchase, sale and/or other dispositions of our securities by our directors, officers and employees that we believe is reasonably designed to promote compliance with insider trading laws, rules and regulations, and the exchange listing standards applicable to us. A copy of our Insider Trading Policy is filed as Exhibit 19 to this Annual Report on Form 10-K.
The remainder of the response to this item will be included under the sections captioned “Corporate Governance,” “Board Leadership Structure," "Succession Planning,” “Information About the Nominees,” “Risk Oversight,” “Committees and Meetings of Directors,” “Executive Officers” and “Section 16(a) Beneficial Ownership Reporting Compliance” of Dana’s definitive Proxy Statement relating to the Annual Meeting of Shareholders to be held on April 24, 2025, which sections are hereby incorporated herein by reference.

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ITEM 11. EXECUTIVE COMPENSATION
Item 11. Executive Compensation
The response to this item will be included under the sections captioned “Compensation Committee Interlocks and Insider Participation,” “Compensation of Executive Officers,” “Compensation Discussion and Analysis,” “Compensation of Directors,” “Officer Stock Ownership Guidelines,” “Compensation Committee Report,” “Summary Compensation Table,” “Grants of Plan-Based Awards at Fiscal Year-End,” “Outstanding Equity Awards at Fiscal Year-End,” “Option Exercises and Stock Vested During Fiscal Year,” “Nonqualified Deferred Compensation at Fiscal Year-End” and “Potential Payments and Benefits Upon Termination or Change in Control” of Dana’s definitive Proxy Statement relating to the Annual Meeting of Shareholders to be held on April 24, 2025, which sections are hereby incorporated herein by reference.

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ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
The response to this item will be included under the section captioned “Security Ownership of Certain Beneficial Owners and Management” of Dana’s definitive Proxy Statement relating to the Annual Meeting of Shareholders to be held on April 24, 2025, which section is hereby incorporated herein by reference.
Equity Compensation Plan Information
The following table contains information at December 31, 2024 about shares of stock which may be issued under our equity compensation plans, all of which have been approved by our shareholders.
(Shares in millions) Plan Category
Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights(1)
Weighted Average Exercise Price of Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights(2)
Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in Column (a))
Equity compensation plans approved by security holders
4.0
$ -
4.4
Equity compensation plans not approved by security holders
Total
4.0
$ -
4.4
________________________________________
Notes:
(1)
In addition to stock options, restricted stock units and performance shares have been awarded under Dana's equity compensation plans and were outstanding at December 31, 2024.
(2)
Calculated without taking into account the 2.5 shares of common stock subject to outstanding restricted stock and performance share units that become issuable as those units vest since they have no exercise price and no cash consideration or other payment is required for such shares.

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ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Item 13. Certain Relationships and Related Transactions and Director Independence
The response to this item will be included under the sections captioned “Director Independence and Transactions of Directors with Dana,” “Transactions of Executive Officers with Dana” and “Information about the Nominees” of Dana’s definitive Proxy Statement relating to the Annual Meeting of Shareholders to be held on April 24, 2025, which sections are hereby incorporated herein by reference.

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ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES
Item 14. Principal Accountant Fees and Services
The response to this item will be included under the section captioned "Independent Registered Public Accounting Firm" of Dana's definitive Proxy Statement relating to the Annual Meeting of Shareholders to be held on April 24, 2025, which section is hereby incorporated herein by reference.
PART IV

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ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES
Item 15. Exhibits and Financial Statement Schedules
10-K
Pages
(a) List of documents filed as a part of this report:
1.
Consolidated Financial Statements:
Report of Independent Registered Public Accounting Firm (PCAOB ID 238)
Consolidated Statement of Operations
Consolidated Statement of Comprehensive Income
Consolidated Balance Sheet
Consolidated Statement of Cash Flows
Consolidated Statement of Stockholders' Equity
Notes to the Consolidated Financial Statements
2.
Financial Statement Schedule:
Valuation and Qualifying Accounts and Reserves (Schedule II)
All other schedules are omitted because they are not applicable or the required information is shown in the financial statements or notes thereto.
3.
Exhibits
No.
Description
3.1
Third Amended and Restated Certification of Incorporation of Dana Incorporated. Filed as Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed May 2, 2018 and incorporated herein by reference.
3.2
Amended and Restated Bylaws of Dana Incorporated, effective as of May 2, 2018. Filed as Exhibit 3.2 to the Registrant’s Current Report on Form 8-K filed May 2, 2018 and incorporated herein by reference.
4.1
Specimen Common Stock Certificate. Filed as Exhibit 4.1 to Registrant’s Registration Statement on Form 8-A dated January 31, 2008, and incorporated herein by reference.
4.2
Indenture, dated as of January 28, 2011 among Dana and Computershare Trust Company, N.A. as successor to Wells Fargo Bank, National Association, as trustee. Filed as Exhibit 4.6 to Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 2010, and incorporated herein by reference.
4.3
Fourth Supplemental Indenture, dated as November 20, 2019, with respect to the Indenture, dated as of January 28, 2011, between Dana Holding Corporation and Computershare Trust Company, N.A. as successor to Wells Fargo Bank, National Association, as trustee. Filed as Exhibit 4.1 to Registrant's Current Report on Form 8-K dated November 20, 2019, and incorporated herein by reference.
4.4
Indenture, dated as of April 4, 2017, among Dana Luxembourg Financing S.à. r.l., Dana Incorporated and Computershare Trust Company, N.A. as successor to Wells Fargo Bank, National Association, as trustee. Filed as Exhibit 4.1 to Registrant's Current Report on Form 8-K dated April 4, 2017, and incorporated herein by reference.
4.5
Sixth Supplemental Indenture, dated as of June 19, 2020 with respect to the Indenture, dated January 28, 2011, between Dana Incorporated and Computershare Trust Company, N.A. as successor to Wells Fargo Bank, National Association, as trustee. Filed as Exhibit 4.1 to Registrant's Current Report on Form 8-K dated June 20, 2020, and incorporated herein by reference.
4.6
Seventh Supplemental Indenture, dated as of May 13, 2021 with respect to the Indenture, dated January 28, 2011, between Dana Incorporated and Computershare Trust Company, N.A. as successor to Wells Fargo Bank, National Association, as trustee. Filed as Exhibit 4.1 to Registrant's Current Report on Form 8-K dated May 13, 2021, and incorporated herein by reference.
4.7
Indenture, dated as of May 28, 2021, among Dana Luxembourg Financing S.à. r.l., the Company, Computershare Trust Company, N.A. as successor to Wells Fargo Bank, National Association, as trustee and Elavon Financial Services DAC, as paying agent, registrar and transfer agent. Filed as Exhibit 4.1 to Registrant's Current Report on Form 8-K dated May 28, 2021, and incorporated herein by reference.
4.8
Ninth Supplemental Indenture, dated as of November 24, 2021 with respect to the Indenture, dated January 28, 2011, between Dana Incorporated and Computershare Trust Company, N.A. as successor to Wells Fargo Bank, National Association, as trustee. Filed as Exhibit 4.1 to Registrant's Current Report on Form 8-K dated November 24, 2021, and incorporated herein by reference.
4.9
Description of Dana Incorporated Common Stock. Filed as Exhibit 4.9 to the Registrant's Annual Report on Form 10-K for the year ended December 31, 2019, and incorporated herein by reference.
4.10
Indenture, dated as of May 24, 2023, among Dana Luxembourg Financing S.à r.l., Dana Incorporated, Computershare Trust Company, N.A., as trustee, and Elavon Financial Services DAC, as paying agent, registrar and transfer agent. Filed as Exhibit 4.1 to Registrant's Current Report on Form 8-K dated May 24, 2023, and incorporated herein by reference.
10.1*
Executive Employment Agreement dated August 11, 2015, by and between James K. Kamsickas and Dana Incorporated. Filed as Exhibit 10.1 to Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 2015, and incorporated herein by reference.
10.2*
Dana Incorporated Supplemental Executive Retirement Plan. Filed as Exhibit 10.4 to Registrant’s Annual Report on Form 10-K for the fiscal year ended December 31, 2012, and incorporated herein by reference.
10.3*
Amendment to the Dana Limited Supplemental Executive Retirement Plan, effective as of May 1, 2018. Filed with this Report.
10.4*
Dana Incorporated 2021 Omnibus Incentive Plan. Filed as an annex to the Dana Incorporated Proxy Statement dated March 11, 2021, and incorporated herein by reference.
10.5*
Form of Indemnification Agreement. Filed as Exhibit 10.4 to Registrant’s Current Report on Form 8-K dated February 6, 2008, and incorporated herein by reference.
10.6*
Form of Option Agreement. Filed as Exhibit 10.15 to Registrant’s Annual Report on Form 10-K for the fiscal year ended December 31, 2012, and incorporated herein by reference.
10.7*
Amended and Restated Change in Control Severance Plan, effective as of April 30, 2018. Filed as Exhibit 10.1 to Registrant's Current Report on Form 8-K dated April 30, 2018, and incorporated herein by reference.
10.8*
Dana Incorporated Executive Severance Plan, amended and restated effective January 1, 2018. Filed with this Report.
10.9*
Form of Restricted Stock Unit Agreement for Non-Employee Directors. Filed with this Report.
10.10*
Form of Restricted Stock Unit Agreement. Filed with this Report.
10.11*
Form of Performance Share Agreement. Filed with this Report.
10.12*
Dana Savings Restoration Plan. Filed with this Report.
10.13*
Dana Deferred Compensation Plan. Filed with this Report.
10.14
Revolving Credit and Guaranty Agreement, dated as of June 9, 2016, among Dana Incorporated, as borrower, the guarantors party thereto, Citibank, N.A., as administrative agent and collateral agent, and the other lenders party thereto. Filed as Exhibit 10.1 to Registrant's Current Report on Form 8-K dated June 9, 2016, and incorporated herein by reference.
10.15
Revolving Facility Security Agreement, dated as of June 9, 2016, from Dana Incorporated and the other guarantors referred to therein, as guarantors, to Citibank, N.A., as collateral agent. Filed as Exhibit 10.2 to Registrant's Current Report on Form 8-K dated June 9, 2016, and incorporated herein by reference.
10.16
Amendment No. 1 to Revolving Credit and Guaranty Agreement and Amendment No. 1 to the Revolving Facility Security Agreement, dated as of August 17, 2017, among Dana Incorporated, certain domestic subsidiaries of Dana Incorporated party thereto, Citibank, N.A., as administrative agent and collateral agent. Filed as Exhibit 10.1 to Registrant's Current Report on Form 8-K dated August 18, 2017, and incorporated herein by reference.
10.17
Amendment No. 2 to Credit and Guaranty Agreement, dated as of February 28, 2019, among Dana Incorporated, as borrower, the guarantors party thereto, the lenders party thereto and Citibank, N.A., as administrative agent and collateral agent. Filed as Exhibit 10.1 to Registrant’s Current Report on Form 8-K dated March 1, 2019, and incorporated herein by reference.
10.18
Amendment No. 3 to Credit and Guaranty Agreement, dated as of August 30, 2019, among Dana Incorporated, as a borrower, Dana International Luxembourg S.à r.l., as a borrower, the guarantors party thereto, the lenders party thereto and Citibank, N.A., as administrative agent and collateral agent. Filed as Exhibit 10.1 to Registrant’s Current Report on Form 8-K dated September 4, 2019, and incorporated herein by reference.
10.19
Amendment No. 4 to Credit and Guaranty Agreement and Amendment No. 2 to Security Agreement, dated as of April 16, 2020, among Dana Incorporated, Dana International Luxembourg S.à.r.l., the guarantors party thereto, Citibank, N.A. as administrative agent, and the lenders party thereto. Filed as Exhibit 10.4 to the Registrant's Quarterly Report on Form 10-Q for the quarter ended March 31, 2020, and incorporated herein by reference.
10.20
Amendment No. 5 to Credit and Guaranty Agreement and Amendment No. 3 to Security Agreement, dated as of March 25, 2021, among Dana Incorporated, Dana International Luxembourg S.à. r.l., the guarantors party thereto, Citibank, N.A. as administrative agent, and the lenders party thereto. Filed as Exhibit 10.1 to the Registrant's Current Report on Form 8-K filed March 29, 2021, and incorporated herein by reference.
10.21
Director Nomination and Appointment Agreement, dated as of January 7, 2022, among the Icahn Group and Dana Incorporated. Filed as Exhibit 10.1 to the Registrant's Current Report on Form 8-K filed January 7, 2022, and incorporated herein by reference.
10.22
Amendment No. 6 to Credit and Guaranty Agreement, dated as of March 14, 2023, among Dana Incorporated, Dana International Luxembourg S.à r.l., the guarantors party thereto, Citibank, N.A. as administrative agent and collateral agent, and the lenders party thereto. Filed as Exhibit 10.1 to the Registrant's Current Report on Form 8-K filed March 16, 2023, and incorporated herein by reference.
10.23*
First Amendment to the Dana Incorporated 2021 Omnibus Incentive Plan. Filed as Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q filed July 31, 2024, and incorporated herein by reference.
10.24*
Offer Letter to R. Bruce McDonald, dated November 24, 2024. Filed as Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed November 25, 2024, and incorporated herein by reference.
10.25*
Retirement, Transition and Release Agreement, dated November 24, 2024, between Dana Incorporated and James K. Kamsickas. Filed as Exhibit 10.2 to the Registrant’s Current Report on Form 8-K filed November 25, 2024, and incorporated herein by reference.
10.26
Amendment to Director Appointment and Nomination Agreement, dated January 23, 2025, among the Icahn Group and the Dana Incorporated. Filed as Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed January 23, 2025, and incorporated herein by reference.
Dana Incorporated Insider Trading Policy. Filed with this Report.
List of Consolidated Subsidiaries of Dana Incorporated. Filed with this Report.
Consent of PricewaterhouseCoopers LLP. Filed with this Report.
Power of Attorney. Filed with this Report.
31.1
Rule 13a-14(a)/15d-14(a) Certification by Chief Executive Officer. Filed with this Report.
31.2
Rule 13a-14(a)/15d-14(a) Certification by Chief Financial Officer. Filed with this Report.
Section 1350 Certification of Periodic Report (pursuant to Section 906 of the Sarbanes-Oxley Act of 2002). Filed with this Report.
Dana Incorporated Clawback Policy. Filed with this Report.
The following materials from Dana Incorporated’s Annual Report on Form 10-K for the year ended December 31, 2024, formatted in iXBRL (Inline Extensible Business Reporting Language): (i) the Consolidated Statement of Operations, (ii) the Consolidated Statement of Comprehensive Income, (iii) the Consolidated Balance Sheet, (iv) the Consolidated Statement of Cash Flows, (v) the Consolidated Statement of Shareholders’ Equity and (vi) Notes to the Consolidated Financial Statements. Filed with this Report.
Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).
*
Management contract or compensatory plan or arrangement.