0000950170-22-001427 | 10-K | XBRL Viewer | Allison Transmission Holdings INC

Overview

NOTE 1. OVERVIEW

Overview

Throughout 2021, the COVID-19 pandemic continued to cause supply chain, labor and raw material constraints that created volatility in Allison Transmission Holdings, Inc. and its subsidiaries' (“Allison,” or the “Company”) business performance and impacted global markets and supply chains. As a result, the Company experienced, and expect to continue to experience, raw material and component part price inflation, increased freight and logistics costs and increased overtime expense as a result of labor shortages. In addition, despite increased customer demand the Company's net sales for 2021 were negatively impacted as a result of its customers’ inability to secure components from the broader commercial vehicle supply base which resulted in reduced commercial vehicle build schedules.

To limit the spread of COVID-19, governments continue to take various actions including the administration or mandate of vaccinations, travel bans and restrictions, quarantines, curfews, stay-at-home orders, social distancing guidelines and business shutdowns and closures. The Company is also continuing to take a variety of measures to promote the safety and security of its employees and to maintain operations with as minimal impact as possible to its stakeholders, and as a result, the Company has been able to continue its manufacturing operations and deliver its products to customers

The Company designs and manufactures vehicle propulsion solutions, including commercial-duty on-highway, off-highway and defense fully automatic transmissions and electric hybrid and fully electric systems. The business was founded in 1915 and has been headquartered in Indianapolis, Indiana since inception. Allison trades on the New York Stock Exchange under the symbol, “ALSN”.

The Company has approximately 3,400 employees. Although approximately 76% of revenues were generated in North America in 2021, the Company has a global presence by serving customers in Asia, Europe, South America and Africa. The Company serves customers through an independent network of approximately 1,400 independent distributor and dealer locations worldwide.

Summary of Significant Accounting Policies

12 Months Ended

Dec. 31, 2021

Summary of Significant Accounting Policies

NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation and Principles of Consolidation

The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). The information herein reflects all normal recurring material adjustments, which are, in the opinion of management, necessary for a fair statement of the results for the periods presented. The consolidated financial statements herein consist of all wholly-owned domestic and foreign subsidiaries with all significant intercompany transactions eliminated.

These consolidated financial statements present the financial position, results of comprehensive income, cash flows and statements of stockholders’ equity. Certain immaterial reclassifications have been made in the consolidated financial statements of prior periods to conform to the current period presentation. These reclassifications had no impact on previously reported net income, total stockholders’ equity or cash flows.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities and the reported amounts of revenue and expenses. Estimates include, but are not limited to, sales allowances, government price adjustments, fair market values and future cash flows associated with goodwill, indefinite life intangibles, definite life intangibles, long-lived asset impairment tests, useful lives for depreciation and amortization, warranty liabilities, core deposit liabilities, environmental liabilities, determination of discount rate and other assumptions for pension and other post-retirement benefits (“OPEB”) expense, determination of discount rate and period for leases, income taxes and deferred tax valuation allowances, derivative valuation, assumptions for business combinations and contingencies. The Company’s accounting policies involve the application of judgments and assumptions made by management that include inherent risks and uncertainties. Due to the continued uncertainty related to the ongoing COVID-19 pandemic, actual results could differ materially from these estimates and assumptions used in preparation of the financial statements including, but not limited to, future cash flows associated with goodwill, indefinite life intangibles, definite life intangibles, long-lived impairment tests, determination of discount rate and other assumptions for pension and OPEB expense and income taxes. Changes in estimates are recorded in results of operations in the period that the events or circumstances giving rise to such changes occur.

Segment Reporting

In accordance with the Financial Accounting Standards Board’s (“FASB”) authoritative accounting guidance on segment reporting, the Company has one operating segment and reportable segment. The Company is in one line of business, which is the manufacture and distribution of vehicle propulsion solutions.

Business Combinations

The Company uses the acquisition method to account for business combinations. The assets acquired and liabilities assumed are recorded at their respective estimated fair value at the date of acquisition. Any excess purchase price over the fair values of the acquired net assets is recorded as goodwill. Determining the fair values of assets acquired and liabilities assumed requires management's judgment and includes the use of estimates with respect to timing and amount of future cash flows, market rate assumptions, actuarial assumptions, appropriate discount rates and other relevant factors.

Cash and Cash Equivalents

Cash equivalents are defined as short-term, highly-liquid investments with original maturities of 90 days or less. Under the Company’s cash management system, checks issued but not presented to banks may result in book overdraft balances for accounting purposes and are classified within Accounts payable in the Consolidated Balance Sheets. The change in book overdrafts is reported as a component of operating cash flows for Accounts payable.

Investments

Investments in equity securities with a readily determinable fair value, not accounted for under the equity method, are recorded at that value with unrealized gains and losses included in earnings. For equity securities without a readily determinable fair value, the investment is recorded at cost, less any impairment, plus or minus adjustments related to observable transactions for the same or similar securities, with unrealized gains and losses included in earnings. The Company's investments in equity securities had a readily determinable fair value and were recorded at fair value with unrealized gains and losses included in Other income (expense), net. See "NOTE 7. Fair Value of Financial Instruments" for more details.

Inventories

Inventories are stated at the lower of cost or net realizable value. The Company determines cost using the first-in, first-out method. The Company analyzes inventory on a quarterly basis to determine whether it is excess or obsolete inventory. Any decline in carrying value of estimated excess or obsolete inventory is recorded as a reduction of inventory and as an expense included in Cost of sales in the period it is identified.

Property, Plant and Equipment

Property, plant and equipment are recorded at cost less accumulated depreciation. Depreciation expense is recorded using the straight-line method over the following estimated lives:


		Range in Years
Land improvements		5 – 30
Buildings and building improvements		10 – 40
Machinery and equipment		2 – 20
Software		2 – 5
Special tooling		2 – 10

Software represents the costs of software developed or obtained for internal use. Software costs are amortized on a straight-line basis over their estimated useful lives. Software assets are reviewed for impairment when events or circumstances indicate that the carrying value may not be recoverable over the remaining lives of the assets. Upgrades and enhancements are capitalized if they result in added functionality, which enables the software to perform tasks it was previously incapable of performing. Software maintenance, training, data conversion and business process reengineering costs are expensed in the period in which they are incurred.

Special tooling represents the costs to design and develop tools, dies, jigs and other items owned by the Company and used in the manufacture of components by suppliers under long-term supply agreements. Special tooling is depreciated over the tool’s expected life. Special tooling used in the development of new technology is expensed as incurred. Engineering, testing and other costs incurred in the design and development of production parts are expensed as incurred.

Impairment of Long-Lived Assets

The carrying value of long-lived assets is evaluated whenever events or circumstances indicate that the carrying value of an asset may not be recoverable. Events or circumstances that would result in an impairment review primarily include a significant change in the use of an asset or the planned sale or disposal of an asset. The asset would be considered impaired when there is no future use planned for the asset or the future net undiscounted cash flows generated by the asset or asset group are less than its carrying value. An impairment loss would be recognized based on the amount by which the carrying value exceeds fair value.

Assumptions and estimates used to determine cash flows in the evaluation of impairment and the fair values used to determine the impairment are subject to a degree of judgment and complexity. Any changes to the assumptions and estimates resulting from changes in actual results or market conditions from those anticipated may affect the carrying value of long-lived assets and could result in an impairment charge.

Goodwill and Other Intangible Assets

The Company has elected to perform its annual impairment tests for goodwill and indefinite lived intangible assets on October 31 of every year using a multi-step impairment test. In Step 0, the Company has the option to evaluate various qualitative factors to determine the likelihood of impairment. If the Company determines that the fair value is more likely than not less than the carrying value, then it is required to perform Step 1. If the Company does not elect to perform Step 0, it can voluntarily proceed directly to Step 1. In Step 1, the Company performs a quantitative analysis to compare the fair value to its carrying value. If the fair value exceeds the carrying value, no impairment is recorded, and the Company is not required to perform further testing. If the carrying value exceeds fair value, the Company would record an impairment loss equal to the difference.

A qualitative assessment contains uncertainties because it requires management to make assumptions and to apply judgment to assess business changes, economic outlook, financial trends and forecasts, growth rates, credit ratings, equity ratings, discount rates, industry data and other relevant qualitative factors.

A quantitative analysis contains uncertainties because it is performed utilizing a discounted cash flow model which includes key assumptions, such as financial forecasts; net sales growth derived from market information, industry reports, marketing programs and future new product introductions; operating margin improvements derived from cost reduction programs and fixed cost leverage driven by higher sales volumes; and a risk-adjusted discount rate.

Goodwill represents the excess of purchase price paid over the fair value of net assets acquired. In accordance with the FASB’s authoritative accounting guidance on goodwill, the Company does not amortize goodwill but rather evaluates it for impairment on an annual basis, or more often if events or circumstances change that could cause goodwill to become impaired. Goodwill is tested for impairment at the reporting unit level, which is the same as the Company's one operating and reportable segment. The Company does not aggregate any components into its reporting unit.

Goodwill impairment testing for 2021 was performed using the Step 0 analysis by assessing certain qualitative trends and factors. These trends and factors were compared to, and based on, the assumptions used in prior years. After reviewing the various qualitative factors mentioned above, the Company's 2021 annual goodwill impairment test indicated that the fair value for the reporting unit more likely than not exceeded its carrying value, indicating no impairment.

Other intangible assets have both indefinite and finite useful lives. Intangible assets with indefinite useful lives are not amortized but are tested annually for impairment, or more often if events or circumstances change that could cause intangible assets with indefinite useful lives to become impaired. After reviewing the various qualitative factors mentioned above, the Company's annual 2021 indefinite lived intangible assets impairment tests, as of October 31, 2021, indicated that the fair value of its indefinite lived intangible assets more likely than not exceeded their respective carrying value, indicating no impairment.

Intangible assets with finite lives are amortized over their estimated useful lives and reviewed for impairment when circumstances change that would create a triggering event. Customer relationships are amortized over the life in which expected benefits are to be consumed. The other remaining finite life intangibles are amortized on a straight-line basis over their useful lives. The Company evaluates the remaining useful life of the other intangible assets on a periodic basis to determine whether events or circumstances warrant a revision to the remaining useful

life. Assumptions and estimates about future values and remaining useful lives of the Company's intangible and other long-lived assets are complex and subjective. Such assumptions and estimates can be affected by a variety of factors, including external factors such as industry and economic trends, and internal factors, such as changes in the Company's business strategy and internal forecasts. Although management believes the historical assumptions and estimates are reasonable and appropriate, different assumptions and estimates could materially impact the Company's reported financial results. Further information is provided in "NOTE 6. Goodwill and Other Intangible Assets.”

Deferred Financing Costs

The debt issuance costs related to line-of-credit arrangements is presented as a component of other non-current assets. The debt issuance costs related to other types of debt instruments such as notes and loans are presented as a component of long-term debt. Deferred financing costs continue to be amortized over the life of the related debt using the effective interest method. Amortization of deferred financing costs is recorded as part of interest expense and totaled $4 million, $4 million and $5 million for the years ended December 31, 2021, 2020 and 2019, respectively.

Financial Instruments

The Company’s cash equivalents are invested in U.S. government backed securities and recorded at fair value in the Consolidated Balance Sheets. The Company's marketable securities are carried at fair value on the Consolidated Balance Sheets. The Company’s financial derivative instruments, including interest rate swaps, are carried at fair value on the Consolidated Balance Sheets. Refer to "NOTE 7. Fair Value of Financial Instruments” for more detail. The Company’s long-term debt obligations are carried at historical amounts with the Company providing fair value disclosure in "NOTE 8. Debt”. The carrying values of accounts receivable and accounts payable approximate fair value due to their short-term nature.

Insurable Liabilities

The Company records liabilities for its medical, workers’ compensation, long-term disability, product, general and auto liabilities. The determination of these liabilities and related expenses is dependent on claims experience. For most of these liabilities, claims incurred but not yet reported are estimated based upon historical claims experience.

Revenue Recognition

The Company records sales as each distinct performance obligation within a contract is satisfied. The Company sells extended transmission coverage (“ETC”) for which sales are deferred. ETC sales are recognized ratably over the period of coverage, which typically ranges from one to five years after the standard warranty coverage ends. Costs associated with ETC programs are recorded as incurred during the extended period. Distributor and customer sales incentives, consisting of allowances and other rebates, are recorded as a reduction to Net sales when it is determined that the adjustment is not likely to reverse, historically on a quarterly basis. Incentive programs are generally product specific or region specific. Some factors used in estimating when an adjustment is not likely to reverse are the number of transmissions that will be affected by the incentive program and rate of acceptance of any incentive program.

Sales under U.S. government production contracts are recognized at the point in time when control passes to the customer, or when the U.S. government accepts the transmission and is able to direct its use in certain bill-and-hold arrangements. Deferred revenue arises from cash received in advance of the culmination of the earnings process and is recognized as revenue in future periods when the applicable revenue recognition criteria have been

met. Under the terms of previous U.S. government contracts, there were certain price reduction clauses and provisions for potential price reductions which were estimated at the time of sale based upon the Company’s history and experience and were recorded as a reduction to Net sales. Potential reductions may be attributed to a change in projected sales volumes or plant efficiencies which impact overall costs. The Company had $56 million recorded in the price reduction reserve account as of each of December 31, 2021 and 2020.

The Company engages in licensing agreements with certain third parties for the use of the Company’s intellectual property. Deferred revenue arises from cash received in advance of the period of use of the intellectual property. Revenue is recognized over the license period as it is earned.

The Company classifies shipping and handling billed to customers in Net sales and shipping and handling costs in Cost of sales, in accordance with authoritative accounting guidance.

The Company contracts with various third parties to provide engineering services. These services are recorded as Net sales in accordance with the terms of the contract. The saleable engineering recorded was $21 million, $16 million and $11 million for the years ended December 31, 2021, 2020 and 2019, respectively. The associated costs are recorded in Cost of sales.

Warranty

Provisions for estimated expenses related to product warranties are made at the time products are sold. Warranty claims arise when a transmission or propulsion solution manufactured by us fails while in service during the relevant warranty period. The warranty reserve is adjusted in Selling, general and administrative expense based on the Company’s current and historical warranty claims paid and associated repair costs. These estimates are established using historical information including the nature, frequency, and average cost of warranty claims and are adjusted as actual information becomes available. From time to time, the Company may initiate a specific field action program. As a result of the uncertainty surrounding the nature and frequency of specific field action programs, the liability for such programs is recorded when the Company commits to an action. The Company reviews and assesses the liability for these programs on a quarterly basis. The Company also assesses its ability to recover certain costs from its suppliers and records a receivable from the supplier when it believes a recovery is probable. Warranty costs may differ from those estimated if actual claim rates are higher or lower than the Company's historical rates.

Research and Development

The Company incurs costs in connection with research and development programs that are expected to contribute to future earnings. Such costs are charged to Engineering — research and development as incurred.

Environmental

The Company accrues costs related to environmental matters when it is probable that the Company has incurred a liability related to a contaminated site and the costs can be reasonably estimated. For additional information, see "NOTE 18. Commitments and Contingencies”.

Foreign Currency Translation

Most of the Company’s subsidiaries outside the United States prepare financial statements in currencies other than the U.S. Dollar. The functional currency for all of these subsidiaries is the local currency, except for the Company’s Hong Kong and Middle East subsidiaries which currently use the U.S. Dollar as their functional currency. Balances are translated at period-end exchange rates for assets and liabilities and monthly weighted-average exchange rates for revenues and expenses. The translation gains and losses are stated as a component of

Accumulated Other Comprehensive Loss (“AOCL”) as disclosed in "NOTE 17. Accumulated Other Comprehensive Loss”.

Derivative Instruments

In the normal course of business, the Company is exposed to fluctuations in interest rates, foreign currency exchange rates, and commodity prices. The risk is managed through the use of financial derivative instruments, when appropriate. The Company has qualified for and elected hedge accounting treatment on interest rate swap contracts. As necessary, the Company adjusts the values of the derivative instruments for counter-party or credit risk. "NOTE 9. Derivatives” provides further information on the accounting treatment of the Company’s derivative instruments.

Income Taxes

Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the expected future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. The future tax benefits associated with operating loss and tax credit carryforwards are recognized as deferred tax assets. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. When releasing income tax effects from accumulated other comprehensive loss the Company utilizes the portfolio securities approach.

The need to establish a valuation allowance against the deferred tax assets is assessed periodically based on a more-likely-than-not realization threshold, in accordance with the FASB’s authoritative accounting guidance on income taxes. Appropriate consideration is given to all positive and negative evidence related to that realization. This assessment considers, among other matters, the nature, frequency and severity of recent losses, forecasts of future profitability, the duration of statutory carryforward periods, and experience with tax attributes expiring unused and tax planning alternatives. The weight given to these considerations depends upon the degree to which they can be objectively verified.

Stock-Based Compensation

In March 2015, the Company’s Board of Directors adopted, and in May 2015, the Company’s stockholders approved, the Allison Transmission Holdings, Inc. 2015 Equity Incentive Award Plan (“2015 Plan”), which became effective on May 14, 2015. Under the 2015 Plan, certain employees (including executive officers), consultants and directors are eligible to receive equity-based compensation, including non-qualified stock options, incentive stock options, restricted stock, dividend equivalents, stock payments, restricted stock units (“RSUs”), performance awards, stock appreciation rights and other equity-based awards, or any combination thereof. The 2015 Plan limits the aggregate number of shares of common stock available for issue to 15 million and will expire on, and no option or other equity award may be granted pursuant to the 2015 Plan after, the tenth anniversary of the date the 2015 Plan was approved by the Board of Directors.

Prior to the adoption of the 2015 Plan, the Company’s equity-based awards were granted under the Allison Transmission Holdings, Inc. 2011 Equity Incentive Award Plan (“Prior Plan”). As of the effective date of the 2015 Plan, no new awards will be granted under the Prior Plan, but the Prior Plan will continue to govern the equity awards issued under the Prior Plan.

RSU grants are recorded at fair market value at the date of grant and vest upon continued performance of services by the RSU holders over one to three years. Performance unit grants are recorded at fair value based on a Monte-Carlo pricing model and the restrictions lapse on the date the Compensation Committee of the Board of Directors determines the number of shares that shall vest based on the related performance or market condition

achievement. Non-qualified stock option grants are recorded at fair value using a Black-Scholes option pricing model and vest upon the continued performance of services by the option holder on the third anniversary of the grant date for awards under the 2015 Plan.

The Company has made a policy election under applicable accounting guidance to account for forfeitures as a reduction of stock-based compensation expense when the forfeiture actually occurs.

RSUs were granted to certain employees and directors at fair market value on the date of grant. The restrictions lapse upon continued performance by the RSU holder on the vest date which generally occurs over one, two or three years. RSU incentive compensation expense recorded was $6 million, $6 million and $5 million for the years ended December 31, 2021, 2020 and 2019, respectively.

Performance-based awards, including performance units, were granted to certain employees at fair value at the date of grant. The Company records the fair value of each performance-based award based on a Monte-Carlo pricing model. Performance-based award incentive compensation expense recorded was $5 million, $9 million and $6 million for the years ended December 31, 2021, 2020 and 2019, respectively.

Stock options were granted to certain employees at fair value on the date of grant using a Black-Scholes option pricing model. Stock option incentive compensation expense recorded was $3 million for the year ended December 31, 2021 and $2 million for each of the years ended December 31, 2020 and 2019.

Pension and Post-retirement Benefit Plans

For pension and OPEB plans in which employees participate, costs are determined within the FASB’s authoritative accounting guidance set forth in employers’ defined benefit pensions including accounting for settlements and curtailments of defined benefit pension plans, termination of benefits and accounting for post-retirement benefits other than pensions. In accordance with the authoritative accounting guidance, the Company recognizes the funded status of its defined benefit pension plans and OPEB plan in its Consolidated Balance Sheets with a corresponding adjustment to AOCL, net of tax.

Post-retirement benefit costs consist of service cost and interest cost on accrued obligations. Actuarial gains and losses on liabilities, together with any prior service costs, are charged (or credited) to income over the average remaining service lives of employees.

The benefit cost components shown in the Consolidated Statements of Comprehensive Income are based upon various actuarial assumptions and methodologies as prescribed by authoritative accounting guidance. These assumptions include discount rates, expected return on plan assets, health care cost trend rates, inflation, rate of compensation increases, population demographics, mortality rates and other factors. The Company reviews all actuarial assumptions on an annual basis. Changes in key economic indicators can change these assumptions. These assumptions, along with the actual value of assets at the measurement date, will impact the calculation of pension expenses for the following year.

Recently Adopted Accounting Pronouncements

In March 2020, the FASB issued authoritative accounting guidance regarding highly effective cash flow hedges affected by reference rate reform, which guidance was subsequently amended. The guidance allows the Company to continue to classify its interest rate hedges as highly effective subsequent to reference rate reform under certain circumstances. The Company adopted this guidance effective January 1, 2021 and will apply the guidance prospectively on all applicable transactions through December 31, 2022. Management expects to be able to elect the optional expedient within this guidance upon the Company’s transition from the London Interbank Offered Rate ("LIBOR") to an alternative reference rate. The election of the optional expedient is expected to allow for the continuation of the existing contract with no impact on the Company’s consolidated financial statements.

In December 2019, the FASB issued authoritative accounting guidance to simplify the accounting for income taxes. The guidance identifies specific exceptions to be removed from the calculation and reporting of income taxes. The Company adopted this guidance effective January 1, 2021. The adoption of this guidance did not have a material impact on the Company's consolidated financial statements.

Recently Issued Accounting Pronouncements

In October 2021, the FASB issued authoritative accounting guidance that requires contract assets and contract liabilities acquired in a business combination to be recognized as if the acquirer originated the contracts. The guidance will be effective for the Company in fiscal year 2023, and the Company does not plan to early adopt. The guidance will be applied prospectively to acquisitions occurring on or after the effective date.

Revenue

12 Months Ended

Dec. 31, 2021

Revenue From Contract With Customer [Abstract]

Revenue

NOTE 3. REVENUE

Revenue is recognized as each distinct performance obligation within a contract is satisfied. A performance obligation is a promise in a contract to transfer a distinct good or service to the customer. The Company enters into long-term agreements (“LTAs”) and distributor agreements with certain customers. The LTAs and distributor agreements do not include committed volumes until underlying purchase orders are issued; therefore, the Company determined that purchase orders are the contract with a customer. A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue when the performance obligation is satisfied, as there is no right of return.

Some of the Company's contracts include multiple performance obligations, most commonly the sale of both a transmission and ETC. The Company allocates the contract’s transaction price to each performance obligation based on the standalone selling price of each distinct good or service in the contract.

The Company may also use volume-based discounts and rebates as marketing incentives in the sales of both vehicle propulsion solutions and service parts, which are accounted for as variable consideration. The Company records the impact of the incentives as a reduction to revenue when it is determined that the adjustment is not likely to reverse, historically on a quarterly basis. The Company estimates the impact of all other incentives based on the related sales and market conditions in the end market vocation. The Company recorded no material adjustments based on variable consideration during either of the years ended December 31, 2021 and 2020.

Net sales are made on credit terms, generally 30 days, based on an assessment of the customer’s creditworthiness. For certain goods or services, the Company receives consideration prior to satisfying the related performance obligation. Such consideration is recorded as a contract liability in current and non-current deferred revenue as of December 31, 2021 and December 31, 2020. See "NOTE 11. Deferred Revenue” for more information including the amount of revenue earned during the year ended December 31, 2021 that had been previously deferred. The Company had no material contract assets as of either December 31, 2021 and 2020.

The Company has one operating segment and reportable segment. The Company is in one line of business, which is the manufacture and distribution of vehicle propulsion solutions. The following presents disaggregated revenue by categories that best depict how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors (dollars in millions):


	Year ended December 31, 2021		Year ended December 31, 2020
North America On-Highway	$	1,177	$	1,081
North America Off-Highway		58		13
Defense		186		182
Outside North America On-Highway		381		280
Outside North America Off-Highway		83		61
Service Parts, Support Equipment and Other		517		464
Total Net Sales	$	2,402	$	2,081

Disaggregated revenue by end market is further described as follows:

North America On-Highway

Revenue from the North America On-Highway end market is driven by the sale of propulsion solutions to original equipment manufacturers (“OEMs”), distributors and dealers that install the product into Class 4-5, Class 6-7 and Class 8 straight trucks, Class 8 day cab tractors, conventional transit, shuttle and coach buses, school buses and motorhome applications. Revenue is recognized at the point in time when control passes to the customer, which is based on shipping terms when the order is fulfilled by the Company.

North America Off-Highway

Revenue from the North America Off-Highway end market is driven by sales of transmissions to OEMs and distributors that serve end users who operate vehicles and auxiliary equipment in energy, mining and construction applications. Revenue is recognized at the point in time when control passes to the customer, which is based on shipping terms when the order is fulfilled by the Company.

Defense

Revenue from the Defense end market is driven by sales of propulsion solutions to the U.S. Government or its contractors and sales to certain government contractors outside of the U.S. for use in both wheeled and tracked defense vehicle applications. Revenue is recognized at the point in time when control passes to the customer, which is based on shipping terms when the order is fulfilled by the Company.

Periodically, the Company and the U.S. Government will enter into a bill-and-hold arrangement where a completed transmission physically remains at the Company’s facility at the request of the U.S. Government. Revenue is recognized at the point in time when it is determined that the U.S. Government accepts the transmission and is able to direct its use.

Outside North America On-Highway

Revenue from the Outside North America On-Highway end market is driven by the sale of propulsion solutions to OEMs and distributors that produce vehicles for commercial users in medium- and heavy-duty applications. Revenue is recognized at the point in time when control passes to the customer, which is based on shipping terms when the order is fulfilled by the Company.

Outside North America Off-Highway

Revenue from the Outside North America Off-Highway end market is driven by sales of transmissions to OEMs and distributors serving end users who operate vehicles and auxiliary equipment in energy, mining and construction applications. Revenue is recognized at the point in time when control passes to the customer, which is based on shipping terms when the order is fulfilled by the Company.

Service Parts, Support Equipment and Other

Revenue from the Service Parts, Support Equipment and Other end market is primarily derived from the sale of transmission parts and fluid purchased for the normal maintenance and repair needs of products in service, the sale of aluminum die cast components purchased as original parts and the sale of ETC contracts which extend the warranty coverages of propulsion solutions beyond the standard warranty period.

Revenue is recognized on sales of service parts, support equipment and aluminum die cast components at the point in time when control passes to the customer, which is based on shipping terms when the order is fulfilled by the Company.

Revenue from the sale of ETC contracts is recognized ratably over the time period that corresponds with the period of coverage, as the Company has determined this method best depicts the progress towards satisfaction of its performance obligation. ETC contracts are sold in one- to five-year durations within the North America On-Highway, Outside North America On-Highway, North America Off-Highway and Outside North America Off-Highway end markets. The ETC contract period begins when the standard warranty coverage period ends. All consideration allocated to an ETC performance obligation is initially deferred until the coverage period begins.

NOTE 11. DEFERRED REVENUE

As of December 31, 2021, the current and non-current deferred revenue were $37 million and $99 million, respectively. As of December 31, 2020, the current and non-current deferred revenue were $34 million and $109 million, respectively. Deferred revenue activity consists of the following (dollars in millions):


	Year ended December 31, 2021			Year ended December 31, 2020			Year ended December 31, 2019
Beginning balance	$	143		$	139		$	122
Increases		29			40			55
Revenue earned		(36	)		(36	)		(38	)
Ending balance	$	136		$	143		$	139

Deferred revenue recorded in current and non-current liabilities related to ETC as of December 31, 2021 were $30 million and $84 million, respectively. Deferred revenue recorded in current and non-current liabilities related to ETC as of December 31, 2020 were $28 million and $88 million, respectively.

The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts.

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-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130554-203045

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (d)
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130554-203045

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 15
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130558-203045

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (c)
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130554-203045

Property Plant And Equipment [Abstract]

Inventories

12 Months Ended

Dec. 31, 2021

Inventory Disclosure [Abstract]

Inventories

NOTE 4. INVENTORIES

Inventories consisted of the following components (dollars in millions):


	December 31, 2021		December 31, 2020
Purchased parts and raw materials	$	101	$	88
Work in progress		8		15
Service parts		44		43
Finished goods		51		35
Total inventories	$	204	$	181

Inventory components shipped to third parties, primarily cores, parts to re-manufacturers, and parts to contract manufacturers, which the Company has an obligation to buy back, are included in purchased parts and raw materials, with an offsetting liability in other current liabilities. See "NOTE 14. Other Current Liabilities” for more information.

Property, Plant and Equipment

12 Months Ended

Dec. 31, 2021

Property, Plant and Equipment

NOTE 5. PROPERTY, PLANT AND EQUIPMENT

The cost and accumulated depreciation of property, plant and equipment are as follows (dollars in millions):


	December 31, 2021			December 31, 2020
Land and land improvements	$	27		$	26
Buildings and building improvements		492			423
Machinery and equipment		795			783
Software		188			175
Special tooling		243			223
Construction in progress		83			54
Total property, plant and equipment		1,828			1,684
Accumulated depreciation		(1,122	)		(1,046	)
Property, plant and equipment, net	$	706		$	638

Depreciation of property, plant and equipment was $104 million, $96 million and $81 million for the years ended December 31, 2021, 2020 and 2019, respectively.

Goodwill and Other Intangible Assets

12 Months Ended

Dec. 31, 2021

Goodwill And Intangible Assets Disclosure [Abstract]

Goodwill and Other Intangible Assets

NOTE 6. GOODWILL AND OTHER INTANGIBLE ASSETS

As of each of December 31, 2021 and 2020, the carrying amount of the Company’s Goodwill was $2,064 million.

The following presents a summary of other intangible assets (dollars in millions):


	December 31, 2021							December 31, 2020
	Intangible assets, gross		Accumulated amortization			Intangible assets, net		Intangible assets, gross		Accumulated amortization			Intangible assets, net
Other intangible assets:
Trade name	$	791	$	—		$	791	$	791	$	—		$	791
In process research and development		25		—			25		25		—			25
Customer relationships – commercial		839		(751	)		88		839		(708	)		131
Proprietary technology		478		(477	)		1		478		(477	)		1
Customer relationships – defense		62		(50	)		12		62		(47	)		15
Total	$	2,195	$	(1,278	)	$	917	$	2,195	$	(1,232	)	$	963

Amortization of intangible assets was $46 million, $52 million and $86 million for the years ended December 31, 2021, 2020 and 2019, respectively.

As of December 31, 2021 and 2020, the net carrying value of the Company’s Goodwill and Other intangible assets, net was $2,981 million and $3,027 million, respectively. The Company’s 2021 annual goodwill impairment test indicated that the fair value of the reporting unit more likely than not exceeded its carrying value, indicating no impairment. The Company's 2021 annual indefinite lived intangible assets impairment test indicated that the fair value of the Company’s indefinite lived intangible assets more likely than not exceeded their carrying value, indicating no impairment.

Amortization expense related to other intangible assets for the next five years is expected to be (dollars in millions):


	2022		2023		2024		2025		2026
Amortization expense	$	45	$	43	$	8	$	4	$	1

Fair Value of Financial Instruments

12 Months Ended

Dec. 31, 2021

Fair Value Disclosures [Abstract]

Fair Value of Financial Instruments

NOTE 7. FAIR VALUE OF FINANCIAL INSTRUMENTS

In accordance with the FASB’s authoritative accounting guidance on fair value measurements, fair value is the price (exit price) that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Company utilizes market data or assumptions that market participants would use in pricing the asset or liability, including assumptions about risk and the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market corroborated, or generally unobservable. The Company primarily applies the market approach for recurring fair value measurements and utilizes the best available information that maximizes the use of observable inputs and minimizes the use of unobservable inputs. The Company is able to classify fair value balances based on the observability of those inputs. The accounting guidance establishes a fair value hierarchy that prioritizes the inputs used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3 measurement). The three levels of the fair value hierarchy defined by the relevant guidance are as follows:

Level 1 — Quoted prices are available in active markets for identical assets or liabilities as of the reporting date. Active markets are those in which transactions for the asset or liability occur in sufficient frequency and volume to provide pricing information on an ongoing basis. Level 1 primarily consists of financial instruments such as exchange-traded derivatives, listed equities and publicly traded bonds.

Level 2 — Pricing inputs are other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date. Level 2 includes financial instruments that are valued using quoted prices in markets that are not active and those financial instruments that are valued using models or other valuation methodologies. These models are primarily industry standard models that consider various assumptions, including quoted forward prices for commodities, time value, volatility factors, and current market and contractual prices for the underlying instruments, as well as other relevant economic measures. Substantially all of these assumptions are observable in the marketplace throughout the full term of the instrument, can be derived from observable data or are supported by observable levels at which transactions are executed in the marketplace.

Level 3 — Pricing inputs include significant inputs that are generally less observable from objective sources. These inputs may be used with internally developed methodologies that result in management’s best estimate of fair value. At each balance sheet date, the Company performs an analysis of all instruments subject to authoritative accounting guidance and includes, in Level 3, all of those whose fair value is based on significant unobservable inputs. As of December 31, 2021 and 2020, the Company did not have any Level 3 financial assets or liabilities.

The Company’s assets and liabilities that are measured at fair value include cash equivalents, marketable securities, derivative instruments, assets held in a rabbi trust and a deferred compensation obligation. The Company’s cash equivalents consist of short-term U.S. government backed securities. The Company's marketable securities consist of publicly traded stock of Jing-Jin Electric Technologies Co. Ltd., which has a readily determinable fair value. The Company’s derivative instruments consist of interest rate swaps. The Company’s assets held in the rabbi trust consist principally of publicly available mutual funds and target date retirement funds. The Company’s deferred compensation obligation is directly related to the fair value of assets held in the rabbi trust.

The Company’s valuation techniques used to calculate the fair value of cash and cash equivalents, assets held in the rabbi trust and the deferred compensation obligation represent a market approach in active markets for identical assets that qualify as Level 1 in the fair value hierarchy. The Company’s valuation techniques used to calculate the fair value of derivative instruments represent a market approach with observable inputs that qualify as Level 2 in the fair value hierarchy.

The Company uses valuations from the issuing financial institutions for the fair value measurement of interest rate swaps. The floating-to-fixed interest rate swaps are based on LIBOR which is observable at commonly quoted

intervals. The fair values are included in other current and non-current assets and liabilities in the Consolidated Balance Sheets.

The following table summarizes the fair value of the Company’s financial assets and (liabilities) as of December 31, 2021 and 2020 (dollars in millions):


	Fair Value Measurements Using
	Quoted Prices in Active Markets for Identical Assets (Level 1)						Significant Other Observable Inputs (Level 2)						TOTAL
	2021			2020			2021			2020			2021			2020
Cash equivalents	$	—		$	160		$	—		$	—		$	—		$	160
Marketable securities		46			—			—			—			46			—
Derivative liabilities, net		—			—			(31	)		(60	)		(31	)		(60	)
Rabbi trust assets		19			17			—			—			19			17
Deferred compensation obligation		(19	)		(17	)		—			—			(19	)		(17	)
Total	$	46		$	160		$	(31	)	$	(60	)	$	15		$	100

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

Debt

12 Months Ended

Dec. 31, 2021

Debt Disclosure [Abstract]

Debt

NOTE 8. DEBT

Long-term debt and maturities are as follows (dollars in millions):


	December 31, 2021		December 31, 2020
Long-term debt:
Senior Secured Credit Facility Term Loan, variable, due 2026	$	631	$	638
Senior Notes, fixed 4.75%, due 2027		400		400
Senior Notes, fixed 5.875%, due 2029		500		500
Senior Notes, fixed 3.75%, due 2031		1,000		1,000
Total long-term debt	$	2,531	$	2,538
Less: current maturities of long-term debt		6		6
deferred financing costs, net (see NOTE 2)		21		25
Total long-term debt, net	$	2,504	$	2,507

Principal payments required on long-term debt during the next five years are as follows:


(dollars in millions)	2022		2023		2024		2025		2026
Payments	$	6	$	6	$	6	$	6	$	607

As of December 31, 2021, the Company had $2,531 million of indebtedness associated with Allison Transmission, Inc.’s (“ATI”), the Company’s wholly-owned subsidiary, ATI’s 4.75% Senior Notes due October 2027 (“4.75% Senior Notes”), ATI’s 5.875% Senior Notes due June 2029 (“5.875% Senior Notes”), ATI’s 3.75% Senior Notes due January 2031 (“3.75% Senior Notes” and, together with the 4.75% Senior Notes and 5.875% Senior Notes, the “Senior Notes”) and the Second Amended and Restated Credit Agreement dated as of March 29, 2019, as amended (the “Credit Agreement”), governing ATI’s term loan facility in the amount of $631 million due March 2026 (“Term Loan”) and ATI’s revolving credit facility with commitments in the amount of $650 million due September 2025 (“Revolving Credit Facility” and, together with the Term Loan, the “Senior Secured Credit Facility”).

The fair value of the Company’s long-term debt obligations as of December 31, 2021 was $2,568 million. The fair value is based on quoted Level 2 market prices of the Company’s debt as of December 31, 2021. It is not expected that the Company would be able to repurchase a significant amount of its debt at these levels. The difference between the fair value and carrying value of the long-term debt is driven primarily by trends in the financial markets.

Senior Secured Credit Facility

In March 2019, the Company and ATI entered into the Credit Agreement to reduce the commitments under the prior term loan due 2022 (“Prior Term Loan”) by $500 million and increase the commitments under the prior $550 million revolving credit facility due 2021 (“Prior Revolving Credit Facility” and, together with the Prior Term Loan, the “Prior Senior Secured Credit Facility”) by $50 million. The Senior Secured Credit Facility also extended the maturity of the Prior Term Loan from 2022 to 2026 and extended the Prior Revolving Credit Facility termination date from 2021 to 2024. The Senior Secured Credit Facility replaced the Prior Senior Secured Credit Facility, including the Prior Term Loan and Prior Revolving Credit Facility, on March 29, 2019. The Credit Agreement was treated as a modification to the Prior Senior Secured Credit Facility under GAAP, and thus the Company expensed $5 million of prior deferred financing fees and $1 million of related third party fees in the Consolidated Statement of Comprehensive Income for the year ended December 31, 2019 and recorded $5 million as new deferred financing fees in the Consolidated Balance Sheet in the first quarter of 2019.

In October 2019, the Company and ATI entered into an amendment to the Credit Agreement with the Term Loan lenders under its Senior Secured Credit Facility to lower the applicable margins on the Term Loan by 0.25%. The October 2019 amendment was treated as a modification to the Senior Secured Credit Facility under GAAP.

In November 2020, the Company and ATI entered into an amendment to the Credit Agreement to increase the commitments under the Revolving Credit Facility by $50 million to $650 million. The amendment also extended the Revolving Credit Facility termination date from September 2024 to September 2025.

The borrowings under the Senior Secured Credit Facility are collateralized by a lien on substantially all assets of the Company, ATI and each of the existing and future U.S. subsidiary guarantors, with certain exceptions set forth in the Credit Agreement, and ATI’s capital stock and all of the capital stock or other equity interests held by the Company, ATI and each of ATI’s existing and future U.S. subsidiary guarantors (subject to certain limitations for equity interest of foreign subsidiaries and other exceptions set forth in the Credit Agreement). Interest on the Term Loan, as of December 31, 2021, is either (a) 1.75% over a LIBOR rate on deposits in U.S. dollars for one-, two-, three- or six-month periods (or twelve-month or shorter periods if, at the time of the borrowing, available from all relevant lenders) (the "LIBOR Rate"), or (b) 0.75% over the greater of the prime lending rate as quoted by the administrative agent, the LIBOR Rate for an interest period of one month plus 1.00% and the federal funds effective rate published by the Federal Reserve Bank of New York plus 0.50%, subject to a 1.00% floor (the "Base Rate"). As of December 31, 2021, the Company elected to pay the lowest all-in rate of LIBOR plus the applicable margin, or 1.85%, on the Term Loan. The Credit Agreement requires minimum quarterly principal payments on the Term Loan starting with the fiscal quarter which ended September 30, 2019, as well as prepayments from certain net cash proceeds of non-ordinary course asset sales and casualty and condemnation events, the incurrence of certain debt and from a percentage of excess cash flow, if applicable. The minimum required quarterly principal payment on the Term Loan through its maturity date of March 2026 is $2 million. As of December 31, 2021, there had been no payments required for certain net cash proceeds of non-ordinary course asset sales and casualty and condemnation events. The remaining principal balance is due upon maturity.

The Senior Secured Credit Facility also provides a Revolving Credit Facility, net of an allowance for up to $75 million in outstanding letters of credit commitments. As of December 31, 2021, the Company had $645 million available under the Revolving Credit Facility, net of $5 million in letters of credit. Borrowings under the Revolving Credit Facility bear interest at a variable base rate plus an applicable margin based on the Company’s first lien net leverage ratio. When the Company’s first lien net leverage ratio is above 4.00x, interest on the Revolving Credit Facility is (a) 0.75% over the Base Rate or (b) 1.75% over the LIBOR Rate; when the Company’s first lien net leverage ratio is equal to or less than 4.00x and above 3.50x, interest on the Revolving Credit Facility is (i) 0.50% over the Base Rate or (ii) 1.50% over the LIBOR Rate; and when the Company’s first lien net leverage ratio is equal to or below 3.50x, interest on the Revolving Credit Facility is (y) 0.25% over the Base Rate or (z) 1.25% over the

LIBOR Rate. As of December 31, 2021, the applicable margin for the Revolving Credit Facility was 1.25%. In addition, there is an annual commitment fee, based on the Company’s first lien net leverage ratio, on the average unused revolving credit borrowings available under the Revolving Credit Facility. As of December 31, 2021, the commitment fee is 0.25%. Borrowings under the Revolving Credit Facility are payable at the option of the Company throughout the term of the Senior Secured Credit Facility with the balance due in September 2025.

The Senior Secured Credit Facility requires the Company to maintain a specified maximum first lien net leverage ratio of 5.50x when revolving loan commitments remain outstanding on the Revolving Credit Facility at the end of a fiscal quarter. As of December 31, 2021, the Company had no amounts outstanding under the Revolving Credit Facility; however, the Company would have been in compliance with the maximum first lien net leverage ratio, achieving a 0.60x ratio. Additionally, within the terms of the Senior Secured Credit Facility, a first lien net leverage ratio at or below 4.00x results in the elimination of excess cash flow payments on the Senior Secured Credit Facility for the applicable year.

In addition, the Credit Agreement, among other things, includes customary restrictions (subject to certain exceptions) on the Company’s ability to incur certain indebtedness, grant certain liens, make certain investments, engage in acquisitions, consolidations and mergers, declare or pay certain dividends or repurchase shares of the Company’s common stock. As of December 31, 2021, the Company was in compliance with all covenants under the Credit Agreement.

5.0% Senior Notes

In November 2020, ATI redeemed all of its outstanding 5.0% Senior Notes due 2024 (“5.0% Senior Notes”), at the redemption price equal to 101.25% of the principal amount plus any accrued and unpaid interest, using the proceeds from the issuance of the 3.75% Senior Notes and cash on hand, resulting in a loss (the premium between the purchase price of the 5.0% Senior Notes and the face value of such notes) of $19 million including the deferred financing fees written off.

4.75% Senior Notes

ATI may from time to time seek to retire the 4.75% Senior Notes through cash purchases and/or exchanges for equity securities, in open market purchases, privately negotiated transactions, contractual redemptions or otherwise. Such repurchases or exchanges, if any, will depend on prevailing market conditions, liquidity requirements, contractual restrictions and other factors. The amounts involved may be material. Prior to October 1, 2022, ATI may redeem some or all of the 4.75% Senior Notes by paying a price equal to 100.00% of the principal amount being redeemed, plus an “applicable premium”. At any time on or after October 1, 2022, ATI may redeem some or all of the 4.75% Senior Notes at specified redemption prices in the governing indenture.

The 4.75% Senior Notes are unsecured and are guaranteed by each of ATI’s domestic subsidiaries that is a borrower under or guarantees the Senior Secured Credit Facility and are unconditionally guaranteed, jointly and severally, by any of ATI’s future domestic subsidiaries that are borrowers under or guarantee the Senior Secured Credit Facility. None of ATI’s domestic subsidiaries currently guarantee its obligations under the Senior Secured Credit Facility, and therefore none of ATI’s domestic subsidiaries currently guarantee the 4.75% Senior Notes. The indenture governing the 4.75% Senior Notes contains negative covenants restricting or limiting the Company’s ability to, among other things: incur or guarantee additional indebtedness, incur liens, pay dividends on, redeem or repurchase the Company’s capital stock, make certain investments, permit payment or dividend restrictions on certain of the Company’s subsidiaries, sell assets, engage in certain transactions with affiliates, and consolidate or merge or sell all or substantially all of the Company’s assets. As of December 31, 2021, the Company was in compliance with all covenants under the indenture governing the 4.75% Senior Notes.

5.875% Senior Notes

In March 2019, ATI completed an offering of $500 million of the 5.875% Senior Notes. The 5.875% Senior Notes were offered in a private placement exempt from registration under the Securities Act of 1933, as amended. The net proceeds from the offering, together with borrowings under the Senior Secured Credit Facility and cash on hand, were used to repay all of the outstanding borrowings under the Prior Term Loan plus accrued and unpaid interest and related transaction expenses. As a result of the offering, the Company recorded $6 million as deferred financing fees in the Consolidated Balance Sheet in the first quarter of 2019.

ATI may from time to time seek to retire the 5.875% Senior Notes through cash purchase and/or exchanges for equity securities, in open market purchases, privately negotiated transactions, contractual redemptions or otherwise. Such repurchases or exchanges, if any, will depend on prevailing market conditions, liquidity requirements, contractual restrictions and other factors. The amounts involved may be material. Prior to June 1, 2022, ATI may redeem up to 40% of the 5.875% Senior Notes by paying a price equal to 105.875% of the principal amount being redeemed. Prior to June 1, 2024, ATI may redeem some or all of the 5.875% Senior Notes by paying a price equal to 100.00% of the principal amount being redeemed, plus an “applicable premium”. At any time on or after June 1, 2024, ATI may redeem some or all of the 5.875% Senior Notes at specified redemption prices in the governing indenture.

The 5.875% Senior Notes are unsecured and are guaranteed by each of ATI’s domestic subsidiaries that is a borrower under or guarantees the Senior Secured Credit Facility and are unconditionally guaranteed, jointly and severally, by any of ATI’s future domestic subsidiaries that are borrowers under or guarantee the Senior Secured Credit Facility. None of ATI’s domestic subsidiaries currently guarantee its obligations under the Senior Secured Credit Facility, and therefore none of ATI’s domestic subsidiaries currently guarantee the 5.875% Senior Notes. The indenture governing the 5.875% Senior Notes contains negative covenants restricting or limiting the Company’s ability to, among other things: incur or guarantee additional indebtedness, incur liens, pay dividends on, redeem or repurchase the Company’s capital stock, make certain investments, permit payment or dividend restrictions on certain of the Company’s subsidiaries, sell assets, engage in certain transactions with affiliates, and consolidate or merge or sell all or substantially all of the Company’s assets. As of December 31, 2021, the Company was in compliance with all covenants under the indenture governing the 5.875% Senior Notes.

3.75% Senior Notes

In November 2020, ATI completed an offering of $1,000 million of the 3.75% Senior Notes. The 3.75% Senior Notes were offered in a private placement exempt from registration under the Securities Act of 1933, as amended. The net proceeds from the offering, together with cash on hand, were used to redeem all of the outstanding 5.0% Senior Notes plus accrued and unpaid interest and related transaction expenses. As a result of the offering, the Company recorded $10 million as deferred financing fees in the Consolidated Balance Sheet as of December 31, 2020.

ATI may from time to time seek to retire the 3.75% Senior Notes through cash purchase and/or exchanges for equity securities, in open market purchases, privately negotiated transactions, contractual redemptions or otherwise. Such repurchases or exchanges, if any, will depend on prevailing market conditions, liquidity requirements, contractual restrictions and other factors. The amounts involved may be material. Prior to January 30, 2024, ATI may redeem up to 40% of the 3.75% Senior Notes by paying a price equal to 103.750% of the principal amount being redeemed. Prior to January 30, 2026, ATI may redeem some or all of the 3.75% Senior Notes by paying a price equal to 100.00% of the principal amount being redeemed, plus an “applicable premium”. At any time on or after January 30, 2026, ATI may redeem some or all of the 3.75% Senior Notes at specified redemption prices in the governing indenture.

The 3.75% Senior Notes are unsecured and are guaranteed by each of ATI’s domestic subsidiaries that is a borrower under or guarantees the Senior Secured Credit Facility and are unconditionally guaranteed, jointly and severally, by any of ATI’s future domestic subsidiaries that are borrowers under or guarantee the Senior Secured Credit Facility. None of ATI’s domestic subsidiaries currently guarantee its obligations under the Senior Secured Credit Facility, and therefore none of ATI’s domestic subsidiaries currently guarantee the 3.75% Senior Notes. The indenture governing the 3.75% Senior Notes contains negative covenants restricting or limiting the Company’s ability to, among other things: incur or guarantee additional indebtedness, incur liens, pay dividends on, redeem or repurchase the Company’s capital stock, make certain investments, permit payment or dividend restrictions on certain of the Company’s subsidiaries, sell assets, engage in certain transactions with affiliates, and consolidate or merge or sell all or substantially all of the Company’s assets. As of December 31, 2021, the Company was in compliance with all covenants under the indenture governing the 3.75% Senior Notes.

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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-Paragraph 1B
-Subparagraph (i)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

Derivative Instruments And Hedging Activities Disclosure [Abstract]

Derivatives

12 Months Ended

Dec. 31, 2021

Derivatives

NOTE 9. DERIVATIVES

The Company is subject to interest rate risk related to the Senior Secured Credit Facility and enters into interest rate swaps that are based on LIBOR to manage a portion of this exposure. The interest rate swaps are designated as cash flow hedges that qualify for hedge accounting under the hypothetical derivative method. Fair value adjustments are recorded as a component of AOCL in the Consolidated Balance Sheets. Balances in AOCL are reclassified to earnings when transactions related to the underlying risk are settled. During the first quarter of 2019, the Company entered into $250 million of interest rate swaps and designated them as cash flow hedges under the hypothetical derivative method. As of December 31, 2021, the Company held interest rate swaps effective from (i) September 2019 to September 2022 with notional values totaling $250 million and a weighted average LIBOR fixed rate of 3.01%, (ii) from September 2019 to September 2025 with notional values totaling $250 million and a weighted average LIBOR fixed rate of 3.04% and (iii) September 2022 to September 2025 with notional values totaling $250 million and a weighted average LIBOR fixed rate of 2.82%. See "NOTE 7. Fair Value of Financial Instruments” for information regarding the fair value of the Company’s interest rate swaps.

The following tabular disclosures further describe the Company’s interest rate derivatives qualifying and designated for hedge accounting and their impact on the financial condition of the Company (dollars in millions):


	December 31, 2021			December 31, 2020
	Balance Sheet Location	Fair Value		Balance Sheet Location	Fair Value
Derivatives designated as hedging instruments:
Interest rate swaps	Other current liabilities	$	10	Other current liabilities	$	14
	Other non-current liabilities		21	Other non-current liabilities		46
Total derivatives designated as hedging instruments		$	31		$	60

The balance of derivative losses recorded in AOCL as of December 31, 2021 and 2020 was $31 million and $60 million, respectively. During the year ended December 31, 2021, the Company reclassified $15 million from AOCL to earnings, which was recorded as Interest expense, net on the Consolidated Statements of Comprehensive Income. The Company had $13 million of derivative losses recorded in AOCL expected to be reclassified to earnings within the next twelve months as of December 31, 2021. See "NOTE 17. Accumulated Other Comprehensive Loss” for information regarding activity recorded as a component of AOCL during the year ended December 31, 2021.

Product Warranty Liabilities

12 Months Ended

Dec. 31, 2021

Guarantees And Product Warranties [Abstract]

Product Warranty Liabilities

NOTE 10. PRODUCT WARRANTY LIABILITIES

As of December 31, 2021, the current and non-current product warranty liabilities were $33 million and $20 million, respectively. As of December 31, 2020, the current and non-current product warranty liabilities were $36 million and $30 million, respectively. Product warranty liability activities consist of the following (dollars in millions):


	Year ended December 31, 2021			Year ended December 31, 2020			Year ended December 31, 2019
Beginning balance	$	66		$	52		$	66
Payments		(30	)		(32	)		(26	)
Increase in liability (warranty issued during period)		16			15			21
Net adjustments to liability		1			31			(9	)
Ending balance	$	53		$	66		$	52

The adjustments to the total liability in 2021, 2020 and 2019 were the result of general changes in estimates for various products and specific field action programs as additional claims data and field information became available.

In 2020, the Company recorded a $23 million product warranty adjustment to address a transmission performance issue associated with shift quality in a defined population of products. As a result of this performance issue, the Company created a field action program in 2019 dedicated to the defined population of products and reviewed, assessed and made adjustments to the liability on a quarterly basis. The product warranty adjustment in 2020 was the result of additional claims data and field information becoming available.

Deferred Revenue

12 Months Ended

Dec. 31, 2021

Revenue Recognition And Deferred Revenue [Abstract]

Revenue

NOTE 3. REVENUE


	Year ended December 31, 2021		Year ended December 31, 2020
North America On-Highway	$	1,177	$	1,081
North America Off-Highway		58		13
Defense		186		182
Outside North America On-Highway		381		280
Outside North America Off-Highway		83		61
Service Parts, Support Equipment and Other		517		464
Total Net Sales	$	2,402	$	2,081

Disaggregated revenue by end market is further described as follows:

North America On-Highway

North America Off-Highway

Defense

Outside North America On-Highway

Outside North America Off-Highway

Service Parts, Support Equipment and Other

NOTE 11. DEFERRED REVENUE


	Year ended December 31, 2021			Year ended December 31, 2020			Year ended December 31, 2019
Beginning balance	$	143		$	139		$	122
Increases		29			40			55
Revenue earned		(36	)		(36	)		(38	)
Ending balance	$	136		$	143		$	139

Other Income And Expenses [Abstract]

Leases

12 Months Ended

Dec. 31, 2021

Leases [Abstract]

Leases

NOTE 12. LEASES

Lessee Accounting

Contracts are assessed by the Company to determine if the contract conveys the right to control an identified asset in exchange for consideration during a period of time. The Company classifies all identified leases as either operating or finance leases. As of December 31, 2021, the Company was not a party to any finance leases. Contracts that contain leases are assessed to determine if the consideration in the contract is related to a lease component, non-lease component or other components not related to the lease. Lease components are recorded as right-of-use (“ROU”) assets and lease liabilities while any non-lease component is expensed as incurred. The consideration in the contract related to other components not related to the lease is allocated among the lease component and the non-lease component, as applicable, based on the stand-alone selling price of the lease and non-lease components.

Certain lease agreements may contain an option to extend or terminate the lease. The Company considers the economic impact of extension and termination options for each lease agreement. If the Company concludes it is reasonably certain an option will be exercised, that option is included in the lease term and impacts the amount recorded as an ROU asset and lease liability upon inception of the contract.

The Company's lease liability is determined by discounting the future cash flows over the lease period. The Company determines its discount rates by utilizing current secured financing rates based on the length of the lease period plus the Company's margin over LIBOR on the Term Loan. The Company believes this rate effectively represents a borrowing rate the Company could obtain on a debt instrument possessing similar terms as the lease. Any lease liability is classified between current and non-current liabilities based on the terms of the underlying leases. The weighted average discount rate on operating leases as of December 31, 2021 and 2020 was 4.25% and 4.37%, respectively.

As of December 31, 2021, the Company recorded current and non-current operating lease liabilities of $4 million and $13 million, respectively. As of December 31, 2020, the Company recorded current and non-current operating lease liabilities of $4 million and $17 million, respectively. The following table reconciles future undiscounted cash flows for operating leases as of December 31, 2021 to total operating lease liabilities:


	December 31, 2021
2022	$	5
2023		3
2024		2
2025		2
2026		2
Thereafter		6
Total lease payments	$	20
Less: Interest		3
Present value of lease liabilities	$	17

ROU assets are calculated as the related lease liability adjusted for lease incentives, prepayments and the effect of escalating lease payments on period expense. The below table depicts the ROU assets held by the Company based on the underlying asset:


	December 31, 2021
Buildings	$	16
Land		1
Vehicles		1
Total right-of-use assets	$	18

The weighted average remaining lease term as of December 31, 2021 and December 31, 2020 was 6.8 years and 7.6 years, respectively.

Operating lease expense was $6 million for each of the years ended December 31, 2021 and 2020, and was recorded within Selling, general and administrative expense and Engineering - research and development on the Company's Consolidated Statements of Comprehensive Income. There was no material short-term operating lease expense for any of the years ended December 31, 2021 and 2020.

The calculation of the Company's ROU assets and lease liabilities did not include cash consideration as of either December 31, 2021 or 2020. During each of the years ended December 31, 2021 and 2020, the Company recorded $2 million of new ROU assets obtained in exchange for lease obligations.

Other Income (Expense), Net

12 Months Ended

Dec. 31, 2021

Other Income (Expense), Net

NOTE 13. OTHER INCOME (EXPENSE), NET

Other income (expense), net consists of the following (dollars in millions):


	Years ended December 31,
	2021		2020			2019
Post-retirement benefit plan amendment credits	$	10	$	13		$	11
Unrealized gain on marketable securities		4		—			—
Technology-related investments gain		4		—			—
Expenses related to long-term debt refinancing		—		(13	)		(1	)
Other		1		(4	)		—
Total	$	19	$	(4	)	$	10

Other Current Liabilities

12 Months Ended

Dec. 31, 2021

Other Liabilities Disclosure [Abstract]

Other Current Liabilities

NOTE 14. OTHER CURRENT LIABILITIES

Other current liabilities consist of the following (dollars in millions):


	As of December 31, 2021		As of December 31, 2020
Payroll and related costs	$	80	$	47
Sales allowances		39		20
Accrued interest payable		24		12
Vendor buyback obligation		16		16
Taxes payable		14		11
Derivative liabilities		10		14
Lease liability		4		4
Non-trade payables		2		2
Construction liability		2		1
Other accruals		13		13
Total	$	204	$	140

Employee Benefit Plans

12 Months Ended

Dec. 31, 2021

Compensation And Retirement Disclosure [Abstract]

Employee Benefit Plans

NOTE 15. EMPLOYEE BENEFIT PLANS

The Company’s hourly defined benefit pension plan generally provides benefits of negotiated, stated amounts for each year of service as well as significant supplemental benefits for employees who were hired on or before May 18, 2008 and retire with 30 years of service before normal retirement age. Any difference between actual and expected returns on assets during a year and actuarial gains and losses on liabilities together with any prior service costs are charged (or credited) to income over the average remaining service lives of employees. The benefit cost components shown in the Consolidated Statements of Comprehensive Income are based upon certain data specific to the Company, actuarial assumptions that were used for accounting disclosures, and certain allocation methodologies such as population demographics.

The Company’s salaried defined benefit plan covering salaried employees with a service date prior to January 1, 2001 is generally based on years of service and compensation history. Any difference between actual and expected returns on assets during a year and actuarial gains and losses on liabilities together with any prior service costs are charged (or credited) to income over the average remaining service lives of employees. The benefit cost components shown in the Consolidated Statements of Comprehensive Income are based upon certain data specific to the Company, actuarial assumptions that were used for accounting disclosures, and certain allocation methodologies such as population demographics.

The Company sponsors defined contribution retirement savings plans for eligible employees, based on employee location and status. The Company’s salaried defined contribution retirement savings plans provide for a Company match of employee contributions up to certain limits based upon eligible base salary.

The charge to expense for the Company’s defined contribution retirement savings plans was $14 million, $12 million and $11 million for the years ended December 31, 2021, 2020 and 2019, respectively.

The Company is also responsible for OPEB costs (medical, dental, vision, and life insurance) for hourly employees hired prior to May 19, 2008, excluding those employees eligible to retire at the time of the sale of the Company. Post-retirement benefit costs consist of service cost and interest cost on accrued obligations. Actuarial gains and losses on liabilities and any prior service costs are charged (or credited) to income over the average remaining service lives of employees. The benefit cost components shown in the Consolidated Statements of Comprehensive Income are based upon certain data specific to the Company, actuarial assumptions that were used for OPEB accounting disclosures, and certain allocation methodologies such as population demographics. The plan is unfunded and any future payments will be funded by the Company’s operating cash flows. As of December 31, 2021 and 2020, the Company had an estimated OPEB liability for hourly employees hired prior to May 19, 2008, excluding those employees eligible to retire at the time of the sale of the Company, of $102 million and $107 million, respectively.

The Company provides contributions to certain international benefit plans; however, these contributions are not material for the periods presented.

For all pension and OPEB plans in which employees participate, costs are determined within the FASB’s authoritative accounting guidance set forth on employers’ defined benefit pensions including accounting for settlements and curtailments of defined benefit pension plans, termination of benefits and accounting for post-retirement benefits other than pensions. In accordance with the authoritative accounting guidance, the Company recognizes the funded status of its defined benefit pension plans and OPEB plan in its Consolidated Balance Sheets with a corresponding adjustment to AOCL, net of tax.

Information about the net periodic benefit cost (credit) and other changes recognized in AOCL for the pension and post-retirement benefit plans is as follows (dollars in millions):


	Pension Plans									Post-retirement Benefits
	Year ended December 31, 2021			Year ended December 31, 2020			Year ended December 31, 2019			Year ended December 31, 2021			Year ended December 31, 2020			Year ended December 31, 2019
Net Periodic Benefit Cost (Credit):
Service cost	$	9		$	10		$	10		$	1		$	1		$	1
Interest cost		5			6			7			3			3			4
Expected return on assets		(8	)		(9	)		(9	)		—			—			—
Settlement loss		—			2			—			—			—			—
Prior service credit		—			—			—			(10	)		(14	)		(13	)
Recognized actuarial loss		1			—			—			—			—			—
Net Periodic Benefit Cost (Credit)	$	7		$	9		$	8		$	(6	)	$	(10	)	$	(8	)
Other changes recognized in other comprehensive income:
Net (gain) loss	$	(6	)	$	12		$	(2	)	$	(5	)	$	12		$	(1	)
Amortizations		(1	)		(2	)		—			10			13			13
Total recognized – other comprehensive (income) loss	$	(7	)	$	10		$	(2	)	$	5		$	25		$	12

The components of net periodic benefit costs other than the service cost component are included in Other income (expense), net in the Consolidated Statements of Comprehensive Income.

The voluntary and involuntary separation programs in the second quarter of 2020 resulted in a one-time, non-cash settlement charge of $2 million recorded in Other income (expense), net in the Consolidated Statements of Comprehensive Income.

The table below provides the weighted-average actuarial assumptions used to determine the net periodic benefit cost (credit).


	Pension Plans									Post-retirement Benefits
	Year ended December 31, 2021			Year ended December 31, 2020			Year ended December 31, 2019			Year ended December 31, 2021			Year ended December 31, 2020			Year ended December 31, 2019
Discount rate		2.30	%		3.20	%		4.20	%		2.40	%		3.20	%		4.20	%
Rate of compensation increase (salaried)		3.00	%		3.00	%		3.00	%	N/A			N/A			N/A
Expected return on assets		3.70	%		4.00	%		4.50	%	N/A			N/A			N/A

The table below provides the weighted-average actuarial assumptions used to determine the benefit obligations of the Company’s plans.


	Pension Plans						Post-retirement Benefits
	As of December 31,
	2021			2020			2021			2020
Discount rate		2.70	%		2.30	%		2.80	%		2.40	%
Rate of compensation increase (salaried)		3.00	%		3.00	%	N/A			N/A

The Company’s pension and OPEB costs are calculated using various actuarial assumptions and methodologies as prescribed by authoritative accounting guidance. These assumptions include discount rates, expected return on plan assets, health care cost trend rates, inflation, rate of compensation increases, mortality rates and other factors. The Company reviews all actuarial assumptions on an annual basis and in the case of remeasurement.

The discount rate is used to determine the present value of the Company’s benefit obligations. The Company’s discount rate is determined by matching the plans’ projected cash flows to a yield curve based on long-term, fixed income debt instruments available as of the measurement date of December 31, 2021.

The overall expected rate of return on plan assets is based upon historical and expected future returns consistent with the expected benefit duration of the plan for each asset group adjusted for investment and administrative fees.

Health care cost trends are used to project future post-retirement benefits payable from the Company’s plans. For the Company’s December 31, 2021 obligations, future post-retirement health care costs were forecasted assuming an initial annual increase of up to 6.70%, decreasing to an annual increase of up to 4.00% by the year 2044.

The following table provides a reconciliation of the changes in the net benefit obligations and fair value of plan assets for the years ended December 31, 2021, 2020 and 2019 (dollars in millions):


	Pension Plans									Post-retirement Benefits
	Year ended December 31, 2021			Year ended December 31, 2020			Year ended December 31, 2019			Year ended December 31, 2021			Year ended December 31, 2020			Year ended December 31, 2019
Benefit Obligations:
Net benefit obligation at beginning of year	$	235		$	204		$	177		$	107		$	94		$	93
Service cost		9			10			10			1			1			1
Interest cost		5			6			7			3			3			4
Settlements		—			(12	)		—			—			—			—
Benefits paid		(14	)		(6	)		(9	)		(4	)		(3	)		(2	)
Actuarial (gain) loss		(15	)		33			19			(5	)		12			(2	)
Net benefit obligation at end of year	$	220		$	235		$	204		$	102		$	107		$	94
Fair Value of Plan Assets:
Fair value of plan assets at beginning of year	$	228		$	217		$	196		$	—		$	—		$	—
Actual return on plan assets		(1	)		29			30			—			—			—
Employer contributions		—			—			—			3			3			2
Settlements		—			(12	)		—			—			—			—
Benefits paid		(14	)		(6	)		(9	)		(3	)		(3	)		(2	)
Fair value of plan assets at end of year	$	213		$	228		$	217		$	—		$	—		$	—
Net Funded Status	$	(7	)	$	(7	)	$	13		$	(102	)	$	(107	)	$	(94	)

The Company’s pension plan assets mostly consist of diversified equity securities and diversified debt securities. The fair values of plan assets for the Company’s pension plans as of December 31, 2021 and 2020 are as follows (dollars in millions):


	Fair Value Measurements Using
	Quoted Prices in Active Markets for Identical Assets (Level 1)				Significant Other Observable Inputs (Level 2)				TOTAL
	2021		2020		2021		2020		2021		2020
Diversified debt securities	$	14	$	14	$	160	$	172	$	174	$	186
Diversified equity securities		24		28		9		10		33		38
Cash equivalents		6		4		—		—		6		4
Total	$	44	$	46	$	169	$	182	$	213	$	228

The Company’s investment strategy with respect to pension plan assets is to invest the assets in accordance with laws and regulations. The long-term primary objectives for the Company’s pension assets are to provide results that meet or exceed the plans’ actuarially assumed long-term rate of return without subjecting the funds to undue risk. To achieve these objectives the Company has established the following targets:


	Target
Asset Category	Hourly			Salary
Cash equivalents		2	%		2	%
Diversified equity securities		15			15
Diversified debt securities		83			83
Total		100	%		100	%

Through 2021, the Company’s investment committee has continued to evaluate the investments and take steps toward the established targets.

The following table discloses the amounts recognized in the balance sheet and in AOCL at December 31, 2021 and 2020, on a pre-tax basis (dollars in millions):


	Pension Plans						Post-retirement Benefits
	As of December 31,
	2021			2020			2021			2020
Amounts Recognized in Balance Sheet:
Noncurrent assets	$	1		$	—		$	—		$	—
Current liabilities		—			—			(4	)		(3	)
Noncurrent liabilities		(8	)		(7	)		(98	)		(104	)
Total (liability) asset	$	(7	)	$	(7	)	$	(102	)	$	(107	)
Accumulated Other Comprehensive Loss:
Prior service credit	$	2		$	2		$	34		$	44
Actuarial loss		(8	)		(16	)		(3	)		(8	)
Total	$	(6	)	$	(14	)	$	31		$	36

The accumulated benefit obligation for the Company’s pension plans as of December 31, 2021 and 2020 was $216 million and $230 million, respectively.

As of December 31, 2021 and 2020, the projected benefit obligation, the accumulated benefit obligation, and the fair value of plan assets for pension plans with a projected benefit obligation in excess of plan assets and for pension plans with an accumulated benefit obligation in excess of plan assets were as follows (dollars in millions):


	Hourly Plan		Salary Plan
	As of December 31,
	2021	2020	2021		2020
Plans with projected benefit obligation in excess of plan assets:
Projected benefit obligation	N/A 1	N/A 1	$	110	$	119
Fair value of plan assets	N/A 1	N/A 1	$	101	$	112
Plans with accumulated benefit obligation in excess of plan assets:
Accumulated benefit obligation	N/A 1	N/A 1	$	105	$	114
Fair value of plan assets	N/A 1	N/A 1	$	101	$	112

(1)

As of December 31, 2021 and 2020, the hourly defined pension plan had plan assets greater than the projected benefit obligation and the accumulated benefit obligation.

Information about expected cash flows for the Company’s pension and post-retirement benefit plans is as follows (dollars in millions):


	Pension Plans		Post-retirement Benefits
Employer Contributions:
2022 expected contributions	$	—	$	4
Expected Benefit Payments:
2022		11		4
2023		11		4
2024		12		4
2025		13		4
2026		13		4
2027-2031		68		24

Expected benefit payments for pension and post-retirement benefits will be paid from plan trusts or corporate assets. The Company’s funding policy is to contribute amounts annually that are at least equal to the amounts required by applicable laws and regulations or to directly fund payments to plan participants. Additional discretionary contributions will be made when deemed appropriate to meet the Company’s long-term obligation to the plans.

The Company maintains a non-qualified deferred compensation plan (“Deferred Compensation Plan”) for a select group of management. Under the terms of the plan, the Company has utilized a rabbi trust to accumulate assets to fund its promise to pay benefits under the Deferred Compensation Plan. The rabbi trust is an irrevocable trust, which restricts any use of funds (operational or otherwise) by the Company other than to pay benefits under the Deferred Compensation Plan, and prevents immediate taxation of contributed amounts. Funds are accumulated through both employee deferrals and a Company match. Funds can be invested by the employee into a diversified group of investment options, which have been selected by the Company’s investment committee, that are all categorized as Level 1 in the fair value hierarchy. The Company match resulted in no charge to the Consolidated Statements of Comprehensive Income for any of the years ended December 31, 2021, 2020 and 2019, and the fair value of the rabbi trust plan assets and deferred compensation obligation was $19 million and $17 million as of December 31, 2021 and 2020, respectively.

Income Taxes

12 Months Ended

Dec. 31, 2021

Income Tax Disclosure [Abstract]

Income Taxes

NOTE 16. INCOME TAXES

Income before income taxes included the following (dollars in millions):


	Years ended December 31,
	2021		2020		2019
U.S. income	$	513	$	364	$	712
Foreign income		59		29		56
Total	$	572	$	393	$	768

The provision for income tax expense was estimated as follows (dollars in millions):


	Years ended December 31,
	2021		2020		2019
Estimated current income taxes:
U.S. federal	$	48	$	18	$	75
Foreign		10		6		13
U.S. state and local		8		1		11
Total Current		66		25		99
Deferred income tax expense, net:
U.S. federal		56		61		58
Foreign		—		1		—
U.S. state and local		8		7		7
Total Deferred		64		69		65
Total income tax expense	$	130	$	94	$	164

A reconciliation of the provision for income tax expense compared with the amounts at the U.S. federal statutory rate is as follows (dollars in millions):


	Years ended December 31,
	2021			2020			2019
Tax at U.S. statutory income tax rate	$	120		$	82		$	161
State tax expense		12			10			14
Tax credits		(4	)		(5	)		(4	)
Effect of tax rate changes		2			5			(2	)
Foreign rate differential		(2	)		(2	)		(1	)
Valuation allowance		(1	)		2			1
Non-deductible expenses		—			3			(7	)
Other adjustments		3			(1	)		2
Total income tax expense	$	130		$	94		$	164

The effective tax rate for the years ended December 31, 2021 and 2020 was 23% and 24%, respectively.

Deferred income tax assets and liabilities as of December 31, 2021 and 2020 reflect the effect of temporary differences between amounts of assets, liabilities and equity for financial reporting purposes and the bases of such assets, liabilities and equity as measured by tax laws, as well as tax loss and tax credit carry forwards. Net deferred tax assets and liabilities are classified as non-current in the Consolidated Balance Sheets. As described above, the deferred tax assets and liabilities are measured based on the enacted tax rates that will apply in the years in which the temporary differences are expected to be recovered or paid.

The Company has not recognized any deferred tax liabilities associated with earnings in foreign subsidiaries, except for its subsidiary located in China, as they are intended to be permanently reinvested and used to support foreign operations or have no associated tax requirements. As of December 31, 2021, the Company has recorded a deferred tax liability of $3 million for the tax liability associated with the remittance of previously taxed income and unremitted earnings for its subsidiary located in China.

Temporary differences and carryforwards that gave rise to deferred tax assets and liabilities included the following (dollars in millions):


	As of December 31, 2021			As of December 31, 2020
Deferred tax assets:
Other accrued liabilities	$	35		$	26
Deferred revenue		31			33
Warranty accrual		11			14
Stock-based compensation		10			9
Unrealized loss on Interest rate hedges		7			14
Inventories		7			7
Sales allowances and rebates		7			3
Tax credits		5			4
Operating loss carryforwards		4			6
Technology-related investments		3			4
Intangibles		—			9
Other		13			13
Total deferred tax assets		133			142
Valuation allowances		(11	)		(12	)
Deferred tax liabilities:
Goodwill		(405	)		(373	)
Trade name		(173	)		(153	)
Property, plant and equipment		(46	)		(40	)
Intangibles		(7	)		—
Other		(3	)		(2	)
Total deferred tax liabilities		(634	)		(568	)
Net deferred tax liability	$	(512	)	$	(438	)

The estimated net operating loss carryforwards as of December 31, 2021 relate solely to U.S. state net operating loss carryforwards. Substantially all state operating loss carryforwards will not expire until 2028-2031.

Management has determined, based on an evaluation of available objective and subjective evidence, that it is more likely than not that certain foreign deferred tax assets and an anticipated capital loss carryforward will not be realized; therefore, these deferred tax assets are offset with a valuation allowance of $11 million as of December 31, 2021 and $12 million as of December 31, 2020.

In accordance with the FASB’s authoritative accounting guidance on accounting for income taxes, the Company records uncertain tax positions on the basis of a two-step process whereby (1) it is determined whether it is more likely than not that the tax position will be sustained based on the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold, the Company recognizes the largest amount of tax benefit that is greater than 50% likely to be realized upon ultimate settlement with the related tax authority. Based upon this process, the Company has recognized a $3 million liability for uncertain tax benefits as of each of December 31, 2021 and 2020. Management does not anticipate any material changes in the balance in 2022.

For the years ended December 31, 2021, 2020 and 2019, the Company recognized no interest and penalties in the Consolidated Statements of Comprehensive Income because either no uncertain tax positions were identified or the penalties and interest anticipated were not material in all the periods presented. The Company follows a policy of recording any interest or penalties in Income tax expense.

All of the Company's tax returns, once filed, will remain subject to examination by the various taxing authorities for the duration of the applicable statute of limitations (generally three years from the earlier of the date of filing or the due date of the return).

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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Accumulated Other Comprehensive Loss

Accumulated Other Comprehensive Loss

12 Months Ended

Dec. 31, 2021

Equity [Abstract]

NOTE 17. ACCUMULATED OTHER COMPREHENSIVE LOSS

The changes in components of AOCL consisted of the following (dollars in millions):


	Before Tax			Tax (Expense) Benefit			Reclassification of stranded tax effects			After Tax
Balance at December 31, 2018	$	23		$	(53	)	$	—		$	(30	)
Foreign currency translation		(3	)		—			—			(3	)
Pension and OPEB liability adjustment		(11	)		2			9			—
Available-for-sale securities		(24	)		6			(1	)		(19	)
Net current period other comprehensive (loss) income	$	(38	)	$	8		$	8		$	(22	)
Balance at December 31, 2019	$	(15	)	$	(45	)	$	8		$	(52	)
Foreign currency translation		10			—			—			10
Pension and OPEB liability adjustment		(36	)		9			—			(27	)
Interest rate swaps		(26	)		6			—			(20	)
Net current period other comprehensive (loss) income	$	(52	)	$	15		$	—		$	(37	)
Balance at December 31, 2020	$	(67	)	$	(30	)	$	8		$	(89	)
Foreign currency translation		(8	)		—			—			(8	)
Pension and OPEB liability adjustment		3			(1	)		—			2
Interest rate swaps		29			(7	)		—			22
Net current period other comprehensive income (loss)	$	24		$	(8	)	$	—		$	16
Balance at December 31, 2021	$	(43	)	$	(38	)	$	8		$	(73	)

The following table shows the location in the Consolidated Statements of Comprehensive Income affected by reclassifications from AOCL (dollars in millions):


	For the year ended December 31, 2019
AOCL Components	Amount reclassified from AOCL			Affected line item in the consolidated statements of comprehensive income
Interest rate swaps	$	1		Interest expense, net
Prior service credit		13		Other income (expense), net
Total reclassifications, before tax		14		Income before income taxes
Income tax expense		(3	)	Income tax expense
Total reclassifications	$	11


	For the year ended December 31, 2020
AOCL Components	Amount reclassified from AOCL			Affected line item in the consolidated statements of comprehensive income
Interest rate swaps	$	11		Interest expense, net
Prior service credit		14		Other income (expense), net
Total reclassifications, before tax		25		Income before income taxes
Income tax expense		(6	)	Income tax expense
Total reclassifications	$	19


	For the year ended December 31, 2021
AOCL Components	Amount reclassified from AOCL			Affected line item in the consolidated statements of comprehensive income
Interest rate swaps	$	15		Interest expense, net
Prior service credit		10		Other income (expense), net
Recognized actuarial loss		(1	)	Other income (expense), net
Total reclassifications, before tax		24		Income before income taxes
Income tax expense		(6	)	Income tax expense
Total reclassifications	$	18

Prior service cost and actuarial loss are included in the computation of the Company’s net periodic benefit cost. Please see "NOTE 15. Employee Benefit Plans” for additional details.

Commitments and Contingencies

12 Months Ended

Dec. 31, 2021

Commitments And Contingencies Disclosure [Abstract]

Commitments and Contingencies

NOTE 18. COMMITMENTS AND CONTINGENCIES

Environmental Matters

The Company has an agreement with the Environmental Protection Agency ("EPA") to perform remedial activities at the Company’s Indianapolis, Indiana manufacturing facilities related to historical soil and groundwater contamination. In the fourth quarter of 2019, the EPA accepted a proposal to reduce the Company’s ongoing responsibilities for operating, monitoring and maintaining the ongoing activities resulting in the Company reducing its associated undiscounted liability to $3 million to complete the future operating, monitoring and maintenance activities over the next 30 years. As of December 31, 2021, the Company had a liability recorded in the amount of $3 million.

Claims, Disputes, and Litigation

The Company is party to various legal actions and administrative proceedings and subject to various claims arising in the ordinary course of business. These proceedings primarily involve commercial claims, product liability claims, personal injury claims and workers’ compensation claims. The Company believes that the ultimate liability, if any, in excess of amounts already provided for in the consolidated financial statements or covered by insurance on the disposition of these matters will not have a material adverse effect on the financial position, results of operations or cash flows of the Company.

Concentration of Risk

12 Months Ended

Dec. 31, 2021

Risks And Uncertainties [Abstract]

Concentration of Risk

NOTE 19. CONCENTRATION OF RISK

As of December 31, 2021 and 2020, the Company employed approximately 3,400 and 3,300 employees, respectively, with 90% and 89%, respectively, of those employees in the U.S. Approximately 46% and 47% of the Company’s U.S. employees were represented by unions and subject to a collective bargaining agreement as of December 31, 2021 and 2020, respectively. The Company is currently operating under a collective bargaining agreement with UAW Local 933 that expires in November 2023.

Three customers accounted for 10% or more of net sales within the last three years presented.


	Years ended December 31,
% of net sales	2021			2020			2019
Daimler AG		20	%		20	%		20	%
PACCAR Inc.		10	%		11	%		12	%
Traton SE1		10	%		11	%		11	%

(1)

Traton SE acquired Navistar International Corporation in July 2021. Percentages for 2021 include net sales to Traton SE and Navistar International Corporation. Percentages for 2020 and 2019 include net sales to Navistar International Corporation only.

No other customers accounted for 10% or more of net sales of the Company during the years ended December 31, 2021, 2020 or 2019.

Two customers accounted for 10% or more of outstanding accounts receivable within the last two years presented.


% of accounts receivable	As of December 31, 2021			As of December 31, 2020
Daimler AG		17	%		21	%
Traton SE1		11	%		14	%

(1)

No other customers accounted for 10% or more of the outstanding accounts receivable as of December 31, 2021 or December 31, 2020.

No supplier accounted for 10% or more of materials purchased during the years ended December 31, 2021, 2020 or 2019.

Common Stock

12 Months Ended

Dec. 31, 2021

Equity [Abstract]

Common Stock

NOTE 20. COMMON STOCK

The Company's Board of Directors has authorized it to repurchase up to $3,000 million, in the aggregate, of its common stock pursuant to a stock repurchase program (the “Repurchase Program”). During 2021, the Company repurchased approximately $513 million of its common stock under the Repurchase Program, leaving $314 million of authorized repurchases remaining under the Repurchase Program as of December 31, 2021. The Repurchase Program has no termination date, and the timing and amount of stock purchases are subject to market conditions and corporate needs. The Repurchase Program may be modified, suspended or discontinued at any time at the Company’s discretion.

Earnings Per Share

12 Months Ended

Dec. 31, 2021

Earnings Per Share [Abstract]

Earnings Per Share

NOTE 21. EARNINGS PER SHARE

The Company presents both basic and diluted earnings per share (“EPS”) amounts. Basic EPS is calculated by dividing net income by the weighted average number of common shares outstanding during the reporting period. Diluted EPS is calculated by dividing net income by the weighted average number of common shares and common equivalent shares outstanding during the reporting period that are calculated using the treasury stock method for stock-based awards. The treasury stock method assumes that the Company uses the proceeds from the exercise of awards to repurchase common stock at the average market price during the period. The assumed proceeds under

the treasury stock method include the purchase price that the grantee will pay in the future and compensation cost for future service that the Company has not yet recognized. During each of the years ended December 31, 2021 and 2020, 1 million outstanding stock options were excluded from the diluted EPS calculation because they were anti-dilutive, and during the year ended December 31, 2019, there were no outstanding stock options excluded from the diluted EPS calculation because they were anti-dilutive. Basic and diluted EPS for the full-year is calculated using the weighted average shares of common stock outstanding during the year while quarterly basic and diluted EPS is calculated using the weighted average shares of common stock outstanding during the quarter; therefore, the sum of the four quarters’ EPS may not equal full-year EPS.

The following table reconciles the numerators and denominators used to calculate basic EPS and diluted EPS (in millions, except per share data):


	Years ended December 31,
	2021		2020		2019
Net income	$	442	$	299	$	604
Weighted average shares of common stock outstanding		107		114		122
Dilutive effect stock-based awards		—		—		1
Diluted weighted average shares of common stock outstanding		107		114		123
Basic earnings per share attributable to common stockholders	$	4.13	$	2.62	$	4.95
Diluted earnings per share attributable to common stockholders	$	4.13	$	2.62	$	4.91

Geographic Information

12 Months Ended

Dec. 31, 2021

Segment Reporting [Abstract]

Geographic Information

NOTE 22. GEOGRAPHIC INFORMATION

The Company had the following net sales by country, based on the location of the customer (dollars in millions):


	Years ended December 31,
	2021		2020		2019
United States	$	1,706	$	1,521	$	1,915
China		122		87		136
Japan		109		66		79
Canada		62		70		104
Mexico		50		61		71
Germany		34		36		59
South Korea		28		22		24
Sweden		27		19		23
France		27		21		37
United Kingdom		26		25		35
Netherlands		24		21		26
Other		187		132		189
Total	$	2,402	$	2,081	$	2,698

The Company had the following net long-lived assets by country (dollars in millions):


	Years ended December 31,
	2021		2020		2019
United States	$	680	$	611	$	583
India		11		12		17
Hungary		11		11		11
Other		4		4		5
Total	$	706	$	638	$	616

Schedule I-Parent Company Only Financial Statements

12 Months Ended

Dec. 31, 2021

Condensed Financial Information Of Parent Company Only Disclosure [Abstract]

Schedule I-Parent Company Only Financial Statements

Allison Transmission Holdings, Inc.

Schedule I—Parent Company only Balance Sheets

(dollars in millions)


	December 31, 2021			December 31, 2020
ASSETS
Current Assets:
Cash	$	—		$	—
Total Current Assets		—			—
Investments in and advances to subsidiaries		634			756
TOTAL ASSETS	$	634		$	756
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities:
Accounts payable	$	—		$	—
Total Current Liabilities		—			—
Capital stock		1			1
Paid in capital		1,832			1,818
Treasury stock		—			—
Accumulated deficit		(1,126	)		(974	)
Accumulated other comprehensive loss, net of tax		(73	)		(89	)
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	634		$	756

The accompanying note is an integral part of the Parent Company only financial statements.

Allison Transmission Holdings, Inc.

Schedule I—Parent Company only Statements of Comprehensive Income

(dollars in millions)


	Years ended December 31,
	2021		2020		2019
Net sales	$	—	$	—	$	—
General and administrative fees		—		—		—
Total operating income		—		—		—
Other income:
Equity earnings of consolidated subsidiary		442		299		604
Income before income taxes		442		299		604
Income tax expense		—		—		—
Net income	$	442	$	299	$	604
Comprehensive income	$	458	$	262	$	582

The accompanying note is an integral part of the Parent Company only financial statements.

Allison Transmission Holdings, Inc.

Schedule I—Parent Company only Statements of Cash Flows

(dollars in millions)


	Years ended December 31,
	2021			2020			2019
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	442		$	299		$	604
Deduct items included in net income not providing cash:
Equity in earnings in consolidated subsidiary		(442	)		(299	)		(604	)
Net cash provided by operating activities		—			—			—
CASH FLOWS FROM INVESTING ACTIVITIES:
Investments in subsidiaries		(3	)		(2	)		(5	)
Dividends		81			78			73
Net cash provided by investing activities		78			76			68
CASH FLOWS FROM FINANCING ACTIVITIES:
Capital contributions		3			2			5
Dividends		(81	)		(78	)		(73	)
Net cash used in financing activities		(78	)		(76	)		(68	)
Net increase (decrease) during period		—			—			—
Cash and cash equivalents at beginning of period		—			—			—
Cash and cash equivalents at end of period	$	—		$	—		$	—

The accompanying note is an integral part of the Parent Company only financial statements.

Schedule I-Parent Company Only Financial Statements - BASIS OF PRESENTATION	12 Months Ended
	Dec. 31, 2021
Parent Company
Condensed Financial Statements Captions [Line Items]
Basis of Presentation	NOTE 1—BASIS OF PRESENTATION Allison Transmission Holdings, Inc. (the “Parent Company”) is a holding company that conducts all of its business operations through its subsidiaries. There are restrictions on the Parent Company’s ability to obtain funds from its subsidiaries through dividends (refer to "NOTE 8. Debt” of Notes to Consolidated Financial Statements). The entire amount of the Parent Company’s consolidated net assets was subject to restrictions on payment of dividends as of December 31, 2021, 2020 and 2019. Accordingly, these financial statements have been presented on a “parent-only” basis. Under a parent-only presentation, the Parent Company’s investments in its consolidated subsidiaries are presented under the equity method of accounting. These parent-only financial statements should be read in conjunction with Allison Transmission Holdings, Inc.’s audited Consolidated Financial Statements included elsewhere herein.

Summary of Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2021

Basis of Presentation and Principles of Consolidation

Use of Estimates

Segment Reporting

Business Combinations

Cash and Cash Equivalents

Investments

Inventories

Property, Plant and Equipment

Property, plant and equipment are recorded at cost less accumulated depreciation. Depreciation expense is recorded using the straight-line method over the following estimated lives:


		Range in Years
Land improvements		5 – 30
Buildings and building improvements		10 – 40
Machinery and equipment		2 – 20
Software		2 – 5
Special tooling		2 – 10

Impairment of Long-Lived Assets

Goodwill and Other Intangible Assets

Deferred Financing Costs

Financial Instruments

Insurable Liabilities

Revenue Recognition

The Company classifies shipping and handling billed to customers in Net sales and shipping and handling costs in Cost of sales, in accordance with authoritative accounting guidance.

Warranty

Research and Development

Environmental

Foreign Currency Translation

Accumulated Other Comprehensive Loss (“AOCL”) as disclosed in "NOTE 17. Accumulated Other Comprehensive Loss”.

Derivative Instruments

Income Taxes

Stock-Based Compensation

The Company has made a policy election under applicable accounting guidance to account for forfeitures as a reduction of stock-based compensation expense when the forfeiture actually occurs.

Pension and Post-retirement Benefit Plans

Recently Adopted and Issued Accounting Pronouncements

Recently Adopted Accounting Pronouncements

Recently Issued Accounting Pronouncements

Lessee Accounting

Summary of Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2021

Property And Equipment Estimated Useful Lives

Depreciation expense is recorded using the straight-line method over the following estimated lives:


		Range in Years
Land improvements		5 – 30
Buildings and building improvements		10 – 40
Machinery and equipment		2 – 20
Software		2 – 5
Special tooling		2 – 10

The cost and accumulated depreciation of property, plant and equipment are as follows (dollars in millions):


	December 31, 2021			December 31, 2020
Land and land improvements	$	27		$	26
Buildings and building improvements		492			423
Machinery and equipment		795			783
Software		188			175
Special tooling		243			223
Construction in progress		83			54
Total property, plant and equipment		1,828			1,684
Accumulated depreciation		(1,122	)		(1,046	)
Property, plant and equipment, net	$	706		$	638

Revenue (Tables)

12 Months Ended

Dec. 31, 2021

Revenue From Contract With Customer [Abstract]

Disaggregated Revenue by Categories

The following presents disaggregated revenue by categories that best depict how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors (dollars in millions):


	Year ended December 31, 2021		Year ended December 31, 2020
North America On-Highway	$	1,177	$	1,081
North America Off-Highway		58		13
Defense		186		182
Outside North America On-Highway		381		280
Outside North America Off-Highway		83		61
Service Parts, Support Equipment and Other		517		464
Total Net Sales	$	2,402	$	2,081

Inventories (Tables)

12 Months Ended

Dec. 31, 2021

Inventory Disclosure [Abstract]

Schedule of Components of Inventories

Inventories consisted of the following components (dollars in millions):


	December 31, 2021		December 31, 2020
Purchased parts and raw materials	$	101	$	88
Work in progress		8		15
Service parts		44		43
Finished goods		51		35
Total inventories	$	204	$	181

Property, Plant and Equipment (Tables)

12 Months Ended

Dec. 31, 2021

Property Plant And Equipment [Abstract]

Property And Equipment Estimated Useful Lives

Depreciation expense is recorded using the straight-line method over the following estimated lives:


		Range in Years
Land improvements		5 – 30
Buildings and building improvements		10 – 40
Machinery and equipment		2 – 20
Software		2 – 5
Special tooling		2 – 10

The cost and accumulated depreciation of property, plant and equipment are as follows (dollars in millions):


	December 31, 2021			December 31, 2020
Land and land improvements	$	27		$	26
Buildings and building improvements		492			423
Machinery and equipment		795			783
Software		188			175
Special tooling		243			223
Construction in progress		83			54
Total property, plant and equipment		1,828			1,684
Accumulated depreciation		(1,122	)		(1,046	)
Property, plant and equipment, net	$	706		$	638

Goodwill and Other Intangible Assets (Tables)

12 Months Ended

Dec. 31, 2021

Goodwill And Intangible Assets Disclosure [Abstract]

Schedule of Other Intangible Assets

The following presents a summary of other intangible assets (dollars in millions):


	December 31, 2021							December 31, 2020
	Intangible assets, gross		Accumulated amortization			Intangible assets, net		Intangible assets, gross		Accumulated amortization			Intangible assets, net
Other intangible assets:
Trade name	$	791	$	—		$	791	$	791	$	—		$	791
In process research and development		25		—			25		25		—			25
Customer relationships – commercial		839		(751	)		88		839		(708	)		131
Proprietary technology		478		(477	)		1		478		(477	)		1
Customer relationships – defense		62		(50	)		12		62		(47	)		15
Total	$	2,195	$	(1,278	)	$	917	$	2,195	$	(1,232	)	$	963

Schedule of Amortization Expense Related to Other Intangible Assets for Next Five Fiscal Years

Amortization expense related to other intangible assets for the next five years is expected to be (dollars in millions):


	2022		2023		2024		2025		2026
Amortization expense	$	45	$	43	$	8	$	4	$	1

Fair Value of Financial Instruments (Tables)

12 Months Ended

Dec. 31, 2021

Fair Value Disclosures [Abstract]

Summary of Fair Value of Financial Assets and (Liabilities)

The following table summarizes the fair value of the Company’s financial assets and (liabilities) as of December 31, 2021 and 2020 (dollars in millions):


	Fair Value Measurements Using
	Quoted Prices in Active Markets for Identical Assets (Level 1)						Significant Other Observable Inputs (Level 2)						TOTAL
	2021			2020			2021			2020			2021			2020
Cash equivalents	$	—		$	160		$	—		$	—		$	—		$	160
Marketable securities		46			—			—			—			46			—
Derivative liabilities, net		—			—			(31	)		(60	)		(31	)		(60	)
Rabbi trust assets		19			17			—			—			19			17
Deferred compensation obligation		(19	)		(17	)		—			—			(19	)		(17	)
Total	$	46		$	160		$	(31	)	$	(60	)	$	15		$	100

Debt (Tables)

12 Months Ended

Dec. 31, 2021

Debt Disclosure [Abstract]

Summary of Long-Term Debt and Maturities

Long-term debt and maturities are as follows (dollars in millions):


	December 31, 2021		December 31, 2020
Long-term debt:
Senior Secured Credit Facility Term Loan, variable, due 2026	$	631	$	638
Senior Notes, fixed 4.75%, due 2027		400		400
Senior Notes, fixed 5.875%, due 2029		500		500
Senior Notes, fixed 3.75%, due 2031		1,000		1,000
Total long-term debt	$	2,531	$	2,538
Less: current maturities of long-term debt		6		6
deferred financing costs, net (see NOTE 2)		21		25
Total long-term debt, net	$	2,504	$	2,507

Principal Payments Required on Long Term Debt

Principal payments required on long-term debt during the next five years are as follows:


(dollars in millions)	2022		2023		2024		2025		2026
Payments	$	6	$	6	$	6	$	6	$	607

Tabular disclosure of long-debt instruments or arrangements, including identification, terms, features, collateral requirements and other information necessary to a fair presentation. These are debt arrangements that originally required repayment more than twelve months after issuance or greater than the normal operating cycle of the entity, if longer.

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Reference 8: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 7
-URI http://asc.fasb.org/extlink&oid=123467817&loc=d3e21521-112644

Reference 9: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
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-Section 50
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Reference 10: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 942
-SubTopic 470
-Section 50
-Paragraph 3
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Reference 11: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 835
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-Section 55
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Reference 12: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=123467817&loc=d3e21475-112644

Derivative Instruments And Hedging Activities Disclosure [Abstract]

Derivatives (Tables)

12 Months Ended

Dec. 31, 2021

Derivative Instruments and their Impact on Financial Condition


	December 31, 2021			December 31, 2020
	Balance Sheet Location	Fair Value		Balance Sheet Location	Fair Value
Derivatives designated as hedging instruments:
Interest rate swaps	Other current liabilities	$	10	Other current liabilities	$	14
	Other non-current liabilities		21	Other non-current liabilities		46
Total derivatives designated as hedging instruments		$	31		$	60

Product Warranty Liabilities (Tables)

12 Months Ended

Dec. 31, 2021

Guarantees And Product Warranties [Abstract]

Product Warranty Liability Activities

Product warranty liability activities consist of the following (dollars in millions):


	Year ended December 31, 2021			Year ended December 31, 2020			Year ended December 31, 2019
Beginning balance	$	66		$	52		$	66
Payments		(30	)		(32	)		(26	)
Increase in liability (warranty issued during period)		16			15			21
Net adjustments to liability		1			31			(9	)
Ending balance	$	53		$	66		$	52

Deferred Revenue (Tables)

12 Months Ended

Dec. 31, 2021

Revenue Recognition And Deferred Revenue [Abstract]

Summary of Deferred Revenue Activity

Deferred revenue activity consists of the following (dollars in millions):


	Year ended December 31, 2021			Year ended December 31, 2020			Year ended December 31, 2019
Beginning balance	$	143		$	139		$	122
Increases		29			40			55
Revenue earned		(36	)		(36	)		(38	)
Ending balance	$	136		$	143		$	139

Leases (Tables)

12 Months Ended

Dec. 31, 2021

Leases [Abstract]

Schedule of Lease Maturity, Current Guidance

The following table reconciles future undiscounted cash flows for operating leases as of December 31, 2021 to total operating lease liabilities:


	December 31, 2021
2022	$	5
2023		3
2024		2
2025		2
2026		2
Thereafter		6
Total lease payments	$	20
Less: Interest		3
Present value of lease liabilities	$	17

Schedule of Right of Use Assets

The below table depicts the ROU assets held by the Company based on the underlying asset:


	December 31, 2021
Buildings	$	16
Land		1
Vehicles		1
Total right-of-use assets	$	18

Other Income (Expense), Net (Tables)

12 Months Ended

Dec. 31, 2021

Other Income And Expenses [Abstract]

Computation of Other Income (Expense), Net

Other income (expense), net consists of the following (dollars in millions):


	Years ended December 31,
	2021		2020			2019
Post-retirement benefit plan amendment credits	$	10	$	13		$	11
Unrealized gain on marketable securities		4		—			—
Technology-related investments gain		4		—			—
Expenses related to long-term debt refinancing		—		(13	)		(1	)
Other		1		(4	)		—
Total	$	19	$	(4	)	$	10

Other Current Liabilities (Tables)

12 Months Ended

Dec. 31, 2021

Other Liabilities Disclosure [Abstract]

Summary of Other Current Liabilities

Other current liabilities consist of the following (dollars in millions):


	As of December 31, 2021		As of December 31, 2020
Payroll and related costs	$	80	$	47
Sales allowances		39		20
Accrued interest payable		24		12
Vendor buyback obligation		16		16
Taxes payable		14		11
Derivative liabilities		10		14
Lease liability		4		4
Non-trade payables		2		2
Construction liability		2		1
Other accruals		13		13
Total	$	204	$	140

Employee Benefit Plans (Tables)

12 Months Ended

Dec. 31, 2021

Compensation And Retirement Disclosure [Abstract]

Net Periodic Benefit Costs

Information about the net periodic benefit cost (credit) and other changes recognized in AOCL for the pension and post-retirement benefit plans is as follows (dollars in millions):


	Pension Plans									Post-retirement Benefits
	Year ended December 31, 2021			Year ended December 31, 2020			Year ended December 31, 2019			Year ended December 31, 2021			Year ended December 31, 2020			Year ended December 31, 2019
Net Periodic Benefit Cost (Credit):
Service cost	$	9		$	10		$	10		$	1		$	1		$	1
Interest cost		5			6			7			3			3			4
Expected return on assets		(8	)		(9	)		(9	)		—			—			—
Settlement loss		—			2			—			—			—			—
Prior service credit		—			—			—			(10	)		(14	)		(13	)
Recognized actuarial loss		1			—			—			—			—			—
Net Periodic Benefit Cost (Credit)	$	7		$	9		$	8		$	(6	)	$	(10	)	$	(8	)
Other changes recognized in other comprehensive income:
Net (gain) loss	$	(6	)	$	12		$	(2	)	$	(5	)	$	12		$	(1	)
Amortizations		(1	)		(2	)		—			10			13			13
Total recognized – other comprehensive (income) loss	$	(7	)	$	10		$	(2	)	$	5		$	25		$	12

Weighted-Average Actuarial Assumptions

The table below provides the weighted-average actuarial assumptions used to determine the net periodic benefit cost (credit).


	Pension Plans									Post-retirement Benefits
	Year ended December 31, 2021			Year ended December 31, 2020			Year ended December 31, 2019			Year ended December 31, 2021			Year ended December 31, 2020			Year ended December 31, 2019
Discount rate		2.30	%		3.20	%		4.20	%		2.40	%		3.20	%		4.20	%
Rate of compensation increase (salaried)		3.00	%		3.00	%		3.00	%	N/A			N/A			N/A
Expected return on assets		3.70	%		4.00	%		4.50	%	N/A			N/A			N/A

The table below provides the weighted-average actuarial assumptions used to determine the benefit obligations of the Company’s plans.


	Pension Plans						Post-retirement Benefits
	As of December 31,
	2021			2020			2021			2020
Discount rate		2.70	%		2.30	%		2.80	%		2.40	%
Rate of compensation increase (salaried)		3.00	%		3.00	%	N/A			N/A

Reconciliation of Changes in Net Benefit Obligations and Fair Value of Plan Assets

The following table provides a reconciliation of the changes in the net benefit obligations and fair value of plan assets for the years ended December 31, 2021, 2020 and 2019 (dollars in millions):


	Pension Plans									Post-retirement Benefits
	Year ended December 31, 2021			Year ended December 31, 2020			Year ended December 31, 2019			Year ended December 31, 2021			Year ended December 31, 2020			Year ended December 31, 2019
Benefit Obligations:
Net benefit obligation at beginning of year	$	235		$	204		$	177		$	107		$	94		$	93
Service cost		9			10			10			1			1			1
Interest cost		5			6			7			3			3			4
Settlements		—			(12	)		—			—			—			—
Benefits paid		(14	)		(6	)		(9	)		(4	)		(3	)		(2	)
Actuarial (gain) loss		(15	)		33			19			(5	)		12			(2	)
Net benefit obligation at end of year	$	220		$	235		$	204		$	102		$	107		$	94
Fair Value of Plan Assets:
Fair value of plan assets at beginning of year	$	228		$	217		$	196		$	—		$	—		$	—
Actual return on plan assets		(1	)		29			30			—			—			—
Employer contributions		—			—			—			3			3			2
Settlements		—			(12	)		—			—			—			—
Benefits paid		(14	)		(6	)		(9	)		(3	)		(3	)		(2	)
Fair value of plan assets at end of year	$	213		$	228		$	217		$	—		$	—		$	—
Net Funded Status	$	(7	)	$	(7	)	$	13		$	(102	)	$	(107	)	$	(94	)

Fair Value of Plan Assets

The fair values of plan assets for the Company’s pension plans as of December 31, 2021 and 2020 are as follows (dollars in millions):


	Fair Value Measurements Using
	Quoted Prices in Active Markets for Identical Assets (Level 1)				Significant Other Observable Inputs (Level 2)				TOTAL
	2021		2020		2021		2020		2021		2020
Diversified debt securities	$	14	$	14	$	160	$	172	$	174	$	186
Diversified equity securities		24		28		9		10		33		38
Cash equivalents		6		4		—		—		6		4
Total	$	44	$	46	$	169	$	182	$	213	$	228

Schedule of Allocation of Plan Assets

To achieve these objectives the Company has established the following targets:


	Target
Asset Category	Hourly			Salary
Cash equivalents		2	%		2	%
Diversified equity securities		15			15
Diversified debt securities		83			83
Total		100	%		100	%

Amounts Recognized in Balance Sheet and in Accumulated Other Comprehensive Income AOCI

The following table discloses the amounts recognized in the balance sheet and in AOCL at December 31, 2021 and 2020, on a pre-tax basis (dollars in millions):


	Pension Plans						Post-retirement Benefits
	As of December 31,
	2021			2020			2021			2020
Amounts Recognized in Balance Sheet:
Noncurrent assets	$	1		$	—		$	—		$	—
Current liabilities		—			—			(4	)		(3	)
Noncurrent liabilities		(8	)		(7	)		(98	)		(104	)
Total (liability) asset	$	(7	)	$	(7	)	$	(102	)	$	(107	)
Accumulated Other Comprehensive Loss:
Prior service credit	$	2		$	2		$	34		$	44
Actuarial loss		(8	)		(16	)		(3	)		(8	)
Total	$	(6	)	$	(14	)	$	31		$	36

Projected Benefit Obligation in Excess of Plan Assets and Accumulated Benefit Obligation in Excess of Plan Assets


	Hourly Plan		Salary Plan
	As of December 31,
	2021	2020	2021		2020
Plans with projected benefit obligation in excess of plan assets:
Projected benefit obligation	N/A 1	N/A 1	$	110	$	119
Fair value of plan assets	N/A 1	N/A 1	$	101	$	112
Plans with accumulated benefit obligation in excess of plan assets:
Accumulated benefit obligation	N/A 1	N/A 1	$	105	$	114
Fair value of plan assets	N/A 1	N/A 1	$	101	$	112

(1)

As of December 31, 2021 and 2020, the hourly defined pension plan had plan assets greater than the projected benefit obligation and the accumulated benefit obligation.

Expected Cash Flows for Pension and Post-Retirement Benefit Plans

Information about expected cash flows for the Company’s pension and post-retirement benefit plans is as follows (dollars in millions):


	Pension Plans		Post-retirement Benefits
Employer Contributions:
2022 expected contributions	$	—	$	4
Expected Benefit Payments:
2022		11		4
2023		11		4
2024		12		4
2025		13		4
2026		13		4
2027-2031		68		24

Income Taxes (Tables)

12 Months Ended

Dec. 31, 2021

Income Tax Disclosure [Abstract]

Income Loss Before Income Taxes

Income before income taxes included the following (dollars in millions):


	Years ended December 31,
	2021		2020		2019
U.S. income	$	513	$	364	$	712
Foreign income		59		29		56
Total	$	572	$	393	$	768

Provision for Income Tax Expense

The provision for income tax expense was estimated as follows (dollars in millions):


	Years ended December 31,
	2021		2020		2019
Estimated current income taxes:
U.S. federal	$	48	$	18	$	75
Foreign		10		6		13
U.S. state and local		8		1		11
Total Current		66		25		99
Deferred income tax expense, net:
U.S. federal		56		61		58
Foreign		—		1		—
U.S. state and local		8		7		7
Total Deferred		64		69		65
Total income tax expense	$	130	$	94	$	164

Reconciliation of Provision for Income Tax Expense

A reconciliation of the provision for income tax expense compared with the amounts at the U.S. federal statutory rate is as follows (dollars in millions):


	Years ended December 31,
	2021			2020			2019
Tax at U.S. statutory income tax rate	$	120		$	82		$	161
State tax expense		12			10			14
Tax credits		(4	)		(5	)		(4	)
Effect of tax rate changes		2			5			(2	)
Foreign rate differential		(2	)		(2	)		(1	)
Valuation allowance		(1	)		2			1
Non-deductible expenses		—			3			(7	)
Other adjustments		3			(1	)		2
Total income tax expense	$	130		$	94		$	164

Deferred Tax Assets and Liabilities

Temporary differences and carryforwards that gave rise to deferred tax assets and liabilities included the following (dollars in millions):


	As of December 31, 2021			As of December 31, 2020
Deferred tax assets:
Other accrued liabilities	$	35		$	26
Deferred revenue		31			33
Warranty accrual		11			14
Stock-based compensation		10			9
Unrealized loss on Interest rate hedges		7			14
Inventories		7			7
Sales allowances and rebates		7			3
Tax credits		5			4
Operating loss carryforwards		4			6
Technology-related investments		3			4
Intangibles		—			9
Other		13			13
Total deferred tax assets		133			142
Valuation allowances		(11	)		(12	)
Deferred tax liabilities:
Goodwill		(405	)		(373	)
Trade name		(173	)		(153	)
Property, plant and equipment		(46	)		(40	)
Intangibles		(7	)		—
Other		(3	)		(2	)
Total deferred tax liabilities		(634	)		(568	)
Net deferred tax liability	$	(512	)	$	(438	)

Accumulated Other Comprehensive Loss (Tables)

12 Months Ended

Dec. 31, 2021

Equity [Abstract]

Changes in Accumulated Other Comprehensive Loss by Component

The changes in components of AOCL consisted of the following (dollars in millions):


	Before Tax			Tax (Expense) Benefit			Reclassification of stranded tax effects			After Tax
Balance at December 31, 2018	$	23		$	(53	)	$	—		$	(30	)
Foreign currency translation		(3	)		—			—			(3	)
Pension and OPEB liability adjustment		(11	)		2			9			—
Available-for-sale securities		(24	)		6			(1	)		(19	)
Net current period other comprehensive (loss) income	$	(38	)	$	8		$	8		$	(22	)
Balance at December 31, 2019	$	(15	)	$	(45	)	$	8		$	(52	)
Foreign currency translation		10			—			—			10
Pension and OPEB liability adjustment		(36	)		9			—			(27	)
Interest rate swaps		(26	)		6			—			(20	)
Net current period other comprehensive (loss) income	$	(52	)	$	15		$	—		$	(37	)
Balance at December 31, 2020	$	(67	)	$	(30	)	$	8		$	(89	)
Foreign currency translation		(8	)		—			—			(8	)
Pension and OPEB liability adjustment		3			(1	)		—			2
Interest rate swaps		29			(7	)		—			22
Net current period other comprehensive income (loss)	$	24		$	(8	)	$	—		$	16
Balance at December 31, 2021	$	(43	)	$	(38	)	$	8		$	(73	)

Reclassification out of Accumulated Other Comprehensive Loss

The following table shows the location in the Consolidated Statements of Comprehensive Income affected by reclassifications from AOCL (dollars in millions):


	For the year ended December 31, 2019
AOCL Components	Amount reclassified from AOCL			Affected line item in the consolidated statements of comprehensive income
Interest rate swaps	$	1		Interest expense, net
Prior service credit		13		Other income (expense), net
Total reclassifications, before tax		14		Income before income taxes
Income tax expense		(3	)	Income tax expense
Total reclassifications	$	11


	For the year ended December 31, 2020
AOCL Components	Amount reclassified from AOCL			Affected line item in the consolidated statements of comprehensive income
Interest rate swaps	$	11		Interest expense, net
Prior service credit		14		Other income (expense), net
Total reclassifications, before tax		25		Income before income taxes
Income tax expense		(6	)	Income tax expense
Total reclassifications	$	19


	For the year ended December 31, 2021
AOCL Components	Amount reclassified from AOCL			Affected line item in the consolidated statements of comprehensive income
Interest rate swaps	$	15		Interest expense, net
Prior service credit		10		Other income (expense), net
Recognized actuarial loss		(1	)	Other income (expense), net
Total reclassifications, before tax		24		Income before income taxes
Income tax expense		(6	)	Income tax expense
Total reclassifications	$	18

Concentration of Risk (Tables)

12 Months Ended

Dec. 31, 2021

Risks And Uncertainties [Abstract]

Schedules of Concentration of Risk by Risk Factor

customers accounted for 10% or more of net sales within the last three years presented.


	Years ended December 31,
% of net sales	2021			2020			2019
Daimler AG		20	%		20	%		20	%
PACCAR Inc.		10	%		11	%		12	%
Traton SE1		10	%		11	%		11	%

(1)

customers accounted for 10% or more of outstanding accounts receivable within the last two years presented.


% of accounts receivable	As of December 31, 2021			As of December 31, 2020
Daimler AG		17	%		21	%
Traton SE1		11	%		14	%

(1)

Earnings Per Share (Tables)

12 Months Ended

Dec. 31, 2021

Earnings Per Share [Abstract]

Schedule of Reconciliation of Numerators and Denominators Used to Calculate Basic EPS and Diluted EPS

The following table reconciles the numerators and denominators used to calculate basic EPS and diluted EPS (in millions, except per share data):


	Years ended December 31,
	2021		2020		2019
Net income	$	442	$	299	$	604
Weighted average shares of common stock outstanding		107		114		122
Dilutive effect stock-based awards		—		—		1
Diluted weighted average shares of common stock outstanding		107		114		123
Basic earnings per share attributable to common stockholders	$	4.13	$	2.62	$	4.95
Diluted earnings per share attributable to common stockholders	$	4.13	$	2.62	$	4.91

Geographic Information (Tables)

12 Months Ended

Dec. 31, 2021

Segment Reporting [Abstract]

Net Sales by Country

The Company had the following net sales by country, based on the location of the customer (dollars in millions):


	Years ended December 31,
	2021		2020		2019
United States	$	1,706	$	1,521	$	1,915
China		122		87		136
Japan		109		66		79
Canada		62		70		104
Mexico		50		61		71
Germany		34		36		59
South Korea		28		22		24
Sweden		27		19		23
France		27		21		37
United Kingdom		26		25		35
Netherlands		24		21		26
Other		187		132		189
Total	$	2,402	$	2,081	$	2,698

Schedule of Disclosure of Long-Lived Assets by Geographic Location

he Company had the following net long-lived assets by country (dollars in millions):


	Years ended December 31,
	2021		2020		2019
United States	$	680	$	611	$	583
India		11		12		17
Hungary		11		11		11
Other		4		4		5
Total	$	706	$	638	$	616

Overview - Additional Information (Details)	12 Months Ended
Overview - Additional Information (Details)	Dec. 31, 2021 Customer
Organization, Consolidation and Presentation of Financial Statements Disclosure [Line Items]
Worldwide independent distributor and dealer locations	1,400
Sales Revenue, Net \| North America \| Geographic Concentration Risk
Organization, Consolidation and Presentation of Financial Statements Disclosure [Line Items]
Concentration of risk, percentage	76.00%

Summary of Significant Accounting Policies - Additional Information (Details) shares in Millions	12 Months Ended
	Dec. 31, 2021 USD ($) Segment	Dec. 31, 2020 USD ($)	Dec. 31, 2019 USD ($)	Mar. 31, 2015 shares
Segment Reporting
Number of operating segment \| Segment	1
Number of reportable segment \| Segment	1
Deferred Financing Costs
Amortization of deferred financing costs	$ 4,000,000	$ 4,000,000	$ 5,000,000
Revenue Recognition
Military price reduction reserve	56,000,000	56,000,000
Net sales	2,402,000,000	2,081,000,000	2,698,000,000
Stock-Based Compensation
Aggregate number of shares of common stock available for issuance under the 2015 Plan \| shares				15
Goodwill impairment	$ 0
Accounting Standards Update 2017-12
Stock-Based Compensation
Change in accounting principle, accounting standards update, adopted	true
Change in accounting principle, accounting standards update, adoption date	Jan. 01, 2021
Change in accounting principle, accounting standards update, immaterial effect	true
Accounting Standards Update 2019-12
Stock-Based Compensation
Change in accounting principle, accounting standards update, adopted	true
Change in accounting principle, accounting standards update, adoption date	Jan. 01, 2021
Change in accounting principle, accounting standards update, immaterial effect	true
Restricted Stock And Restricted Stock Unit
Stock-Based Compensation
Incentive compensation expense	$ 6,000,000	6,000,000	5,000,000
Performance Awards
Stock-Based Compensation
Incentive compensation expense	5,000,000	9,000,000	6,000,000
Stock Options
Stock-Based Compensation
Incentive compensation expense	$ 3,000,000	2,000,000	2,000,000
Vesting Schedule One \| Restricted Stock Units (RSUs)
Stock-Based Compensation
Option vesting period	1 year
Vesting Schedule One \| Restricted Stock And Restricted Stock Unit
Stock-Based Compensation
Option vesting period	1 year
Vesting Schedule Three \| Restricted Stock Units (RSUs)
Stock-Based Compensation
Option vesting period	3 years
Vesting Schedule Three \| Restricted Stock And Restricted Stock Unit
Stock-Based Compensation
Option vesting period	3 years
Vesting Schedule Two \| Restricted Stock And Restricted Stock Unit
Stock-Based Compensation
Option vesting period	2 years
Engineering Services
Revenue Recognition
Net sales	$ 21,000,000	$ 16,000,000	$ 11,000,000
Minimum
Revenue Recognition
Extended Transmission Coverage sales, recognition period	1 year
Maximum
Revenue Recognition
Extended Transmission Coverage sales, recognition period	5 years

Summary of Significant Accounting Policies - Property Plant and Equipment Estimated Lives (Details)	12 Months Ended
	Dec. 31, 2021
Land improvements \| Minimum
Property, Plant and Equipment [Line Items]
Property, plant and equipment, estimated Lives	5 years
Land improvements \| Maximum
Property, Plant and Equipment [Line Items]
Property, plant and equipment, estimated Lives	30 years
Buildings and building improvements \| Minimum
Property, Plant and Equipment [Line Items]
Property, plant and equipment, estimated Lives	10 years
Buildings and building improvements \| Maximum
Property, Plant and Equipment [Line Items]
Property, plant and equipment, estimated Lives	40 years
Machinery and equipment \| Minimum
Property, Plant and Equipment [Line Items]
Property, plant and equipment, estimated Lives	2 years
Machinery and equipment \| Maximum
Property, Plant and Equipment [Line Items]
Property, plant and equipment, estimated Lives	20 years
Software \| Minimum
Property, Plant and Equipment [Line Items]
Property, plant and equipment, estimated Lives	2 years
Software \| Maximum
Property, Plant and Equipment [Line Items]
Property, plant and equipment, estimated Lives	5 years
Special tooling \| Minimum
Property, Plant and Equipment [Line Items]
Property, plant and equipment, estimated Lives	2 years
Special tooling \| Maximum
Property, Plant and Equipment [Line Items]
Property, plant and equipment, estimated Lives	10 years

Revenue - Additional Information (Details)	12 Months Ended
Revenue - Additional Information (Details)	Dec. 31, 2021 USD ($) Segment	Dec. 31, 2020 USD ($)
Deferred Revenue Arrangement [Line Items]
Material adjustments based on variable consideration \| $	$ 0	$ 0
Credit term period	30 days
Contract assets \| $	$ 0	$ 0
Number of operating segment \| Segment	1
Number of reportable segment \| Segment	1
Minimum
Deferred Revenue Arrangement [Line Items]
Duration of contract sold	1 year
Maximum
Deferred Revenue Arrangement [Line Items]
Duration of contract sold	5 years

Revenue - Disaggregated Revenue by Categories (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Disaggregation of Revenue [Line Items]
Total Net Sales	$ 2,402	$ 2,081	$ 2,698
North America On-Highway
Disaggregation of Revenue [Line Items]
Total Net Sales	1,177	1,081
North America Off-Highway
Disaggregation of Revenue [Line Items]
Total Net Sales	58	13
Defense
Disaggregation of Revenue [Line Items]
Total Net Sales	186	182
Outside North America On-Highway
Disaggregation of Revenue [Line Items]
Total Net Sales	381	280
Outside North America Off-Highway
Disaggregation of Revenue [Line Items]
Total Net Sales	83	61
Service Parts, Support Equipment and Other
Disaggregation of Revenue [Line Items]
Total Net Sales	$ 517	$ 464

Amount, excluding tax collected from customer, of revenue from satisfaction of performance obligation by transferring promised good or service to customer. Tax collected from customer is tax assessed by governmental authority that is both imposed on and concurrent with specific revenue-producing transaction, including, but not limited to, sales, use, value added and excise.

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 30
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8906-108599

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 40
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e9031-108599

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 41
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e9038-108599

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8933-108599

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8933-108599

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 4
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130543-203045

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 22
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8736-108599

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 22
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8736-108599

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 42
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e9054-108599

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 5
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130545-203045

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 924
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SAB Topic 11.L)
-URI http://asc.fasb.org/extlink&oid=6472922&loc=d3e499488-122856

Inventories - Schedule of Components of Inventories (Details) - USD ($) $ in Millions	Dec. 31, 2021	Dec. 31, 2020
Inventory Disclosure [Abstract]
Purchased parts and raw materials	$ 101	$ 88
Work in progress	8	15
Service parts	44	43
Finished goods	51	35
Total inventories	$ 204	$ 181

Property, Plant and Equipment - Schedule of Property Plant and Equipment Cost and Accumulated Depreciation (Details) - USD ($) $ in Millions	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Property, Plant and Equipment [Line Items]
Construction in progress	$ 83	$ 54
Property, plant and equipment, gross	1,828	1,684
Accumulated depreciation	(1,122)	(1,046)
Property, plant and equipment, net	706	638	$ 616
Land improvements
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	27	26
Buildings and building improvements
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	492	423
Machinery and equipment
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	795	783
Software
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	188	175
Special tooling
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	$ 243	$ 223

Property, Plant and Equipment - Additional Information (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Property Plant And Equipment [Abstract]
Depreciation of property, plant and equipment	$ 104	$ 96	$ 81

Goodwill And Other Intangible Assets - Additional Information (Details) - USD ($)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Goodwill And Intangible Assets Disclosure [Abstract]
Goodwill	$ 2,064,000,000	$ 2,064,000,000
Amortization of intangible assets	46,000,000	52,000,000	$ 86,000,000
Net carrying value of Goodwill and other intangible assets	2,981,000,000	3,027,000,000
Trade name impairment	$ 0	$ 0

Goodwill and Other Intangible Assets - Schedule of Other Intangible Assets (Details) - USD ($) $ in Millions	Dec. 31, 2021	Dec. 31, 2020
Goodwill and Intangible Assets Disclosure [Line Items]
Intangible assets, gross, Total	$ 2,195	$ 2,195
Accumulated amortization	(1,278)	(1,232)
Intangible assets, net, Total	917	963
Customer relationships - commercial
Goodwill and Intangible Assets Disclosure [Line Items]
Intangible assets, gross	839	839
Accumulated amortization	(751)	(708)
Intangible assets, net	88	131
Proprietary technology
Goodwill and Intangible Assets Disclosure [Line Items]
Intangible assets, gross	478	478
Accumulated amortization	(477)	(477)
Intangible assets, net	1	1
Customer relationships - defense
Goodwill and Intangible Assets Disclosure [Line Items]
Intangible assets, gross	62	62
Accumulated amortization	(50)	(47)
Intangible assets, net	12	15
Trade name
Goodwill and Intangible Assets Disclosure [Line Items]
Indefinite lived intangible assets	791	791
In process research and development
Goodwill and Intangible Assets Disclosure [Line Items]
Indefinite lived intangible assets	$ 25	$ 25

Goodwill and Other Intangible Assets - Schedule of Amortization Expense Related to Other Intangible Assets for Next Five Fiscal Years (Details) $ in Millions	Dec. 31, 2021 USD ($)
Goodwill And Intangible Assets Disclosure [Abstract]
2022	$ 45
2023	43
2024	8
2025	4
2026	$ 1

Fair Value of Financial Instruments - Additional Information (Details) - USD ($)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Fair value measurement guidance and hierarchy levels, description	In accordance with the FASB’s authoritative accounting guidance on fair value measurements, fair value is the price (exit price) that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Company utilizes market data or assumptions that market participants would use in pricing the asset or liability, including assumptions about risk and the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market corroborated, or generally unobservable. The Company primarily applies the market approach for recurring fair value measurements and utilizes the best available information that maximizes the use of observable inputs and minimizes the use of unobservable inputs. The Company is able to classify fair value balances based on the observability of those inputs. The accounting guidance establishes a fair value hierarchy that prioritizes the inputs used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3 measurement). The three levels of the fair value hierarchy defined by the relevant guidance are as follows:Level 1 — Quoted prices are available in active markets for identical assets or liabilities as of the reporting date. Active markets are those in which transactions for the asset or liability occur in sufficient frequency and volume to provide pricing information on an ongoing basis. Level 1 primarily consists of financial instruments such as exchange-traded derivatives, listed equities and publicly traded bonds.Level 2 — Pricing inputs are other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date. Level 2 includes financial instruments that are valued using quoted prices in markets that are not active and those financial instruments that are valued using models or other valuation methodologies. These models are primarily industry standard models that consider various assumptions, including quoted forward prices for commodities, time value, volatility factors, and current market and contractual prices for the underlying instruments, as well as other relevant economic measures. Substantially all of these assumptions are observable in the marketplace throughout the full term of the instrument, can be derived from observable data or are supported by observable levels at which transactions are executed in the marketplace.Level 3 — Pricing inputs include significant inputs that are generally less observable from objective sources. These inputs may be used with internally developed methodologies that result in management’s best estimate of fair value. At each balance sheet date, the Company performs an analysis of all instruments subject to authoritative accounting guidance and includes, in Level 3, all of those whose fair value is based on significant unobservable inputs. As of December 31, 2021 and 2020, the Company did not have any Level 3 financial assets or liabilities.
Fair Value, Inputs, Level 3
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Financial assets	$ 0	$ 0
Financial liabilities	$ 0	$ 0

Fair Value of Financial Instruments - Summary of Fair Value of Financial Assets and (Liabilities) (Details) - USD ($) $ in Millions	Dec. 31, 2021	Dec. 31, 2020
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Cash equivalents	$ 0	$ 160
Marketable Securities	46	0
Rabbi trust assets	19	17
Deferred compensation obligation	(19)	(17)
Total	15	100
Derivatives Designated as Hedging Instruments
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Derivative liabilities, net	(31)	(60)
Quoted Prices in Active Markets for Identical Assets (Level 1)
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Cash equivalents	0	160
Marketable Securities	46	0
Rabbi trust assets	19	17
Deferred compensation obligation	(19)	(17)
Total	46	160
Quoted Prices in Active Markets for Identical Assets (Level 1) \| Derivatives Designated as Hedging Instruments
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Derivative liabilities, net	0	0
Significant Other Observable Inputs (Level 2)
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Cash equivalents	0	0
Marketable Securities	0	0
Rabbi trust assets	0	0
Deferred compensation obligation	0	0
Total	(31)	(60)
Significant Other Observable Inputs (Level 2) \| Derivatives Designated as Hedging Instruments
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Derivative liabilities, net	$ (31)	$ (60)

Debt - Summary of Long-Term Debt and Maturities (Details) - USD ($) $ in Millions	Dec. 31, 2021	Dec. 31, 2020	Mar. 31, 2019
Debt Instrument [Line Items]
Total long-term debt	$ 2,531	$ 2,538
Current portion of long-term debt	6	6
deferred financing costs, net	21	25
Long-term debt	2,504	2,507
Senior Secured Credit Facility Term Loan, Variable, Due 2026
Debt Instrument [Line Items]
Total long-term debt	631	638
Senior Notes, Fixed 4.75%, Due 2027
Debt Instrument [Line Items]
Total long-term debt	400	400
Senior Notes, Fixed 5.875%, Due 2029
Debt Instrument [Line Items]
Total long-term debt	500	500
deferred financing costs, net			$ 6
Senior Notes, Fixed 3.75%, Due 2031
Debt Instrument [Line Items]
Total long-term debt	1,000	$ 1,000
deferred financing costs, net	$ 10

Amount, after unamortized (discount) premium and debt issuance costs, of long-term debt. Includes, but not limited to, notes payable, bonds payable, debentures, mortgage loans and commercial paper. Excludes capital lease obligations.

+ References + Details

Debt - Summary of Long-Term Debt and Maturities (Parenthetical) (Details)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Senior Secured Credit Facility Term Loan, Variable, Due 2026
Debt Instrument [Line Items]
Debt instrument, due date	2026	2026
Senior Notes, Fixed 4.75%, Due 2027
Debt Instrument [Line Items]
Debt instrument, due date	2027	2027
Debt instrument, stated interest rate	4.75%	4.75%
Senior Notes, Fixed 5.875%, Due 2029
Debt Instrument [Line Items]
Debt instrument, due date	2029	2029
Debt instrument, stated interest rate	5.875%	5.875%
Senior Notes, Fixed 3.75%, Due 2031
Debt Instrument [Line Items]
Debt instrument, due date	2031	2031
Debt instrument, stated interest rate	3.75%	3.75%

Debt - Principal Payments Required on Long Term Debt (Details) $ in Millions	Dec. 31, 2021 USD ($)
Debt Disclosure [Abstract]
2022	$ 6
2023	6
2024	6
2025	6
2026	$ 607

Debt - Additional Information (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Nov. 30, 2020	Oct. 31, 2019	Mar. 31, 2019
Debt Instrument [Line Items]
Long-term debt	$ 2,531	$ 2,538
Fair value of long-term debt obligations	2,568
Senior Notes, Fixed 3.75%, Due 2031
Debt Instrument [Line Items]
Long-term debt	$ 1,000	$ 1,000
Debt instrument, stated interest rate	3.75%	3.75%
Debt instrument, maturity month and year	2031-01
Senior Notes, Fixed 4.75%, Due 2027
Debt Instrument [Line Items]
Long-term debt	$ 400	$ 400
Debt instrument, stated interest rate	4.75%	4.75%
Debt instrument, maturity month and year	2027-10
Senior Notes, Fixed 5.875%, Due 2029
Debt Instrument [Line Items]
Long-term debt	$ 500	$ 500
Debt instrument, stated interest rate	5.875%	5.875%
Debt instrument, maturity month and year	2029-06
Senior Secured Credit Facility Term Loan, Variable, Due 2026
Debt Instrument [Line Items]
Long-term debt	$ 631	$ 638
Debt instrument, maturity month and year	2026-03
Revolving Credit Facility
Debt Instrument [Line Items]
Long-term debt			$ 650	$ 50	$ 50
Debt instrument, maturity month and year	2025-09
Credit facility, commitments amount	$ 650

Debt - Senior Secured Credit Facility - Additional Information (Details) - USD ($)	1 Months Ended		12 Months Ended
	Oct. 31, 2019	Mar. 31, 2019	Dec. 31, 2021	Dec. 31, 2019	Dec. 31, 2020	Nov. 30, 2020
Debt Instrument [Line Items]
Long-term debt			$ 2,531,000,000		$ 2,538,000,000
Deferred financing fees			21,000,000		$ 25,000,000
Letter of Credit
Debt Instrument [Line Items]
Available revolving credit facility			$ 5,000,000
Revolving Credit Facility
Debt Instrument [Line Items]
Long-term debt	$ 50,000,000	$ 50,000,000				$ 650,000,000
Debt instrument, due date				2022
Debt instrument extended, due date				2026
Deferred financing fees		5,000,000
Debt issuance expense				$ 1,000,000
Debt instrument, maturity month and year			2025-09
Credit facility, commitments amount			$ 650,000,000
Available revolving credit facility			$ 645,000,000
Commitment fee percentage			0.25%
Amount outstanding			$ 0
Achieved senior secured leverage ratio			0.60
LIBOR \| Revolving Credit Facility
Debt Instrument [Line Items]
Applicable margin over base rate			1.25%
LIBOR \| First Lien Net Leverage Ratio is Above 4.00x \| Revolving Credit Facility
Debt Instrument [Line Items]
Applicable margin over base rate			1.75%
LIBOR \| First Lien Net Leverage Ratio is Equal to or Less Than 4.00x and above 3.50x \| Revolving Credit Facility
Debt Instrument [Line Items]
Applicable margin over base rate			1.50%
LIBOR \| First Lien Net Leverage Ratio is Equal to or Below 3.50x \| Revolving Credit Facility
Debt Instrument [Line Items]
Applicable margin over base rate			1.25%
Base Rate \| First Lien Net Leverage Ratio is Above 4.00x \| Revolving Credit Facility
Debt Instrument [Line Items]
Applicable margin over base rate			0.75%
Base Rate \| First Lien Net Leverage Ratio is Equal to or Less Than 4.00x and above 3.50x \| Revolving Credit Facility
Debt Instrument [Line Items]
Applicable margin over base rate			0.50%
Base Rate \| First Lien Net Leverage Ratio is Equal to or Below 3.50x \| Revolving Credit Facility
Debt Instrument [Line Items]
Applicable margin over base rate			0.25%
Minimum \| First Lien Net Leverage Ratio is Above 4.00x \| Revolving Credit Facility
Debt Instrument [Line Items]
Net leverage ratio			4.00
Minimum \| First Lien Net Leverage Ratio is Equal to or Less Than 4.00x and above 3.50x \| Revolving Credit Facility
Debt Instrument [Line Items]
Net leverage ratio			3.50
Maximum \| First Lien Net Leverage Ratio is Equal to or Below 3.50x \| Revolving Credit Facility
Debt Instrument [Line Items]
Net leverage ratio			3.50
Prior Term Loan
Debt Instrument [Line Items]
Long-term debt		500,000,000
Prior Revolving Credit Facility
Debt Instrument [Line Items]
Long-term debt		$ 550,000,000
Debt instrument, due date		2021		2021
Debt instrument extended, due date				2024
Senior Secured Credit Facility
Debt Instrument [Line Items]
Debt instrument, due date			2024
Debt instrument extended, due date			2025
Net leverage ratio			4.00
Required senior secured leverage ratio			5.50
Senior Secured Credit Facility \| Letter of Credit
Debt Instrument [Line Items]
Credit facility, commitments amount			$ 75,000,000
Senior Secured Credit Facility \| Maximum \| First Lien Net Leverage Ratio is Equal to or Less Than 4.00x and above 3.50x
Debt Instrument [Line Items]
Net leverage ratio			4.00
Prior Senior Secured Credit Facility
Debt Instrument [Line Items]
Deferred financing fees				$ 5,000,000
Term Loan
Debt Instrument [Line Items]
Applicable margin over base rate	0.25%
Debt instrument effective interest rate			1.85%
Debt instrument, maturity month and year			2026-03
Principal payments on term loans			$ 2,000,000
Term Loan \| LIBOR
Debt Instrument [Line Items]
Applicable margin over base rate			0.75%
Term Loan \| Base Rate
Debt Instrument [Line Items]
Applicable margin over base rate			0.50%
Term Loan \| Minimum \| LIBOR
Debt Instrument [Line Items]
Applicable margin over base rate			1.75%
Term Loan \| Minimum \| Base Rate
Debt Instrument [Line Items]
Applicable margin over base rate			1.00%
Floor rate			1.00%

Debt - 5.0% Senior Notes - Additional Information (Details) - USD ($) $ in Millions	1 Months Ended
	Nov. 30, 2020	Dec. 31, 2021	Dec. 31, 2020
Debt Instrument [Line Items]
Deferred financing fees		$ 21	$ 25
Senior Notes, fixed 5.0%, due 2024
Debt Instrument [Line Items]
Debt instrument, stated interest rate	5.00%
Percentage of principal amount redeemed	101.25%
Deferred financing fees	$ 19

Debt - 4.75% Senior Notes - Additional Information (Details) - Senior Notes, Fixed 4.75%, Due 2027	12 Months Ended
	Dec. 31, 2021
Debt Instrument [Line Items]
Debt instrument, stated interest rate	4.75%
Debt Instrument, Redemption, Period One
Debt Instrument [Line Items]
Percentage of principal amount redeemed	100.00%

Debt - 5.875% Senior Notes - Additional Information (Details) - USD ($)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Mar. 31, 2019
Debt Instrument [Line Items]
Deferred financing fees	$ 21,000,000	$ 25,000,000
Senior Notes, Fixed 5.875%, Due 2029
Debt Instrument [Line Items]
Debt instrument, stated interest rate	5.875%	5.875%
Face amount			$ 500,000,000
Deferred financing fees			$ 6,000,000
Senior Notes, Fixed 5.875%, Due 2029 \| Debt Instrument, Redemption, Period One
Debt Instrument [Line Items]
Percentage of principal amount redeemed	105.875%
Senior Notes, Fixed 5.875%, Due 2029 \| Debt Instrument, Redemption, Period Two
Debt Instrument [Line Items]
Percentage of principal amount redeemed	100.00%
Senior Notes, Fixed 5.875%, Due 2029 \| Maximum \| Debt Instrument, Redemption, Period One
Debt Instrument [Line Items]
Percentage of principal amount redeemable	40.00%
Debt instrument, redemption date	Jun. 01, 2022
Senior Notes, Fixed 5.875%, Due 2029 \| Maximum \| Debt Instrument, Redemption, Period Two
Debt Instrument [Line Items]
Debt instrument, redemption date	Jun. 01, 2024
Senior Notes, Fixed 5.875%, Due 2029 \| Minimum \| Debt Instrument, Redemption, Period Three
Debt Instrument [Line Items]
Debt instrument, redemption date	Jun. 01, 2024

Debt - 3.75% Senior Notes - Additional Information (Details) - USD ($)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Debt Instrument [Line Items]
Deferred financing fees	$ 21,000,000	$ 25,000,000
Senior Notes, Fixed 3.75%, Due 2031
Debt Instrument [Line Items]
Debt instrument, stated interest rate	3.75%	3.75%
Face amount	$ 1,000,000,000
Deferred financing fees	$ 10,000,000
Senior Notes, Fixed 3.75%, Due 2031 \| Debt Instrument, Redemption, Period One
Debt Instrument [Line Items]
Percentage of principal amount redeemable	40.00%
Senior Notes, Fixed 3.75%, Due 2031 \| Maximum \| Debt Instrument, Redemption, Period One
Debt Instrument [Line Items]
Percentage of principal amount redeemed	103.75%
Debt instrument, redemption date	Jan. 30, 2024
Senior Notes, Fixed 3.75%, Due 2031 \| Maximum \| Debt Instrument, Redemption, Period Two
Debt Instrument [Line Items]
Percentage of principal amount redeemed	100.00%
Debt instrument, redemption date	Jan. 30, 2026
Senior Notes, Fixed 3.75%, Due 2031 \| Minimum \| Debt Instrument, Redemption, Period Three
Debt Instrument [Line Items]
Debt instrument, redemption date	Jan. 30, 2026

Derivatives - Additional Information (Details) - USD ($)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019	Mar. 31, 2019	Dec. 31, 2018
Derivative [Line Items]
Derivative, description of terms	The Company is subject to interest rate risk related to the Senior Secured Credit Facility and enters into interest rate swaps that are based on LIBOR to manage a portion of this exposure. The interest rate swaps are designated as cash flow hedges that qualify for hedge accounting under the hypothetical derivative method. Fair value adjustments are recorded as a component of AOCL in the Consolidated Balance Sheets. Balances in AOCL are reclassified to earnings when transactions related to the underlying risk are settled. During the first quarter of 2019, the Company entered into $250 million of interest rate swaps and designated them as cash flow hedges under the hypothetical derivative method. As of December 31, 2021, the Company held interest rate swaps effective from (i) September 2019 to September 2022 with notional values totaling $250 million and a weighted average LIBOR fixed rate of 3.01%, (ii) from September 2019 to September 2025 with notional values totaling $250 million and a weighted average LIBOR fixed rate of 3.04% and (iii) September 2022 to September 2025 with notional values totaling $250 million and a weighted average LIBOR fixed rate of 2.82%. See "NOTE 7. Fair Value of Financial Instruments” for information regarding the fair value of the Company’s interest rate swaps.
Notional amount				$ 250,000,000
Accumulated other comprehensive loss, net of tax	$ (43,000,000)	$ (67,000,000)	$ (15,000,000)		$ 23,000,000
Derivative losses in AOCL expected to be reclassified within next twelve months	13,000,000
Interest Expense
Derivative [Line Items]
Amount reclassified from accumulated other comprehensive loss to earnings	15,000,000
Interest Rate Swaps A
Derivative [Line Items]
Notional amount	250,000,000
Interest Rate Swaps B
Derivative [Line Items]
Notional amount	250,000,000
Interest Rate Swap C
Derivative [Line Items]
Notional amount	250,000,000
Available-for-sale securities and interest rate swaps
Derivative [Line Items]
Accumulated other comprehensive loss, net of tax	$ (31,000,000)	$ (60,000,000)
LIBOR \| Interest Rate Swaps A
Derivative [Line Items]
Fixed interest rate	3.01%
LIBOR \| Interest Rate Swaps B
Derivative [Line Items]
Fixed interest rate	3.04%
LIBOR \| Interest Rate Swap C
Derivative [Line Items]
Fixed interest rate	2.82%

Derivatives - Derivative Instruments and their Impact on Financial Condition (Details) - Derivatives Designated as Hedging Instruments - Interest Rate Swaps - USD ($) $ in Millions	Dec. 31, 2021	Dec. 31, 2020
Derivative [Line Items]
Total derivatives designated as hedging instruments	$ 31	$ 60
Other current liabilities
Derivative [Line Items]
Interest rate swaps, liability	10	14
Other non-current liabilities
Derivative [Line Items]
Interest rate swaps, liability	$ 21	$ 46

Product Warranty Liabilities - Additional Information (Detail) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2021
Guarantees [Abstract]
Product warranty liability, current	$ 36	$ 33
Product warranty liability, non-current	30	$ 20
Product warranty adjustment to address transmission performance	$ 23

Product Warranty Liabilities - Product Warranty Liability Activities (Detail) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Guarantees [Abstract]
Beginning balance	$ 66	$ 52	$ 66
Payments	(30)	(32)	(26)
Increase in liability (warranty issued during period)	16	15	21
Net adjustments to liability	1	31	(9)
Ending balance	$ 53	$ 66	$ 52

Deferred Revenue - Additional Information (Details) - USD ($) $ in Millions	Dec. 31, 2021	Dec. 31, 2020
Disaggregation of Revenue [Line Items]
Deferred revenue current liabilities	$ 37	$ 34
Deferred revenue non-current liabilities	99	109
ETC contracts
Disaggregation of Revenue [Line Items]
Deferred revenue current liabilities	30	28
Deferred revenue non-current liabilities	$ 84	$ 88

Deferred Revenue - Summary of Deferred Revenue Activity (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Revenue Recognition And Deferred Revenue [Abstract]
Beginning balance	$ 143	$ 139	$ 122
Increases	29	40	55
Revenue earned	(36)	(36)	(38)
Ending balance	$ 136	$ 143	$ 139

Leases - Additional Information (Details) - USD ($)	12 Months Ended
Leases - Additional Information (Details) - USD ($)	Dec. 31, 2021	Dec. 31, 2020
Leases [Abstract]
Lessee lease description	Contracts are assessed by the Company to determine if the contract conveys the right to control an identified asset in exchange for consideration during a period of time. The Company classifies all identified leases as either operating or finance leases. As of December 31, 2021, the Company was not a party to any finance leases. Contracts that contain leases are assessed to determine if the consideration in the contract is related to a lease component, non-lease component or other components not related to the lease. Lease components are recorded as right-of-use (“ROU”) assets and lease liabilities while any non-lease component is expensed as incurred. The consideration in the contract related to other components not related to the lease is allocated among the lease component and the non-lease component, as applicable, based on the stand-alone selling price of the lease and non-lease components
Discount rate	4.25%	4.37%
Current lease liabilities	$ 4,000,000	$ 4,000,000
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List]	Other current liabilities	Other current liabilities
Non-current lease liabilities	$ 13,000,000	$ 17,000,000
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List]	Other non-current liabilities	Other non-current liabilities
Remaining lease term	6 years 9 months 18 days	7 years 7 months 6 days
Operating expense	$ 6,000,000	$ 6,000,000
Material short term operating lease expense	0	0
New ROU assets	$ 2,000,000	$ 2,000,000

Leases - Schedule of Lease Maturity, Current Guidance (Details) $ in Millions	Dec. 31, 2021 USD ($)
Leases [Abstract]
2022	$ 5
2023	3
2024	2
2025	2
2026	2
Thereafter	6
Total lease payments	20
Less: Interest	3
Present value of lease liabilities	$ 17
Operating Lease, Liability, Statement of Financial Position [Extensible List]	us-gaap:OtherLiabilities

Leases - Schedule of Right of Use Assets (Details) $ in Millions	Dec. 31, 2021 USD ($)
Lessee, Lease, Description [Line Items]
Total right-of-use assets	$ 18
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration]	Property Plant And Equipment Net
Buildings
Lessee, Lease, Description [Line Items]
Total right-of-use assets	$ 16
Land
Lessee, Lease, Description [Line Items]
Total right-of-use assets	1
Vehicles
Lessee, Lease, Description [Line Items]
Total right-of-use assets	$ 1

Other Income (Expense), Net (Detail) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Other Income And Expenses [Abstract]
Post-retirement benefit plan amendment credits	$ 10	$ 13	$ 11
Unrealized gain on marketable securities	4
Technology-related investments gain	4
Expenses related to long-term debt refinancing		(13)	(1)
Other	1	(4)
Total	$ 19	$ (4)	$ 10

Other Current Liabilities - Summary of Other Current Liabilities (Detail) - USD ($) $ in Millions	Dec. 31, 2021	Dec. 31, 2020
Payables And Accruals [Abstract]
Payroll and related costs	$ 80	$ 47
Sales allowances	39	20
Accrued interest payable	24	12
Vendor buyback obligation	16	16
Taxes payable	14	11
Derivative liabilities	10	14
Lease liability	4	4
Non-trade payables	2	2
Construction liability	2	1
Other accruals	13	13
Total	$ 204	$ 140

Employee Benefit Plans - Additional Information (Detail) - USD ($)	3 Months Ended	12 Months Ended
	Jun. 30, 2020	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Defined Benefit Plan Disclosure [Line Items]
One-time, non-cash settlement charge recorded in Other income (expense)	$ 2,000,000
Health care cost ultimate trend year		2044
Accumulated benefit obligation		$ 216,000,000	$ 230,000,000
Deferred compensation expense		0	0	$ 0
Deferred compensation obligation		$ 19,000,000	17,000,000
Maximum
Defined Benefit Plan Disclosure [Line Items]
Health care cost trend rate		6.70%
Health care cost ultimate trend rate		4.00%
Post-retirement Benefits
Defined Benefit Plan Disclosure [Line Items]
Net benefit obligation		$ 102,000,000	107,000,000	94,000,000	$ 93,000,000
Hourly Plan
Defined Benefit Plan Disclosure [Line Items]
Defined benefit plan, service period before normal retirement age		30 years
Retirement Savings Plans
Defined Benefit Plan Disclosure [Line Items]
Defined contribution plan expense		$ 14,000,000	$ 12,000,000	$ 11,000,000

Employee Benefit Plans - Employee Benefit Plans (Detail) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Defined Benefit Plan Disclosure [Line Items]
Total recognized - other comprehensive (income) loss	$ (2)	$ 27	$ 0
Pension Plans
Defined Benefit Plan Disclosure [Line Items]
Service cost	9	10	10
Interest cost	5	6	7
Expected return on assets	(8)	(9)	(9)
Settlement loss	0	2	0
Prior service credit	0	0	0
Recognized actuarial loss	1	0	0
Net Periodic Benefit Cost (Credit)	7	9	8
Net (gain) loss	(6)	12	(2)
Amortizations	(1)	(2)	0
Total recognized - other comprehensive (income) loss	(7)	10	(2)
Post-retirement Benefits
Defined Benefit Plan Disclosure [Line Items]
Service cost	1	1	1
Interest cost	3	3	4
Expected return on assets	0	0	0
Settlement loss	0	0	0
Prior service credit	(10)	(14)	(13)
Recognized actuarial loss	0	0	0
Net Periodic Benefit Cost (Credit)	(6)	(10)	(8)
Net (gain) loss	(5)	12	(1)
Amortizations	10	13	13
Total recognized - other comprehensive (income) loss	$ 5	$ 25	$ 12

Employee Benefit Plans - Weighted-Average Actuarial Assumptions Used to Determine Net Periodic Benefit Cost (Detail)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Pension Plans
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Discount rate	2.30%	3.20%	4.20%
Rate of compensation increase (salaried)	3.00%	3.00%	3.00%
Expected return on assets	3.70%	4.00%	4.50%
Post-retirement Benefits
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Discount rate	2.40%	3.20%	4.20%

Employee Benefit Plans - Weighted-Average Actuarial Assumptions Used to Determine Benefit Obligations (Detail)	Dec. 31, 2021	Dec. 31, 2020
Pension Plans
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Discount rate	2.70%	2.30%
Rate of compensation increase (salaried)	3.00%	3.00%
Post-retirement Benefits
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Discount rate	2.80%	2.40%

Employee Benefit Plans - Reconciliation of Changes in Net Benefit Obligations and Fair Value of Plan Assets (Detail) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Pension Plans
Benefit Obligations:
Net benefit obligation at beginning of year	$ 235	$ 204	$ 177
Service cost	9	10	10
Interest cost	5	6	7
Settlements	0	(12)	0
Benefits paid	(14)	(6)	(9)
Actuarial (gain) loss	(15)	33	19
Net benefit obligation at end of year	220	235	204
Fair Value of Plan Assets:
Fair value of plan assets at beginning of year	228	217	196
Actual return on plan assets	(1)	29	30
Employer contributions	0	0	0
Settlements	0	(12)	0
Benefits paid	(14)	(6)	(9)
Fair value of plan assets at end of year	213	228	217
Net Funded Status	(7)	(7)	13
Post-retirement Benefits
Benefit Obligations:
Net benefit obligation at beginning of year	107	94	93
Service cost	1	1	1
Interest cost	3	3	4
Settlements	0	0	0
Benefits paid	(4)	(3)	(2)
Actuarial (gain) loss	(5)	12	(2)
Net benefit obligation at end of year	102	107	94
Fair Value of Plan Assets:
Fair value of plan assets at beginning of year	0	0	0
Actual return on plan assets	0	0	0
Employer contributions	3	3	2
Settlements	0	0	0
Benefits paid	(3)	(3)	(2)
Fair value of plan assets at end of year	0	0	0
Net Funded Status	$ (102)	$ (107)	$ (94)

Employee Benefit Plans - Fair Value of Plan Assets by Asset Category (Detail) - Pension Plans - USD ($) $ in Millions	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Fair Value of Plan Assets	$ 213	$ 228	$ 217	$ 196
Diversified debt Securities
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Fair Value of Plan Assets	174	186
Diversified equity Securities
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Fair Value of Plan Assets	33	38
Cash and Cash Equivalents
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Fair Value of Plan Assets	6	4
Quoted Prices in Active Markets for Identical Assets (Level 1)
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Fair Value of Plan Assets	44	46
Quoted Prices in Active Markets for Identical Assets (Level 1) \| Diversified debt Securities
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Fair Value of Plan Assets	14	14
Quoted Prices in Active Markets for Identical Assets (Level 1) \| Diversified equity Securities
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Fair Value of Plan Assets	24	28
Quoted Prices in Active Markets for Identical Assets (Level 1) \| Cash and Cash Equivalents
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Fair Value of Plan Assets	6	4
Significant Other Observable Inputs (Level 2)
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Fair Value of Plan Assets	169	182
Significant Other Observable Inputs (Level 2) \| Diversified debt Securities
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Fair Value of Plan Assets	160	172
Significant Other Observable Inputs (Level 2) \| Diversified equity Securities
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Fair Value of Plan Assets	9	10
Significant Other Observable Inputs (Level 2) \| Cash and Cash Equivalents
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Fair Value of Plan Assets	$ 0	$ 0

Amount of asset segregated and restricted to provide benefit under defined benefit plan. Asset includes, but is not limited to, stock, bond, other investment, earning from investment, and contribution by employer and employee.

+ References + Details

Employee Benefit Plans - Plan Asset Allocation (Detail)	Dec. 31, 2021
Hourly Plan
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Target allocation	100.00%
Salary Plan
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Target allocation	100.00%
Cash and Cash Equivalents \| Hourly Plan
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Target allocation	2.00%
Cash and Cash Equivalents \| Salary Plan
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Target allocation	2.00%
Diversified equity Securities \| Hourly Plan
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Target allocation	15.00%
Diversified equity Securities \| Salary Plan
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Target allocation	15.00%
Diversified debt Securities \| Hourly Plan
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Target allocation	83.00%
Diversified debt Securities \| Salary Plan
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Target allocation	83.00%

Employee Benefit Plans - Amounts Recognized in Balance Sheet and Accumulated Other Comprehensive Income AOCI (Detail) - USD ($) $ in Millions	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Pension Plans
Amounts Recognized in Balance Sheet:
Noncurrent assets	$ 1	$ 0
Current liabilities	0	0
Noncurrent liabilities	(8)	(7)
Net Funded Status	(7)	(7)	$ 13
Accumulated Other Comprehensive Loss:
Prior service credit	2	2
Actuarial loss	(8)	(16)
Total	(6)	(14)
Post-retirement Benefits
Amounts Recognized in Balance Sheet:
Noncurrent assets	0	0
Current liabilities	(4)	(3)
Noncurrent liabilities	(98)	(104)
Net Funded Status	(102)	(107)	$ (94)
Accumulated Other Comprehensive Loss:
Prior service credit	34	44
Actuarial loss	(3)	(8)
Total	$ 31	$ 36

Employee Benefit Plans - Projected Benefit Obligation in Excess of Plan Assets and Accumulated Benefit Obligation in Excess of Plan Assets (Detail) - Salary Plan - USD ($) $ in Millions	Dec. 31, 2021	Dec. 31, 2020
Plans with projected benefit obligation in excess of plan assets:
Projected benefit obligation - salary	$ 110	$ 119
Fair value of plan assets - salary	101	112
Plans with accumulated benefit obligation in excess of plan assets:
Accumulated benefit obligation - salary	105	114
Fair value of plan assets - salary	$ 101	$ 112

Employee Benefit Plans - Expected Cash Flows for Pension and Post-Retirement Benefit Plans (Detail) $ in Millions	Dec. 31, 2021 USD ($)
Pension Plans
Employer Contributions:
2022 expected contributions	$ 0
Expected Benefit Payments:
2022	11
2023	11
2024	12
2025	13
2026	13
2027-2031	68
Post-retirement Benefits
Employer Contributions:
2022 expected contributions	4
Expected Benefit Payments:
2022	4
2023	4
2024	4
2025	4
2026	4
2027-2031	$ 24

Income Taxes - Income Before Income Taxes (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Income Tax Disclosure [Abstract]
U.S. income	$ 513	$ 364	$ 712
Foreign income	59	29	56
Income before income taxes	$ 572	$ 393	$ 768

Amount of income (loss) from continuing operations, including income (loss) from equity method investments, before deduction of income tax expense (benefit), and income (loss) attributable to noncontrolling interest.

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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Reference 4: http://fasb.org/us-gaap/role/ref/legacyRef
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Reference 5: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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Reference 6: http://fasb.org/us-gaap/role/ref/legacyRef
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Reference 7: http://fasb.org/us-gaap/role/ref/legacyRef
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Reference 8: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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Reference 9: http://www.xbrl.org/2003/role/exampleRef
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-Name Accounting Standards Codification
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Reference 10: http://fasb.org/us-gaap/role/ref/legacyRef
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Income Taxes - Provision for Income Tax Expense (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Estimated current income taxes:
U.S. federal	$ 48	$ 18	$ 75
Foreign	10	6	13
U.S. state and local	8	1	11
Total Current	66	25	99
Deferred income tax expense, net:
U.S. federal	56	61	58
Foreign	0	1	0
U.S. state and local	8	7	7
Total Deferred	64	69	65
Total income tax expense	$ 130	$ 94	$ 164

Income Taxes - Additional Information (Details) - USD ($)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Income Tax Contingency [Line Items]
Effective income tax rate reconciliation, percent	23.00%	24.00%
Tax liability associated with foreign subsidiary	$ 3,000,000
Valuation allowances	11,000,000	$ 12,000,000
Uncertain tax benefit liability	3,000,000	3,000,000
Unrecognized tax benefits, income tax penalties and interest accrued	$ 0	$ 0	$ 0
Minimum
Income Tax Contingency [Line Items]
Percentage of tax benefit realized upon settlement	50.00%

Income Taxes - Reconciliation of Provision for Income Tax Expense (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Income Tax Disclosure [Abstract]
Tax at U.S. statutory income tax rate	$ 120	$ 82	$ 161
State tax expense	12	10	14
Tax credits	(4)	(5)	(4)
Effect of tax rate changes	2	5	(2)
Foreign rate differential	(2)	(2)	(1)
Valuation allowance	(1)	2	1
Non-deductible expenses	0	3	(7)
Other adjustments	3	(1)	2
Total income tax expense	$ 130	$ 94	$ 164

Income Taxes - Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Millions	Dec. 31, 2021	Dec. 31, 2020
Deferred tax assets:
Other accrued liabilities	$ 35	$ 26
Deferred revenue	31	33
Warranty accrual	11	14
Stock-based compensation	10	9
Unrealized loss on Interest rate hedges	7	14
Inventories	7	7
Sales allowances and rebates	7	3
Tax credits	5	4
Operating loss carryforwards	4	6
Technology-related investments	3	4
Intangibles	0	9
Other	13	13
Total deferred tax assets	133	142
Valuation allowances	(11)	(12)
Deferred tax liabilities:
Goodwill	(405)	(373)
Trade name	(173)	(153)
Property, plant and equipment	(46)	(40)
Intangibles	(7)
Other	(3)	(2)
Total deferred tax liabilities	(634)	(568)
Net deferred tax liability	$ (512)	$ (438)

Accumulated Other Comprehensive Loss - Changes in Components of Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Accumulated Other Comprehensive Income Loss [Line Items]
Before Tax, beginning balance	$ (67)	$ (15)	$ 23
Before Tax, ending balance	(43)	(67)	(15)
Tax (Expense) Benefit, beginning balance	(30)	(45)	(53)
Tax (Expense) Benefit, ending balance	(38)	(30)	(45)
Reclassification of stranded tax effects, beginning balance	8	8	0
Reclassification of stranded tax effects, ending balance	8	8	8
Before Tax	24	(52)	(38)
Tax (Expense) Benefit	(8)	15	8
Reclassification of stranded tax effects	0	0	8
Total other comprehensive income (loss), net of tax	16	(37)	(22)
Balance	756	781	659
Balance	634	756	781
Foreign currency items
Accumulated Other Comprehensive Income Loss [Line Items]
Before Tax	(8)	10	(3)
Tax (Expense) Benefit	0	0	0
Reclassification of stranded tax effects	0	0	0
Total other comprehensive income (loss), net of tax	(8)	10	(3)
Pension and OPEB liability adjustment
Accumulated Other Comprehensive Income Loss [Line Items]
Before Tax	3	(36)	(11)
Tax (Expense) Benefit	(1)	9	2
Reclassification of stranded tax effects	0	0	9
Total other comprehensive income (loss), net of tax	2	(27)	0
Available-for-sale securities and interest rate swaps
Accumulated Other Comprehensive Income Loss [Line Items]
Before Tax	29	(26)	(24)
Tax (Expense) Benefit	(7)	6	6
Reclassification of stranded tax effects	0	0	(1)
Total other comprehensive income (loss), net of tax	22	(20)	(19)
Accumulated Other Comprehensive Loss, net of tax
Accumulated Other Comprehensive Income Loss [Line Items]
Balance	(89)	(52)	(30)
Balance	$ (73)	$ (89)	$ (52)

Accumulated Other Comprehensive Loss - Consolidated Statements of Comprehensive Income affected by reclassifications from AOCL (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Accumulated Other Comprehensive Income Loss [Line Items]
Interest expense, net	$ (116)	$ (137)	$ (134)
Other income (expense), net	19	(4)	10
Income before income taxes	572	393	768
Income tax expense	(130)	(94)	(164)
Net income	442	299	604
Reclassified from AOCL \| Interest rate swaps
Accumulated Other Comprehensive Income Loss [Line Items]
Interest expense, net	15	11	1
Reclassified from AOCL \| Prior service credit
Accumulated Other Comprehensive Income Loss [Line Items]
Other income (expense), net	10	14	13
Reclassified from AOCL \| Pension and OPEB liability adjustment
Accumulated Other Comprehensive Income Loss [Line Items]
Income before income taxes	24	25	14
Income tax expense	(6)	(6)	(3)
Net income	18	$ 19	$ 11
Reclassified from AOCL \| Recognized actuarial loss
Accumulated Other Comprehensive Income Loss [Line Items]
Other income (expense), net	$ (1)

Commitments and Contingencies - Additional Information (Details) - USD ($) $ in Millions	3 Months Ended
	Dec. 31, 2019	Dec. 31, 2021
Commitments And Contingencies Disclosure [Abstract]
Increase (decrease) in environmental liability	$ 3
Estimated undiscounted liabilities payment period	30 years
Environmental liability		$ 3

Concentration of Risk - Additional Information (Details) - Customer	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Number of Employees, Geographic Area \| United States \| Labor Force Concentration
Concentration Risk [Line Items]
Concentration risk, percentage	90.00%	89.00%
Workforce Subject to Collective Bargaining Arrangements \| United States \| Unionized employees subject to collective bargaining agreement
Concentration Risk [Line Items]
Concentration risk, percentage	46.00%	47.00%
Sales Revenue, Net \| Customer Concentration Risk
Concentration Risk [Line Items]
Number of significant customers	3	3	3
Accounts Receivable \| Credit Concentration Risk
Concentration Risk [Line Items]
Number of significant customers	2	2

Concentration of Risk - Customers Accounted for Greater Than Ten Percent of Net Sales (Details) - Sales Revenue, Net - Customer Concentration Risk	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Daimler AG
Concentration Risk [Line Items]
Concentration risk, percentage	20.00%	20.00%	20.00%
PACCAR Inc.
Concentration Risk [Line Items]
Concentration risk, percentage	10.00%	11.00%	12.00%
Traton SE
Concentration Risk [Line Items]
Concentration risk, percentage	10.00%	11.00%	11.00%

Concentration of Risk - Customers Accounted for Greater Than Ten Percent of Accounts Receivable (Details) - Accounts Receivable - Credit Concentration Risk	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Daimler AG
Concentration Risk [Line Items]
Concentration risk, percentage	17.00%	21.00%
Traton SE
Concentration Risk [Line Items]
Concentration risk, percentage	11.00%	14.00%

Common Stock - Additional Information (Details) - Repurchase Program	12 Months Ended
	Dec. 31, 2021 USD ($)
Common Stock Disclosure [Line Items]
Stock repurchase program, authorized amount	$ 3,000,000,000
Common stock, repurchased during the period	513,000,000
Stock repurchase program, remaining amount	$ 314,000,000

Earnings Per Share - Additional Information (Details) - shares	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Earnings Per Share [Abstract]
Shares excluded from diluted EPS calculation (in shares)	1,000,000	1,000,000	0

Earnings Per Share - Schedule of Reconciliation of Numerators and Denominators Used to Calculate Basic EPS and Diluted EPS (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Earnings Per Share [Abstract]
Net income	$ 442	$ 299	$ 604
Weighted average shares of common stock outstanding	107	114	122
Dilutive effect stock-based awards	0	0	1
Diluted weighted average shares of common stock outstanding	107	114	123
Basic earnings per share attributable to common stockholders (USD per share)	$ 4.13	$ 2.62	$ 4.95
Diluted earnings per share attributable to common stockholders (USD per share)	$ 4.13	$ 2.62	$ 4.91

The amount of net income (loss) for the period per each share of common stock or unit outstanding during the reporting period.

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The amount of net income (loss) for the period available to each share of common stock or common unit outstanding during the reporting period and to each share or unit that would have been outstanding assuming the issuance of common shares or units for all dilutive potential common shares or units outstanding during the reporting period.

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The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

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