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Delphi to Spin-Off Powertrain Segment

May 4, 2017
New business to focus on vehicle propulsion systems for environmental efficiency, performance OEM and aftermarket supplier Two companies, advanced technologies Split by March 2018
Delphi Automotive Powertrain Systems supplies products and systems for fuel handling, valve-train fuel injection, combustion controls, and electronics for gasoline and diesel engines.

Delphi Automotive PLC is planning a tax-free spin-off of its Powertrain Systems segment into a new, independent publicly traded company, with Delphi shareholders owning shares of both companies. President and CEO Kevin Clark called the plan “an exciting opportunity” to create companies with flexibility to accelerate investments in advanced technologies.

The split and sale would be completed by March 2018.

Currently Delphi Automotive has four operating divisions: Delphi has four diversified business segments: Electrical/Electronic Architecture, Electronics & Safety, Powertrain Systems, and Product & Service Solutions.

The Powertrain Systems division supplies products and systems for fuel handling, valve-train fuel injection, combustion controls, electronics, and aftermarket products and services for gasoline and diesel engines.

Delphi Powertrain will be focused on vehicle propulsion systems that enhance environmental efficiency and vehicle performance. It will be a global supplier to OEMs and aftermarket customers, with 20,000 employees, and 2016 revenues of approximately $4.5 billion.

Timothy Manganello, currently an independent director on the Delphi Board, will become non-executive chairman of the new company. He is a former chairman and CEO of BorgWarner, Inc. Liam Butterworth, currently senior vice president and president of Powertrain Systems will become president and CEO.

After the spin-off, the Electrical/Electronic Architecture and Electronics & Safety divisions will be the core of the Delphi organization, with products in signal and power distribution, centralized computing platforms, advanced safety and autonomous driving systems, enhanced infotainment and user experience, vehicle connectivity and electrification, and data services.

The company explained that “the convergence of technologies underpinning industry megatrends” supports growing demand advanced electronics and computing power, to achieve greater safety, efficiency, and connectivity in vehicles.  Also, emissions and fuel-economy regulations are becoming increasingly stringent, requiring advanced engine management and electrification that will improve vehicle performance.

“At a time of unprecedented industry change, the underlying strength of both our operating businesses and strategic partnerships will allow each company to focus even more sharply on its unique opportunities, continue to develop the very best advanced technologies, and help our customers navigate the road ahead,” according to Clark.

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