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Lear Corporation is a global automotive technology leader in Seating and E-Systems, enabling superior in-vehicle experiences for consumers around the world.
−Removed: We supply complete seat systems, key seat components, complete electrical distribution and connection systems, battery disconnect units and other electronic products t o all of the world's major automotive manufacturers.
+Added: We supply complete seat systems, key seat components, complete electrical distribution and connection systems, high-voltage power distribution products, including battery disconnect units ("BDUs"), low-voltage power distribution products, electronic controllers and other electronic products t o all of the world's major automotive manufacturers.
At Lear, we are Making every drive better TM by providing technology for safer, smarter and more comfortable journeys, while adhering to our values — Be Inclusive.
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We have 265 manufacturing, engineering and administrative locations in 38 countries.
−Removed: We continue to grow our business in all automotive producing regions of the world, both organically and through complementary acquisitions.
+Added: We continue to grow our business in every major automotive producing region of the world, both organically and through complementary acquisitions.
We continue to restructure our manufacturing footprint to optimize our cost structure with 68% of our manufacturing facilities and 86% of our employees located in low-cost countries.
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Our capabilities in operations and supply chain management enable synchronized assembly and just-in-time delivery of complex complete seat systems at high volumes to our customers.
−Removed: Included in our complete seat systems and components are our advanced comfort solutions, including thermal, safety and wellness products, as well as configurable seating product technologies.
−Removed: All of these products are compatible with traditional internal combustion engine ("ICE") architectures and electrified powertrains, including the full range of hybrid, plug-in hybrid and battery electric architectures.
−Removed: Our advanced comfort solutions are facilitated by our seat system, component and integration capabilities, together with our competencies in electronics, sensors, software and algorithms.
As the most vertically integrated global seat supplier, our key seat component product offerings include seat trim covers;
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seat mechanisms;
−Removed: thermal comfort solutions such as seat massage, lumbar, heat and ventilation products;
+Added: thermal comfort systems such as seat heating, ventilation, active cooling, pneumatic lumbar and massage products;
and headrests.
−Removed: • E-Systems — Our E-Systems segment consists of the design, development, engineering and manufacture of complete electrical distribution and connection systems, battery disconnect units ("BDUs") and other electronic products.
+Added: All of these products are compatible with traditional internal combustion engine ("ICE") architectures and electrified powertrains, including the full range of hybrid, plug-in hybrid and battery electric architectures.
+Added: Our thermal comfort systems are facilitated by our seat system, component and integration capabilities, together with our competencies in electronics, sensors, software and algorithms.
+Added: • E-Systems — Our E-Systems segment consists of the design, development, engineering and manufacture of complete electrical distribution and connection systems;
+Added: high-voltage power distribution products, including BDUs;
+Added: and low-voltage power distribution products, electronic controllers and other electronic products.
These capabilities enable us to provide our customers with customizable solutions with optimized designs at competitive costs for both low-voltage and high-voltage vehicle architectures.
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battery connection systems include intercell connect boards, bus bars and main battery connection systems.
−Removed: BDUs control all electrical energy flowing into and out of high voltage batteries on electrified vehicles.
−Removed: Our other electronic products facilitate signal, data and power management within the vehicle and include the associated software required to facilitate these functions.
+Added: High-voltage power distribution products control the flow and distribution of high-voltage power throughout electrified vehicles and include BDUs which control all electrical energy flowing into and out of high-voltage batteries in electrified vehicles.
+Added: Low-voltage power distribution products, electronic controllers and other electronic products facilitate signal, data and/or power management within the vehicle and include the associated software required to facilitate these functions.
Key components of our other electronic products portfolio include zone control modules, body domain control modules and low-voltage and high-voltage power distribution modules.
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Our customers traditionally have sourced our electronic hardware together with the software that we embed in it.
−Removed: We serve all of the world's major automotive manufacturers across both our Seating and E-Systems businesses, and we have automotive content on more than 450 vehicle nameplates worldwide.
+Added: We serve all of the world's major automotive manufacturers through both our Seating and E-Systems businesses, and we have automotive content on more than 475 vehicle nameplates worldwide.
It is common for us to have both seating and electrical and/or electronic content on the same vehicle platform.
Our businesses benefit globally from leveraging common operating standards and disciplines, including world-class product development and manufacturing processes, as well as common customer support and regional infrastructures, all of which contribute to our reputation for operational excellence.
−Removed: Our core capabilities are shared across component categories and include:
−Removed: high-precision manufacturing and assembly with short lead times;
−Removed: complex, global supply chain management;
−Removed: global engineering and program management;
−Removed: the agility to establish and/or transfer production between facilities quickly;
−Removed: and a unique, customer-focused culture.
+Added: Our core capabilities are shared across component categories and include high-precision manufacturing and assembly with short lead times, complex, global supply chain management, global engineering and program management, the agility to establish and/or transfer production between facilities quickly, and a unique, customer-focused culture.
In select instances, we are able to manufacture both Seating and E-Systems components in the same facility.
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These functions include health and safety, logistics, quality, supply chain management and all major administrative functions, such as corporate finance, executive administration, human resources, information technology and legal.
+Added: We continue to build on our reputation for operational excellence through investment in Industry 4.0 technologies.
+Added: Industry 4.0 refers to the current era of digital transformation in manufacturing.
+Added: It involves the integration of new technologies, such as Industrial Internet of Things (IIoT), cloud computing, artificial intelligence (AI), machine learning and advanced automation, into production facilities and business operations.
+Added: These technologies enable smart and automated machines and smart factories to communicate, analyze and optimize processes and products, resulting in higher efficiency, quality and responsiveness to customers.
Available Information on our Website
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The acquisition of UT Automotive represented our entry into automotive electrical and electronic systems and formed the basis for our current E-Systems segment.
−Removed: We have subsequently augmented our internal growth plans with selective acquisitions and investments to expand our component capabilities and global footprint, as well as expand our technology portfolio, including the following:
+Added: We have subsequently augmented our organic growth plans with selective acquisitions and investments to expand our component capabilities and global footprint, as well as our Industry 4.0 technologies and automation capabilities, including the following:
• In May 2012, we acquired Guilford Mills, a leading supplier of automotive seat and interior fabric, for approximately $243 million.
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• In April 2017, we acquired Grupo Antolin's automotive seating business for approximately $292 million.
−Removed: • In January 2019, we launched Lear Innovation Ventures ("LIV") to supplement our internal innovation efforts.
−Removed: LIV provides us with a framework to invest in advanced development teams, partnerships and early stage technologies by working with venture capital firms, accelerators and incubators.
−Removed: LIV also makes direct capital investments in start-ups and internal innovation initiatives.
• In March 2021, we acquired M&N Plastics, an injection molding specialist and manufacturer of engineered plastic components for automotive electrical distribution applications.
+Added: This acquisition enabled the significant expansion of our footprint and capabilities with respect to engineered components and enhanced our vertical integration capabilities in connection systems.
• In February 2022, we acquired substantially all of Kongsberg Automotive's Interior Comfort Systems business unit ("Kongsberg ICS") for approximately $188 million.
−Removed: Kongsberg ICS specializes in thermal comfort solutions, including seat massage, lumbar, heat and ventilation products.
+Added: Kongsberg ICS specializes in thermal comfort systems, including seat massage, lumbar, heat and ventilation products.
This acquisition enhances our seat component capabilities by adding specialized thermal comfort seating solutions and further differentiates our product offerings by improving the seat system's performance and packaging.
• In May 2022, we acquired Romanian-based Thagora Technology SRL ("Thagora") to access scalable smart-manufacturing technology.
−Removed: Thagora's proprietary solutions complement our sustainable manufacturing processes by reducing scrap generated by our Seating segment's surface materials operations and lowering energy usage during production.
+Added: Thagora's proprietary solutions complement our sustainable manufacturing processes by improving the production yield of our Seating segment's surface materials operations and lowering energy usage during production.
In addition, Thagora's Industry 4.0 technologies bring significant advances to our manufacturing operations through engineering and logistics enhancements, including improved material traceability and facility footprint utilization capabilities.
−Removed: • In May 2022, we entered into a definitive agreement to acquire I.G.
−Removed: Bauerhin ("IGB") for approximately €140 million, on a cash and debt free basis.
−Removed: IGB is a privately held supplier of automotive seat heating, ventilation and active cooling, steering wheel heating, seat sensors and electronic control modules, headquartered in Gruendau, Germany.
−Removed: The acquisition, subject to regulatory approvals and customary closing conditions and adjustments, is expected to close in 2023.
• In November 2022, we acquired InTouch Automation ("InTouch"), a supplier of Industry 4.0 technologies and complex automated testing equipment critical in the production of automotive seats.
InTouch's product portfolio is aligned with our Industry 4.0 strategy to implement technologies designed to automate the testing and validation of seat components and complete seats.
+Added: • In April 2023, we completed the acquisition of I.G.
+Added: Bauerhin ("IGB"), a privately held supplier of automotive seat heating, ventilation and active cooling, steering wheel heating, seat sensors and electronic control modules, headquartered in Grundau-Rothenbergen, Germany, for approximately $175 million.
+Added: The acquisition furthers our comprehensive strategy to develop and integrate a complete portfolio of thermal comfort systems for automotive seating.
+Added: IGB provides active cooling, as well as additional scale to our seat heating and ventilation capabilities and complements the lumbar and massage capabilities obtained with our acquisition of Kongsberg ICS.
We supply all vehicle segments of the automotive light vehicle original equipment market in every major automotive producing region in the world.
Our sales are driven by the number of vehicles produced by the automotive manufacturers, which is ultimately dependent on consumer demand for automotive vehicles and the availability of raw materials and components, and our content per vehicle.
−Removed: Due to the evolving global economic co nditions since 2020, initially as a result of the COVID-19 pandemic, the automotive industry experienced a decline in global customer sales and pro duction volumes.
−Removed: Although industry production has recovered modestly with production increasing 7% in 2022 compared to 2021 and expected to increase 3% in 2023 compared to 2022 (based on January 2023 S&P Global Mobility, formerly IHS Markit, projections), production remains well below recent historic levels.
−Removed: Global industry production in 2022 was approximately 8% below 2019 pre-pandemic levels and 16% below 2017 peak levels.
−Removed: Since 2020, industry and economic conditions have been influenced directly and indirectly by macroeconomic events such as the COVID-19 pandemic and, beginning in the first quarter of 2022, the Russia-Ukraine conflict, resulting in unfavorable conditions, including shortages of semiconductor chips and other components, elevated inflation levels, higher interest rates, and labor and energy shortages in certain markets.
−Removed: These factors, among others, are impacting consumer demand as well as the ability of automotive manufacturers to produce vehicles to meet demand.
−Removed: Our strategy to mitigate these impacts encompasses our comprehensive cost management process, including value added value engineering (or cost technology optimization), actions to further align our manufacturing capacity to the current industry production environment, investments in Industry 4.0 technologies to enhance operational efficiencies and utilization of existing capital to reduce future expenditures.
−Removed: For risks related to the COVID-19 pandemic, including supply shortages, see Item 1A, "Risk Factors."
−Removed: Details on light vehicle production in certain key regions for 2022 and 2021 are provided below.
−Removed: Our actual results are impacted by the specific mix of products within each market, as well as other factors described in Item 1A, "Risk Factors."
+Added: In 2020, the automotive industry experienced a significant decline in global production volumes as a result of the COVID-19 pandemic.
+Added: In 2022, industry production recovered modestly, increasing 8% compared to 2021.
+Added: In 2023, industry production increased 9% compared to 2022.
+Added: This reflects a return to 2019 pre-pandemic production levels but remains 5% below 2017 peak levels.
+Added: Since 2020, the global economy, as well as the automotive industry, have been influenced directly and indirectly by macroeconomic events resulting in unfavorable conditions, including shortages of semiconductor chips and other components, elevated inflation levels on commodities and labor, higher interest rates, and labor and energy shortages in certain markets.
+Added: Beginning in the third quarter of 2023 and continuing into the fourth quarter of 2023, the automotive industry was impacted by labor strikes and related disruptions at certain facilities in the United States.
+Added: Certain of these factors, among others, continue to impact consumer demand, as well as the ability of automotive manufacturers to produce vehicles to meet demand.
+Added: Our strategy to mitigate these impacts encompasses our comprehensive cost management process, including cost technology optimization, actions to further align our manufacturing capacity to the current industry production environment and investments in Industry 4.0 technologies.
+Added: This will allow us to enhance operational efficiencies, improve the utilization of existing facilities and equipment to reduce future expenditures, and streamline and automate administrative functions.
+Added: For a description of risks related to macroeconomic events, see Item 1A, "Risk Factors."
+Added: Details on light vehicle production volumes in certain key regions for 2023 and 2022 are provided below.
+Added: Our actual results are impacted by the specific volume mix of products within each market, as well as other factors described in Item 1A, "Risk Factors."
(In thousands of units) 2023 (1)
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China (non-consolidated) 1,867.4 1,750.0 7%
−Removed: The automotive industry, and our business, continue to be shaped by the broad trends of electrification and, to a lesser extent, shared mobility.
−Removed: Demand for, and regulatory developments related to, improved energy efficiency, sustainability, and enhanced safety and communications (e.g., government mandates related to fuel economy, carbon emissions and safety equipment) are significant drivers of these trends.
−Removed: Electrification, in particular, is likely to be at the forefront of our industry for the foreseeable future.
+Added: The automotive industry, and our business, continue to be shaped by the broad trend of electrification, which is likely to be at the forefront of the industry for the foreseeable future.
+Added: Demand for, and regulatory developments related to, improved energy efficiency and sustainability (e.g., government mandates related to fuel economy and carbon emissions) are significant drivers of this trend.
In 2024, the battery electric vehicle market is expected to represent 15% of global light vehicle production (based on January 2024 S&P Global Mobility projections), as compared to 12% in 2023 and 10% in 2022.
Battery electric vehicle production increased to 10.2 million units in 2023 from 8.1 million units in 2022, primarily driven by growth in China.
−Removed: Increasing demand for electric vehicles is driven by numerous product offerings from both traditional and non-traditional automotive manufacturers, government requirements and incentives, automotive manufacturers' intern al targets and a growing segment of end consumers who are seeking alternatives to vehicles with traditional ICE architectures.
+Added: Increasing demand for electrified vehicles is driven by numerous product offerings from both traditional and non-traditional automotive manufacturers, government requirements and incentives, automotive manufacturers' intern al targets and a growing segment of end consumers who are seeking alternatives to vehicles with traditional ICE architectures.
Meeting this demand requires further use of electronically controlled and assisted powertrains and related components to impr ove fuel efficiency;
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and the use of lighter weight materials throughout the vehicle.
−Removed: Shared mobility also continues to be a key trend in the automotive industry.
−Removed: Demand for shared mobility services and on-demand transportation from providers such as Uber, Lyft and Didi (in China) is driving interest and growth in this trend.
−Removed: Increased vehicle utilization and the relevance of ride-sharing is leading to customer and consumer demands for more services, enhanced personalization, configurability of the automotive interior and an improved mobility experience.
−Removed: The increasing prevalence of shared mobility services may result in a new segment of customers with unique vehicle technology and design needs, including more flexible, durable and connected seating solutions for a wide range of passengers.
Our business is also influenced by vehicle segment trends that continue to experience a shift in consumer preference toward crossover and sport utility vehicles.
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Crossover and sport utility vehicle production has grown to approximately 46% of total vehicle production in 2023, up from 33% five years ago.
−Removed: Thro ugh our products, technology and strategic initiatives, we are well positioned to capture business growth opportunities resulting from current industry trends.
+Added: Thro ugh our products, technology and strategic initiatives, we are well positioned to capitalize on business growth opportunities.
We are focused on profitably growing our businesses and have implemented a strategy designed to deliver industry-leading, long-term financial returns.
−Removed: This strategy is based upon the following four pillars designed to capitalize on current industry trends and drive growth and profitability in both of our business segments:
−Removed: • Extend our market leadership position in Seating with priceable content;
−Removed: • Transform our E-Systems business through accelerated growth in connection systems, vehicle architecture evolution and electrification;
+Added: This strategy is based on the following four pillars designed to drive growth and profitability in both of our business segments:
+Added: • Extend our market leadership position in Seating with priceable features;
+Added: • Transform our E-Systems business through accelerated growth in connection systems, vehicle architecture evolution and electrification, and the rationalization of our product portfolio to improve profitability;
• Build on our reputation for operational excellence through investment in Industry 4.0 technologies;
−Removed: • Prioritize people and the planet through our Environmental, Social and Governance ("ESG") initiatives.
−Removed: In our Seating business, key attributes of the seat design are evolving as the market continues to pivot toward electric vehicles, providing us with an opportunity to offer value added solutions to our customers through our products and to use our leading market position to capture additional market share.
−Removed: Our products include seat massage, lumbar, heat and ventilation through INTU TM Thermal Comfort, the latest addition to our Intelligent Seating (INTU TM Seating) offerings, and seat reconfigurability through Configurable Seating Architecture (ConfigurE+ TM ).
−Removed: By integrating our existing seating capabilities with the thermal comfort solutions, realized through the acquisition of Kongsberg ICS, we are positioned to extend our competitive advantage and leadership position in Seating.
−Removed: Our thermal comfort solutions provide our customers with a unique value proposition,
−Removed: reducing complexity and cost while providing superior performance, efficiency and comfort.
−Removed: Specifically, our newly designed thermal comfort seat system can reduce sub-components by 50% and increase airflow directly to the occupant by 40%, as compared to currently available designs.
+Added: • Prioritize people and the planet through our sustainability initiatives to drive business growth, cost reductions and improved employee retention.
+Added: In our Seating business, key attributes of the seat design are evolving as the market continues to pivot toward electrified vehicles, providing us with an opportunity to offer value added solutions to our customers through our products and to use our leading market position to capture additional market share.
+Added: Our products include seat heating, ventilation, active cooling, pneumatic lumbar and massage products through INTU TM Thermal Comfort, the latest addition to our Intelligent Seating (INTU TM Seating) offerings, and seat reconfigurability through Configurable Seating Architecture (ConfigurE+ TM ).
+Added: In thermal comfort systems, we are integrating our existing capabilities with those realized through our acquisitions of Kongsberg ICS and IGB.
+Added: Further, we are enhancing product design through the integration of multiple thermal comfort features into a module which offers fewer parts, reduced complexity, improved packaging and significant performance improvements.
+Added: Finally, we have leveraged our complete seat system and component expertise and capabilities to develop a complete thermal comfort solution that combines this thermal comfort module with FlexAir TM , our 100% recyclable non-foam alternative, and the seat trim cover.
+Added: Our new ly designed thermal comfort seat system can reduce sub-components by 50% and increase airflow directly to the occupant by 40%, as compared to currently available designs.
Our design enables heating and ventilation of t he occupant rather than the entire cabin, which can improve energy efficiency, resulting in improved battery range for electric vehicles.
−Removed: With our thermal comfort solutions expertise, we are poised to capitalize on the market trends in electric vehicles, ride sharing and second and third row comfort, while also providing greater design, cost, production and energy efficiency for our customers.
−Removed: In our E-Systems business, our broad capabilities in electrical distribution and connection systems, BDUs and other electronic products support the trend toward electrification, as well as the evolution toward zone-based vehicle electrical architectures for both ICE and electrified powertrains.
+Added: With our thermal comfort systems expertise, we are poised to capitalize on the market trends in electric vehicles, second and third row comfort, and ride sharing, while also providing greater design, cost, production and energy efficiency for our customers.
+Added: In our E-Systems business, our broad capabilities in electrical distribution and connection systems;
+Added: high-voltage power distribution products, including BDUs;
+Added: and low-voltage power distribution products, electronic controllers and other electronic products support the trend toward electrification, as well as the evolution toward zone-based vehicle electrical architectures for both ICE and electrified powertrains.
We are investing in and expanding our electrical distribution and connection systems business.
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In addition, we have enhanced our vertical integration capabilities in connection systems through the acquisition of M&N Plastics.
−Removed: Our BDU business is benefiting from the increased adoption of electrified powertrains and the expansion of longer range, larger format (trucks and SUVs) and higher performance electrified vehicles, where we provide market-leading solutions.
+Added: Our high-voltage power distribution business, including our BDU business, and our low-voltage power distribution business are benefiting from the increased adoption of electrified powertrains and the expansion of longer range, larger format (trucks and SUVs) and higher performance electrified vehicles, where we provide market-leading solutions.
Differentiation through higher power management capacity, lighter weight solutions, and optimized and vertically integrated manufacturing solutions provide us with a competitive advantage in the electrification market.
−Removed: Our other electronic products business is benefiting from the adoption of new vehicle electrical architectures with more integrated power management and control, which is aligned with our strong history of providing highly complex and integrated electronics to our customers.
−Removed: We are streamlining our electronics product portfolio to align with this trend, focusing future investments on those products where we believe that we have a competitive advantage and we can achieve industry-leading financial returns.
+Added: Our electronic controllers and other electronic products business is benefiting from the adoption of new vehicle electrical architectures with more integrated power management and control, which is aligned with our strong history of providing highly complex and integrated electronics to our customers.
+Added: We have rationalized our electronics product portfolio to align with this trend, focusing future investments on those products where we believe that we have a competitive advantage and we can achieve industry-leading financial returns.
Further, we are de-emphasizing and exiting those product lines where we do not see a path to sustainable risk-adjusted financial returns.
We are building on our reputation for operational excellence within the automotive industry with the establishment of our Lear Forward Plan , which will enhance operational efficiencies across our business, and our investments in Industry 4.0 technologies, including the 2022 acquisitions of Thagora and InTouch.
−Removed: Our acquisition of Thagora provides us with scalable smart-manufacturing technology that reduces scrap generated by our Seating segment's surface materials operations and lowers energy usage during production.
+Added: Our acquisition of Thagora provides us with scalable smart-manufacturing technology that improves the production yield of our Seating segment's surface materials operations and lowers energy usage during production.
Our acquisition of InTouch provides us with complex testing equipment that automates the testing and validation of seat components and complete seats.
−Removed: We continue to embed responsible and sustainable ESG principles into our key business processes and operati ons.
−Removed: We have developed new products such as ReNewKnit TM , a sustainable sueded alternative material that is fully recyclable at its end of life and composed of 100% recycled plastic bottles, FlexAir TM , a 100% recyclable non-foam alternative, and SoyFoam TM , a substitute for certain petroleum-based products.
+Added: We continue to embed responsible and sustainable principles into our key business processes and operati ons.
+Added: We have developed products such as FlexAir TM , ReNewKnit TM , a sustainable sueded alternative material that is fully recyclable at its end of life and composed of 100% recycled plastic bottles, and SoyFoam TM , a substitute for certain petroleum-based products.
We also have improved energy efficiency in our operations and established climate goals to reduce carbon emissions and increase the use of renewable energy.
−Removed: In 2022, we joined Climate Group's RE100, a global renewable electricity initiative comprised of companies committed to sourcing 100% of their electricity from renewable sources.
Seating Segment
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seat mechanisms;
−Removed: thermal comfort solutions such as seat massage, lumbar, heat and ventilation products;
+Added: thermal comfort systems such as seat heating, ventilation, active cooling, pneumatic lumbar and massage products;
and headrests.
−Removed: Our extensive system-level knowledge and component-level capab ilities, including internal development of sensor and control algorithms, have provided a solid foundation for innovation and commercialization of advanced comfort solutions, including thermal, safety and wellness products, and convenience features.
+Added: Our extensive system-level knowledge and component-level capab ilities, including internal
+Added: development of sensor and control algorithms, have provided a strong foundation for innovation and commercialization of thermal comfort systems and convenience features.
We belie ve that with our comprehensive set of component offerings, we are a leader in the global market.
−Removed: Overall, our global manufacturing and engineering expertise, low-cost footprint, complete component capabilities, quality leadership and strong customer relationships provide us with a solid platform for both organic and inorganic growth opportunities to enable us to reach our mid-term target global market share of 28% in complete automotive seat systems.
−Removed: We produce seat systems that are fully assembled and ready for installation in automobiles and light trucks.
+Added: Overall, our global manufacturing and engineering expertise, low-cost footprint, complete component capabilities, quality leadership and strong customer relationships provide us with a catalyst for both organic and inorganic growth opportunities to enable us to reach our mid-term target global market share of 29% in complete automotive seat systems.
+Added: We produce seat systems that are fully assembled and ready for installation in light vehicles globally.
Seat systems are generally designed and engineered for specific vehicle models or platforms.
We develop seat systems and components for all vehicle segments from compact cars to pick-up trucks and full-size sport utility vehicles.
−Removed: We are the world leader in luxury and performance automotive seating, providing craftsmanship, elegance in design, use of innovative materials and industry-leading technology req uired by premium brands and vehicles, including those produced by Alfa Romeo, Aston Martin, Audi, BMW,
−Removed: Cadillac, Chevrolet, Ferrari, Genesis, Infiniti, Jaguar, Lamborghini, Land Rover, Lincoln, Maserati, Mercedes-Benz, Polestar, Porsche and Volvo.
+Added: We are the world leader in luxury and performance automotive seating, providing craftsmanship, elegance in design, use of innovative materials and industry-leading technology req uired by premium brands and vehicles, including those produced by Alfa Romeo, Aston Martin, Audi, BMW, Cadillac, Chevrolet, Ferrari, GMC, Jaguar, Lamborghini, Land Rover, Lincoln, Maserati, Mercedes-Benz, NIO, Polestar, Porsche and Volvo.
We are executing on our strategy to extend our leadership position in the market through unique product offerings and selective vertical integration.
Our acquisition of Kongsberg ICS provided us with capabilities in seat massage, lumbar, heating and ventilation.
+Added: Our acquisition of IGB provided us with capabilities in seat heating, ventilation and active cooling, steering wheel heating, seat sensors and electronic control modules.
ConfigurE+ is a wireless powered rail system that allows for easy repositioning of seats within vehicles.
Further, selective vertical integration of key seat components is enhancing growth and increasing profitability, as well as improving quality.
−Removed: In this regard, w e have developed standardized seat mechanisms that can be used across multiple vehicle programs to minimize investment costs.
−Removed: O ur seat mechanisms are developed and manufactured in key locations to supply every major automotive producing region in the world.
+Added: In this regard, we have developed standardized seat mechanisms that can be used across multiple vehicle programs to minimize investment costs.
+Added: Our seat mechanisms are developed and manufactured in key locations to supply every major automotive producing region in the world.
We believe that our precision-engineered seat mechanism expertise and low-cost manufacturing footprint provide us with a competitive advantage.
Our seat cover operations have continued to expand in low-cost markets, including precision cutting, assembly, sewing and lamination.
−Removed: Our acquisition of Eagle Ottawa has afforded us an industry-leading market share in automotive leather globally.
+Added: Our acquisition of Eagle Ottawa provided us an industry-leading market share in automotive leather globally.
Our capabilities in leather design, development and manufacturing allow us to deliver the most luxurious, durable and performance-tested leathers to our customers.
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We believe that the combination of these capabilities in seat surface materials differentiates us and provides us with a competitive advantage facilitating our leadership position in the industry.
−Removed: We are committed to sustainability and reducing the environmental footprint of our products, operations and supply chain.
+Added: We are committed to reducing the environmental footprint of our products, operations and supply chain as a means to drive business growth and reduce costs.
We are working to improve the sustainability of our operations through identification and reduction of generated waste, reuse of materials whenever possible and recycling.
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ReNewKnit TM fibers are spun from polyester yarn and finished with a foam-free recycled fleece backing.
+Added: Thermal Comfort Systems
+Added: Our thermal comfort systems consist largely of seat heating, ventilation, active cooling, pneumatic lumbar and massage products, together with other thermal products such as panel and steering wheel heating.
+Added: Our thermal comfort systems strategy consists of three phases:
+Added: business integration, component modularity and delivery of the most efficient and feature-packed seat in the industry.
+Added: Over the past decade, we have dedicated significant engineering resources to designing, developing and advancing the future of thermal comfort systems.
+Added: Our recent acquisitions of Kongsberg ICS and IGB further expanded our unique capabilities with experienced engineering and manufacturing leaders to accelerate the execution of our thermal comfort systems strategy and provide purchasing, logistics, administrative and footprint synergies to improve our cost competitiveness.
+Added: Through component modularity efforts, we are innovating and enhancing product design by combining multiple functions that were previously provided across multiple components into modular solutions.
+Added: Traditionally, heating, ventilation, lumbar and massage products have been designed as independent systems in a multi-layered model.
+Added: We have designed a single module that combines these thermal comfort features and uses fewer parts.
+Added: This module provides a more efficient system, reduces complexity, improves packaging size and delivers significant performance improvements.
+Added: Finally, we have leveraged all of our complete seat systems and seat component expertise and capabilities to develop a complete thermal comfort system that combines our thermal comfort module, FlexAir TM and the seat trim cover.
+Added: This revolutionary design further reduces part
+Added: complexity, mass and package size (allowing for easier adoption in second and third rows) and significantly improves the final seat assembly process while providing a more efficient system with improved performance (including reduced time to sensation) and enhanced comfort for the occupant.
+Added: In addition, our complete thermal comfort module can be supplied to any seat supplier and is compatible with any seat structure with traditional foam or FlexAir TM .
+Added: We believe that we are the only supplier with the complete capabilities necessary to realize these modular concepts, providing a unique value proposition to our customers.
Advanced Seating Craftsmanship and Innovation
−Removed: We believe that our broad capabilities, including advanced design and material integration skills, are a differentiating competitive advantage for us.
−Removed: Our team of experts at our Center for Craftsmanship in Southfield, Michigan has developed a portfolio of technologies that deliver differentiated design, craftsmanship and comfort, as well as sustainable products.
−Removed: Through this dedicated studio, we are leveraging our unique position to be an industry leader in differentiated design and facilitating customer interactions with designers and engineers working collaboratively to create innovative solutions early in the design process.
−Removed: The breadth of our portfolio and depth of our design expertise provides the opportunity to better integrate all seat components to provide differentiated design comfort, quality and overall value for the end consumer.
−Removed: We believe that our unmatched component capabilities, design expertise, global manufacturing presence and portfolio of enabling and sustainable technologies uniquely position us to bring innovative designs into production with the highest level of craftsmanship.
+Added: We believe that our broad capabilities, including advanced design and material integration skills, provide us with a competitive advantage.
+Added: Our team of experts at our Center for Craftsmanship in Southfield, Michigan has developed a portfolio of technologies that deliver sustainable products, differentiated design, craftsmanship and comfort.
+Added: Through this dedicated studio, we are leveraging our unique position to be an industry leader in design and facilitating customer interactions with designers and engineers working collaboratively to create innovative solutions early in the design process.
+Added: The breadth of our portfolio and depth of our design expertise allows us to better integrate all seat components and bring innovative designs into production with the highest level of craftsmanship, providing differentiated design comfort, quality and overall value to the end consumer.
+Added: We believe that our unmatched component capabilities, design expertise, global manufacturing presence, and portfolio of enabling and sustainable technologies provide a unique value proposition to our customers and will drive market share gains for our business.
We believe that we are the only fully integrated seat supplier with global capabilities in critical seat components, together with software design, integration and manufacturing expertise.
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The seat offers a direct connection between the driver, passengers and vehicle systems.
−Removed: Our development of INTU TM technologies provides the driver and passengers with intelligent, intuitive seat system options that offer advanced comfort solutions, including thermal, safety and wellness products, as well as configurable seating product technologies.
+Added: Our development of INTU TM technologies provides the driver and passengers with intelligent, intuitive seat system options that offer advanced comfort solutions, including thermal products, as well as configurable seating product technologies.
Our extensive knowledge in consumer ergonomics and comfort, in combination with our electronics capabilities, facilitated the development of our INTU TM seat features, which are capable of being programmed to identify certain key occupant inputs and automatically adjust the appropriate seat parameters to provide consumers with a better, highly personalized, in-vehicle experience.
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Derived from our research, INTU TM Comfort deploys proprietary technology and in-house developed analytical processes to identify the optimal seat position for the occupant given certain conditions.
−Removed: For example, on extended trips, the lumbar support is continuously adjusted for optimal
−Removed: comfort, and seat bolsters automatically adjust during sharp curves to provide the driver with optimal support.
−Removed: The latest addition to our INTU TM Comfort features is INTU TM Thermal Comfort that focuses on faster and more efficient heating and ventilation for the occupant.
+Added: For example, on extended trips, the lumbar support is continuously adjusted for optimal comfort, and seat bolsters automatically adjust during sharp curves to provide the driver with optimal support.
We have developed and designed efficiencies into individual seat components and full system integration to outperform existing systems.
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We have in-house, industry-leading seat validation test centers featuring crash worthiness, durability and full acoustic and sound quality testing capabilities.
−Removed: Together with computer-controlled data acquisition and analysis capabilities, these centers provide precisely controlled laboratory conditions for sophisticated testing of parts, materials and systems.
+Added: with computer-controlled data acquisition and analysis capabilities, these centers provide precisely controlled laboratory conditions for sophisticated testing of parts, materials and systems.
In addition, we incorporate many convenience, comfort and safety features into our designs, including advanced whiplash prevention concepts, integrated restraint seat systems and side impact airbags.
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Our ECO Structures utilize an innovative hub and spoke concept offering economic solutions for developing markets.
+Added: • Zero Gravity Seat – Zero gravity seats (i.e., seats designed to replicate the sensation of weightlessness) have become increasingly more important in the local China market as they provide an enhanced comfort experience for the second row occupants.
+Added: We have developed a zero gravity seat for second row occupants that includes a 65 degree recline, a raising calf rest for lower leg support, an adaptive arm rest and occupant body pressure distribution, together with various comfort features, including integrated pneumatic neck support and heated back massage.
+Added: Production for our first award is expected to launch in 2024.
• Foam and Comfort – Our highly engineered low-profile foam, low-emission foam and our first-to-market, U.S.-sourced SoyFoam TM are break-through innovations in comfort, safety and sustainability.
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Moreover, we have continued to expand our employee engagement initiatives, achieving global scalability and successfully driving cultural advances.
−Removed: Our initiatives have resulted in increased first-time quality, decreased absenteeism, material cost reductions and decreased average build times per seat set.
+Added: initiatives have resulted in improvements in quality, lower employee absenteeism, material cost savings and a reduction in average assembly build times per seat set.
The top five customers of our Seating segment are:
General Motors, Mercedes-Benz, Stellantis, Volkswagen and Ford.
−Removed: Our primary competitors in this segment globally are Adient, plc, Forvia, Magna International Inc., Toyota Boshoku Corporation, TS Tech Co., Ltd.
+Added: Our primary competitors in this segment globally are Adient plc, Forvia SE, Magna International Inc., Toyota Boshoku Corporation, TS Tech Co., Ltd.
and Yanfeng Automotive Systems Co., Ltd., which have varying market presence depending on the region, country or automotive manufacturer.
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E-Systems Segment
−Removed: Our E-Systems segment consists of the design, development, engineering and manufacture of complete electrical distribution and connection systems, BDUs and other electronic products for light vehicles globally.
+Added: Our E-Systems segment consists of the design, development, engineering and manufacture of complete electrical distribution and connection systems;
+Added: high-voltage power distribution products, including BDUs;
+Added: and low-voltage power distribution products, electronic controllers and other electronic products for light vehicles globally.
We are a leader in signal distribution and power management within the vehicle for all types of powertrains – from traditional ICE architectures to the full range of electrified powertrains.
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We are expanding our capabilities and introducing new product lines, primarily within our electrical distribution and connections systems business and including intercell connect boards, BDUs, engineered components, high-voltage wire, high-speed data cables and zone control modules.
−Removed: Further, we are deemphasizing and exiting certain electronics product lines, including audio modules, lighting modules, on-board chargers, telematics control units and niche electronic controllers, where we do not see a path to sustainable risk-adjusted financial returns.
+Added: Further, we are de-emphasizing and exiting certain electronics product lines, including audio modules, lighting modules, on-board chargers, telematics control units and niche electronic controllers, where we do not see a path to sustainable risk-adjusted financial returns.
In our E-Systems business, the electrification of the vehicle powertrain adds significant content per vehicle for our products, including high-voltage wire harnesses, high-voltage battery connection systems (intercell connect boards, bus bars and main battery connection systems) and BDUs.
−Removed: The trend toward longer range, larger format (trucks and SUVs) and higher performance electrified vehicles further increases content per vehicle and aligns favorably with our products, including high power-to-size ratio terminal systems, high performance BDUs and intercell connect boards.
+Added: Higher performance and larger format electrified vehicles, including trucks and SUVs, as well as electrified vehicles with longer range, further increase content per vehicle and aligns favorably with our products, including high power-to-size ratio terminal systems, high performance BDUs and intercell connect boards.
In addition, the continuing evolution of the vehicle electrical architecture is introducing more highly integrated power management and control electro nics (or zone control modules) and greatly expanding the use of high-speed data within the vehicle.
Our customers are adopting these new architectures on both ICE and electrified powertrains to enable continued integration of more electrical and electronic content and to enable future software-defined functionality.
−Removed: These market demands
−Removed: align favorably with our expertise in zone control modules and high-speed data cables and are expected to increase content per vehicle.
+Added: These market demands align favorably with our expertise in zone control modules and high-speed data cables.
Our product portfolio strategy enables increased leverage of our investments across a focused product portfolio and creates a competitive advantage as we are able to offer our customers customized solutions optimized to provide complete architecture benefits.
Our component designs consider the performance of the complete architecture, creating superior value for our customers.
−Removed: Our investments in electrification over the past fourteen years are providing us with a significant growth opportunity with respect to this trend.
+Added: Our investments in electrification over the past fifteen years are providing us with a significant growth opportunity with respect to this trend.
Further, electrified vehicle architectures represent a significant content per vehicle expansion opportunity for us.
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Wire harness assemblies, together with connection systems, link all of the various electrical and electronic devices within the vehicle to each other and/or to a power source.
−Removed: Our wire harnesses provide low voltage (12 volts and 48 volts) and high voltage (60 volts – 800 volts) power distribution.
+Added: Our wire harnesses provide low-voltage (12 volts and 48 volts) and high-voltage
+Added: (60 volts – 800 volts) power distribution.
Low-voltage wire harnesses are used on all light duty vehicles, and high voltage wire harnesses are used on vehicles with electrified powertrains.
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Our connection systems are produced using highly automated processes, including stamping, injection molding and automated assembly processes.
−Removed: In 2021, we entered into multiple partnerships to expand our business opportunities in connection systems, including partnerships with IMS Connector System, a technology company based in Germany to enable advanced high-speed data connection systems, and Hu Lane Associate Inc., a world-class manufacturer of automotive connector products to expand our access to a broader catalog of product-enabling solutions for our customers.
−Removed: Our connection systems are currently manufactured in Germany, Czech Republic, China and the United States.
+Added: In 2021, we entered into a partnership with Hu Lane Associate Inc., a world-class manufacturer of automotive connector products, to expand our business opportunities in connection systems through access to a broader catalog of product-enabling solutions for our customers.
+Added: Our connection systems are currently manufactured in Germany, the Czech Republic, Morocco, China and the United States.
Key material inputs to our connection systems business include metals, such as copper and aluminum, and various resins.
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These products are produced using highly automated processes, including stamping, bending, molding and assembly.
+Added: We leverage our metal stamping capabilities in our Seating business to provide a competitive advantage for these products through vertical integration and supply chain management.
Our established capabilities in connection systems and engineered components facilitate our ability to produce these products.
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These components perform specific functions, such as protection, routing, sealing or covering, to ensure that the wire harness assembly properly performs its function.
−Removed: In 2021, we acquired M&N Plastics, a privately owned injection molding specialist and manufacturer of engineered plastic components for automotive electrical distribution applications, which significantly expanded our capabilities and footprint in engineered components.
+Added: In 2021, we acquired M&N Plastics, a privately owned injection molding specialist and manufacturer of engineered plastic components for automotive electrical distribution applications, which enabled the significant expansion of our footprint and capabilities with respect to engineered components.
Engineered component capabilities are a significant contributor to vertically integrated product assemblies and enable business growth across electrical distribution and connection systems and our Seating business due to increased control of product cost and quality, as well as the supply chain.
Engineered components are applicable to all vehicle architectures and are produced using molding processes.
−Removed: Our engineered components are currently manufactured in Germany, the Czech Republic, the United States and China.
+Added: Our engineered components are currently manufactured in Germany, the Czech Republic, Morocco, China and the United States.
Key material inputs to our engineered components are various resins.
−Removed: Battery Disconnect Units
−Removed: In our E-Systems segment, we also design, develop, engineer and manufacture BDUs.
−Removed: These products control all electrical energy flowing into and out of the high voltage battery on electrified vehicles.
−Removed: More than fourteen years of experience in BDUs and our expertise in areas integral to the performance of BDUs, such as power and thermal management and electrical architecture integration, have contributed to our well-established market position and our ability to effectively and competitively supply BDUs.
−Removed: BDUs are applicable to all electrified powertrain vehicles, but the size, complexity and configuration of BDUs can vary widely dependent upon the power requirements of individual vehicle platforms.
−Removed: Our BDUs are currently manufactured in Mexico, China and Morocco, with an anticipated new facility opening in the United States in 2023.
−Removed: Key material inputs to our BDUs include metals, including copper and aluminum, various resins, and power components such as fuses, e-fuses and contactors.
−Removed: Other Electronic Products
−Removed: In our E-Systems segment, we also design, develop, engineer and manufacture other electronic products that control various functions and power distribution within the vehicle.
−Removed: Our electronic product offerings include zone control modules, body domain modules and low voltage and high voltage power distribution units.
+Added: High-Voltage Power Distribution Products, including BDUs
+Added: In our E-Systems segment, we also design, develop, engineer and manufacture high-voltage power distribution products, including BDUs.
+Added: These products control the flow and distribution of high-voltage power throughout electrified vehicles and include BDUs which control all electrical energy flowing into and out of high-voltage batteries in electrified vehicles.
+Added: More than fifteen years of experience in high-voltage power distribution products, together with our expertise in areas integral to the performance of BDUs, such as power and thermal management and electrical architecture integration, have contributed to our well-established market position and our ability to effectively and competitively supply BDUs.
+Added: High-voltage power distribution products are applicable to all electrified powertrain vehicles, but the size, complexity and configuration can vary widely dependent upon the power requirements of individual vehicle platforms.
+Added: Our high-voltage power distribution products are currently manufactured in Mexico, China, Spain and Morocco.
+Added: Key material inputs to our high-voltage power distribution products include metals, including copper and aluminum, various resins, and power components, such as fuses, e-fuses and contactors.
+Added: Low-Voltage Power Distribution Products, Electronic Controllers and Other Electronic Products
+Added: In our E-Systems segment, we also design, develop, engineer and manufacture low-voltage power distribution products, electronic controllers and other electronic products that control various functions and power distribution within the vehicle.
+Added: electronic product offerings include zone control modules, body domain modules and low-voltage power distribution units.
These units are typically purchased with embedded software to manage vehicle functions, control power distribution and ensure vehicle network connection.
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These technologies are supported by our proprietary virtual proving grounds, which is an industry-leading suite of in-house developed tools and processes to significantly reduce design, development and validation testing time and expense.
−Removed: In BDUs, we have developed many patented or patent pending technologies that enable management of higher power levels and efficient thermal management.
−Removed: In addition, our technology and capabilities were awarded an Automotive News PACE Award for technological excellence in 2021.
+Added: Our ongoing and accelerating investments in Industry 4.0 technologies, including the automation of wire harness manufacturing, design for automation and digital transformation, will yield future efficiencies and flexibility to our operations.
+Added: In high-voltage power distribution products, including BDUs, and low-voltage power distribution products, we have developed many patented or patent pending technologies that enable management of higher power levels and efficient thermal management.
+Added: Our technology and capabilities were awarded an Automotive News PACE Award for technological excellence in 2021.
+Added: In addition, we partnered with BASF and General Motors to develop the BDU in the 2022 GMC Hummer EV and won the Society of Plastics Engineers Automotive Innovation Award for the electric and autonomous vehicle systems category in 2023.
Our BDU capabilities enable the highest power large-format vehicles by utilizing innovative technologies, including flat-flex wires to quickly dissipate heat.
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These technologies are also scalable to achieve superior performance for vehicles with lower power requirements.
−Removed: In our other electronic products, we are a market leader in zone control, body domain control and power distribution technology and began production of our Automotive News PACE Award-winning Solid State Smart Junction Box TM in 2016.
+Added: In our electronic controllers and other electronic products, we are a market leader in zone control, body domain control and power distribution technology and began production of our Automotive News PACE Award-winning Solid State Smart Junction Box TM in 2016.
Further, our expertise in e-fuse technology is leading to new power distribution business awards as new architectures are adopted and functional safety requirements increase.
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Limited, Delta Electronics, Inc., LG Energy Systems, Ltd., Panasonic Holdings Corporation and Yazaki Corporation.
−Removed: Our major competitors in other electronic products include Aptiv PLC, Continental AG, Denso Corporation, Harman International Industries, Incorporated (a subsidiary of Samsung Electronics Co.
−Removed: Ltd.), Hella AG, Robert Bosch GmbH, Valeo S.A.
+Added: Our major competitors in other electronic products include Aptiv PLC,
+Added: Continental AG, Denso Corporation, Harman International Industries, Incorporated (a subsidiary of Samsung Electronics Co.
+Added: Ltd.), Hella (a subsidiary of Forvia SE), Robert Bosch GmbH, Valeo S.A.
and Visteon Corporation.
−Removed: Environmental, Social and Governance
−Removed: At Lear, we recognize the importance of ESG considerations to our investors, as well as our employees, customers and other stakeholders.
−Removed: We believe that growing customer and consumer demand for sustainable products provides additional business opportunities for our Company, and more efficient use of energy and natural resources provides the potential to lower operating costs.
−Removed: We are continuously working to embed responsible and sustainable ESG principles into our key business processes and operations, including without limitation corporate strategy, enterprise risk management, innovation, procurement, product and process development, and sales.
−Removed: Our ESG strategy and initiatives are developed by a cross-functional team of senior subject matter experts, reviewed and approved by senior management and overseen by the Governance and Sustainability Committee of our Board.
+Added: Sustainability
+Added: Sustainability initiatives provide the opportunity to gain competitive advantages.
+Added: For example, we believe that growing customer and consumer demand for sustainable products provides opportunities for growth, and the more efficient use of energy and natural resources provides the potential to lower our operating costs while reducing our impact on the environment.
+Added: We are continuously working to embed responsible and sustainable principles into our key business processes and operations, including enterprise risk management, innovation, procurement, product and process development, and sales.
+Added: Our sustainability strategy and initiatives are developed by a cross-functional team of senior subject matter experts, reviewed and approved by senior management and overseen by the Governance and Sustainability Committee of our Board.
We actively communicate our goals and activities to our investors in our public disclosures available on our website and in our SEC filings.
−Removed: Our ESG efforts demonstrate how we live our core value to Get Results the Right Way , which we have reinforced by recommitting to the United Nations Global Compact each year since becoming a signatory in 2020.
+Added: Our sustainability efforts demonstrate how we live our core value to Get Results the Right Way , which we have reinforced by recommitting to the United Nations Global Compact each year since becoming a participant in 2020.
Energy Efficiency and Carbon Reduction Efforts at Lear
• How We Are Driving Sustainability in Our Production Processes
−Removed: We employ standardized production processes globally that are designed to drive the efficient use of energy to reduce energy costs and greenhouse gas emissions, the prevention of pollution and the utilization of safe and sustainable production processes.
−Removed: We have published carbon reduction goals that we intend to achieve by 2030, including 100% usage of renewable energy for our electricity consumption and a 50% reduction in carbon emissions at our facilities, as well as an aspiration to be carbon neutral by 2050.
+Added: We employ standardized processes globally that are designed to drive the efficient use of energy to reduce energy costs and greenhouse gas emissions, prevention of pollution and use of safe and sustainable production processes.
+Added: We have published carbon reduction goals that we intend to achieve by 2030, including 100% usage of renewable energy for our electricity consumption and a 50% reduction in carbon emissions at our sites globally, as well as an aspiration to be carbon neutral by 2050.
We are implementing a multifaceted approach to achieve these goals.
−Removed: In our internal operations, this approach is focused in large part on increasing our usage of renewable energy, as well as on efforts to reduce energy consumption and use energy more efficiently.
+Added: In our internal operations, we are focused in large part on increasing our usage of renewable energy, as well as on efforts to reduce energy consumption and use energy more efficiently.
In particular, we have developed, and are implementing, a comprehensive renewable energy strategy which includes the following:
−Removed: – On-site renewable energy generation at certain sites (we currently have solar arrays operating at eight sites in Europe, South America and China);
−Removed: – Purchasing energy attribution certifications from energy providers, whether bundled with existing energy purchases or unbundled in certain regions (such purchases are made on an ongoing basis each year);
−Removed: – Virtual power purchase agreements to support new renewable energy projects in the United States and Europe.
−Removed: Also, in 2022, we joined Climate Group's RE100, a global renewable electricity initiative comprised of companies committed to sourcing 100% of their electricity from renewable sources, and also committed to the Science Based Targets Initiative (SBTi).
−Removed: In 2021, we released our Energy Efficiency Playbook into our operations to institutionalize best practices regarding energy usage.
−Removed: Since its release, this playbook has been used broadly within our global operations on an ongoing basis.
−Removed: We have also updated our facilities' specifications for new construction and significant building refurbishments to require more energy efficient systems, such as heating and cooling, wherever practicable.
−Removed: Furthermore, in 2022, we released additional playbooks specific to waste generation and water usage for implementation at our global facilities.
−Removed: Like our Energy Efficiency Playbook, these playbooks are focused on promoting sustainable operating practices within our facilities, while at the same time increasing operational efficiency and potentially reducing costs.
+Added: – On-site renewable energy generation at certain sites (we currently have solar arrays operating at 14 sites in Europe, South America and China);
+Added: – Virtual power purchase agreements, where viable, to support new renewable energy projects;
+Added: – Purchasing energy attribution certifications from energy providers, whether bundled with existing energy purchases or unbundled in certain regions.
+Added: Our operations globally use our Energy Efficiency, Water Usage and Waste Generation Playbooks to promote sustainable practices within our facilities, while at the same time increasing operational efficiency and reducing costs.
+Added: As an example, leveraging the best practices outlined in our Energy Efficiency Playbook, our global teams completed 170 energy efficiency projects, potentially saving nearly 6 million kWh of energy globally.
+Added: In addition, our facilities' specifications for new construction and significant building refurbishments require the consideration of more energy efficient systems, such as heating and cooling systems, wherever practicable.
While the foregoing efforts will help us drive toward the elimination of carbon emissions in those areas we directly control (Scope 1 and 2 emissions), we are also progressing toward our longer-term overall goal of carbon neutrality across our value chain (including Scope 3 emissions).
−Removed: Accordingly, we are working to measure our Scope 3 emissions through the development of product life cycle assessments for our major product offerings.
−Removed: In terms of our supply chain, we are communicating both our own carbon and renewable energy goals and our expectations of our suppliers as to sustainable energy usage going forward.
−Removed: • How We Are Responding to Increased Calls for Product Sustainability
−Removed: The automotive industry remains focused on the development of sustainable transportation solutions, particularly in light of the continued focus on climate change and environmental sustainability among governments, non-governmental organizations, investors, consumers and other stakeholders.
−Removed: This focus is increasing the expectations, and in some cases, leading to regulatory requirements, that the automotive industry utilize cleaner, more fuel-efficient solutions.
−Removed: In addition, the advantages of carbon reduction and energy efficiency are expected to make electric vehicles an increasingly popular choice over time.
−Removed: Many of our product offerings are designed to capitalize on these evolving regulatory requirements and consumer preferences, such as electrical distribution and connection systems and BDUs des igned for high voltage applications, as well as our thermal comfort solutions that can increase the efficiency of a vehicle's HVAC system and, in turn, potentially facilitate an increased range for electric vehicles.
−Removed: Additionally, our intelligent and reconfigurable seats support the trend of shared mobility.
−Removed: Our stakeholders' focus on sustainability is aligned with our efforts to develop products that are more environmentally sustainable.
−Removed: These products include, without limitation, SoyFoam TM , a substitute for certain petroleum-based products, FlexAir TM , our 100% recyclable non-foam alternative, and ReNew Knit TM , a sustainable sueded alternative material that is fully recyclable at its end of life and composed of 100% recycled plastic bottles.
+Added: In terms of our supply chain, we are communicating our carbon and renewable energy goals, as well as our expectation that our suppliers have, and follow, their own internal policies regarding the conservation and efficient use of natural resources, including energy.
+Added: • How We Are Driving Sustainable Products
+Added: The automotive industry remains focused on the development of sustainable transportation solutions, particularly in light of the continued focus on climate change and environmental sustainability among governments, non-governmental organizations, consumers and other stakeholders.
+Added: This focus is increasing the expectations, and in some cases, leading to regulatory requirements, that the automotive industry reduce the carbon emissions generated by vehicles, which is expected to increase the adoption of electric vehicles in the coming years.
+Added: Certain of our product offerings are designed to capitalize on these evolving regulatory requirements and consumer preferences, such as electrical distribution and connection systems and BDUs designed for high-voltage applications, providing growth opportunities for our business.
+Added: Our thermal comfort systems can increase the efficiency of a vehicle's HVAC system and, in turn, potentially facilitate an increased range for electric vehicles.
+Added: In addition, our lightweight
+Added: components and vertical integration capabilities can facilitate weight reductions and other performance efficiencies in our products, in turn enabling lower emissions and increased battery driving range.
+Added: Our customers' focus on sustainability is aligned with our efforts to develop products that are more environmentally sustainable.
+Added: These products include, without limitation, FlexAir TM , our 100% recyclable non-foam alternative, ReNew Knit TM , our sustainable sueded alternative material that is fully recyclable at its end of life and composed of 100% recycled material, and SoyFoam TM , a substitute for certain petroleum-based products.
We are also committed to working with our suppliers and customers to source raw materials, including leather, in a sustainable manner.
−Removed: Our leather operations source cattle hides as a by product of the beef industry and are protecting forests by working to eliminate purchases of such hides from cattle farms involved in deforestation and forest degradation.
+Added: Our leather operations source cattle hides as a byproduct of the beef industry and are helping to protect forests by working to eliminate purchases of such hides from cattle farms involved in deforestation and forest degradation.
Our No Deforestation Policy aligns with industry standards and requires of our suppliers:
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– Compliance with governmental laws, regulations and guidelines regarding deforestation.
−Removed: With respect to the Amazon rainforest, 100% of the direct Brazilian suppliers to our leather operations use georeferencing technology to confirm that their suppliers did not directly buy cattle from farms involved in deforestation, invasion of indigenous and protected areas or human rights violations.
−Removed: To monitor our suppliers' compliance with these requirements, we may conduct audits and/or require third-party verification.
−Removed: Other ESG-Related Initiatives
−Removed: We are especially proud of our employee efforts to support our global communities.
−Removed: Through our Operation GIVE campaign at our Southfield, Michigan headquarters, approximately $1 million in employee contributions benefited local programs focused on economic well-being, education and the environment in 2022.
−Removed: Our commitment to human rights is set forth in our Human Rights Policy that clearly defines how we approach, govern and defend the dignity of people throughout our operations, our global supply chain and the communities in which we operate.
−Removed: In addition, our Together We Belong program helps fund initiatives that address racial inequality and discrimination through a combination of grants to external organizations, as well as internal investments to educate and engage our employees.
−Removed: Our governance activities help ensure that our business and operations are conducted in compliance with all applicable laws, as well as Lear's policies and procedures, particularly our Code of Business Conduct and Ethics, which addresses conflicts of interest, bribery and corruption, political contributions and information technology security, among other things.
−Removed: In 2022, we updated our Code of Business Conduct and Ethics to include additional and enhanced sections on certain of these topics, as well as on topics such as social media, human rights, and diversity and inclusion.
+Added: With respect to the Amazon rainforest, 100% of the direct Brazilian suppliers to our leather operations use georeferencing technology to confirm that their suppliers did not directly buy cattle from farms involved in deforestation, invasion of indigenous and protected areas or other human rights violations.
+Added: To monitor our suppliers' compliance with these requirements, we may conduct audits or assessments and/or require third-party verification.
+Added: Other Sustainability And Governance Initiatives
+Added: We are especially proud of our employees’ efforts to support our global communities.
+Added: Through our Operation GIVE campaign at our Southfield, Michigan headquarters, nearly $1 million in employee contributions benefited local programs focused on economic well-being, education and the environment in 2023.
+Added: In addition, our teams completed numerous volunteer projects to support the global communities where we live and work.
+Added: Our commitment to human rights is set forth in our Human Rights Policy which clearly defines how we approach, govern and defend the dignity of people throughout our operations, our global supply chain and our communities.
+Added: Our governance activities help ensure that our business and operations are conducted in compliance with all applicable laws, as well as Lear's policies and procedures, particularly our Code of Business Conduct and Ethics.
Our Board and its Audit and Governance and Sustainability Committees oversee our compliance and governance activities.
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Human Capital Management
−Removed: We believe that the best way to deliver the highest quality products and services is to maintain a work environment that prioritizes safety and fosters collaboration, inclusion, tolerance and respect for our 168,700 employees around the world.
+Added: Our human capital management strategy is based on our belief that an important factor in delivering the highest quality products and services is to maintain a work environment that prioritizes safety and fosters collaboration, inclusion, tolerance and respect for our 186,600 employees around the world.
+Added: Our Board and its People and Compensation Committee oversee this strategy.
As of December 31, 2023 and 2022, our employment levels worldwide were approximately as follows:
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Our health and safety programs are designed around global standards with appropriate variations to address the multiple jurisdictions and unique working environments of our manufacturing operations.
−Removed: Our health and safety management system is compliant with the ISO 45001 standard, and we are currently implementing a more comprehensive program which combines ISO 14001 and 45001 requirements to improve efficiency and performance.
+Added: Our health and safety management system is compliant with the International Organization for Standardization ("ISO") 45001 standard, and we are currently implementing a more comprehensive program which combines ISO 14001 and 45001 requirements to improve efficiency and performance.
Each of our locations performs regular safety audits to ensure that proper safety policies are in place and appropriate safety training is provided.
In addition, we engage an independent third-party conformity assessment and certification vendor to audit selected operations for adherence to our global health and safety standards.
−Removed: In 2020, in response to the COVID-19 pandemic, we created a Safe Work Playbook, which provides a standardized approach for each of our facilities to create a consistent and safe work environment and offers insights into navigating operational challenges related to the COVID-19 pandemic.
−Removed: The playbook is available to the public and includes health and safety
−Removed: information related to plant operating protocols;
−Removed: employee education, training and feedback;
−Removed: facility assessments;
−Removed: and phased reopening of engineering and administrative centers.
+Added: Our employees also support healthier lifestyles through our Driving Wellness campaign.
+Added: Local teams around the world plan activities, such as mental health awareness events, first aid training and on-site physical fitness initiatives, that are focused on promoting increased physical, emotional and mental wellness.
+Added: This program has been expanded globally since its inception in 2022.
Diversity, Equity and Inclusion ("DEI")
We strive to build a culture of diversity, equity and inclusion not only through our human resource policies and practices but also by actively monitoring pay equity and working to eliminate discrimination and harassment in all of its forms.
−Removed: In 2022, our employees participated in more than 200,000 hours of DEI and anti-harassment training.
+Added: Since 2022, our employees participated in more than 200,000 hours of DEI and anti-harassment training.
In addition, our global executives and U.S.
managers at our Southfield, Michigan headquarters have completed our Connecting with Others DEI training, which helps our employees identify barriers to inclusion and learn behaviors that both promote inclusion and establish stronger connections.
−Removed: Our Together We Belong program continues to help our employees learn to navigate difficult conversations, support our colleagues and celebrate the many facets of diversity.
+Added: Our T ogether We Belong program continues to help our employees learn to navigate difficult conversations, support our colleagues and celebrate the many facets of diversity.
In 2021, we introduced Together We Grow , a merit-based program designed to help future leaders from historically underrepresented groups build their careers at Lear.
−Removed: We are accomplishing this by investing in meaningful development and proactive career management and being intentional in advancing and promoting this talent to management roles and leadership positions.
−Removed: In addition, the program provides an executive sponsor, career mapping and access to the senior leadership team.
−Removed: By focusing on engagement and relationship building, this program allows our next generation of leaders to maximize their full potential.
+Added: This program provides participants with meaningful development and proactive career management.
+Added: With an emphasis on engagement and relationship building, this program continues to support our next generation of leaders, maximizing their full potential.
+Added: We are currently working to expand the program globally.
+Added: In 2023, we launched our JumpStart program, attracting mid-career professionals who had previously chosen to pause their careers for a variety of personal reasons.
+Added: Leveraging our internal referral process, we found participants that were eager to update their skills and, with support, ready to return to full-time employment.
+Added: During the 12-week program, participants receive custom onboarding, attend professional development and technical training workshops, and are assigned a job coach.
We are also proud of our six employee resource groups, representing 15 countries.
−Removed: Each employee-led resource group is supported by an executive sponsor and is open to all employees, with a goal of fostering a culture where everyone in our diverse and global workforce feels engaged, accepted and valued.
+Added: Each employee-led resource group is supported by an executive sponsor and is open to all employees, with a goal of fostering a culture where everyone in our
+Added: diverse and global workforce feels engaged, accepted and valued.
Over the last two years, the employee resource groups have held over 1,300 events, including lunch and learns, trainings, and volunteer and social activities.
−Removed: Training and Talent Development
+Added: Talent, Education and Development
We are committed to the continued development of our employees.
−Removed: In 2022, we have delivered more than five million hours of safety, development, leadership, quality, continuous improvement, lean manufacturing, and ISO and IATF certification training.
+Added: In 2023, we delivered more than seven million hours of safety, development, leadership, quality, continuous improvement, lean manufacturing, and ISO and IATF certification training.
We offer several professional development and leadership programs in the United States, Europe, Asia, Mexico and South America.
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Twice per year, a select group of leaders representing diverse functions and backgrounds are invited to participate in a week-long leadership immersion event, during which each participant presents a bold business idea to help drive Lear's success.
−Removed: In addition, formal talent reviews and succession planning occur annually – globally and across all business areas.
−Removed: Senior leadership provides annual updates on succession and talent development to the Board.
Employee Engagement and Culture
−Removed: Launched in 2017, Together We Win is Lear's global employee engagement program focused on driving cultural change in our operations.
+Added: Launched in 2017, Together We Win ("TWW") is Lear's global employee engagement program focused on driving cultural change in our operations.
Plants advance through four segments — leadership, work environment, employee involvement and team empowerment.
−Removed: Together We Win unites manufacturing employees across the globe in achieving excellence based on key operations and employee engagement metrics, such as quality, absenteeism, health and safety performance, and operational efficiency.
+Added: TWW unites manufacturing employees across the globe in achieving excellence based on key operations and employee engagement metrics, such as quality, absenteeism, health and safety performance, and operational efficiency.
+Added: Our approach towards employee engagement has evolved into an employee experience framework based on three main chapters of the employee lifecycle:
+Added: attract and recruit, learn and grow, and perform and reward.
Champions of Lear celebrates our global operations and our hourly and salaried employees who represent the best-of-the-best in our company.
Individuals, teams or plants submit an application which is reviewed by a diverse panel of judges, including Lear leadership.
−Removed: Award categories honor achievements in culture, customer appreciation, innovation, supply chain, quality, safety, operational excellence, continuous improvement, sustainability, best launch and best plant collaboration, as well as the prestigious CEO Special Appreciation Award.
−Removed: In 2021, an additional award category was added to recognize initiatives that support DEI in the workplace.
−Removed: In 2022, General Motors and Ford, two of the largest automotive and light truck manufacturers in the world, accounted for 20% and 14% of our net sales, respectively.
−Removed: In addition, Mercedes-Benz, Volkswagen and Stellantis accounted for 11%, 11% and 10% of our 2022 net sales, respectively.
+Added: Award categories honor achievements in engagement, customer appreciation, innovation, supply chain, quality, safety, operational excellence, sustainability and continuous improvement.
+Added: In 2023, General Motors, one of the largest automotive and light truck manufacturers in the world, accounted for 20% of our net sales.
+Added: In addition, Ford and Volkswagen each accounted for 11%, and Mercedes-Benz and Stellantis each accounted for 10%, of our 2023 net sales.
+Added: Through acquisitions and organic growth, we strive to diversify our customer base to be reflective of the evolving regional markets in which we operate.
We supply and have expertise in all vehicle segments of the automotive market.
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Our customers award business to their suppliers in a number of ways, including the award of complete systems, which allows suppliers either to manufacture components internally or to purchase components from other suppliers at their discretion.
−Removed: Certain of our customers also elect to award certain components directly to component suppliers and independent of
−Removed: the award of the complete system.
−Removed: We have been selectively expanding our component capabilities and investing in manufacturing capacity in low-cost regions in order to enhance our cost competitive structure and maximize our participation in such direct component sourcing by our customers.
+Added: Certain of our customers also elect to award certain components directly to component suppliers and independent of the award of the complete system.
+Added: We have selectively expanded certain of our product offerings and component capabilities and continue to invest in manufacturing capacity in low-cost regions to enhance our cost structure and increase our vertical integration opportunities and participation in our customers' direct component sourcing.
Our customers typically award contracts several years before actual production is scheduled to begin.
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In this process, we may be selected as the supplier on a new model, we may continue as the supplier on an updated model or we may lose the business on a new or updated model to a competitor.
−Removed: Our sales backlog reflects our estimated net sales over the next three years from formally awarded new programs, less lost and discontinued programs.
−Removed: This measure excludes the sales backlog at our non-consolidated joint ventures.
+Added: Our core sales backlog reflects our estimated net sales over the next three years from formally awarded new programs, less lost and discontinued programs.
+Added: This measure excludes the sales backlog at our non-consolidated joint ventures and the impact of the wind down of non-core products in our E-Systems business.
As of January 2024, our 2024 to 2026 sales backlog is $2.8 billion.
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The principal raw materials used in our seat systems, electrical distribution and connection systems, BDUs and other electronic products are generally available and obtained from multiple suppliers under various types of supply agreements.
−Removed: Components such as seat trim covers, surface materials such as leather and fabric, seat mechanisms, seat foam, thermal comfort solutions such as seat massage, lumbar, heat and ventilation products, headrests, connection systems and certain other components are either manufactured by us internally or purchased from multiple suppliers under various types of supply agreements (certain of which are sourced by our customers and certain of which are sourced by us).
+Added: Components such as seat trim covers, surface materials such as leather and fabric, seat mechanisms, seat foam, thermal comfort systems such as seat heating, ventilation, active cooling, pneumatic lumbar and massage products, headrests, connection systems and certain other components are either manufactured by us internally or purchased from multiple suppliers under various types of supply agreements (certain of which are sourced by our customers and certain of which are sourced by us).
The majority of the steel used in our products is comprised of fabricated components that are integrated into a seat system, such as seat frames, recliner mechanisms, seat tracks and other mechanical components.
−Removed: Therefore, our exposure to changes in steel prices is primarily indirect, through these
−Removed: purchased components.
+Added: Therefore, our exposure to changes in steel prices is primarily indirect, through these purchased components.
With the exception of certain connection systems, the materials that we use to manufacture wire harness assemblies are substantially purchased from suppliers, including extruded and insulated wire and cable.
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These laws, regulations and ordinances may impose liability for clean-up costs resulting from past spills, disposals or other releases of hazardous wastes.
−Removed: For a description of our outstanding environmental matters and other legal proceedings, see Note 14, "Commitments and Contingencies," to the consolidated financial statements included in this Report.
+Added: For a description of our outstanding environmental matters and other legal proceedings, see Note 14, "Legal and Other Contingencies," to the consolidated financial statements included in this Report.
In addition, our customers are subject to significant environmentally focused state, federal and foreign laws and regulations that regulate vehicle emissions, fuel economy and other matters related to the environmental impact of vehicles.
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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.