What changed in this filing

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Item 1A. Risk Factors

2026-02-13 compared with 2025-02-14 · 105 added, 75 removed, 194 unchanged (48% of the section changed)

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Risks Related to Our Business

• Our industry is cyclical and a decline in the production levels of our major customers, particularly with respect to models for which we are a significant supplier, or the financial distress of one or more of our major customers could adversely affect our financial performance.

• Our industry is cyclical and a decline or significant fluctuation in the production levels of our major customers, particularly with respect to models for which we are a significant supplier, or the financial distress of or operational disruptions to one or more of our major customers could adversely affect our financial performance.

Our sales are driven by the number of vehicles produced by our automotive manufacturer customers and our content per vehicle.

The automotive industry is cyclical and sensitive to general economic conditions, including interest rates, inflation, consumer demand and spending levels, and geopolitical issues.

Automotive sales and production can also be affected by the age of the vehicle fleet and related scrappage rates, labor relations issues, labor shortages, fuel prices, regulatory requirements, government initiatives and incentives, trade agreements, tariffs and other non-tariff trade barriers, the availability and cost of credit, the availability and cost of raw materials and critical components, and logistics issues, as well as vehicle affordability and consumer preferences regarding vehicle powertrains (including preferences regarding hybrid and electric vehicles), size, configuration and features, among other factors.

Our sales and production may be further affected by new entrants to the industry, including domestic automakers in certain regions and non-traditional automakers, and the restructuring actions, including facility closures, of our customers and suppliers.

An economic downturn or other adverse industry conditions that result in a decline in the production levels of our major customers, particularly with respect to models for which we are a significant supplier, or the financial distress of one or more of our major customers could reduce our sales or otherwise adversely affect our financial condition, operating results and cash flows.

Automotive sales and production can also be affected by the age of the vehicle fleet and related scrappage rates, labor relations issues, unforeseen operational disruptions, labor shortages, fuel prices, regulatory requirements, government initiatives and incentives, trade agreements, tariffs and other non-tariff trade barriers, the availability and cost of raw materials and critical components, logistics issues, cybersecurity incidents, and the availability and cost of credit, as well as vehicle affordability and consumer preferences regarding vehicle powertrains (including preferences regarding electric and hybrid vehicles), size, configuration and features, among other factors.

Our sales and production may be further affected by new entrants to the industry, as well as various automakers entering or expanding in certain regions, and the restructuring actions, including facility closures, of our customers.

Chinese domestic automakers, in particular, continue to expand their market share in China (through electric vehicles) and outside of China with both innovative designs and attractive pricing.

As a result, several traditional automakers have experienced declines in revenue and market share.

As these traditional automakers are among our largest customers, our business and financial results may be adversely affected by decreases in their businesses or market share.

An economic downturn or other adverse industry conditions that result in a decline or significant fluctuation in the production levels of our major customers, particularly with respect to models for which we are a significant supplier, or the financial distress of or operational disruptions to one or more of our major customers could reduce our sales, increase our costs or otherwise adversely affect our financial condition, operating results and cash flows.

Further, our ability to reduce the risks inherent in certain concentrations of business, and thereby maintain our financial performance in the future, will depend, in part, on our ability to continue to diversify our sales on a customer, product, platform and geographic basis to reflect the market overall.

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Raw material, energy, commodity, product component and labor costs can be volatile.

Although we have developed and implemented strategies to mitigate the impact of increases in such costs, these strategies, together with commercial negotiations with our customers and suppliers, do not typically offset all of the adverse impact.

Although we have developed and implemented strategies to mitigate the impact of any such cost increases, these strategies, together with commercial negotiations with our customers and suppliers and improved manufacturing productivity through automation and other advanced technologies, may not offset all of the adverse impact.

Certain of these strategies also may limit our opportunities in a declining price environment.

In addition, the availability of raw materials, energy, commodities, product components and labor fluctuates from time to time due to factors outside of our control, including regulatory requirements and restrictions, natural disasters and other supply chain disruptions, which may impact our ability to meet the production demands of our customers.

Increases in the costs of raw materials, energy, commodities, product

components and labor, or restrictions on the availability thereof, could adversely affect our financial condition, operating results and cash flows.

In addition, the availability of raw materials, energy, commodities, product components and labor fluctuates from time to time due to factors outside of our control, including governmental policies and regulations, natural disasters and other supply chain disruptions, which may impact our ability to meet the production demands of our customers.

Increases in the costs of raw materials, energy, commodities, product components and labor, or restrictions on the availability thereof, could adversely affect our financial condition, operating results and cash flows.

• Our failure to execute our strategic objectives could adversely affect our financial performance.

Our financial performance depends, in part, on our ability to successfully execute our strategic objectives.

Our strategy is based on four pillars designed to drive growth and profitability:

(1) extend our market leadership position in Seating with priceable features, including modularity and thermal comfort systems;

(2) expand margins in E-Systems through a focused portfolio that leverages our strong operating capabilities and customer relationships;

(3) build on our reputation for operational excellence through organic and inorganic investments, including partnerships, in automation and digital technologies;

and (4) prioritize our employee and sustainability initiatives that drive business growth, cost reductions and improved workforce retention.

Various factors, including the industry environment and the other matters described herein and in Part II — Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations," including "— Forward-Looking Statements," could adversely affect our ability to execute our strategic objectives.

risk factors include our failure to identify suitable opportunities for organic investment and/or acquisitions, our inability to successfully develop such opportunities or complete such acquisitions or our inability to successfully utilize or integrate the investments in our operations.

Our failure to execute our strategic objectives could adversely affect our financial condition, operating results and cash flows.

Moreover, there can be no assurances that, even if implemented, our strategic objectives will be successful.

• The lack of commercial success of or an increase in directed component sourcing for a vehicle model for which we are a significant supplier could adversely affect our financial performance.

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We also seek to enhance our financial performance by investing in product development, design capabilities and new product initiatives that respond to and anticipate the needs of our customers and consumers.

We continually evaluate operational and strategic alternatives to improve our business structure and align our business with the changing needs of our customers and major industry trends affecting our business.

We continually evaluate operational and strategic alternatives and enhancements, including in the areas of digitization, automation and the use of artificial intelligence ("AI"), to improve our business structure and align our business with the changing needs of our customers and major industry trends affecting our business.

Our inability to achieve product cost reductions that offset customer-imposed price reductions could adversely affect our financial condition, operating results and cash flows.

• International trade policies, including protectionist trade policies, such as tariffs and sanctions, could adversely affect our financial performance.

• International trade policies, such as tariffs, sanctions, export controls and other trade restrictions, could adversely affect our financial performance.

Due to the interconnectedness of the global economy, policy changes in one area of the world can have an immediate and material adverse impact on markets around the world.

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(ii) greater restrictions on free trade generally;

and (iii) significant increases in customs duties and tariffs on goods imported into the United States and reciprocal actions by other countries, can adversely affect our financial condition and operating results.

On February 1, 2025, President Trump announced the imposition of new tariffs on imports from Mexico, Canada and China, to take effect on February 4, 2025.

On February 3, 2025, President Trump announced that the tariffs imposed on imports from Mexico and Canada would be paused for thirty days.

The impact of these potential tariffs on our business and financial condition, if any, is subject to a number of factors that are not yet known, including the effective date and duration of such tariffs, the scope and nature of any tariffs, the amount of any tariffs, any countermeasures that the target countries may take in response to such tariffs.

In light of these uncertainties, we can provide no assurance that any mitigating actions that may become available to us, such as our ability to pass along some or all of the costs of any tariffs to some or all of our customers, will be successful.

In addition to potential increases in customs duties and tariffs in the United States and other countries, the United States-Mexico-Canada Agreement ("USMCA") is subject to renewal in 2026.

There can be no assurance that any newly negotiated terms in the USMCA will not adversely affect our business.

and (iii) significant increases in customs duties and tariffs imposed by any country, including those already imposed by the United States and retaliatory and other actions by other countries, can adversely affect our financial condition and operating results.

Since his inauguration in January 2025, U.S.

President Donald J.

Trump has announced various tariffs that impact industries around the world, including the automotive industry.

As of the date of this Report, many of the tariffs announced, implemented or threatened by the current U.S.

administration apply to (a) the countries in which we do business or from which we purchase, either directly or indirectly, materials or components, including China, Mexico and Canada, and (b) the materials or components that we purchase, either directly or indirectly, or produce, including steel, aluminum and automobile parts, among others, and therefore could adversely impact our business by increasing our operating costs, requiring us to incur significant costs to transition to alternative suppliers if our mitigation efforts are unsuccessful, or negatively impacting our customers' production.

In addition to tariffs, the U.S.

and foreign governments have implemented sanctions, export controls and other trade restrictions that impact industries around the world, including the automotive industry.

The policies relating to these tariffs continue to evolve, including with respect to the type of tariff or export control, the tariff rates, the countries, components and materials to which such tariffs apply, and the existence and applicability of any exemptions.

The actual impacts of tariffs and other trade restrictions on our business, financial condition and results of operations continue to be subject to a number of factors that are not yet known or are subject to change, including the effect such tariffs and restrictions may have on consumer demand and global automotive production volumes, the duration of such tariffs and restrictions, future changes in the amounts and scope of tariffs, the potential withdrawal of such tariffs and restrictions in whole or in part, the scope and effective date of any exemptions to such tariffs or restrictions, any modification to existing exemptions to such tariffs or restrictions, countermeasures that target countries may take in

response to such tariffs and restrictions, the impact such tariffs and restrictions may have on our customers and our supply chain, and whether and to what extent such tariffs are impacted by judicial review.

We have entered into contractual agreements with our customers to recover substantially all tariff costs incurred to date and have implemented certain actions, and continue to consider others, to counter the potential impact of such tariffs on our business, financial condition and results of operations, including, without limitation, participating in efforts to inform the U.S.

and certain foreign administrations and legislatures of the impact of current trade and tariff policies on the automotive industry and evaluating our production footprint and alternatives in our supply chain.

To date, our mitigation efforts have been successful, but we cannot provide any assurance that future government actions will not adversely impact our customers' production or undermine our mitigation efforts, which could in turn adversely impact our business, financial condition and results of operations.

In addition to potential increases in customs duties and tariffs in the United States and other countries, the United States-Mexico-Canada Agreement ("USMCA") is subject to trilateral review and renewal in 2026.

There can be no assurances that the USMCA will be renewed or, if renewed, any newly negotiated terms in the USMCA will not adversely affect our business.

Also, China presents unique risks to U.S.

automotive manufacturers due to the strain in U.S.-China relations and the level of integration with key components in our global supply chain.

It remains unclear what specific actions the current U.S.

administration may take to resolve trade-related issues with China and other countries.

It remains unclear what additional actions the current U.S.

administration may take with respect to trade issues involving China and other countries.

Further, the U.S.

and other governments could impose additional sanctions or export controls that could restrict us from doing business directly or indirectly in or with certain countries or parties, which could include affiliates.

and other governments could impose additional sanctions, export controls or other trade restrictions that could restrict us from doing business directly or indirectly in or with certain countries or parties, which could include affiliates (e.g., China has imposed tariffs and taken other retaliatory actions).

The current trade environment could impact the status of other trade agreements between the United States and countries other than Canada and Mexico, including, without limitation, the Dominican Republic-Central America-United States Free Trade Agreement.

Any of the above factors could impact our supply chain, as well as our operations, and adversely affect our financial condition and operating results.

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In certain instances, entire industries may experience short-term capacity constraints.

Additionally, our production capacity and costs, and that of our customers and suppliers, may be adversely affected by force majeure events, such as natural disasters, as well as tariffs, sanctions or other significant events.

Additionally, our production capacity and costs, and those of our customers and suppliers, may be adversely affected by force majeure events, such as natural disasters, as well as tariffs, sanctions or other significant events.

Any such significant event could adversely affect our financial performance.

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In the United States and Canada, each of our unionized facilities has a separate collective bargaining agreement with the union that represents the workers at such facility, with each such agreement having an expiration date that is independent of the other agreements.

Labor agreements covering approximately 84% of our global unionized work force, including labor agreements in the United States and Canada covering approximately 5% of our global unionized workforce, are scheduled to expire in 2025.

Labor agreements covering approximately 67% of our global unionized work force are scheduled to expire in 2026.

There can be no assurances that these upcoming negotiations or any other future negotiations with the unions will be resolved favorably or that we will not experience a work stoppage or disruption that could adversely affect our financial condition, operating results and cash flows.

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– exposure to local economic conditions;

– political, economic and civil instability and uncertainty (including acts of terrorism, civil unrest, drug cartel-related and other forms of violence, and outbreaks of war);

– labor scarcity and unrest;

– political, economic and civil instability and uncertainty (including acts of terrorism, civil unrest, drug cartel-related and other forms of violence);

– international disputes, including war, military conflict, security or law enforcement operations, and geopolitical unrest, including due to threatened uses of force;

– labor scarcity, labor unrest and governmental regulations impacting labor supply;

– expropriation, governmental takeover and nationalization;

– currency exchange rate fluctuations, currency controls and the ability to economically hedge currencies;

– currency exchange rate fluctuations, discrepancies in commodity pricing between different exchanges, currency controls and the ability to economically hedge currencies;

– withholding and other taxes on remittances and other payments by subsidiaries;

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– repatriation restrictions or requirements;

– trade wars, tariffs or sanctions;

– trade wars, tariffs, sanctions, export controls or other trade restrictions;

– concerns about human rights, working conditions and other labor rights and conditions and the environmental impact in foreign countries where our products are produced and raw materials and/or components are sourced, as well as changing labor, environmental and other laws in these countries;

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– global sovereign fiscal matters and creditworthiness, including potential defaults and the related impacts on economic activity, including the possible effects on credit markets, currency values, monetary unions, international treaties and fiscal policies.

Expanding our sales and operations in lower-cost regions are important elements of our strategy.

Expanding our sales and operations in lower-cost regions is an important element of our strategy.

As a result, our exposure to the risks described above is substantial.

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Operating a joint venture requires us to operate the business pursuant to the terms of the agreement that we entered into with our partners, which may require additional organizational formalities, as well as the sharing of information and decision making.

Additional risks associated with joint ventures include one or more partners failing to satisfy contractual obligations, the ability to enforce such obligations, conflicts arising between us and any of our partners, a change in the ownership of any of our partners and less of an ability to control compliance with applicable rules and regulations, including the Foreign Corrupt Practices Act and related rules and regulations.

Additional risks associated with joint ventures include one or more partners failing to

satisfy contractual obligations, the ability to enforce such obligations, conflicts arising between us and any of our partners, a change in the ownership of any of our partners and less of an ability to control compliance with applicable rules and regulations, including the Foreign Corrupt Practices Act and similar or related rules and regulations.

Additionally, our ability to sell our interest in a joint venture may be subject to contractual and other limitations.

Accordingly, any such occurrences could adversely affect our financial condition, operating results and cash flows.

• Our failure to execute our strategic objectives could adversely affect our financial performance.

Our financial performance depends, in part, on our ability to successfully execute our strategic objectives.

Our strategy is based on four pillars designed to drive growth and profitability:

(1) extend our market leadership position in Seating with priceable features, including modularity and thermal comfort systems;

(2) transform our E-Systems business through accelerated growth in connection systems and vehicle architecture evolution and electrification;

(3) build on our reputation for operational excellence through organic and inorganic investments in automation and digital technologies;

and (4) prioritize people and the planet through our sustainability initiatives to drive business growth, cost reductions and improved employee retention.

These risk factors include our failure to identify suitable opportunities for organic investment and/or acquisitions, our inability to successfully develop such opportunities or complete such acquisitions or our inability to successfully utilize or integrate the investments in our operations.

Our failure to execute our strategic objectives could adversely affect our financial condition, operating results and cash flows.

Moreover, there can be no assurances that, even if implemented, our strategic objectives will be successful.

• Our inability to effectively manage the timing, quality and costs of new program launches could adversely affect our financial performance.

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In addition, new program launches require a significant ramp up of costs;

however, our sales related to

these new programs generally are dependent upon the timing and success of our customers' introduction of new vehicles.

Customer decisions on program launch timing may be impacted by industry conditions, government regulations and consumer preferences, and therefore, the timing of such launches may also be subject to change.

however, our sales related to these new programs generally are dependent upon the timing and success of our customers' introduction of new vehicles.

Customer decisions on program launch timing may be impacted by various factors, including industry conditions, government regulations and consumer preferences, and therefore, the timing of such launches may also be subject to change.

Our inability to effectively anticipate and manage the timing, quality and costs of these new program launches could adversely affect our financial condition, operating results and cash flows.

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Our competitors' efforts to grow market share could exert downward pressure on our product pricing and margins.

In addition, the automotive industry has attracted, and will continue to attract, new entrants, including domestic automakers in certain regions and non-traditional automakers as a result of the evolving nature of the automotive vehicle market, including the increasing adoption of hybrid and electric vehicles.

Further, the global automotive industry is experiencing a period of significant technological change, including a focus on electrification and digitization.

If we are unable to differentiate our products, maintain a low-cost footprint or compete effectively to win business with new domestic automakers and other new entrants, we may lose market share or be forced to reduce prices, thereby lowering our margins.

In addition, the automotive industry has attracted, and will continue to attract, new entrants as a result of the evolving nature of the automotive vehicle market, including the increasing adoption of electric and hybrid vehicles.

Certain of these automakers and suppliers are also expanding their operations into regions in which they previously did not have a presence.

Traditional automakers are experiencing increased competitive pressures as Chinese domestic automakers continue to expand their market share both in and beyond China.

Chinese domestic suppliers that may have lower financial return expectations are also challenging traditional automotive suppliers for market share.

Further, the global automotive industry is experiencing a period of significant technological change, including in the areas of electrification and digitization.

If we are unable to differentiate our products, maintain a low-cost footprint or compete effectively to win business with newer/emerging automakers, we may lose market share or be forced to reduce prices, thereby lowering our margins.

Any such occurrences could adversely affect our financial condition, operating results and cash flows.

• If we do not respond appropriately, the evolution of the global transportation industry toward electrification could adversely affect our business.

The global transportation industry is increasingly focused on the development of more fuel-efficient solutions to meet demands from consumers and governments worldwide to address climate change and an increased desire for environmentally sustainable solutions.

The impacts of these changes on us are uncertain and could ultimately prove dramatic.

If we do not respond appropriately, the evolution toward electrification and other energy sources, including the timing of such evolution, could adversely affect our business.

The increased adoption of hybrid and fully electrified powertrains may result in lower demand for some of our products.

The evolution of the industry toward electrification has also attracted increased competition from new entrants to the light vehicle industry.

Failure to innovate and to develop or acquire new and compelling products that capitalize upon new technologies in response to evolving consumer preferences and customer landscape could adversely affect our financial condition, operating results and cash flows.

Over the past decade, the global transportation industry has increasingly focused on the development of electric and hybrid vehicles.

As a result, we and our customers have made, and in some cases continue to make, significant investments in electric and hybrid vehicle programs and related infrastructure and technology.

The adoption of such vehicles, particularly electric vehicles, has been slower than anticipated, particularly in the United States, as a result of, among other things, changes in government carbon emissions regulations and tax incentives, as well as prevailing consumer preferences.

This has resulted in, among other things, various volume decreases related to, and cancellations of, vehicle programs for which we are a supplier, as well as general uncertainty about the overall rate of transition to electric and hybrid vehicles in certain regions.

Our inability, or that of our customers, to respond to these evolving circumstances could adversely affect our financial condition, operating results and cash flows.

• Our increasing use of AI and other emerging technologies may expose us to operational, legal and regulatory risks that could adversely affect our business and reputation.

Our use of AI and machine learning presents risks that could adversely affect our business, financial condition and results of operations.

We currently incorporate AI-powered tools into certain internal business operations, such as in our production processes and in certain of our administrative functions.

AI algorithms may be flawed, and datasets may be insufficient, inaccurate, biased or otherwise problematic.

The rapid evolution and increased adoption of AI technologies may increase the risk of technical disruptions to our operations and the processes and functions for which the technology is deployed.

The use of AI tools also raises risks related to privacy and inadvertent disclosure of sensitive information.

systems may access, process or expose personal, confidential or proprietary data in ways that we do not intend or anticipate.

Constraints in hardware (such as GPU availability), power capacity or other supply chain elements may further limit our ability to scale AI responsibly.

We also face competitive risk if other companies develop or adopt AI capabilities more effectively, at lower cost or more rapidly than we do.

Because our AI capabilities currently depend in part on third-party providers of models, cloud services and infrastructure, changes in their performance, pricing, licensing terms or availability could materially increase our costs.

Collectively, these risks could adversely affect our financial condition, operating results, cash flows and reputation.

• A disruption in our information technology systems, or those of our customers, suppliers, sub-suppliers or other contract parties, including a disruption related to cybersecurity, and other cybersecurity risks, such as a security incident resulting in unauthorized access to or theft of personal or other sensitive information, could adversely affect our financial performance.

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These types of incidents have become more prevalent and pervasive across industries, including our industry, and are expected to continue, if not increase, in the future.

In particular, ransomware or other attacks that are intended to disrupt our business operations are becoming increasingly prevalent, particularly for manufacturing companies, and can lead to significant interruptions in operations and the ability to provide products or services, loss of sensitive data and income, reputational harm and diversion of funds.

In particular, ransomware or other attacks that are intended to disrupt our and our customers' business operations are becoming increasingly prevalent, particularly for manufacturing companies, and can lead to significant interruptions in operations and the ability to provide products or services, loss of sensitive data and income, reputational harm and diversion of funds.

Extortion payments may alleviate the negative impact of a disruptive event, but we may be unwilling or unable to make such payments due to, for example, applicable laws or regulations prohibiting such payments.

Additionally, in 2025, a cybersecurity incident affecting one of our major customers disrupted its production systems, which in turn reduced demand for our components and impacted our operating results.

Similar attacks on our customers, suppliers or other third parties in our supply chain could likewise adversely affect our financial performance.

We are incorporated into the supply chain of a large number of companies globally.

As a result, if our products or services are compromised, unavailable or unable to be manufactured or delivered, a significant number or, in some instances, all of our customers' operations and their data could be simultaneously affected.

Our contracts with customers and others may not contain limitations of liability, and even where they do, there can be no assurance that limitations of liability in our contracts are sufficient to protect us from liabilities, damages or claims related to our security obligations.

The potential

liability and associated consequences we could suffer as a result of such a large-scale event impacting multiple customers could be catastrophic and result in irreparable harm.

Our contracts with customers and others may not contain limitations of liability, and even where they do, there can be no assurances that limitations of liability in our contracts are sufficient to protect us from liabilities, damages or claims related to our security obligations.

The potential liability and associated consequences we could suffer as a result of such a large-scale event impacting multiple customers could be catastrophic and result in irreparable harm.

The secure operation of our information technology networks, and the processing and maintenance of information by these networks, is critical to our operations and strategy.

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Our efforts to do so may not be successful.

Actions taken by us or the third parties with whom we work to detect, investigate, mitigate, contain and remediate a security incident could result in outages, data losses and disruptions of our business.

taken by us or the third parties with whom we work to detect, investigate, mitigate, contain and remediate a security incident could result in outages, data losses and disruptions of our business.

In addition, the information technology systems and software that we and our vendors use are vulnerable to outages, breakdowns, software vulnerabilities, coding errors and other damage from service interruptions, system malfunctions, natural disasters, terrorism, war, and telecommunication and electrical failures.

For example, our business operations suffered temporary interruptions and impacts from the global CrowdStrike Holdings, Inc.

event in July 2024.

To the extent that our business is interrupted, including the vehicle systems and components that we supply to our customers or our plant operations, or data is lost, destroyed or inappropriately accessed, used or disclosed, such disruptions could adversely affect our competitive position, operating capacity, ability to provide our goods and services, relationships with our customers, financial condition, operating results and cash flows and/or subject us to regulatory actions, including those contemplated by data privacy laws and regulations such as European Union General Data Privacy Regulation, China Cyber Security Laws including the China Personal Information Protection Law, India's Information Technology Act and supplementary rules, and the California Consumer Privacy Act, or litigation.

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and (5) an impaired ability to access credit and capital markets.

public health crises, could adversely affect our business, financial condition, operating results and cash flows going forward.

Any future public health crises could adversely affect our business, financial condition, operating results and cash flows going forward.

• Perspectives on global climate change and other sustainability matters by various stakeholders could adversely affect our business.

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We regularly monitor our goodwill and long-lived assets for impairment indicators.

In conducting our goodwill impairment testing, we may first perform a qualitative assessment of whether it is more likely than not that a reporting unit's fair value is less than its carrying amount.

In conducting our goodwill impairment testing, we may first perform a qualitative assessment of whether it is more likely than not that a reporting unit's fair value

is less than its carrying amount.

If not, no further goodwill impairment testing is required.

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In conducting our impairment analysis of long-lived assets, we compare the undiscounted cash flows expected to be generated from the long-lived assets to the related net book values.

If the net book value exceeds the undiscounted cash flows, an impairment loss is measured and recognized.

An impairment loss is measured as the difference between the net book value and the fair value of the long-lived assets.

Changes in economic or operating conditions impacting our estimates and assumptions could result in the impairment of our goodwill or long-lived assets.

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We are also subject to ongoing tax audits globally.

These audits can involve complex issues, which may require an extended period of time to resolve and can be

highly judgmental.

These audits can involve complex issues, which may require an extended period of time to resolve and can be highly judgmental.

Tax authorities may disagree with certain of our tax reporting positions and, as a result, assess additional taxes against us.

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The amounts ultimately paid upon resolution of current and future tax audits could be materially different from the amounts previously included in our income tax provision and, therefore, could have a material impact on our income tax provision.

The Organization for Economic Cooperation and Development ("OECD") issued new guidelines, known as "Pillar Two," to implement a 15% global corporate minimum tax to address gaps in current tax laws and ensure that large multinational enterprises pay a minimum level of tax in the countries in which they operate.

The Organization for Economic Cooperation and Development ("OECD") issued guidelines on the Global Anti-Base Erosion Model Rules, known as "Pillar Two," to implement a 15% global corporate minimum tax to address gaps in current tax laws and ensure that large multinational enterprises pay a minimum level of tax in the countries in which they operate.

Countries may implement the OECD Pillar Two model rules as issued, in a modified form or not at all.

A number of countries have passed legislation enacting certain parts of the OECD's Pillar Two framework effective in 2024.

As a result of the uncertainty, OECD Pillar Two could have a material impact on our effective tax rate and result in higher cash tax liabilities depending on which countries enact minimum tax legislation and in what manner.

On January 5, 2026, the OECD released new guidelines introducing the side-by-side system as part of the Pillar Two Global Minimum Tax framework.

This system is intended to coordinate the application of Pillar Two rules in jurisdictions that already operate minimum tax regimes.

Under the OECD's guidelines, the United States is treated as a qualifying jurisdiction, allowing U.S.-parented multinational enterprises ("MNEs") to opt out of the global Pillar Two income inclusion rule and undertaxed profits rule beginning January 1, 2026.

The adoption of the side-by-side system reduces uncertainty regarding the impact of the Pillar Two Global Minimum Tax on U.S.-parented MNEs.

While many countries have not yet enacted Pillar Two legislation, it is not expected to have a material impact on the Company's consolidated financial statements.

Risks Related to Our Indebtedness

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• A significant product liability lawsuit, warranty claim or product recall involving us or one of our major customers could adversely affect our financial performance.

In the event that our products fail to perform as expected, regardless of fault, and such failure results in, or is alleged to result in, bodily injury and/or property damage or other losses, we may be subject to product liability lawsuits and other claims.

In the event that our products fail to, or are alleged to fail to, perform as expected, regardless of fault, and such failure or alleged failure results in, or is alleged to result in, bodily injury and/or property damage or other losses, we may be subject to product liability lawsuits and other claims.

Our customers may also pursue claims against us for contribution of all or a portion of the amounts sought in connection with product liability, warranty and recall claims related to our products.

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We are involved in various legal and regulatory proceedings and claims that, from time to time, are significant.

These are typically claims that arise in the normal course of business, including, without limitation, commercial or contractual disputes, including disputes with our customers, suppliers or competitors, intellectual property matters, personal injury claims, environmental matters, tax matters, employment matters and antitrust matters.

These claims typically arise in the normal course of business, including, without limitation, commercial or contractual disputes, including disputes with our customers, suppliers or competitors, intellectual property matters, personal injury claims, environmental matters, tax matters, employment matters and antitrust matters.

No assurances can be given that such proceedings and claims will not adversely affect our financial condition, operating results and cash flows.

• The continuing focus on human rights and environmental laws and regulations, as well as related customer requirements, globally could cause us to incur significant costs.

• The continuing focus on human rights and environmental laws and regulations globally, as well as related customer requirements, could cause us to incur significant costs.

Concerns over human rights, environmental pollution and climate change have produced significant legislative and regulatory efforts globally.

In addition, our customers have imposed various requirements on their suppliers, including us, in response to these concerns.

We expect that these regulatory and customer requirements will continue to increase in number and breadth of scope for the foreseeable future, thereby affecting our business.

Complying with these requirements will likely require us to incur costs, make investments in new innovations, change product and production processes and/or modify product supply chains, certain of which actions could be significant.

Significant challenges may exist to comply with new legislative efforts around supply chain transparency due to the inherent complexity of global automotive supply

These regulatory and customer requirements may continue to increase in number and breadth of scope going forward.

Complying with these requirements may require us to, among other things, make investments in new innovations, change product and production processes and/or modify product supply chains, certain of which actions could be significant.

Significant challenges may exist to comply with new legislative efforts and increasing customer requirements around supply chain transparency due to the inherent complexity of global automotive supply chains.

If we fail to comply with these requirements, we could be subject to lost business opportunities and/or future liabilities, which could adversely affect our reputation, business, financial condition, operating results and cash flows.

• New laws or regulations or changes in existing laws or regulations could adversely affect our financial performance.

We and the automotive industry are subject to a variety of federal, state, local and foreign laws and regulations, including those related to health, safety and, increasingly, sustainability matters.

Governmental regulations also affect taxes and levies, capital markets, healthcare costs, energy usage, data privacy, international trade, including tariffs and sanctions, human rights, immigration and other labor issues (including labor costs), all of which may have a direct or indirect effect on our business and the businesses of our customers and suppliers.

We and the automotive industry are subject to a variety of federal, state, local and foreign laws and regulations, including those related to health, safety and sustainability matters.

Governmental regulations also affect taxes and levies, capital markets, healthcare costs, energy usage, data privacy, international trade, including tariffs and sanctions, human rights, and employment and labor issues, all of which may have a direct or indirect effect on our business and the businesses of our customers and suppliers.

We cannot predict the substance or impact of pending or future legislation or regulations, or the application thereof.

The introduction of new laws or regulations or changes in existing laws or regulations, including those in connection with the new U.S.

administration, or the interpretation thereof, could increase the costs of doing business for us or our customers or suppliers or restrict our actions and adversely affect our financial condition, operating results and cash flows.

The introduction of new laws or regulations or changes in existing laws or regulations, or the interpretation thereof, could increase the costs of doing business for us or our customers or suppliers or restrict our actions and adversely affect our financial condition, operating results and cash flows.

• We may incur fines or penalties, damage to our reputation or other adverse consequences if our employees, suppliers, sub-suppliers or other contract parties, agents or business partners violate anti-bribery, competition, export and import, trade sanctions, data privacy, environmental, human rights or other laws.

8 unchanged sentences

• We are required to comply with environmental laws and regulations that could cause us to incur significant costs.

Our manufacturing facilities are subject to numerous laws and regulations designed to protect the environment, and we expect that additional requirements with respect to environmental matters will be imposed on us and our customers in the future.

Our manufacturing facilities are subject to numerous laws and regulations designed to protect the environment, and additional requirements with respect to environmental matters may continue to be imposed on us and our customers in the future.

Material future expenditures may be necessary if compliance standards change or material unknown conditions that require remediation are discovered.

9 unchanged sentences

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.

What changed 10-K

Item 1A. Risk Factors