Aptiv PLC (APTV) 2017 Q4 法說會逐字稿

Good morning. My name is Jamie, and I will be your conference facilitator. At this time, I would like to welcome everyone to the Aptiv Q4 2017 Earnings Conference Call. (Operator Instructions)

I would now like to turn the call over to Elena Rosman, Vice President of Investor Relations at Aptiv. Elena, you may now begin your conference.

Thank you. Good morning, Jamie, and thank you everyone for joining Aptiv's Fourth Quarter 2017 Earnings Conference Call. To follow along with today's presentation, our slides can be found at ir.aptiv.com.

And consistent with prior calls, today's review of our actual and forecasted financials excludes restructuring and other special items and will address the continuing operations of Aptiv. The reconciliation between GAAP and non-GAAP measures is included in the back of today's presentation and the press release. And in addition, the appendix also includes a number of supplemental tables, which provides the historical financials for Aptiv. Please see Slide 2 for a disclosure on forward-looking statements, which reflects Aptiv's current view of future financial performance, which may be materially different from our actual performance for reasons that we cite in our Form 10-K and other SEC filings.

Joining us today will be Kevin Clark, Aptiv's President and CEO; and Joe Massaro, CFO and Senior Vice President. As seen on Slide 3, Kevin will provide a strategic update for the business, and then Joe will cover the financial results and our outlook for 2018 in more detail.

With that, I'd like to turn the call over to Kevin Clark.

Great. Thank you, Elena. Good morning, everyone. Thanks for joining us. This is our first quarterly earnings call as Aptiv, and I'm excited to report a very strong finish to 2017. Highlights for the year included: We exceeded our financial commitments. 2017 revenue, operating profit and earnings per share all finished above the guidance we provided at our Investor Day. We completed the spin-off of Delphi Technologies ahead of schedule and received strong customer endorsement of our more focused portfolio of advanced technologies, reflected by the record bookings of $19.3 billion.

We made significant progress positioning the company for the future through the acquisitions of Movimento and nuTonomy, organic and inorganic investments and the expansion of our automated driving pilots around the globe. In summary, our 2017 performance reflected very strong execution by the entire team. Let's dive a little deeper on a number of the key milestones on Slide 4.

2017 marked another year of successfully executing our strategy. We continued to strengthen our operating capabilities, which translated into accelerated revenue and earnings growth and exceeding our commitments to shareholders. Sales increased 5%. That's 4 points over market. Operating income increased 7%, excluding investments in mobility and services.

We acquired Movimento and nuTonomy and made organic investments in our mobility and services businesses that strengthened our competitive position. In addition, minority investments in otonomo, Valens, LeddarTech and Innoviz enhanced our technology portfolio and helped to unlock new commercial opportunities. This past year's success is in large part a result of the strong foundation that we've built, with leadership positions in fast-growing technology areas, including active safety, where bookings totaled $3.7 billion. That's 2.5x greater than 2016 bookings of $1.4 billion, supporting greater than 40% forecasted revenue growth in the years to come.

2017 active safety revenues actually increased 66% to $600 million. Infotainment and user experience bookings totaled $1.5 billion, reflecting the timing of lumpy customer awards. And revenues increased 15%, reaching $1.6 billion. Our strong backlog of infotainment and user experience awards, totaling over $6.5 billion over the last 3 years, gives us confidence that the pace of revenue growth will continue at roughly 15% over the next several years.

High voltage electrification bookings increased 12%, totaling $1.4 billion, and 2017 revenues increased 50% to roughly $300 million and are expected to nearly double in 2018 to over $550 million.

In summary, our strong 2017 operating and financial performance gives us further confidence in our outlook for 2018 and beyond. The core competencies that are necessary to succeed today are the building blocks required to solve mobility's toughest challenges in the future, and we believe we have all the necessary competencies.

Turning to Slide 5. As I mentioned, Aptiv is built on a strong foundation of consistently delivering automotive-grade advanced technologies. As the vehicle has increasingly become a software-defined platform, we've adapted our portfolio of technologies and capabilities to meet the demand for more complex software development and systems integration expertise. And as a result, Aptiv is uniquely positioned to provide the end-to-end solutions required to commercialize in mobility.

We have over 6,000 engineers focused on software development, shipping over 40 billion lines of code daily, increasing to over 150 billion lines of code in 2020. Vehicles need more computing power than ever before to enable advanced vehicle features, including increased levels of active safety and connectivity. And this increased need for high-speed computing platforms sits right in our sweet spot, allowing Aptiv to leverage the signal and power solutions that enable more connected vehicle content.

Managing complexity and optimizing vehicle architecture to increase efficiency and maximize performance is where we integrate systems and we enable new mobility. And lastly, vehicle connectivity and data are driving a significant change in the automotive industry. And Aptiv solutions combine edge computing, over-the-air analytics, cyber security and a data marketplace to fully integrate a vehicle into the ecosystem, unlocking the cost reduction opportunities and new revenue models for both our customers and for Aptiv.

All of this requires tremendous execution capabilities, and this is where we excel. Aptiv is uniquely positioned as the bridge connecting our customers to more advanced technologies. Coupled with our systems integration expertise, we're making the future of mobility real.

Turning to the next slide. Just as we rebranded the company under Aptiv, a name that represents our knowledge, adaptiveness and drive, we've chosen new segment names that better reflect our capabilities and the role each has to play in the future of mobility. These new segment names do not change the overall operating or financial composition of the segments themselves.

Starting with Advanced Safety and User Experience on the left, formerly Electronics and Safety. We sometimes refer to the technologies and solutions in this segment as the brain of the vehicle. We're focusing our deep systems expertise in software and central compute platforms to deliver advanced safety, user experience and automated driving systems, enabling more connected content in the vehicle. This segment includes our active safety, infotainment and user experience, [body] and security and connected services product lines.

Going forward, the mobility and services group, which is being led by Glen De Vos, includes our automated driver software businesses, Ottomatika and nuTonomy as well as our data services businesses, Control-Tec and Movimento.

Moving to the right side of the chart to Signal and Power Solutions, formerly Electrical and Electronic Architecture. We sometimes refer to the technologies and solutions in this segment as the nervous system of the vehicle. This segment's solutions reflect the increasing significance of next-gen architectures, requiring high-speed data and high-power electrical distribution to enable the necessary technologies for the future of mobility.

This segment continues to include our electrical distribution business, along with our engineered components business, which includes connectors and cable management products, and has approximately $1 billion of nonautomotive-related revenues.

Again, no change in the composition at the segment level. However, as Aptiv has evolved, the rebranding of our segments more accurately reflect the role each plays in solving mobility's toughest challenges.

Moving to Slide 7. We've amassed some of the most experienced engineering talent in the world. And as a result, we sit at the forefront of new opportunities to enable and monetize future mobility.

Starting with automated driving. As we look forward, we have a significant opportunity to monetize our system and technology capabilities, providing mobility players with an advanced Level 4, Level 5 system like those we're currently operating in every major region of the world. The development work we're doing with several customers in smart cities will result in more than 150 cars on the road by the end of this year, accumulating almost 2 million miles of experience. And the work we're doing today on Level 4 and Level 5 systems for mobility providers is gaining leverage into Level 2 and Level 3 solutions for our traditional OEM customers. And that fact's reflected in the $3.7 billion of active safety bookings last year.

Further, we've made significant progress in the connected services market with our acquisitions of Control-Tec and Movimento. And by deploying connectivity solutions in all our relative products by 2020, we see significant data monetization opportunities ahead, as the capability to get the right data, effectively analyze it and translate that data into valuable information for our customers increases.

Joe will cover in more detail how we're funding a portion of these investments through ongoing productivity gains in our base business. And as I mentioned, our advanced technology development work continues to drive new conquest wins today as we help solve some of our customers' biggest challenges.

Turning to Slide 8. In 2017, Aptiv booked a record $19.3 billion of new business awards, reflecting $7 billion of bookings in the fourth quarter. And you can see on the right side of the chart, we had significant wins in each business and region, including a conquest infotainment award with a Chinese multinational customer; a conquest active safety award with an OEM alliance, another example of a high-volume customer award enhancing our overall market position; a high-voltage mobile charger award from a leading North American electric vehicle manufacturer; and an architectural award for BYD's high-volume SUV platform in China. Together, these wins reinforce Aptiv's leadership position in enabling next-generation vehicle features and functionality and is further evidenced by our strategic wins with BMW in the quarter, highlighted on Slide 9.

Building on our strategic relationship as well as the automated driving partnership formed last year, the teams have been working closely to enhance BMW's functionality, leveraging Aptiv's lean portfolio of advanced safety and user experience technologies. As a result, BMW selected our next-gen radar and high-end vision sensor suite, powered by our ADAS multi-domain controller, the most advanced centralized supercompute platform in production. In addition, we were selected to provide our patented multilayer display technology, which we acquired with the PureDepth acquisition just 2 years ago, becoming the industry's first high-definition reconfigurable 3D display in production, transforming the overall in-vehicle experience. These technologies were on display at CES and, as evidenced here, are in high demand.

Moving to Slide 10. This was our absolute best year at CES yet. As the only company offering automated rides on the streets of Las Vegas to the general public, we conducted over 400 rides, leveraging the Lyft mobility-on-demand network, marking our first real-life application of technology that we've been demonstrating at CES for several years.

Feedback was overwhelmingly positive as we operated 99% of the time in autonomous mode, while the general public rated the experience a near-perfect score. Customer and government interest reflected a meaningful shift in tone and pace of technology deployment. Conversations with customers underscored the importance of an integrated and an optimized approach to vehicle architecture, consistent with what I talked about earlier. These same conversations reinforce the increasing importance of the fully connected user experience in a more automated vehicle, underscoring the fact that in addition to the development of the automated driving software staff, that an integrated and optimized architecture and enhanced user experience are critical to the successful commercialization of Level 4 and Level 5 automated vehicles. And we positioned Aptiv as the only end-to-end system provider of the integrated brain and nervous system.

So with that, I'll now turn it over to Joe to walk you through the financials and our outlook for 2018, before summarizing at the end and opening it up for Q&A. Joe?

Great. Thanks, Kevin. Good morning, everyone. Starting with a recap of the full year financials on Slide 11. Results were ahead of the guidance we provided at Investor Day, with revenue of $12.9 billion, up 5%. With less than 1% market growth, we delivered on our commitment of mid-single-digit growth above market.

Operating income was $1.6 billion, with operating margins of 12.4%, consistent with what we shared with you at our September Investor Day when you take into account the lower flow-through from a stronger euro in the quarter.

Earnings per share of $4.64 were up over 10%, and operating cash flow of $1.1 billion, which included the $310 million Unsecured Creditors settlement and approximately $80 million of spin-related costs. Excluding these items, operating cash flow grew faster than operating income, primarily driven by improvements in working capital.

Turning to Slide 12. The fourth quarter was incredibly busy as we successfully executed the spin of the Powertrain segment, had near-record launch activity and new bookings and delivered ahead of expectations on revenue and operating income. Aptiv revenues of $3.4 billion, up 4%, were above our implied outlook as favorable FX and stronger growth in Europe and China more than offset North American passenger car weakness, which was down 17% in the quarter. And underlying global vehicle production was up by 0.5%, slightly better than expected.

We had good volume growth year-over-year, driven by double-digit gains in Advanced Safety and User Experience despite the unusually strong fourth quarter in China in 2016.

Slide 13 walks our operating income and EPS performance in the quarter, adjusted for the sale of Mechatronics. Again, these numbers reflect the continuing operations of Aptiv following the spin and are better than we anticipated back in September when we provided the stand-alone pro forma financials. Operating income was $450 million, up 3%, as revenue growth and operational performance more than offset unfavorable price and the impact of higher mobility investment spending, which we had indicated would ramp over the course of the year. Earnings per share were $1.28 and reflect an $0.11 headwind year-over-year on tax as last year's rate reflected the tax benefit of restructuring actions in the prior year quarter. Neutralized for tax, earnings per share growth would have been in line with operating income.

Let's move into the segments. Advanced Safety and User Experience revenues grew 19% in the quarter, consistent with the full year, driven by active safety growth of 69%, reflecting continued new launches and increased penetration.

Infotainment and user experience revenues were up 8% in the quarter, even while lapping strong prior year revenue growth and launch activity. Both active safety and infotainment are expected to continue their strong pace of double-digit growth in 2018. Operating margins expanded 290 basis points in the quarter, excluding the impact of our mobility investments, driven by strong volume growth and the lapping of last year's warranty items. Including these mobility investments, margins were down 20 basis points versus Q4 of 2016. Our planned increase in mobility investments totaled approximately $30 million in the quarter and $50 million for the year. Going forward, we will provide this level of detail to better reflect the improving margin profile of the underlying business, showing performance both with and without the impact of these investments. And as a reminder, we remain on track with our plan to spend approximately $140 million in mobility and services in 2018, including the addition of nuTonomy, and consistent with what we guided late last year.

In summary, the Advanced Safety and User Experience segment is well positioned for continued strong growth and operating leverage in 2018 and beyond.

Turning to Signal and Power Solutions on the next slide. Revenues were down 1% in the quarter and roughly flat for the year, driven by the decrease in North American passenger car production, which, as I mentioned, was 17% in the quarter, 14% down for the year, consistent with our outlook. It's important to note, the slowdown in North American passenger car sales, including last year's cancellation by FCA of several passenger car platforms, primarily impacted our Signal and Power Solutions segment.

Operating margins were down 70 basis points in the quarter as strong operational performance was offset by last year's exceptionally strong fourth quarter performance in China.

Full year margins were up 10 basis points, a testament to how our operating model supports margin expansion even in the face of lower North American pass car volumes and the unfavorable year-over-year China comps.

Heading into 2018, we expect mid-single-digit revenue growth, driven by new launches and high-voltage sales growth, yielding stronger operating performance and higher margins.

Slide 16. Turning to our expectations for 2018, no change from what we shared at our investor conference in September. For the year, we expect revenues to be up 5% to 6%, with production expected to be flat to up 1%, in line with our financial framework of mid-single-digit growth over market. From a segment perspective, we expect approximately 10% growth in Advanced Safety and User Experience and mid-single-digit growth in Signal and Power Solutions.

Operating margins are expected to be in the range of 12.6% to 12.8%, up 20 to 40 basis points, while also investing an incremental $80 million in mobility, as we remain relentless on operating performance and improving our cost structure.

Excluding mobility investments, both segments will expand margins in 2018. This is expected to result in earnings per share in the range of $5 to $5.20 per share, up 10% at the midpoint, with share count flat year-over-year. And the operating cash flow is expected to be approximately $1.6 billion, up double-digits over 2017 when normalized for the Unsecured Creditors settlement. CapEx will be roughly $750 million for the year.

For the first quarter, revenues are expected to be up 3% at the midpoint or 4 points above market on production declines of roughly 1%. We expect 70 to 90 basis points of operating margin expansion in the first quarter, reflecting improved operating performance as well as having lapped higher warrantee expense last year. And EPS is expected in the range of $1.17 to $1.22, up 10% at the midpoint despite a headwind from a more normalized tax rate of 15% to 16%.

Turning to the next slide. As always, our team remains laser-focused on improving our cost structure, both as a means to fund incremental growth investments and continue our strong track record of margin expansion and earnings growth. What we've shown here in the left is a walk from our pre-spin to post-spin margins for 2017, which came in right in line with what we targeted back in September, with stronger operating performance despite the margin-dilutive impact of a stronger euro.

Moving to the middle. You see the margin walk for 2018 with 20 to 40 basis points expansion, consistent with our long-term outlook, as benefits from productivity initiatives and operating performance are partially offset by our mobility investments.

Finally, moving to the right, we expect 100 basis points of margin expansion between 2017 and 2020, and the stranded costs will be substantially eliminated by the end of 2019. And the adoption of key growth technologies drives faster growth and greater operating margin expansion out to 2022, leveraging the benefits of our industry-leading footprint, lower corporate overheads and a more efficient operation overall.

Turning to the next slide. Our business model is enabling us to convert more income to cash. And as cash flow compounds double digits, there is no shortage of attractive deployment opportunities. I want to reiterate, Aptiv will continue to have a disciplined and well-balanced approach to capital allocation, similar to what you saw from Delphi. We are focused on reinvesting in our business, both organically and inorganically, while maintaining our investment-grade rating, paying a competitive dividend. On M&A, we remain focused on accretive bolt-ons similar to HellermannTyton, which provided attractive end-market diversification, and technology acquisitions focused on our mobility and services group, where we have the opportunity to significantly accelerate the commercialization of new technologies. In both cases, the pipeline remains full, and we hope to share more with you over the course of the year. And to the extent we have excess cash, we will be opportunistic in returning it to shareholders.

In summary, we believe effective capital deployment is a major differentiator for Aptiv and an important part of our overall investment thesis.

I'd like to turn the call back to Kevin for his closing remarks.

Thanks, Joe. We'll wrap up on Slide 19. 2017 was another outstanding year. We exceeded our financial commitments and executed the spin-off of our Powertrain segment flawlessly and ahead of schedule, all while enhancing our portfolio of advanced technologies with the acquisitions of Movimento and nuTonomy and investments in Valens, otonomo, Innoviz and LeddarTech, all which will serve to enhance our competitive position as the demand for ADAS and automated mobility solutions ramps up.

Looking ahead to 2018, as Joe just mentioned, our outlook includes mid-single digit revenue growth above market, reflecting the strength of our technology portfolio and execution capabilities, and margin expansion in line with the long-term framework we provided back in September with 20 to 40 basis points expansion, while continuing to invest for future growth, all which results in double-digit earnings and cash flow growth and the ability to sustain long-term shareholder value creation through efficient and disciplined capital deployment.

So with that, we'll open up the line for questions, operator. Thank you.

(Operator Instructions) Our first question comes from the line of Brian Johnson with Barclays.

Just a couple of questions. First, in what we used to call E/EA, now data and signal, can you maybe, in talking about the new bookings and also just the revenue outlook, talk about the different trends within which one might call traditional wiring harness and connector business, where you have maybe a new launch but the platforms aren't radically different, versus some of the more advanced data-intensive? And in particular, is the core traditional wiring harness business, are you booking less there when you don't like the price or the commodity pass-throughs or other commercial terms?

Yes. Brian, it's Kevin. I'll start, and then Joe will follow up. So a couple of trends as it relates to Electrical Architecture. As it relates to the transition to what we sometimes refer to as a more sophisticated or smarter architecture, obviously, more business booked, more business being done with the traditional automotive OEs that have a, let's call it, a higher component of technology in their overall portfolio. So -- who are pushing at the furthest ends of ADAS today, so whether it be advanced Level 2, approaching Level 3, advanced infotainment or user experience systems and increased vehicle connectivity. Most of that activity, quite frankly, is in Europe. Second, and along similar lines, but consistently happening both in the North American market, the European markets and beginning in the Asian market, is more KSK harnesses, which are customized harnesses, which are effectively built to match the VIN number and the specific outfitting of the vehicle, which is a much more complex architecture and an even more complex supply chain, as you can imagine. The third piece, I would say, there are a few of the -- what I would call the newer OEs that we've been deeply engaged and more active as it relates to clean-sheet-of-paper architecture and discussions about how we optimize that and how do you bring that into production sooner rather than later. And then lastly, I apologize for rambling, there are a number of other OEs that, I think, is approaching close to double digit, where we're spending time talking about that clean-sheet re-architecture of the vehicle, but doing it over a longer period of time, a lengthier period of time. So Joe, you should...

Yes. Brian, within that business, I think a couple of things to note with that business. One, we obviously, and we've talked a lot about it this year, I think the business did a really good job of weathering the North American pass car downturn while expanding margins. We see that flipping next year. So that business returns to probably mid-single-digit growth. Within there, we also continue to see strong growth in HellermannTyton, both in their industrial business as well as their auto. I would expect them to continue with double digits. They've been between 10% or 11% growth per year since we bought them, and we see that continuing. So really, I think the story for next year is really just lapping that passenger car volume in North America, and you'll see it return to mid-single digits.

Okay. Second question's more kind of longer-term strategic. It looks like great progress, at least around the ADAS and kind of advanced electronic side with BMW. Can you maybe help us, especially in light of all the acquisitions you've put into your effort, kind of where the Intel-Mobileye partnership you have is, how it relates to what you're doing in autonomy and what we saw in Ottomatika and what we saw in Vegas? And then BMW's own joint venture with Intel-Mobileye, where, of course, Fiat Chrysler has become one of their partners. So just are those kind of moving on parallel tracks? Separate, but related? Sort of the same thing? Or how should we think about that?

There's obviously a lot of activity in and around autonomous driving. So let me start with, we continue to progress with our partners, Mobileye and Intel, in the development of the CSLP platform that will be commercially available in 2019. So let's start with that. Where we are having discussions with other OEs, whether it's their interest in the CSLP platform or it's their interest in doing some portions of that activity on their own, like the BMW partnership, we're doing all we can, as you can imagine, from a financial standpoint, not to recreate, but to reuse the technology and the capabilities that we've established. I can't get into specifics at this point in time. So some OEs want more of that. Some want less of that. I think there's a direct correlation between their level of internal technical capabilities, what they've had historically, and how strategic they view that automated driving stack to be.

Your next question comes from Chris McNally with Evercore ISI.

Congrats on a successful spin. Just 2 follow-up questions for autonomous for me. So the first one, on the Robotaxi front, Kevin, as you referenced, CES and Lyft was a big positive. And you mentioned 2019 is a commercial test deployment in a city. That seems pretty significant, given that Aptiv will add a lot more automotive-grade experience to what nuTonomy could do by themselves. Could you just elaborate and give a little bit more details? How many vehicles? Is this highway travel? Will Lyft be contributing significant R&D? Anything that you can add around some of that, the details around the 2019 program?

Yes. Well, listen, the 2019 program relates to Aptiv, and we're in discussions with multiple players in the mobility-on-demand space as well as cities with respect to deploying vehicles at Level 4 levels, initially in late 2018, early 2019. By the end of this year, we'll have roughly 150 vehicles-plus on the road. I think I mentioned traveling roughly 2 million miles during the year. And we'll be doing that through multiple partnerships, whether they be mobility-on-demand players or they be direct agreements with cities. Now one thing is important, I think, to underscore, and you've heard Joe and myself say this several times. We're not in the fleet management business. We're not a mobility provider. So it's our objective to partner with others who are. At the same time, it's really important to advance the technology and, quite frankly, to monetize the capabilities to get as many vehicles out on the road as we can nearer-term, whether those are vehicles we're paying for or our partner's paying for, to enhance our capabilities and prove out the capabilities.

That's great. And just a quick follow-up to Brian's question on the production car side. I think, previously, when you first sort of launched CSLP, you mentioned that if an OEM were to sign up to the program in somewhat of a turn-key solution, it would aid them in getting to market with an L4-type car in maybe 3 years. I think you talked about 2019 as the first year. Is it fair to say that some of those discussions have happened? You just can't really announce formal awards? I just think because the investment community sort of was prepped for some sort of big award announcements over the last year. And that just may not be the case. It may be discussions that are going behind the scenes. I just wanted to get a little bit more color on the award process.

Sure. So several of those conversations have happened and are happening. As you can imagine, from an OE standpoint, there's a strategic aspect to this, there's a risk aspect to this, there's a product portfolio aspect to this that, in reality, is pretty complex. And there's a business model aspect. So we continue to be engaged with a number of OEs about both the entire CSLP platform as well as portions of the CSLP platform. We've always said we're about giving our customers what they want. And the benefit of having the platform, it's for those who don't have the capabilities and want to move more quickly. We can provide more full turnkey solutions. On the flip side, for those that want a portion, having the ability or the understanding of the full systems allows us to enhance the parts. So I say that's one. I think the second thing, Chris, I'd underscore, one of the things that we've concluded, and it's for obvious reasons, that you're going to see the acceleration of autonomous driving with the mobility-on-demand players, quite frankly, sooner than you're going to see it with the traditional OEs. And that's purely economic. The cost of an automated driving system is, today, relatively expensive, and the economics are justified by the mobility players to the extent that they can either get the driver out of the car or they can have the driver doing things other than just transporting passengers or goods.

Chris, it's Joe. The one other thing I'd add, and we've talked about this before, particularly on the OE side, as the conversations have evolved, the other thing which we think is very positive from our perspective is they're now becoming discussions around how to move from active safety, Level 2 into Level 3 into Level 4. So they're becoming sort of technology roadmap discussions, which given, by 2020, we'll have over 20 or just about 20 active safety customers providing Level 2 and have the capabilities to do Level 3 and Level 4, we certainly think sort of the technology continuum discussions are going to accrue to our benefit as well.

Your next question comes from David Leiker with Baird.

So I just want to follow up on the conversation you were just having. As you look at -- once upon a time, there was a view that we go from Level 1 to 2 to 3 to 4 to 5. And then all of a sudden, everybody jumped to Level 4 and 5. And now it seems that Level 3 is becoming more prominent. How internally do you manage that technology roadmap? Are those separate businesses? Are they parallel passes? How do you manage that?

The answer is a little bit of both. So our approach is the Level 4, Level 5 is actually separate. That sits in that mobility group with Glen De Vos and with our autonomous driving team from Ottomatika and nuTonomy. And they're focused on really Level 4, Level 5 solutions. That's where all their focus is. However, we have a system set up where they're able to effectively share their advancements in algorithms and technologies with our traditional ADAS business that resides in our Advanced Safety and User Experience segment today, that is having discussions with traditional OE customers, principally around Level 2, Level 3 and some around Level 4. But they're separate organizations with the ability to share technology. And the reason they're separate is, one, to make sure that we are focused on advancing that Level 4, Level 5 capabilities. And then, two, as I mentioned, David, the mobility-on-demand players today are moving much faster. And we want to make sure that we have a new organization that's effectively focusing on delivering that technology to that customer group.

Yes. No, that's 2 different customer bases there. As we look out -- I don't know that 2020 is the timeframe. But if -- what would be your guess in 2025 of that mix for you in terms of revenue contribution between that Level 3, 3-plus like the ADAS, the [HV] types, incremental approach versus the mobility-on-demand Level 4 or 5?

Yes, David. What we're seeing -- so we've been out with -- our target's $1 billion in revenue related to automated driving/mobility, right, the services that come around automated driving. That number's $1 billion. The way we see it plotting out right now is about 50-50. So 50% of that coming from Level 3 as we migrate our Level 2-plus business into Level 3 opportunities with OEs, and then targeting $0.5 billion of revenue coming out of the mobility-on-demand group.

And then active safety underneath that of about $1.2 billion.

Active safety by then will be well north of $2 billion, probably close to $2.5-plus billion of business.

And that's just Level 1 and 2? Or does that include 3?

That's just levels up -- 1 and 2. That's the existing business.

Okay. And then just one small item here as we look at user experience on the infotainment side, strong bookings there, strong performance there. If you look at what bookings are being done today within that space, what do you think your market share is in that today versus what it is relative to the business that's being delivered today?

What's our market share today relative to what it will be in the future?

No, no. What it is currently, your current revenue base, your share there versus the share on how much your bookings are?

Yes. David, that's a hard one. Part of the challenge for that space is you've got some of the captives in there with low-end audio. I think if you racked it all up and included low-end audio, we're a top, probably, 7. I think as you start to focus on the really relevant technologies and where this is going, low-end audio displays going away, we think the mid-systems are going to push their way down, we clearly see ourselves moving in -- organically, into a top 5 position over the next couple of years. I mean, this MLD booking for us, it's hundreds of millions of dollars of bookings from an acquisition we did in 2016 for $15 million. The technology is just phenomenal. So again, it's a little bit about how you rack it up that market. But if you put the audio in there, we're probably further down. But where we want to play, clearly, targeting a top 5 to top 3 position.

Your next question comes from Joseph Spak with RBC Capital Markets.

First question, just a little bit more sort of on 2018. So the 20 to 40 bps of margin expansion, in line with what you talked about previously, but it does show a big sequential improvement from the first quarter guide. So I think some of that is the subsiding of the stranded costs. But I was wondering if you could talk about any of the other sort of puts and takes through the years, and maybe what your commodity outlook is as well.

Yes. So there's -- Joe, we've got stranded costs. We're going to lap some warranty in Q1. So that's going to help the Q1 number. But our mission here is to get stranded costs out, for all intents and purposes, by the end of 2019. So it's a fairly deliberate march. We're starting the year with about $90 million, as we talked about in September, about $80 million to $90 million of stranded costs to get out of the system. So that's where a lot of that comes from. However, we continue to do a really good job on the manufacturing and the material performance side as it relates to continued savings. And as we've talked about, one of the benefits we're getting here is, are these product lines coming to scale? Things like active safety getting to $600 million of revenue. It's going to continue to grow at 40%. That adds efficiencies into the manufacturing plants, adds efficiencies into the material buy. Very similar with high-voltage electrification. We've got that business growing in -- $300 million of revenue. It's going to grow well above 50% next year. We've already booked about $1.4 billion this year. So very strong bookings to revenues. So those product lines coming to scale help while we continue to bang away at our overall cost footprint, if you will, and again, doing this in light of investing and being able to fund those additional mobility investments. Commodities are pretty straightforward. The 2018 guide has no real significant changes in there. Copper is the biggest one. But again, that's mostly pass-through. To the extent we don't pass through copper, we hedge. So that plays around a bit with the top line, but doesn't really impact performance. And then I think from a currency perspective, the thing we're obviously watching, the guide's got $1.15 euro in there, which was about our average for 2017. Obviously, that looks conservative relative to where we are today. But that's been bouncing around a bit, so we'll continue to watch that. But at this point, with where the business is post-spin, the really only focused commodity is copper. Mindful of resin pricing, but -- from an oil perspective, but don't see any challenges there.

That's helpful. And then just back on the autonomous discussion. You guys have talked about, a couple of times now, some nontraditional customers potentially rising up. And you reiterated today, you don't want to be sort of the mobility provider, you want to work with them. But what does that really look like from, I guess, from the actual vehicle perspective? Is it something like you showed at CES, where you're retrofitting vehicles? Or is it working with someone else to design and build those vehicles?

Joe, it's effectively both. I think it's an optimized vehicle. It's both an optimized OE vehicle set up for Level 4, Level 5 autonomous driving, and then it's a -- what I'd call a custom bespoke vehicle that can transport more passengers and has a more fully integrated architecture, ADAS stack or automated driving stack as well as user experience capability. So we're actually working on both.

Your next question comes from Rod Lache with Deutsche Bank.

I'll ask a couple of things. One is, obviously, you ended 2017 with a very strong cash position, $1.6 billion, and you alluded to a pretty solid pipeline of M&A opportunities. Can you just remind us, at a very high level, how should we be thinking about what your cash target is? So if we're thinking out a year or so, what are you kind of managing that down to between the various uses of cash?

To run the business, call it, $300 million to $400 million of cash, right? So we've -- clearly, the cash balance is strong. As I mentioned in my prepared comments, capital allocation philosophy at Aptiv hasn't changed. We are -- we do have a good-looking deal funnel at the moment. There's a lot of things on both the Signal and Power Solutions side that we're looking at, and I think as well as on the technology side. Those will really -- will unfold over the next couple of quarters. And again, I think there'll be transactions like HellermannTyton, bolt-on-type transactions that both deepen the capabilities of the Signal and Power business within auto, but also look at some adjacent market opportunities. Things like PureDepth, as we mentioned, that's been a complete home run as it relates to the bookings with BMW on that technology. So things like that. And to the extent we get to the point where later in the year, those haven't materialized, it's hard to control timing, we understand the importance of returning cash to shareholders. The guide only includes, at this point, keeping share count flat. So we'll -- we won't allow creep, obviously. So we'll be repurchasing to avoid creep. And anything incremental will really be based on, as we get further through the year, what we see from -- actually materializing from a funnel perspective.

So just to clarify, you would think or suggest to us that we should be thinking you exit the year at $300 million to $400 million? So you have the $1.6 billion, plus the free cash flow that you generate this year to deploy between M&A and share repurchases or -- and that kind of thing? Is that correct?

Yes. Listen, I don't want to call a number that specific. The deals -- the types of transactions we look at take time, particularly in that electrical architecture space. We're looking at a lot of what I'll call mid-sized bolt-ons. They're typically family-owned businesses. They take some time to cultivate. So I wouldn't want to be on record saying we're going to have it all buttoned up by 12/31/2018. But as you think about Aptiv, capital deployment hasn't changed from Delphi. Long term, we -- on average, we need $300 million to $400 million of cash, and we're going to work really hard to try to find smart uses for that cash.

Okay. And just switching gears. The shift from passenger car has actually been a tailwind for the industry broadly just given richer mix, but a bit of a headwind for you guys, just in part because of the Fiat Chrysler situation. Can you give us a sense of what your North American passenger car exposure is now kind of on a run-rate basis? And is that still something that you would put in the risk bucket?

Listen, it was --- FCA we knew about going into the year. GM took a lot out of pass car. That was really what we were working through during the year. That business continues to be or it looks to be about 65% SUV and truck in North America, about 35% in pass car. As we book business, as we bid on business, we're very mindful of what pass car platforms, if any, quite honestly, we want to be on. So we'd look to continue to pivot that. Certainly, there are some that distinguish themselves from others. But it's certainly something we watch carefully and are managing through. I think given what happened last year, at this point, do we have a big risk associated with it? Next year, no. We really see ourselves lapping that, but it's something we'll continue to manage through. And quite honestly, it's -- again, that business -- North American pass car probably took 30 to 40 basis points of margin out of signal and power distribution in 2017. And the team was on it. That business was able to expand margins 10% even -- or 10 basis points, even with that headwind. So we're laser-focused on it, and we'll continue to manage the business to the extent it comes up short. Kevin, I don't know if you have any thoughts.

No, you've covered it all, Joe.

Great. And just lastly, can you just talk to us about how you're thinking about conversion on volume going forward as you're currently configured? The 21% that you did in the quarter, it's a little bit lower than what the prior configuration was. And for the full year, how should we be thinking about the cost items and savings items like performance and depreciation versus your pro forma 2017?

Yes. Listen, I think we used to always talk about volume flow at an 18% to 22% as Delphi holdco. I think it's fair, as Aptiv, we're in the higher end of that range. So call it, 20% to 22% as we see volume flow. I think the one other comment I'll make is we're running this business for flat to up slight production volumes. So when we see things like we did in China in Q4 '16, we'll flow higher. And our goal is, when we see things like North American pass car, is to be able to continue to expand margins. But as a rule of thumb, I'd go to the higher end of the Delphi holdco range and call it 20% to 22%.

Okay. And performance and cost items like depreciation versus the pro forma, is the run rate that we're observing here something that would be sustained into 2018?

Yes. Something that, as we talked about, is going to accelerate a bit just given we've lapped some of the warranty and get the stranded costs out. I know Elena can sort of take you through the detail there, but I'd be focused -- I think you've got to be mindful just how you think through stranded, if you can (inaudible).

Your next question comes from John Murphy with Bank of America Merrill Lynch.

If I could just ask sort of a slightly longer-term question, and it's a little bit theoretical, but I mean, Glen and you guys have been talking about, as we see more L4 and L5 autonomous-drive vehicles being developed that you're going to be needing a whole new architecture. I'm just curious, if you think of sort of the brains and veins and everything that you guys supply to the automakers, what sort of magnitude of increasing potential content per vehicle there could be. I mean, is it kind of like a 50% number? Or is this the kind of thing where it could be a factor of 2 to 3x higher potential content for you guys?

Yes. I don't know if I've thought about it from a content -- an exact number, content per vehicle. I guess, the way we would look at it, and I think it's reflected in the longer-term guidance that Joe talked about at our Investor Day, is accelerated growth and growth over market. And it's being driven by more software, more data and solid growth within the vehicle architecture space. So I don't have a content-per-vehicle factor number, if you will. Maybe a way to think about it, kind of not quite backing into it, but when you think about active safety and you think about our spend on Level 4, Level 5, I think Joe and I and the team would tell you, we're seeing a factor change in active safety revenues and active safety booking. So we think you'll continue for the next several years to see a run rate from a booking standpoint that's in the range of, call it, $3-plus billion. That's in the range that we've booked this year in active safety. We talked about infotainment. It's been a bit lumpy. So we're actually down year-over-year on the infotainment bookings, but up on revenue. You'll see strong revenue growth there as well. And then I think the smart architecture, the vehicle architecture overlay, we'll see how that plays out.

Yes, John, if you go back to, and we're happy to revisit you with it offline. As you think about the architecture business, our view between sort of now and, call it, 2030, is for every $3 of content that goes into the architecture, we lose about $1 from optimization. And that's -- so we're not exactly on content per vehicle 10 years out. But as we look at the trend, vehicle architecture has a positive mix. That would be higher-end connection systems, more complicated materials going in for the 3. Mass coming out is the one decrement. And then to Kevin's point, we're going to see additional content from the higher-end compute platforms as well, the integrated cockpit controllers, multi-domain controllers. But that's -- on the architecture side itself, there is an optimization decrement, but we see the increase of the different materials and technology far exceeding that, yes.

So every one of our major product lines, the segments, are growing over market, growing over vehicle production.

Okay. And then maybe just a follow-up to that. I mean, I understand you guys are incredibly financially disciplined on margins and returns and [great] towards the shareholder capital, but there is also sort of a view in the market right now, for particularly future car technologies, that significant growth, regardless of exact profitability of returns, being rewarded with high multiples, whether it be in the private market and see some early-stage companies or some stuff even in the public markets. Is there any potential that you might drift away from sort of that return and margin target to get greater growth, which might reward you with a higher stock price, which might reduce your cost of capital, and then sort of be somewhat of a virtuous circle? There's some consternation in the market right now just in a barbell of where you guys are valued and where some slightly high flyers and higher multiples are valued right now.

Listen, I would tell you there's 0 possibility that happens. And that's for multiple reasons, including experience and seeing over the long-term companies who choose growth for growth's sake what ultimately happens. I'd say the second and maybe more aligned -- directly aligned with shareholders near term, from a management team standpoint, over -- or roughly half our compensation is tied to expanding return on capital. So there is a direct correlation that affects myself, my direct reports, their management team and is pushed on down, tied to our long-term incentive plan, that really drives the mindset where it's about increasing and enhancing return on capital. And consistent with what Joe has mentioned earlier about us being maniacally focused on our cost structure and our cash flow generation, all these programs, all these major programs, size, strategic, we take a look at and we review with the management team before they bid on them. And we give them specific guardrails and guidelines with respect to where they can go. And the discussion about return on capital, quite frankly, is one of the biggest discussions. We spend more time on that, quite frankly, than we even do on the margin expansion discussion.

That's very good to hear. And maybe one just real quick housekeeping, and I apologize if I missed this, Joe. I mean, on raw mat headwinds for '18 and what you're seeing in sort of the relationship with the automakers on ability to index, pass-through and all that kind of stuff with -- particularly around copper or other raws that you might be facing some inflation with.

Yes. No change here, John. I mean, our copper is -- the pass-throughs are contractual copper. So those -- again, they impact -- it can move revenue depending on how fast copper moves. There's sometimes a little bit of a lag, call it, 1.5 quarters to get the inventories through the system. But beyond that, we're not anticipating any headwinds, and there's been no contractual changes, certainly. And then we're really down to -- again, we watch resin, but that's a distant derivative of oil, so we're able to manage that. We think (inaudible) got a big resin buy, but we're -- we buy fairly efficiently. So not a lot of commodity headwinds or risk from anything we see.

Your next question comes from David Tamberrino with Goldman Sachs.

Active safety bookings look like they've significantly accelerated in the fourth quarter from the $2 billion year-to-date in 3Q. Can you kind of talk about the state of the environment with quoting activity and kind of what your percentage share of wins of businesses you're looking at is?

Yes. I don't have -- this is Kevin. I don't have an exact share of win. We tend to be focused on the higher end -- medium to high-end vision, radar and other solutions. Active safety activity across the customer base from an opportunity standpoint has picked up as active safety rates -- penetration rates have increased. I think as Joe mentioned, a year or so ago, we were at 5 customers. Well, I think we're in 10 or more.

12 of them.

Yes, in 2017. So we're seeing a significant ramp-up both with existing customers as well as new customers. As I mentioned, I think you'll see a factor change in our bookings in the active safety space on a going-forward basis. I think we see a significant increase [relative to market] (inaudible).

Yes. David, our win rate, I mean, it's a little bit like my infotainment response to David Leiker. It depends on what you're scoring. We don't -- low-end cameras, those types of things, we really don't participate in. So if you're in there, that share would be lower. I mean, our teams have been seeing 90% win rate in the work that we're going after. And we've had, as you mentioned, a very strong Q4 and see, I would call it, plus-$3 billion booking levels in '18 and '19. We've got line of sight to those at this point. So we're feeling very good about that active safety business. And as I mentioned earlier, a lot of those conversations then bleed into Level 3-plus autonomous driving.

Got it. And then as we think about what you've booked so far, almost $10 billion cumulatively, I think, on our count, how much of that is more software-related revenue versus hardware? Understanding it's a package together, but just trying to see how much embedded software from Aptiv is in that new business bookings for active safety versus software that might come from a Tier 2, Tier 3?

Yes. For -- it's hard, David. For active safety, I would -- it's sort of ragout. It's all in there. I would tell you, our view is the software capabilities around things like sensor fusion and such are what's helping us drive the business. But on the active safety side of the business, it really is sort of firmware. It's embedded in there, and it's in the price. So that would be very hard to split out revenue.

Got it. But just thinking of that from a margin uplift perspective. Is it -- you're mentioning hardware, vision and multi-domain controllers, how much of those componentries have embedded software that's coming from your software engineers versus a third party?

Yes. Listen, I mean, all of it has some of our software. But -- what we incorporate from a customer or a customer's third -- another third-party from the customer is platform-dependent, but it's looking steadfast. That's a lot of our software. Audi put some software in there. There's actually some software from 2 other -- Valeo and someone else, I believe, TT. So it's usually a mix. But in terms of -- all of our products have some of our software. And we're the integrator of the other software component. So we tend to be sitting on top and making sure that the software all works together within that control unit.

Your next question comes from David Lim with Wells Fargo.

Just quickly, on the backlog, it looks like where the win rate is, it looks like it declined a little bit for your E/EA or what you called the E/EA division in the past. I'm thinking maybe it's something to do with passenger cars, but can you guys elaborate on that?

Yes. I think year-to-year, David, you've got to be -- there's -- as we've said, in the past, there's lumpiness as it relates to bookings. So I wouldn't read the trend into a year-over-year small change. I'd also underscore, last year, we had a couple of very big bookings, including the GM C1XX program that obviously had a positive effect in 2017.

Got you. So yes, that's what I was thinking, it was episodic. And finally, can you give us some color on the situation with NAFTA and how that would impact you? I know that there's a lot of moving parts, but some additional color would be very helpful.

Yes. A lot of moving parts on NAFTA, David. So I would tell you, less concerning and less significant than, call it, border adjustment tax laws, if you go 6 to 9 months back. Right now, on the -- there's really 2 things we're watching on NAFTA. It's that sort of regional value content and what they do with those percentages. They're talking about bumping it up to maybe as much as 85%. That is in the ballpark of what I'd call additional duties of, call it, maybe $20 million a year. So we're watching that. But again, these are what I would call manageable amounts. The other is the domestic content requirement. If they put one in, what does it mean? That's a little bit hard to calculate at the moment because, as you know, unlike the RVC, you can sort of adjust the percentages and calculate the numbers. The domestic content is still wide open. I will tell you, though, that to the extent -- which they're talking about, to the extent they include intellectual property in the domestic content number, it should really not be a big deal for us because that will allow us to count the value of the software and the -- sort of the intellectual property being put into the products that are manufactured in Mexico. So again, we're way off where we were from an impact of something like a border adjustment tax. So this is manageable. And if NAFTA was to go poof tomorrow, it's probably (inaudible) -- which it can, 6 months. But if it he was to leave, then we'd be probably be, call it, on a full year basis maybe up to $100 million of additional duty we'd have to work through.

Your next question comes from Itay Michaeli with Citi.

I just wanted to go back to the mobility-on-demand and Robotaxi discussion, so understanding that you don't want to be kind of a fleet manager or mobility provider. But as we think about the race we're seeing by different players to deploy these vehicles relatively quickly, to the extent that Aptiv technology enables one of your partnership customers to get into this race fairly quickly, for example, like next year would plan on deploying, how should we think about the economics to Aptiv ultimately in these businesses? Is it still limited to the content per vehicle? Or will there be other software, other data-related revenue that will be -- maybe be part of the growth of that [network]?

Yes. I think the answer to that is, depending on the customer relationship or the nature of the customer agreement, it would be for a customer to use both our AD stack as well as our mobility cloud, right, which allows -- or allows both that customer as well as Aptiv to monetize data, whether it's on-vehicle data or it's off-vehicle data, whether it's data used by the OE to op -- or fleet manager to optimize fleet performance or it's data basically bundled and sold to outside third parties. So our objective would be able -- would be to target each one of those. That would be the biggest opportunity.

Great. That's helpful. And then just quickly on the 2018 outlook, and I apologize if I've missed it. Joe, did you provide any kind of directional margin commentary for the segments themselves, some of the puts and takes?

Yes, both -- yes. No, we didn't give specific guidance. Both will be up, excluding that mobility investment and the active safety and user experience business, and that spend will be about $140 million.

Your next question comes from Emmanuel Rosner with Guggenheim.

Just 2 quick follow-ups for me. The first one is on your bookings, and it's a follow-up to a previous question. I'm looking at Slide 8. Can you maybe just go over again how you think of that metric and how it relates to future organic growth? I think under the old combined Delphi, yes, the old rule of thumb was, look, it's growing at a 10% CAGR. Therefore, we have high confidence we keep growing revenues at 5%. Like is it the same way to think about it at Aptiv?

Yes. Listen, these are programs with lifetime revenues. Programs typically start at Aptiv, call it, 2 to 3 years out, versus at Delphi with the Powertrain business, that would be 3 to 4 years out. We would assume if you can consistently grow 10%, there is the possibility that there's some leakage in those bookings or adjustments to FX or shifts in programs, that it gives us confidence that we can grow at roughly 5 points over market.

Yes. Emmanuel, the only thing I'd add to that is that's a CAGR over time, right? So I wouldn't react to necessarily 1 year we'll be growing bookings 12%. Next year, we'll be growing bookings 7%. That's over -- we did that analysis probably, you're right, a couple of years ago. And that was over time. So it was not a -- this year, that changed. It's over time. So we're -- and again, bookings are very lumpy for us. But it's a good metric as a CAGR over -- 10% is a good CAGR over a 5-plus-year period.

Understood. And then just one additional follow-up. You're expecting some pretty decent growth acceleration in the, I guess, electrical business. Can you talk about the cadence of that in 2018? Are we going to see it already straight in Q1?

Yes, it will be lower in Q1 and ramping up throughout the year. I think it's actually Q1 flat to slightly down, quite frankly, and then ramping up to the kind of mid-single-digit growth level for the full year.

Or the way to think about it is just -- it's how we cover the pass car comp. And that accelerated towards the back half of '17. So that's sort of where you see the delta come in.

Your next question comes from Steven Fox with Cross Research.

Just one question for me, please. Could you -- it's good to hear that you're staying disciplined to your profit targets that you laid out in the fall. One of the things that seems to have changed in the last, I don't know, even just the last month or so has been the ramp-up in expectation for vehicle miles -- or autonomous vehicle miles from Waymo and Uber that are going to be driven this year. You guys are talking about 2 million on 150 vehicles by the end of the year. Can you just talk about how you manage that profit expectation versus what seems to be sort of a bigger arms race around getting autonomous vehicle data from road tests as we go through '18?

Yes. Listen -- yes. No, listen, that's a great question. It's a very fair question. We have a specific business plan tied to a mobility group, tied to our autonomous driving activity. And that ties to the resources, whether it's people, vehicles and activities, that we're willing to commit to. And based on those dollars spent, there are key milestones that need to be delivered as it relates to advancement in technology and customer interaction. So we are very, very focused on, as Joe mentioned early, managing our cost structure, using much of the internal funding as we can through cost reduction to support investment in future growth opportunity, and then taking those future growth opportunities where we can and apply those newer technologies to near-term commercial opportunities like active safety. So it's just a very disciplined approach. We manage it just like we manage any other business. We know we have financial commitments. We have margin targets. We have a return-on-capital targets, and we operate to those.

So is there possibilities that, say there was pressure on you to gather more data more quickly, that you could reach some kind of financial partnerships? Or would it totally be related to Aptiv's spend in the near term?

Listen, we're focused on how do we maximize return on capital and shareholder value. So to the extent opportunities like that make financial sense, those are certainly things that we'd evaluate.

Your next question comes from Colin Langan with UBS.

I just have a couple of quick ones. Any guidance on the $140 million in mobility investment post-2018? Is that a good run rate? Or does it continue to expand from there?

Yes, it will expand. It won't expand at the percentage that it did between '17 and '18. But we'd expect that to grow. But again, to Kevin's comment, it will grow within that financial framework of the 20 to 40 basis points [of margin].

Got it. And then just last thing. I know you've already indicated there's no change from the U.S. tax reform to your tax rate. Is there any long-term impact? Does this help you at all? Would your rate have gone up in the future? Or essentially, there's really no long-term impact in there? I'm just trying to think about if there's (inaudible) would have been a help, if I remember.

Yes. There's always gives and takes to taxes. The U.S. tax rate -- lower U.S. tax rate's helpful, but we're not -- just given the way we're set up, we're not a big U.S. taxpayer. So it just doesn't move it significantly. And the way we're focused at the moment is how to make sure that 15% to 16% stays sustainable. And for us, we treat tax like we treat every other cost in the place. We're trying to figure out how to manage it, and we think we've got better uses for cash. So we're always working it, so there's a lot of ins and outs there.

There are no further questions at this time. I will turn the call back over to the presenters for any closing comments.

Okay. Well, listen, thank you, everybody, for your time. We greatly appreciate it, and have a great day.

That concludes the Aptiv Q4 2017 Earnings Conference Call. Thank you for joining. You may now disconnect.