7. RESTRUCTURING

Delphi continually evaluates alternatives to align its business with the changing needs of its customers and to lower the operating costs of the Company. This includes the realignment of its existing manufacturing capacity, facility closures, or similar actions in the normal course of business. These actions may result in voluntary or involuntary employee termination benefits, which are mainly pursuant to union or other contractual agreements. Voluntary termination benefits are accrued when an employee accepts the related offer. Involuntary termination benefits are accrued when Delphi commits to a termination plan and the benefit arrangement is communicated to affected employees, or when liabilities are determined to be probable and estimable, depending on the existence of a substantive plan for severance or termination. Contract termination costs are recorded when contracts are terminated or when Delphi ceases to use the leased facility and no longer derives economic benefit from the contract. All other exit costs are accrued when incurred.

Delphi's restructuring costs are undertaken as necessary to implement management's strategy, streamline operations, take advantage of available capacity and resources, and ultimately achieve net cost reductions. These activities generally relate to the realignment of existing manufacturing capacity and closure of facilities and other exit or disposal activities, as it relates to executing the Company's strategy in the normal course of business and transforming the salaried workforce to reduce general and administrative expenses.

The table below summarizes the activity in the restructuring liability for the three months ended March 31, 2012:


	Employee Termination Benefits Liability			Other Exit Costs Liability			Total
	(in millions)
Accrual balance at January 1, 2012	$	86		$	10		$	96
Provision for estimated expenses incurred during the period		5			1			6
Payments made during the period		(19	)		(1	)		(20	)
Foreign currency and other		2			(1	)		1

Accrual balance at March 31, 2012	$	74		$	9		$	83

Delphi has initiated several programs to streamline operations and lower costs. As part of Delphi's ongoing efforts to lower costs and operate efficiently, the Company recorded $6 million and $9 million of restructuring costs during the three months ended March 31, 2012 and 2011, respectively, primarily related to plant closures and programs related to the rationalization of manufacturing and engineering processes. These restructuring costs were primarily incurred by the Company's Powertrain and Electrical/Electronic Architecture segments.