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Segmented Information
 12 Months Ended
Dec. 31, 2015
Segment Reporting [Abstract]  
Segmented Information

25. SEGMENTED INFORMATION

 

[a]

Magna is a global automotive supplier whose product capabilities include producing body, chassis, exterior, seating, powertrain, electronic, vision, closure and roof systems and modules, as well as complete vehicle engineering and contract manufacturing.

Magna’s success is directly dependent upon the levels of North American and European [and currently to a lesser extent on Asia and Rest of World] car and light truck production by its customers. OEM production volumes in each of North America and Europe may be impacted by a number of geographic factors, including general economic conditions, interest rates, consumer credit availability, fuel prices and availability, infrastructure, legislative changes, environmental emission and safety issues, and labour and/or trade relations.

Given the differences between the regions in which the Company operates, Magna’s operations are segmented on a geographic basis. The Company’s segments consist of North America, Europe, Asia and Rest of World. The Company maintains management teams in each of the Company’s two primary markets, North America and Europe. The role of the North American and European management teams is to manage Magna’s interests to ensure a coordinated effort across the Company’s different product capabilities. In addition to maintaining key customer, supplier and government contacts in their respective markets, the regional management teams centrally manage key aspects of the Company’s operations while permitting the divisions enough flexibility through Magna’s decentralized structure to foster an entrepreneurial environment.

Consistent with the above, the Company’s internal financial reporting separately segments key internal operating performance measures between North America, Europe, Asia and Rest of World for purposes of presentation to the chief operating decision maker to assist in the assessment of operating performance, the allocation of resources, and the long-term strategic direction and future global growth in the Company.

The Company’s chief operating decision maker uses Adjusted EBIT as the measure of segment profit or loss, since management believes Adjusted EBIT is the most appropriate measure of operational profitability or loss for its reporting segments. Adjusted EBIT represents income from operations before income taxes; interest expense, net; and other expense (income), net.

The accounting policies of each segment are the same as those set out under “Significant Accounting Policies” [note 1] and intersegment sales and transfers are accounted for at fair market value.

 

The following tables show certain information with respect to segment disclosures:

 

     2015  
     Total
sales		     External
sales		      Depreciation
and
amortization		      Adjusted
EBIT [ii]		     Goodwill      Fixed
asset
additions		      Fixed
assets,
net		  

North America

                   

Canada

    $ 6,329      $ 5,856               $ 242       $ 647   

United States

      9,603        9,183                 421         1,431   

Mexico

      4,261        3,869                 233         756   

Eliminations

      (1,178 )      —                   —           —     
  

 

 

    

 

 

     

 

 

     

 

 

    

 

 

     

 

 

     

 

 

  

North America

      19,015        18,908       $ 411       $ 1,934      $ 590         896         2,834   
  

 

 

    

 

 

     

 

 

     

 

 

    

 

 

     

 

 

     

 

 

  

Europe

                   

Western Europe (excluding Great Britain)

      8,936        8,635                 357         1,279   

Great Britain

      404        404                 26         145   

Eastern Europe

      2,110        1,873                 112         474   

Eliminations

      (327 )      —                   —           —     
  

 

 

    

 

 

     

 

 

     

 

 

    

 

 

     

 

 

     

 

 

  

Europe

      11,123        10,912         276         451        525         495         1,898   
  

 

 

    

 

 

     

 

 

     

 

 

    

 

 

     

 

 

     

 

 

  

Asia

      1,981        1,846         77         149        229         121         820   

Rest of World

      461        461         17         (25 )      —           15         54   

Corporate and Other [i]

      (446 )      7         21         20        —           64         399   
  

 

 

    

 

 

     

 

 

     

 

 

    

 

 

     

 

 

     

 

 

  

Total reportable segments

    $ 32,134      $ 32,134       $ 802       $ 2,529      $ 1,344       $ 1,591       $ 6,005   

Current assets

                      11,144   

Investments, goodwill, deferred tax assets and other assets

                      2,557   
  

 

 

    

 

 

     

 

 

     

 

 

    

 

 

     

 

 

     

 

 

  

Consolidated total assets

                    $ 19,706   
  

 

 

    

 

 

     

 

 

     

 

 

    

 

 

     

 

 

     

 

 

  

 

     2014  
     Total
sales		     External
sales		      Depreciation
and
amortization		      Adjusted
EBIT [ii]		     Goodwill      Fixed
asset
additions		      Fixed
assets,
net		  

North America

                   

Canada

    $ 6,799      $ 6,324               $ 204       $ 638   

United States

      9,194        8,666                 328         1,204   

Mexico

      3,984        3,653                 153         626   

Eliminations

      (1,216 )      —                   —           —     
  

 

 

    

 

 

     

 

 

     

 

 

    

 

 

     

 

 

     

 

 

  

North America

      18,761        18,643       $ 407       $ 2,003      $ 633         685         2,468   
  

 

 

    

 

 

     

 

 

     

 

 

    

 

 

     

 

 

     

 

 

  

Europe

                   

Western Europe (excluding Great Britain)

      11,086        10,794                 334         1,302   

Great Britain

      385        384                 13         36   

Eastern Europe

      2,397        2,102                 80         498   

Eliminations

      (366 )      —                   —           —     
  

 

 

    

 

 

     

 

 

     

 

 

    

 

 

     

 

 

     

 

 

  

Europe

      13,502        13,280         327         502        577         427         1,836   
  

 

 

    

 

 

     

 

 

     

 

 

    

 

 

     

 

 

     

 

 

  

Asia

      1,919        1,773         71         150        127         140         648   

Rest of World

      695        694         17         (35 )      —           8         82   

Corporate and Other [i]

      (474 )      13         23         61        —           234         368   
  

 

 

    

 

 

     

 

 

     

 

 

    

 

 

     

 

 

     

 

 

  

Total reportable segments

    $ 34,403      $ 34,403       $ 845       $ 2,681      $ 1,337       $ 1,494       $ 5,402   

Current assets

                      9,862   

Investments, goodwill, deferred tax assets and other assets

                      2,462   

Noncurrent assets held for sale

                      348   
  

 

 

    

 

 

     

 

 

     

 

 

    

 

 

     

 

 

     

 

 

  

Consolidated total assets

                    $ 18,074   
  

 

 

    

 

 

     

 

 

     

 

 

    

 

 

     

 

 

     

 

 

  

 

[i]

Included in Corporate and Other Adjusted EBIT are intercompany fees charged to the automotive segments.
[ii]

The following table reconciles Adjusted EBIT to Income from operations before income taxes:

 

     2015      2014  

Adjusted EBIT

    $ 2,529       $ 2,681   

Other income (expense), net

      166         (46 ) 

Interest expense, net

      (44 )       (30 ) 
  

 

 

     

 

 

  

Income from continuing operations before income taxes

    $ 2,651       $ 2,605   
  

 

 

     

 

 

  

 

[b]

The following table aggregates external revenues by customer as follows:

 

     2015      2014  

General Motors

    $ 6,424       $ 6,361   

Fiat / Chrysler Group

      5,094         5,505   

Ford Motor Company

      4,923         4,660   

Daimler AG

      3,779         4,009   

Volkswagen

      3,301         3,872   

BMW

      3,300         4,153   

Other

      5,313         5,843   
  

 

 

     

 

 

  
   $ 32,134       $ 34,403   
  

 

 

     

 

 

  

 

[c]

The following table summarizes external revenues generated by automotive products and services:

 

     2015      2014  

Body systems and chassis systems

    $ 7,790       $ 8,078   

Exterior systems

      5,155         5,435   

Powertrain systems

      4,755         5,083   

Seating systems

      4,497         4,969   

Tooling, engineering and other

      2,700         2,755   

Vision and electronic systems

      2,583         2,518   

Complete vehicle assembly

      2,357         3,160   

Closure systems

      2,297         2,405   
  

 

 

     

 

 

  
   $ 32,134       $ 34,403