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Inventories

12 Months Ended

Dec. 31, 2024

Classes of current inventories [abstract]

Note 7. Inventories

Inventories consisted of the following:


	December 31, 2024		December 31, 2023		January 1, 2023


Direct materials	$	85	$	70	$	79

Repair and distribution parts		94		115		101

Work-in-progress		62		90		73

Equipment		17		19		20

Total inventories	$	258	$	294	$	273


	December 31, 2024		December 31, 2023		January 1, 2023


Work-in-progress related to finance leases	$	35	$	-	$	31

The amount of inventory and overhead costs recognized as expense and included in COGS during the year ended December 31, 2024, was $1,910 million (December 31, 2023 – $1,886 million). COGS is made up of direct materials, direct labour, depreciation on manufacturing assets, post-manufacturing expenses, and overhead. COGS also includes inventory write-downs pertaining to obsolescence and aging, and recoveries of past write-downs upon disposition. The net change in inventory reserves charged to the consolidated statements of earnings (loss) and included in COGS for the year ended December 31, 2024, was $3 million (December 31, 2023 – less than $1 million).

The costs related to the construction of EI assets determined to be finance leases are accounted for as work-in-progress related to finance leases. Once a project is completed and enters service it is reclassified to COGS.