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Derivative Financial Instruments | 12 Months Ended
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Dec. 31, 2015
Derivative Instruments And Hedging Activities Disclosure [Abstract] |
Derivative Financial Instruments | Note 13 — Derivative Financial Instruments We are exposed to market risk from changes in foreign currency exchange rates, short-term interest rates and price fluctuations of certain material commodities such as copper. Market risks for changes in interest rates relate primarily to our debt obligations under our Credit Agreement. Foreign currency exchange risks are attributable to sales to foreign customers and purchases from foreign suppliers not denominated in the location’s functional currency, foreign plant operations, intercompany indebtedness, intercompany investments and include exposures to the European Euro, Mexican Peso, Canadian Dollar, Hungarian Forint, Macedonian Denar, Ukrainian Hryvnia, Japanese Yen, Chinese Renminbi, Korean Won and Vietnamese Dong. The Company regularly enters into derivative contracts with the objective of managing its financial and operational exposure arising from these risks by offsetting gains and losses on the underlying exposures with gains and losses on the financial instruments used to hedge them. The maximum length of time over which we hedge our exposure to foreign currency exchange risks is one year. We had foreign currency derivative contracts with a notional value of $0 and $52,446 outstanding at December 31, 2015 and 2014, respectively, relating entirely to derivative contracts intended to offset the risk associated with the currency related swap (“CRS”) agreement with UniCredi Bank AG. Settlement of the CRS and offsetting foreign currency derivative contracts is discussed below. The maximum length of time over which we hedge our exposure to price fluctuations in material commodities is two years. We had copper commodity swap contracts with a notional value of $4,885 and $0 outstanding at December 31, 2015 and 2014, respectively. Note 13 — Derivative Financial Instruments (Continued) We do not enter into derivative financial instruments for speculative or trading purposes. Our hedging relationships are formally documented at the inception of the hedge, and hedges must be highly effective in offsetting changes to future cash flows on hedged transactions both at the inception of a hedge and on an ongoing basis to be designated for hedge accounting treatment. For derivative contracts which can be classified as a cash flow hedge, the effective portion of the change in the fair value of the derivative is recorded to accumulated other comprehensive loss in the consolidated balance sheet. When the underlying hedge transaction is realized, the gain or loss included in accumulated other comprehensive loss is recorded in earnings in the consolidated statement of income on the same line as the gain or loss on the hedged item attributable to the hedged risk. We record the ineffective portion of foreign currency hedging instruments, if any, to foreign currency gain (loss) in the consolidated statements of income. All of the unrealized loss associated with foreign currency derivatives reported in accumulated other comprehensive loss as of December 31, 2014 were settled and reclassified into earnings during 2015. No amount of the unrealized loss associated with copper commodity derivatives reported in other comprehensive income during 2015 were settled and reclassified into earnings during 2015. Though we continuously monitor the hedging program, derivative positions and hedging strategies, foreign currency forward exchange agreements have not always been designated as hedging instruments for accounting purposes. The Company uses an income approach to value derivative instruments, analyzing quoted market prices to calculate the forward values and then discounts such forward values to the present value using benchmark rates at commonly quoted intervals for the instrument’s full term. On December 2, 2015, Gentherm GmbH (“Gentherm Germany”), a subsidiary of Gentherm Incorporated (the “Company”), entered into an agreement settling all claims against UniCredit Bank AG pertaining to a 10 year currency related swap (“CRS”) entered into by Gentherm Germany in March 2008. Prior to the settlement, a lawsuit filed by Gentherm GmbH in 2011 was pending appeal at the Higher Regional Court in Munich, Germany. As a result of the settlement, the CRS and its related liability to Gentherm have been terminated and Gentherm’s remaining interest in an offsetting derivative contract designed to limit the market risk of payments due under the CRS was sold. Gentherm realized a one-time, pre-tax gain of $9,949,000 in the fourth quarter of 2015. Gentherm made a final cash settlement payment of $7,593,000 during the fourth quarter of 2015. Information related to the recurring fair value measurement of derivative financial instruments in our consolidated balance sheet as of December 31, 2015 is as follows :
|  |  |  |  |  | Asset Derivatives |  |  | Liability Derivatives |  |  | Net Asset/ (Liabilities) |
|  | Hedge Designation |  | Fair Value Hierarchy |  | Balance Sheet Location |  |  | Fair Value |  |  | Balance Sheet Location |  | Fair Value |  |
Commodity derivatives |  | Cash flow hedge |  | Level 2 |  |  |  |  |  |  |  |  |  | Current liabilities |  | $ | (725 | ) |  | $ | (725 | )
Information related to the recurring fair value measurement of derivative financial instruments in our consolidated balance sheet as of December 31, 2014 is as follows:
|  |  |  |  |  | Asset Derivatives |  |  | Liability Derivatives |  |  | Net Asset/ (Liabilities) |
|  | Hedge Designation |  | Fair Value Hierarchy |  | Balance Sheet Location |  |  | Fair Value |  |  | Balance Sheet Location |  | Fair Value |  |
CRS |  | Not a hedge |  | Level 2 |  |  |  |  |  |  |  |  |  | Current liabilities |  | $ | (2,466 | ) |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  | Non current liabilities |  |  | (6,698 | ) |  |  |  |
Total CRS |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | (9,164 | ) |  | $ | (9,164 | )
Foreign currency derivatives |  | Not a hedge |  | Level 2 |  |  | Current assets |  |  | $ | 145 |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  | Non‑current assets |  |  | $ | 1,345 |  |  |  |  |  |  |  |  |  |  |
Total foreign currency derivatives |  |  |  |  |  |  |  |  |  |  | 1,490 |  |  |  |  |  |  |  |  | $ | 1,490 |
Note 13 — Derivative Financial Instruments (Continued) Information related to the effect of derivative instrument`s on our consolidated statements of income is as follows:
|  | Location |  | Year Ended December 31, 2015 |  |  | Year Ended December 31, 2014 |
Foreign currency derivatives |  | Revaluation of derivatives |  | $ | (1,102 | ) |  |  | 640 |
|  | Product Revenues |  |  | — |  |  |  | (390 | )
|  | Cost of Sales |  |  | (1,782 | ) |  |  | (174 | )
|  | Selling, general and administrative |  |  | (477 | ) |  |  | (161 | )
|  | Other Comprehensive Income |  |  | 10 |  |  |  | (10 | )
|  | Foreign currency gain (loss) |  |  | 351 |  |  |  | (976 | )
Total foreign currency derivatives |  |  |  | $ | (3,000 | ) |  | $ | (1,071 | )
CRS |  | Revaluation of derivatives |  | $ | — |  |  | $ | (1,157 | )
|  | Gain on settlement of derivatives |  |  | 9,949 |  |  |  | — | )
Total CRS |  |  |  | $ | 9,949 |  |  | $ | (1,157 | )
Interest Rate derivatives |  | Revaluation of derivatives |  | $ | — |  |  | $ | (1 | )
|  | Other Comprehensive Income |  |  | — |  |  |  | 81 |
Total interest rate derivatives |  |  |  | $ | — |  |  | $ | 80 |
Commodity derivatives |  | Other Comprehensive Income |  | $ | (725 | ) |  | $ | — |
|  | Cost of Sales |  |  | (123 | ) |  |  | — |
Total commodity derivatives |  |  |  | $ | (848 | ) |  | $ | — |
We did not incur any hedge ineffectiveness during the twelve months ended December 31, 2015 and 2014.

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- Definition Tabular disclosure of pertinent information about a derivative or group of derivatives on a disaggregated basis, such as for individual instruments, or small groups of similar instruments. May include a combination of the type of instrument, risks being hedged, notional amount, hedge designation, related hedged item, inception date, maturity date, or other relevant item. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 5 -URI http://asc.fasb.org/extlink&oid=56946850&loc=d3e41641-113959 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 4B -URI http://asc.fasb.org/extlink&oid=56946850&loc=SL5624163-113959 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 8 -URI http://asc.fasb.org/extlink&oid=56946850&loc=d3e41678-113959 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 4 -URI http://asc.fasb.org/extlink&oid=56946850&loc=d3e41638-113959 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 1B -URI http://asc.fasb.org/extlink&oid=56946850&loc=SL5580258-113959 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 1A -URI http://asc.fasb.org/extlink&oid=56946850&loc=SL5579245-113959 Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 4C -URI http://asc.fasb.org/extlink&oid=56946850&loc=SL5624171-113959 Reference 8: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 25 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6886632&loc=d3e76258-113986 Reference 9: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=56946850&loc=SL5579240-113959 Reference 10: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=56946850&loc=d3e41620-113959 Reference 11: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08.(n)(2)) -URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690 + Details
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