The following is excerpted from the question-and-answer section of the transcript.
(Questions from industry analysts are provided in full, but answers are omitted - download the transcript to see the full question-and-answer session)
Question: Aileen Elizabeth Smith - BofA Securities, Research Division - Analyst
: To ask another question around electrification investment, the call out of it being a margin headwind in the quarter, because I think the first time
that it's been explicitly referenced by you guys, but it's not really surprising given the strategy from you over the past several years in acquiring
and investing in EV technologies. So to understand it correctly, this is just the dynamic of commercialization investment rather than technology
development as the backlog is finally ramping up with customer buy-in. And as you think about the margin bridge from 9% in the fourth quarter
to 11% in 2021, is that outlook based on the assumption that the electrification investment burden moderates in any way? Or it's just offset by
operating leverage on the broader volume and your revenue recovery?
Question: Aileen Elizabeth Smith - BofA Securities, Research Division - Analyst
: Okay. That's helpful. And then wanted to touch upon one of the comments in your prepared remarks that you're going to be supplying the cold
plates for GM's Ultium batteries. Are you able to provide us with an estimate for the total related content that you're going to have on that platform?
And as a reminder, will you be on the entirety of that platform, for example, the 1 million by 2025 target that GM has established? Or will it be for
specific models?
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FEBRUARY 18, 2021 / 2:00PM, DAN.N - Q4 2020 Dana Inc Earnings Call
Question: Aileen Elizabeth Smith - BofA Securities, Research Division - Analyst
: Yes. Understood.
Question: James Albert Picariello - KeyBanc Capital Markets Inc., Research Division - Analyst
: If I'm reading Slide 6 correctly, it looks like electrification spend will trend at around $400 million over the next 3 years. What portion of that is
included within your 2021 guide? Because if we bridge 2021 guidance to the 12% plus EBITDA margin trajectory for 2023, implied incrementals
are what, somewhere in the high teens. Just wondering what level of conservatism is baked in, how much of the $400 million in spend is included
in 2021, that might help bridge everything.
Question: James Albert Picariello - KeyBanc Capital Markets Inc., Research Division - Analyst
: Okay. All right. Yes, because that was -- that would kind of indicate the high teens incrementals might, yes, be more conservative, but it will depend
on what, the quantification of that in additional spend.
Okay. So just to clarify, the capital allocation plan over the next 3 years, the company doesn't have any debt maturities until 2024, but will likely
deploy another, what, $650 million or so toward -- for debt repayment before then. Is that right? And then just from an M&A pipeline standpoint,
as you think about Dana's electrification portfolio, are there any areas that make the most strategic sense to explore? Any color there would be
helpful.
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