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Year-over-year tone shift - average net-tone change across Risk Factors and MD&A vs the prior 10-K. This filing is 0.15pp more bullish than last year's.
Why YoY instead of absolute: the LM lexicon has ~6.6× more negative words than positive (legal/risk-disclosure language is heavy on hedging), so every 10-K reads bearish on raw tone. Year-over-year change strips that bias and surfaces the actual shift in management's framing.
Tone shift by section
The two components the gauge averages: how Risk Factors and MD&A each shifted in net tone versus last year's 10-K. The headline above is their average, so a green needle over a soft section just means the other section carried it.
Risk Factors
+0.09pp
Flat
Net-tone change vs last year's 10-K.
MD&A
+0.22pp
Flat
Net-tone change vs last year's 10-K.
Per-snippet highlights
Sentence-level sentiment highlighting with category and subcategory filters is coming once the snippet-scoring pipeline lands. For now, dig into the actual section text on the Sections tab.
Language change vs prior 10-K
Risk Factors (Item 1A) - words with the biggest YoY frequency increase
Negative rising
disruptions+2
disputes+2
impair+2
unable+1
challenges+1
Positive rising
able+2
Risk Factors (Item 1A)
8,475 words
Item 1A. Risk Factors
We have listed below (not necessarily in order of importance or probability of occurrence) the most significant risk factors that could cause our actual results to vary materially from recent or anticipated results and could materially and adversely affect our business, results of operations, financial condition and cash flows.
Operational Risks
Changes in U.S. or foreign trade policies, including the imposition of tariffs on imported goods and other trade restrictions, as well as uncertainty over such actions, may adversely impact our business and financial performance.
We obtain raw materials, components and other products and services from numerous suppliers and other vendors throughout the world. Changes in laws or policies governing the terms of foreign trade and, in particular, increased trade restrictions, tariffs or taxes on imports from countries where we manufacture products or from where we import products or raw materials could have an impact on our competitive position, business operations and financial performance.
Recently, the U.S. government announced substantial changes in U.S. trade policy and U.S. trade agreements, including the initiation of tariffs and trade restrictions on certain foreign goods. In response to these tariffs, certain foreign governments subject to such tariffs, including China, have retaliated by imposing tariffs on certain U.S. goods, which could represent near-term challenges to our industry. Increased tariffs imposed by other countries on U.S. exports, further increases in U.S. tariffs, and the uncertainties surrounding domestic and foreign tariffs could require us to increase our prices, which could decrease demand for our products, and in certain cases, the Company may be to pass along such increased costs to our customers. We are actively monitoring and evaluating the development and potential impacts of tariffs on our supply chain and results of operations. While the Company continues to assess these developments, it may not be to fully mitigate the effects of any tariffs or trade .
Language change vs prior 10-K
MD&A (Item 7) - words with the biggest YoY frequency increase
Negative rising
persistent+3
unfavorable+2
declines+2
critical+1
disruptions+1
Positive rising
favorable+3
despite+2
strengthening+2
benefit+1
strong+1
MD&A (Item 7)
8,300 words
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
This management’s discussion and analysis of financial condition and results of operations is intended to assist in understanding and assessing the trends and significant changes in our results of operations and financial condition. Our historical results may not indicate, and should not be relied upon as an indication of, our future performance. Our forward-looking statements reflect our current views about future events, are based on assumptions and are subject to known and unknown risks and uncertainties that could cause actual results to differ materially from those contemplated by these statements. See Item 1. “Business—Forward-Looking Statements” for a discussion of risks associated with reliance on forward-looking statements. Factors that may cause differences between actual results and those contemplated by forward-looking statements include, but are not limited to, those discussed below and in Item 1A. “Risk Factors.” Management’s discussion and analysis of financial condition and results of operations should be read in conjunction with our consolidated financial statements and the notes to those statements included in Item 8. “Financial Statements and Supplementary Data” of this Report. References in this Annual Report on Form 10-K (the “Report”) to “we”, “our”, or the “Company” refer to Cooper-Standard Holdings Inc., together with its consolidated subsidiaries.
Executive Overview
Our Business
We design, manufacture and sell sealing systems and fluid handling systems (consisting of fuel and brake delivery systems and fluid transfer systems) for use primarily in passenger vehicles and light trucks manufactured by global OEMs. In 2025, approximately 86% of our sales consisted of original equipment sold directly to OEMs for installation on new vehicles. The remaining 14% of our sales were primarily to Tier I and Tier II suppliers and non-automotive manufacturers. Accordingly, sales of our products are directly affected by the annual vehicle production of OEMs, particularly the production levels of the vehicles for which we provide specific parts. Most of our products are custom designed and engineered for a specific vehicle platform. Our sales and product development personnel frequently work directly with OEM engineering departments in the design and development of our various products.
Further, additional trade restrictions could be adopted with little to no advanced notice, and we may not be able to effectively mitigate the adverse impacts from those such measures. Political uncertainty surrounding trade or other international disputes also could have a negative impact on consumer confidence and willingness to spend money, which could impair our business. We cannot predict whether, and to what extent, there may be changes to international trade agreements, such as those between the U.S. and China, or whether, or to what extent, additional tariffs, taxes on imports or other restrictions will be changed or imposed by the U.S. or by other countries. Any of these events could increase the cost of our products, create disruptions to our supply chain and impair our ability to effectively operate and compete in the countries where we do business.
Our business, financial condition and results of operations may be adversely impacted by the effects of inflation.
Inflation has the potential to adversely affect our business, financial condition and results of operations by increasing our overall cost structure. Other inflationary pressures could affect wages, the cost and availability of components and raw materials and other inputs and our ability to meet customer demand. Inflation may further exacerbate other risk factors, including supply chain disruptions, risks related to international operations and the recruitment and retention of qualified employees. If we are unsuccessful in negotiating pricing adjustments with our customers to raise the prices of our products sufficiently to keep up with the rate of inflation, our profit margins and cash flows may be adversely affected.
Increases in the costs, or reduced availability, of raw materials and manufactured components may adversely affect our profitability.
Raw material costs have recently been volatile which has been further exacerbated by the changes to U.S. policies related to global trade and increased tariffs and trade restrictions. The principal raw materials to produce our products include rubber, carbon black, process oils, and plastic resins. Principal procured components are primarily made from plastic, carbon steel, aluminum and stainless steel. Material costs represented approximately 52% of our total cost of products sold in 2025. The costs and availability of raw materials and manufactured components could continue to fluctuate due to factors beyond our control, such as other geopolitical events and the effects of climate change. Changes in global temperatures, weather patterns, and the frequency and severity of extreme weather and natural disasters may adversely affect the availability or pricing for certain raw materials.
A significant increase in the price of raw materials, or a restriction in their availability, could materially increase our operating costs and adversely affect our profitability because it is generally difficult to pass through these increased costs to our customers. While we entered into index pricing agreements with some of our customers which provide for a price adjustment based on quoted market prices to attempt to address some of these risks (primarily with respect to steel and rubber), there can be no assurance that commodity price fluctuations will not adversely affect our results of operations and cash flows. In addition,
while the use of index pricing adjustments may provide us with some protection from adverse fluctuations in commodity prices, by utilizing these instruments, we potentially forego the benefits that might result from favorable fluctuations in price.
Disruptions in the supply chain could have an adverse effect on our business, financial condition, results of operations and cash flows.
We obtain components and other products and services from numerous suppliers and other vendors throughout the world. We are responsible for managing our supply chain, including suppliers that may be the sole sources of products that we require, that our customers direct us to use or that have unique capabilities that would make it difficult and/or expensive to re-source. In certain instances, entire industries may experience short-term capacity constraints. Any significant disruptions in the automotive industry due to industry-wide parts shortages, global supply chain constraints and price volatility due to increased tariffs and trade restrictions could adversely affect our operations and financial performance. Uncertain economic or industry conditions resulting from such supply chain constraints and trade disputes could result in financial distress within our supply base, thereby further increasing the risk of supply disruption. Furthermore, any economic downturn or other unfavorable conditions in one or more of the regions in which we operate could cause supply disruptions and thereby adversely affect our financial condition, operating results and cash flows.
Work stoppages or other disruptions to our operations could negatively affect our operations and financial performance.
We may experience work stoppages caused by labor disputes under existing collective bargaining agreements or in connection with the negotiation of new agreements given that we have a number of agreements that expire in any given year. Further, there is no certainty that we will be successful in negotiating new collective bargaining agreements that extend beyond the current expiration dates or that new agreements will be on terms as favorable to us as past labor agreements. In addition, it is possible that our workforce will become more unionized in the future. Unionization activities could increase our costs, which could negatively affect our results of operations.
Our operations may also be disrupted by other labor issues, including absenteeism, public health events and government restrictions; major equipment failure with prolongeddowntime or a complete loss of critical equipment where either no other comparable equipment exists or the remaining equipment does not have enough capacity to pick up the demand; plant closures or disruptions caused by natural or other disasters; disruptions caused by cybersecurity attacks; or any similar disruptions at one or more of our suppliers or our customers’ suppliers if an alternative source of supply were not readily available. Additionally, similar disruptions at our customers’ facilities could result in reduced demand for our products causing us to delay or cancel production. Any significant disruption to our production could negatively affect our operations, customer relationships and financial performance.
A disruption in, or the inability to successfully implement upgrades to, our information technology systems, including disruptions relating to cybersecurity as well as data privacy concerns, could adversely affect our business and financial performance.
We rely upon information technology networks, systems and processes, including the information technology networks of third parties such as suppliers and joint venture partners, to manage and support our business. We have implemented a number of procedures and practices designed to protect againstbreaches or failures of our systems. Despite the security measures that we have implemented, including those measures to prevent cyber-attacks, our systems could be breached or damaged by computer viruses or unauthorized physical or electronic access. Like other public companies, our computer systems and those of our third-party vendors, partners and service providers are regularly subject to, and will continue to be the target of, computer viruses, malware or other malicious codes (including ransomware), unauthorized access, cyber-attacks or other computer-related penetrations (including through the use of A.I.) which may cause disruptions to our operations. While we have experienced threats to our data and systems, to date, we are not aware that we have experienced a cybersecurity incident that has materially affected our business strategy, results of operations, or financial condition. Over time, however, the sophistication of these threats continues to increase. The preventative actions we take to reduce the risk of cyber incidents and protect our information may be insufficient. A breach of our information technology systems, or those of the third parties on whom we rely, could result in theft of our intellectual property, disruption to business or unauthorized access to customer or personal information. Such a breach could adversely impact our operations and or our reputation and may cause us to incur significant time and expense to cure or remediate the breach.
Further, we continually update and expand our information technology systems to enable us to run our business more efficiently, including the potential incorporation of traditional and generative A.I. solutions into our information systems and processes. The increasing use and evolution of this technology creates potential risks for loss or misuse of sensitive Company data that forms part of any data set that was collected, used, stored, or transferred to run our business, and unintentional dissemination or intentionaldestruction of confidential information stored in our or our third party providers' systems, portable media or storage
devices. All of these risks have the potential to result in significantly increased business and security costs, a damaged reputation, administrative penalties, or costs related to defending legal claims. In addition, if the content, analyses, or recommendations that A.I. programs assist in producing are or are alleged to be deficient, inaccurate, or biased, our business, financial condition, and results of operations and our reputation may be adversely affected. If our information technology systems and infrastructure are not maintained or implemented successfully and in a timely, cost-effective, compliant and responsible manner, our operations and business could be disrupted and our ability to report accurate and timely financial results could be adversely affected.
Our Company’s, our suppliers’ or our customers’ and their supplier’s inability to effectively manage the timing, quality and costs of new program launches could adversely affect our financial performance.
In connection with the award of new business, we may obligate ourselves to deliver new products that are subject to our customers’ timing, performance and quality standards. Given the number and complexity of new program launches, we may experience difficulties managing product quality, timeliness and associated costs. In addition, new program launches require a significant ramp up of costs. Our sales related to these new programs generally are dependent upon the timing and success of our customers’ introduction of new vehicles. Our inability, and that of our suppliers and customers and our customers’ suppliers, to effectively manage the timing, quality and costs of these new program launches could adversely affect our financial condition, operating results and cash flows.
Our success depends in part on our development of improved products, and our efforts may fail to meet the needs of customers on a timely or cost-effective basis.
Our continued success depends on our ability to maintain advanced technological capabilities and knowledge necessary to adapt to changing market demands, as well as to develop and commercialize innovative products. We may be unable to develop new products successfully or to keep pace with technological developments by our competitors and the industry in general, which in recent years includes the rapid development and rising use of digital, A.I. and machine learning technologies. In addition, we may develop specific technologies and capabilities in anticipation of customers’ demands for new innovations and technologies. If such demand does not materialize, we may be unable to recover the costs incurred in the development of such technologies and capabilities. If we are unable to recover these costs or if any such programs do not progress as expected, our business, results of operations and financial condition could be adversely affected.
We may incur material losses and costs as a result of product liability and warranty and recallclaims that may be brought against us.
We may be exposed to product liability and warranty claims in the event that our products actually or allegedlyfail to perform as specified or expected or the use of our products results, or is alleged to result, in bodily injury and/or property damage. Accordingly, we could experience material warranty or product liability expenses in the future and incur significant costs to defendagainst these claims. In addition, if any of our products are, or are alleged to be, defective, we may be required to participate in a recall of that product if the defect or the allegeddefect relates to automotive safety. Product recalls could cause us to incur material costs and could harm our reputation or cause us to lose customers, particularly if any such recall causes customers to question the safety or reliability of our products. Also, while we possess considerable historical warranty and recall data with respect to the products we currently produce, we do not have such data relating to new products, assembly programs or technologies, including any new fuel and emissions technology and systems being brought into production, to allow us to accurately estimate future warranty or recall costs.
In addition, the increased focus on systems integration platforms utilizing fuel and emissions technology with more sophisticated components from multiple sources could result in an increased risk of component warranty costs over which we have little or no control and for which we may be subject to an increasing share of liability to the extent any of the other component suppliers are in financial distress or are otherwise incapable of fulfilling their warranty or product recall obligations. Our costs associated with providing product warranties and responding to product recallclaims could be material. Product liability, warranty and recall costs may adversely affect our business, results of operations and financial condition.
Our commitment to drive value through culture, innovation and results is dependent on our ability to identify, attract, develop and retain a skilled, engaged and diverse workforce.
Our people are the driving force behind our success at Cooper Standard. Our ability to pursue breakthrough technology innovations, implement cutting-edge manufacturing and business processes, and achieve our operating and strategic goals is dependent on the engagement, skills, experience and knowledge of our employees. Any failure or delay in attracting, retaining and developing such a workforce, including the loss of key technological and leadership personnel, could adversely impact our business, financial condition and operating results.
Our financial condition and results of operations have been previously, and may in the future be, adversely affected by public health events.
We could face risks related to public health events, including epidemics and pandemics. Preventative measures taken to contain or mitigate public health events may materially impact our financial condition and operations results due to shutdowns of our and our customers’ and suppliers’ facilities; increased operating and production costs; disruptions and financial distress in the supply chain; disruptions in our production cycle; lost or absent members of the workforce; a decline in demand due to an economic downturn; and inability to access capital due to disruptions in the global financial markets.
The full impact of a public health event on our financial condition and operations results will depend on various factors, such as the ultimate duration and scope of the crisis, its impact on our customers, suppliers and logistics partners, how quickly normal operations can resume and the duration and magnitude of the economic downturn caused by the health crisis in our key markets. A public health event may also exacerbate the other risks disclosed in this Item 1A. Risk Factors.
Strategic Risks
We are highly dependent on the automotive industry. A prolonged or material contraction in automotive sales and production volumes could adversely affect our business, results of operations and financial condition.
Automotive sales and production are cyclical and depend on, among other things, general economic conditions and consumer spending, vehicle demand and preferences (which can be affected by a number of factors, including fuel costs, employment levels and the availability of consumer financing). These factors could make it difficult for us, our suppliers and our customers to forecast accurately and plan future business activities. As the volume of automotive production and the mix of vehicles produced fluctuate, the demand for our products also fluctuates. Prolonged or material contraction in automotive sales and production volumes, or significant changes in the mix of vehicles produced, could cause our customers to reduce orders of our products, which could adversely affect our business, results of operations and financial condition and our ability to provide accurate forecasts and guidance.
We are subject to other risks associated with our international operations.
We have significant manufacturing operations outside the United States, including joint ventures and other alliances. Our operations are located in 20 countries, and we export to several other countries. In 2025, approximately 78% of our sales were attributable to products manufactured outside the United States. Risks inherent in our international operations include:
• currency exchange rate fluctuations, currency controls and restrictions, and the ability to hedge currencies;
• c hanges in laws and regulations, including laws or policies governing the terms of foreign trade, and in particular increased trade restrictions, tariffs, or taxes or the imposition of embargoes on imports from countries where we manufacture products;
• changes in local economic conditions;
• repatriation restrictions or requirements, including tax increases on remittances and other payments by our foreign subsidiaries;
• global sovereign fiscal uncertainty and hyperinflation in certain foreign countries;
• operating in foreign jurisdictions where the ability to protect and enforce our intellectual property rights is limited as a statutory or practical matter;
• exposure to possible expropriation or other government actions;
• disease, pandemics or other severe public health events; and
• the current geopolitical uncertainty around the world, and the potential exposure to local political or social unrest resulting from acts of war, terrorism, or similar events.
The occurrence of any of these risks may adversely affect the results of operations and financial condition of our international operations and our business as a whole.
In addition, we are subject to the Foreign Corrupt Practices Act (the “FCPA”) and other laws which prohibit improper payments to foreign governments and their officials by U.S. and other business entities. Certain of the countries in which we operate present heightened corruption risks, which therefore increases the risks of our exposure under the FCPA and other applicable anti-bribery and corruption laws and regulations.
We may not realize sales represented by awarded business, which could adversely affect our business, financial condition, results of operations and cash flows.
The realization of future sales from awarded business is subject to risks and uncertainties inherent in the cyclicality of vehicle production. In addition, our customers generally have the right to resource awarded business without penalty. Therefore, the ultimate amount of our sales is not guaranteed. If actual production orders from our customers are not consistent with the projections we use in calculating the amount of awarded business, we could realize substantially less sales and profit over the life of these awards than currently projected.
Pricing pressures and other commercial adjustments may adversely affect our business.
Upfront and ongoing pricing strategies and demands could result in either unsatisfactoryprofitability, loss of replacement or targeted business, and/or exposure to competitive challenges and resourcing. Further, the automotive industry continues to experience aggressive pricing pressure from customers. Vehicle manufacturers often seek price reductions in both the initial bidding process and during the term of the contract and may seek other commercial adjustments, including but not limited to new or adjusted demands relating to annual commercial productivity, quality standards, research and development funding, packaging and materials and demands for the Company to share in productivity and efficiency savings in excess of our cost reduction targets. Price reductions historically have adversely impacted our sales and profit margins and may do so in the future. If we are not able to offset price reductions through improved operating efficiencies and reduced expenditures, those price reductions may have a negative impact on our financial condition.
Our business could be adversely affected if we lose any of our largest customers or significant platforms.
While we provide parts to virtually every major global OEM for use on a wide range of different platforms, sales to our three largest customers, Ford, GM, and Stellantis, on a worldwide basis represented approximately 56% of our sales for the year ended December 31, 2025. Our ability to reduce the risks inherent in certain concentrations of business will depend, in part, on our ability to continue to diversify our sales on a customer, product, platform and geographic basis. Although business with each customer is typically split among numerous contracts, the loss of a major customer, significant reduction in purchases of our products by such customer, or any discontinuance or resourcing of a significant platform could adversely affect our business, results of operations and financial condition.
We operate in a highly competitive industry and efforts by our competitors to gain market share could adversely affect our financial performance.
The automotive parts industry is highly competitive. We face numerous competitors in each of our product lines. In general, there are three or more significant competitors and numerous smaller competitors for most of the products we offer. We also face competition for certain of our products from suppliers producing in lower-cost regions such as Asia and Eastern Europe. Our competitors’ efforts to grow market share could exert downward pressure on the pricing of our products and our margins, or result in the resourcing of platforms by our customers.
The benefits of our continuous improvement programs and other cost savings plans may not be fully realized.
Our operations strategy includes continuous improvement programs and implementation of lean manufacturing tools across all facilities to achieve cost savings and increased performance. Further, we have and may continue to initiate restructuring actions designed to improve future profitability and competitiveness. The cost savings that we anticipate from these initiatives may not be achieved on schedule or at the level we anticipate and could be negatively impacted by lower-than-expected production volumes. If we are unable to realize these anticipated savings, our operating results and financial condition may be adversely affected.
We may continue to incur significant costs related to manufacturing facility closings or consolidation which could have an adverse effect on our financial condition.
If we close or consolidate manufacturing locations, the exit costs associated with such closures or consolidation, including employee termination costs, may be significant. Such costs could negatively affect our cash flows, results of operations and financial condition.
A portion of our operations are conducted by joint ventures which have unique risks.
Certain of our operations are carried out by joint ventures. In joint ventures, we share the management of the company with one or more partners who may not have the same goals, resources or priorities as we do. The operations of our joint ventures are subject to agreements with our partners, which typically include additional organizational formalities as well as requirements to share information and decision making and may also limit our ability to sell our interest. Additional risks include one or more
partners failing to satisfy contractual obligations, a change in ownership of any of our partners and our limited ability to control our partners’ compliance with applicable laws, including the FCPA. Any such occurrences could adversely affect our financial condition, operating results, cash flow or reputation.
Any acquisitions or divestitures we make may be unsuccessful, may take longer than anticipated or may negatively impact our business, financial condition, results of operations and cash flows.
We may pursue acquisitions or divestitures in the future as part of our strategy. Acquisitions and divestitures involve numerous risks, including identifying attractive target acquisitions, undisclosed risks affecting the target, difficulties integrating acquired businesses, the assumption of unknown liabilities, potential adverse effects on existing customer or supplier relationships, and the diversion of management’s attention from day-to-day business. We may not have, or be able to raise on acceptable terms, sufficient financial resources to make acquisitions. Our ability to make investments may also be limited by the terms of our existing or future financing arrangements. Any acquisitions or divestitures we pursue may not be successful or prove to be beneficial to our operations and cash flow.
Financial Risks
Developments in new or ongoing conflicts around the world and related disruptions could adversely affect our liquidity, business, and results of operations.
Developments in new or ongoing conflicts or civil unrest around the world may cause significant disruptions to the global financial system, international trade, and the transportation and energy sectors, among others, potentially impacting supply chain and commodity prices which may result in substantial inflation. These disruptions together with the uncertainty created by these conflicts could have recessionary effects on the global economy. Prolonged inflationary conditions and periods of high interest rates could further negatively affect U.S. and international commerce and exacerbate or further extend the period of high energy prices and supply chain constraints. These and other issues resulting from a global economic slowdown and turmoil in the financial markets may continue to adversely affect the automotive industry, which may lead to a decline in the general demand for our products, our profitability or both. We do not have operations in the regions where there are current conflicts, nor do we sell into these markets. Nonetheless, if there is further global economic slowdown and a continuation of these conflicts, our liquidity, business, and results of operations may continue to be adversely affected.
Global, market and economic conditions could impact our ability to access liquidity sources.
Our continued access to sources of liquidity depends on multiple factors, including global economic conditions, public health events and any global supply chain disruptions on our customers and their production rates, the costs of raw materials, the state of the overall automotive industry, the condition of global financial markets, the availability of sufficient amounts of financing, our operating performance and cash flows and our credit ratings. In particular, the global automotive industry is susceptible to uncertain economic conditions that could adversely impact new vehicle demand and production, and business conditions may vary significantly from period to period or region to region. In recent years, global automotive production was negatively impacted by lingering impacts of the COVID-19 pandemic and broad supply chain challenges stemming, in part, from a sharp rebound in overall industrial demand. Further, rising inflation, interest rates and supply chain challenges contributed to global economic uncertainty. In addition, continuing military actions in Eastern Europe and the Middle East are having broad negative impacts on key sectors of the global economy. Our business is also directly affected by the automotive vehicle production rates in North America, Europe, Asia Pacific and South America which have been adversely impacted by a series of events in recent years.
Our ability to borrow against our senior asset-based revolving credit facility (the “ABL Facility”) is limited to our borrowing base, which consists primarily of our U.S. and Canadian accounts receivable and inventory. Production shutdowns or disruptions in both the United States and Canada could lead to significant reductions in these working capital balances and significantly decrease our ability to borrow under our ABL Facility.
In addition, if the Company has borrowing availability under its ABL Facility less than the greater of (i) $15.0 million and (ii) 10% of the Borrowing Base (as defined in the ABL Facility), it must be in compliance with a springing Fixed Charge Coverage Ratio maintenance covenant of 1.00:1.00. Any adverse effects on the Company’s business due to global, market and economic conditions may adversely impact the Company’s ability to satisfy such covenant. As of December 31, 2025, there were no obligations outstanding under the ABL Facility, the Company’s borrowing base was $168.3 million, and the monthly fixed charge coverage ratio was at a level that provided the Company full access to the borrowing base . Net of $7.4 million of outstanding letters of credit, the Company effectively had $160.9 million available for borrowing under its ABL Facility.
Furthermore, production shutdowns or disruptions will result in working capital swings which could result in increased outflows. As a result of current economic conditions and global supply chain disruptions, we may be required to raise additional
capital, and our access to and cost of financing will depend on, among other things, our performance, changing global economic conditions, conditions in the global financing markets, the availability of sufficient amounts of financing, our prospects and our credit ratings. Such capital may not be available on favorable terms or at all.
We have a substantial amount of indebtedness, which could have a material adverse effect on our financial condition and our ability to obtain financing in the future and to react to changes in our business.
We have a significant amount of indebtedness. As of December 31, 2025, we had total indebtedness of $1,104.6 million. Our substantial amount of debt and our debt service obligations could limit our ability to satisfy our obligations, limit our ability to operate our business and impair our competitive position. For example, it could:
• make it more difficult for us to satisfy our obligations;
• increase our vulnerability to general adverse economic and industry conditions, including interest rate fluctuations, because a portion of our borrowings accrues interest at variable rates;
• require us to dedicate a substantial portion of our cash flows from operations to payments on our debt and debt service obligations, which would reduce the availability of cash to fund working capital, capital expenditures, research and development efforts, acquisitions or other general corporate purposes;
• limit our flexibility in planning for, or reacting to, changes in our business and the markets in which we compete;
• place us at a disadvantage compared to competitors that may have less debt; and
• limit our ability to obtain additional debt or equity financing for working capital, capital expenditures, research and development efforts, debt service requirements, acquisitions and general corporate purposes.
Our ability to make scheduled payments on our debt or to refinance these obligations depends on our financial condition, operating performance and our ability to generate cash in the future. If our cash flows and capital resources are insufficient to fund our debt service obligations, we may be forced to reduce or delay investments and capital expenditures, sell material assets, seek additional capital or restructure or refinance our indebtedness, any of which could have a material adverse effect on our business, results of operations and financial condition. In addition, we may not be able to effect any of these actions, if necessary, on commercially reasonable terms or at all. Our ability to restructure or refinance our indebtedness will depend on the condition of the capital markets and our financial condition at such time. Any refinancing of our debt could be at higher interest rates and may require us to comply with more onerous covenants, which could further restrict our business operations. The terms of existing or future debt instruments, including the credit agreement governing the ABL Facility and the indentures governing the 13.50% Cash Pay / PIK Toggle Senior Secured First Lien Notes due 2027 (the “First Lien Notes”) and the 5.625% Cash Pay / 10.625% PIK Toggle Senior Secured Third Lien Notes due 2027 (the “Third Lien Notes”), may limit or prevent us from taking any of these actions. In addition, a reduction of our credit rating could harm our ability to incur additional indebtedness on commercially reasonable terms or at all. An inability to generate sufficient cash flow to satisfy our debt service obligations, or to refinance or restructure our obligations on commercially reasonable terms or at all, would have an adverse effect, which could be material, on our business, financial condition and results of operations, as well as on our ability to satisfy our obligations in respect of the 5.625% Senior Notes due 2026 (the “2026 Senior Notes”), the First Lien Notes, the Third Lien Notes, or the ABL Facility.
In addition, we and our subsidiaries may be able to incur other substantial additional indebtedness in the future. Although the credit agreement governing the ABL Facility and the indentures governing the First Lien Notes and the Third Lien Notes contain certain limitations on our ability to incur additional indebtedness, such restrictions are subject to a number of qualifications and exceptions, and the indebtedness incurred in compliance with these restrictions could be substantial. To the extent that we incur additional indebtedness or incur such other obligations that may be permitted under our debt instruments, the risks associated with our substantial indebtedness described above, including our potential inability to service our debt, will increase.
Our variable rate indebtedness subjects us to interest rate risk, which could cause our indebtedness service obligations to increase significantly.
The borrowings under the ABL Facility are at variable rates of interest and expose us to interest rate risk. If interest rates increase, our debt service obligations on the variable rate indebtedness would increase even though the amount borrowed remained the same, and our net income and cash flows, including cash available for servicing our indebtedness, would correspondingly decrease.
Secured overnight financing rate (“SOFR”) and other interest rates that are indices deemed to be “benchmarks” are the subject of recent and ongoing national, international and other regulatory guidance and proposals for reform. Some of these reforms are already effective, while others are still to be implemented. These reforms may cause such benchmarks to perform differently than in the past, to be replaced or disappear entirely, or have other consequences that cannot be predicted. Any such consequence could have a material adverse effect on our existing facilities or our future debt linked to such a “benchmark” and our ability to service debt that bears interest at floating rates of interest.
Our debt instruments impose significant operating and financial restrictions on us and our subsidiaries.
The credit agreements governing the ABL Facility and the indentures governing the First Lien Notes and the Third Lien Notes impose significant operating and financial restrictions and limit our ability, among other things, to:
• incur, assume or permit to exist additional indebtedness (including guarantees thereof);
• pay dividends or certain other distributions on our capital stock or repurchase our capital stock;
• prepay, redeem or repurchase indebtedness;
• incur liens on assets;
• make certain investments or other restricted payments;
• allow to exist certain restrictions on the ability of our restricted subsidiaries to pay dividends or make other payments to us;
• engage in transactions with affiliates; and
• sell certain assets or merge or consolidate with or into other companies.
Moreover, our ABL Facility provides the agent with considerable discretion to impose reserves, which could materially reduce the amount of borrowings that would otherwise be available to us.
As a result of these covenants and restrictions (including borrowing base availability), we are limited in how we conduct our business, and we may be unable to raise additional debt or equity financing to compete effectively or to take advantage of new business opportunities or acquisitions. The terms of any future indebtedness we may incur could include more restrictive covenants. We may not be able to maintain compliance with these covenants in the future and, if we fail to do so, we may not be able to obtain waivers from the lenders and/or amend the covenants in such agreements. Our failure to comply with the restrictive covenants described above as well as others contained in our future debt instruments from time to time could result in an event of default, which, if not cured or waived, could result in our being required to repay these borrowings before their due date. If we are forced to refinance these borrowings on less favorable terms or if we are unable to refinance such borrowings at all, our financial condition, results of operations and cash flows could be adversely affected.
If there were an event of default under any of the agreements relating to our outstanding indebtedness whether as a result of a payment default, covenant breach or otherwise, the holders of the defaulted debt could cause all amounts outstanding with respect to that debt to be due and payable immediately. Our assets or cash flow may not be sufficient to fully repay borrowings under our outstanding debt instruments if accelerated upon occurrence of an event of default. Further, if we are unable to repay, refinance or restructure our indebtedness under our secured debt, the holders of such debt could exercise remedies against the collateral securing that indebtedness with the holders of the First Lien Notes receiving full recovery on applicable collateral before the holders of the Third Lien Notes. In addition, any event of default or declaration of acceleration under one debt instrument could also result in an event of default under one or more of our other debt instruments. As a result, any default by us on our indebtedness could have a material adverse effect on our business, financial condition and results of operation.
Our expected annual effective tax rate and cash tax liability could be volatile and could materially change as a result of changes in many items including mix of earnings, debt and capital structure and other factors.
Many items could impact our effective tax rate and cash tax liability including changes in our debt and capital structure, mix of earnings and many other factors. Our overall effective tax rate is based upon the consolidated tax expense as a percentage of consolidated earnings before tax. However, tax expenses and benefits are not recognized on a consolidated or global basis, but rather on a jurisdictional, legal entity basis. Further, certain jurisdictions in which we operate generate losses where no current financial statement tax benefit is realized. In addition, certain jurisdictions have statutory rates greater than or less than the United States statutory rate. As such, changes in the mix and source of earnings between jurisdictions could have a significant impact on our overall effective tax rate and cash tax liability in future years. Changes in rules related to accounting for income taxes,
changes in tax laws and rates or adverse outcomes from tax audits that occur regularly in any of our jurisdictions could also have a significant impact on our overall effective tax rate and cash tax liability in future periods.
Our working capital requirements may negatively affect our liquidity and capital resources.
Our working capital requirements can vary significantly, depending in part on the level, variability and timing of our customers’ worldwide vehicle production and the payment terms with our customers and suppliers. If our working capital needs exceed our cash provided by operating activities, we would look to our cash balances and availability under our borrowing arrangements to satisfy those needs, as well as potential sources of additional capital, which may not be available on satisfactory terms and in adequate amounts, if at all.
Our sales and manufacturing operations outside the United States expose us to currency risks. For our consolidated financial statements, our sales and earnings denominated in foreign currencies are translated into U.S. Dollars. This translation is calculated based on average exchange rates during the reporting period. Accordingly, our reported international sales and earnings could be adversely impacted in periods of a strengthening U.S. Dollar.
Although we generally produce in the same geographic region as our products are sold, we also produce in countries that predominately sell in another currency. Further, some of our commodities are purchased in or tied to the U.S. Dollar; therefore, our earnings could be adversely impacted during the periods of a strengthening U.S. Dollar relative to other foreign currencies. While we employ financial instruments to hedge certain portions of our foreign currency exposures, our efforts to manage these risks may not be successful and may not completely insulate us from the effects of currency fluctuations.
Impairment charges relating to our goodwill, long-lived assets or intangible assets could adversely affect our results.
We regularly monitor our goodwill, long-lived assets and intangible assets for impairment indicators. In conducting a quantitative goodwill impairment test, we compare the fair value of our reporting units to their related net book value. If we instead perform a qualitative goodwill impairment test, we assess whether there are any events or circumstances that indicate it is more likely than not that the fair value of our reporting units is less than their related book value. In conducting our impairment analysis of long-lived and intangible assets, we compare the undiscounted cash flows expected to be generated from the long-lived or intangible assets to the related net book values if indicators of impairment are identified. Changes in economic or operating conditions impacting our estimates and assumptions could result in the impairment of our goodwill, long-lived assets or intangible assets. In the event that we determine that our goodwill, long-lived assets or intangible assets are impaired, we may be required to record a significant charge to earnings, which could adversely affect our results.
Certain of our pension plans are currently underfunded, and we may have to make cash contributions to the plans, reducing the cash available for our business.
We sponsor various pension plans worldwide that are underfunded and will require cash contributions. Additionally, if the performance of the assets in our pension plans does not meet our expectations, or if other actuarial assumptions are modified, our required contributions may be higher than we expect. As of December 31, 2025, our U.S. supplemental employee retirement plan (“SERP”) was underfunded by $9.8 million and our non-U.S. pension plans (which typically are pay-as-you-go plans) were underfunded by $83.7 million. If our cash flow from operations is insufficient to fund our worldwide pension liabilities, it could have an adverse effect on our financial condition and results of operations.
As further described in Note 12. “Pensions” to the consolidated financial statements in Item 8. “Financial Statements and Supplementary Data” of this Report, on April 3, 2024, the Company irrevocably transferred approximately $137.0 million of remaining pension benefit obligations and associated plan assets related to the U.S. Pension Plan to a highly rated insurance company, thereby reducing the Company’s pension obligations and assets by the same amount.
Significant changes in discount rates, the actual return on pension assets and other factors could adversely affect our liquidity, results of operations and financial condition.
Our earnings may be positively or negatively impacted by the amount of income or expense recorded related to our pension plans. Generally accepted accounting principles in the United States (“U.S. GAAP”) require that income or expense related to the pension plans be calculated at the annual measurement date using actuarial calculations which reflect certain assumptions. Because these assumptions have fluctuated and will continue to fluctuate in response to changing market conditions, the amount of gains or losses that will be recognized in subsequent periods, the impact on the funded status of the pension plans and the future minimum required contributions, if any, could adversely affect our liquidity, results of operations and financial condition.
Failure to maintain effective controls and procedures could adversely impact our business, financial condition and results of operations.
Regulatory provisions governing the financial reporting of U.S. public companies require that we establish and maintain disclosure controls and internal controls over financial reporting across our operations in 20 countries. Any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives; as such, they can be susceptible to human error, circumvention or override, and fraud. Failure to maintain adequate, effective controls and procedures could result in potential financial misstatements or other forms of noncompliance that could have an adverse impact on our business, results of operations, financial condition or organizational reputation.
We operate as a holding company and depend on our subsidiaries for cash to satisfy the obligations of the holding company.
Cooper-Standard Holdings Inc. is a holding company. Our subsidiaries conduct all of our operations and own substantially all of our assets. Our cash flow and our ability to meet our obligations depend on the cash flow of our subsidiaries. In addition, the payment of funds in the form of dividends, intercompany payments, tax sharing payments and other payments may be subject to restrictions under the laws of the countries of incorporation of our subsidiaries or their governing documents.
We may not be able to procure insurance at reasonable rates to fully meet our needs.
Integral to our risk management strategy and due to requirements under certain of our contracts, we procure insurance coverage from third-party insurers. There can be no assurance that any of our existing insurance coverage will be renewable upon the expiration of the coverage period or that future coverage will be affordable at needed limits. Such circumstances will lead to an increase in both our overall risk exposure and our operational expenses, disrupt the management of our business, and could have a material adverse effect on our business, financial condition and results of our operations.
Legal and Compliance Risks
We are involved from time to time in legal and regulatory proceedings, claims or investigations which could have an adverse impact on our results of operations and financial condition.
We are involved in legal and regulatory proceedings, claims or investigations that, from time to time, may be significant. These matters typically arise in the normal course of business including, without limitation, commercial or contractual disputes, including warranty claims and other disputes with customers and suppliers; intellectual property matters; personal injuryclaims; environmental issues; tax matters; employment matters; antitrust matters; anti-corruption matters; or allegations relating to legal compliance by us or our employees.
For further information regarding our legal matters, see Item 3. “Legal Proceedings.” The industries in which we operate are also periodically reviewed or investigated by regulators, which could lead to enforcement actions, fines and penalties or the assertion of private litigationclaims. It is not possible to predict with certainty the outcome of claims, investigations and lawsuits, and we could in the future incur judgments, fines or penalties or enter into settlements of lawsuits and claims that could have an adverse effect on our business, results of operations and financial condition in any particular period.
If we are unable to protect our intellectual property or if a third party challenges our intellectual property rights, our business could be adversely affected.
We own or have rights to proprietary technology that is important to our business. We rely on intellectual property laws, patents, trademarks and trade secrets to protect such technology. Such protections, however, vary among the countries in which we market and sell our products, and as a result, we may be unable to prevent third parties from using our intellectual property without authorization. Any infringement or misappropriation of our technology could have an adverse effect on our business and results of operations. We also face exposure to claims by others for infringement of intellectual property rights and could incur significant costs or losses related to such claims. In addition, many of our supply agreements require us to indemnify our customers from third-party infringementclaims. These claims, regardless of their merit or resolution, are frequently costly to prosecute, defend or settle and divert the efforts and attention of our management and employees. If any such claim were to result in an adverse outcome, we could be required to take actions which may include: ceasing the manufacture, use or sale of the infringing products; paying substantial damages to third parties, including to customers, to compensate them for the discontinued use of a product or to replace infringing technology with non-infringing technology; or expending significant resources to develop or license non-infringing products, any of which could adversely affect our operations, business and financial condition.
We may be adversely affected by laws and regulations, including environmental, health and safety laws and regulations.
We are subject to various U.S. federal, state and local, and non-U.S. laws and regulations, including those related to environmental, health and safety, financial, tax, customs and other matters. We cannot predict the substance or impact of pending
or future legislation or regulations, or the application thereof. The introduction of new laws or regulations or changes in existing laws or regulations, or the interpretations thereof, could increase the costs of doing business for us or our customers or suppliers or restrict our actions and adversely affect our financial condition, results of operations and cash flows.
In particular, we are subject to a broad range of laws and regulations governing emissions to air; discharges to water; noise and odor emissions; the generation, handling, storage, transportation, treatment, reclamation and disposal of chemicals and waste materials; the cleanup of contaminated properties; and health and safety. We may incur substantial costs in complying with these laws and regulations. Many of our current and former facilities have been subject to certain environmental investigations and remediation activities, and we maintain environmental reserves for certain of these sites. Through various acquisitions, we have acquired a number of manufacturing facilities, and we cannot assure that we will not incur material costs or liabilities relating to activities that predate our ownership. Material future expenditures may be necessary if compliance standards change or material unknown conditions that require remediation are discovered. Environmental laws could also restrict our ability to expand our facilities or could require us to acquire costly equipment or to incur other significant expenses. In addition, climate change poses regulatory risks that could harm our results of operations or affect the way we conduct our businesses. For example, new or modified regulations could require us to spend substantial funds to enhance our environmental compliance efforts. If we fail to comply with present and future environmental laws and regulations, we could be subject to future liabilities, which could adversely affect our financial condition, operating results and cash flows.
Although each OEM may emphasize different requirements as the primary criteria for judging its suppliers, we believe success as an automotive supplier generally requires outstanding performance with respect to quality, price, service, new program launches, design and engineering capabilities, innovation, timely delivery, financial stability, an extensive global footprint, and sustainability. Also, we believe our continued commitment to invest in global common processes is an important factor in servicing global customers with the same quality and consistency of product wherever we produce in the world. This is especially important when supplying products for global platforms.
In addition, to remain competitive and offset continued customer pricing pressure, we must also consistently achieve and sustain cost savings. In an ongoing effort to reduce our cost structure, we run a global continuous improvement program which includes training for our employees, as well as implementation of lean tools, structured problemsolving, best business practices, standardized processes and change management. We also continually evaluate opportunities to optimize our manufacturing footprint by consolidating facilities and relocating production as appropriate. We believe we will continue to be successful in our efforts to improve our design and engineering capabilities and manufacturing processes while achieving cost savings, including through our continuous improvement initiatives.
Our OEM sales are generally based upon purchase orders issued by the OEMs, with updated releases for volume adjustments. As such, we typically do not have a defined backlog of orders at any point in time. Once selected to supply products for a particular platform, we typically supply those products for the platform life, which is normally five to eight years, though this term is not guaranteed. In addition, when we are the incumbent supplier to a given platform, we believe we have a competitive advantage in winning the redesign or replacement platform, although future awards are not guaranteed.
In 2025, approximately 59% of our sales were generated in North America. Because of our significant international operations, we are subject to the risks associated with doing business in other countries, such as increased trade restrictions, tariffs or taxes or the imposition of embargoes on imports, currency volatility, high interest and inflation rates, and the general political and economic risk that are associated with some of these markets.
Recent Trends and Conditions
General Economic Conditions and Outlook
The global automotive industry is susceptible to unpredictable economic conditions that can adversely impact new vehicle demand and production. Disruptions in the supply chains for certain critical materials and components can further exacerbate these challenges, and business conditions can fluctuate significantly across different regions and time periods. In 2023, light
vehicle production showed strong resilience and growth, supported by sustained consumer demand and OEM efforts to replenish depleted inventory levels. This resilience and growth occurred despite ongoing global economy uncertainty created by persistent inflation, rising interest rates and heightened geopolitical tension in key regions of the world. In 2024, light vehicle production slowed modestly, primarily due to rising inventory levels, relatively high interest rates, concerns about vehicle affordability, and ongoing geopolitical tensions around the world. In 2025, global light vehicle production returned to moderate growth despitelingering economic risks and uncertainties stemming from ongoing geopolitical conflicts and shifts in U.S. trade policy, including the implementation of significant new tariffs on many imported goods, autos among them. This global growth was primarily driven by strong production volume in China which more than offset declines in North America and Europe. In 2026, industry forecasts anticipate a 0.4 percent decline in global vehicle production compared to 2025.
In North America, consumer confidence in the United States remains subdued, with certain indices remaining near their lowest levels in over a decade. Ongoing uncertainty surrounding U.S. trade policy continues to create instability across capital and consumer markets. Persistently high interest rates, elevated prices for consumer goods, and rising consumer debt are further weighing on overall economic activity. Despite these headwinds, lower tax rates, reduced regulation, and other incentives included in recent legislation are expected to help stimulate both commercial investment and consumer demand in 2026. Economists at the International Monetary Fund (IMF) now project that the economies of the United States, Canada and Mexico will grow by 2.4 percent, 1.6 percent and 1.5 percent, respectively, in 2026.
In Europe, rising real wages, increased employment, lower inflation (including reduced energy costs), and declining interest rates are driving stronger household consumption. Fiscal stimulus measures, particularly in Germany, along with increased investments in infrastructure and defense are also contributing to overall economic growth. Nevertheless, uncertainty remains regarding the implementation of recent trade agreements with the United States and their potential effects on the region. Amid this uncertain environment, economists at the IMF project that the Eurozone economy will grow by 1.3 percent in 2026.
In the Asia Pacific region, China’s economy has continued to grow steadily, supported by domestic stimulus measures and an increase in exports. However, weak domestic consumer demand, persistentdeclines in property values and mounting public debt are obscuring the prospects for future growth. Consumer confidence remains near its lowest point in a decade. Additionally, ongoing uncertainty surrounding trade relations with the United States has contributed to a slowdown in private industrial investment. Despite these challenges, economists at the IMF project that the Chinese economy will grow by 4.5 percent in 2026.
In South America, the Brazilian central bank has maintained interest rates at restrictive levels to combat persistent inflation. While these high interest rates, combined with a more conservative fiscal policy have resulted in lower inflation, it has not yet reached the target rate of 4.0 percent. Lower inflation, strong global demand for the country’s exports, and expectations of interest rate cuts later in 2026 as inflation nears the target rate are contributing to improved consumer confidence in the country. However, after two years of economic growth averaging roughly 3.0 percent, economists at the IMF project that Brazil's economic growth rate will slow modestly to 1.6 percent in 2026.
Production Levels
Our business is directly affected by the automotive vehicle production rates in North America, Europe, the Asia Pacific region and South America. These production rates can be impacted by changing macro-economic conditions, geopolitical actions, regional consumer sentiment, labor disruptions, supply chain disruptions and changing regulatory and trade requirements, among other factors.
According to estimates of S&P Global, global light vehicle production was approximately 92.9 million units in 2025. This reflects an increase of approximately 3.7% globally compared to 2024.
Light vehicle production in certain regions for 2025 and 2024, as well as projections for 2026, are provided in the following table:
(in millions of units)
Projected % Change 2026 vs. 2025
% Change 2025 vs. 2024
North America
Europe
Asia Pacific
Greater China
South America
(1) Production data based on S&P Global, January 2026.
Industry Overview
Competition in the automotive supplier industry is intense and has increased in recent years as OEMs have demonstrated a preference for stronger relationships with fewer suppliers. Because of a growing emphasis on global vehicle platforms, automotive suppliers with a global manufacturing footprint capable of fully servicing customers around the world will typically have a competitive advantage over smaller, regional competitors. This dynamic is likely to result in further consolidation of competing suppliers within our industry over time.
OEMs have shifted some research and development, design and testing responsibility to suppliers, while simultaneously shortening new product cycle times. To remain competitive, suppliers must have state-of-the-art engineering and design capabilities and continuously improve their engineering, design and manufacturing processes to effectively service the customer. Suppliers are increasingly expected to collaborate on, or assume the product design and development of, key automotive components. This shift requires suppliers to provide innovative solutions to meet evolving technologies aimed at improved emissions and fuel economy.
Increased competitiveness in the industry, as well as customer focus on costs, has resulted in continued pressure on suppliers for price reductions, even in an inflationary environment, which reduces the overall profitability of the supply industry. Consolidations and market share shifts among vehicle manufacturers continue to put additional pressures on the supply chain. These pricing and market pressures will continue to drive our focus on reducing our overall cost structure through continuous improvement initiatives, capital redeployment, restructuring and other cost management processes. In response to ongoing inflationary cost pressures, we have implemented aggressive lean and cost optimization initiatives to help mitigate their impact. In addition, we continue to actively pursue pricing adjustments from our customers to offset higher costs on our existing business, particularly where such costs are market driven and beyond our immediate control.
In addition to the above, other factors will present opportunities for automotive suppliers that are positioned to meet the demands of evolving automotive markets and operating environments. These include advancements in autonomous and connected vehicle technologies, shifting regulatory requirements, and growing consumer preferences for environmentally friendly products. Rapid developments in hybrid and electric vehicle (“EV”) architectures such as expanded global EV adoption, accelerating investment in charging infrastructure, and continued improvements in battery technology are reshaping industry expectations. EV sales continued to grow into 2025, supported by broader model availability and enhanced battery performance, while global forecasts project further expansion driven by regulatory pressure on emissions and ongoing electrification across major markets.
Raw Materials
Our business is susceptible to inflationary pressures with respect to raw materials. Abrupt changes in the market prices or availability of certain key raw materials may result in operational and profitabilitychallenges for the Company and the industry as a whole. Although global commodity markets and pricing remained stable in 2025, we continually work with our customers and suppliers to mitigate ongoing inflationary pressures and material-related cost exposures through a combination of expanded index-based agreements and other commercial enhancements.
Critical Accounting Policies and Estimates
Our significant accounting policies are more fully described in Note 2. “Basis of Presentation and Summary of Significant Accounting Policies” to the consolidated financial statements included in Item 8. “Financial Statements and Supplementary Data” of this Report. Certain of our accounting policies require the application of significant judgment by management in selecting the appropriate assumptions for calculating financial estimates. These policies require the most difficult, subjective or complex judgments that management makes in the preparation of the financial statements and accompanying notes. We consider an accounting estimate to be critical if (i) it requires us to make assumptions about matters that were uncertain at the time we were making the estimate, and (ii) changes in the estimate or different estimates that we could have selected could have had a material impact on our financial condition or results of operations. Such critical accounting estimates are discussed below. For these, materially different amounts could be reported under varied conditions and assumptions. While other items in our consolidated financial statements require estimation, however, in our judgment, they are not as critical as those discussed below.
Goodwill . Goodwill is tested for impairment as of October 1 of each year, or more frequently if an event occurs or circumstances indicate the carrying value of goodwill may be impaired. Our goodwill impairment testing is performed at the reporting unit level. We test goodwill for impairment by performing a qualitative assessment or using a quantitative test. We first assess qualitative factors to determine whether it is necessary to perform a more detailed quantitative goodwill impairment test. We would perform a quantitative test if the qualitative assessment determined it is more likely than not that a reporting unit’s carrying value is more than its fair value. We may also elect to bypass the qualitative assessment and proceed directly to the quantitative test for any reporting unit. If we elect to perform a quantitative test, fair value is based on the cash flows projected in
the reporting units’ strategic plans and long-range planning forecasts, discounted at a risk-adjusted rate of return. Our long-range planning forecasts are based on our assessment of revenue growth rates generally based on industry specific data, external vehicle build assumptions published by widely used external sources, and customer market share data based on known and targeted awards over a three-year period. The projected profit margin assumptions included in the plans are based on the current cost structure and adjustments for anticipated cost reductions or increases. If different assumptions were used in these plans, the related cash flows used in measuring fair value could be different and impairment of goodwill might be recorded. For the 2025 annual goodwill impairment test, we performed a quantitative assessment and determined that it is more likely than not that the fair values of our Sealing Systems, Fluid Handling Systems, and Industrial and Specialty Group reporting units exceeded their carrying values . See Note 9. “Goodwill and Intangible Assets” to the consolidated financial statements included in Item 8. “Financial Statements and Supplementary Data” of this Report for additional information.
Long-Lived Assets . We monitor our long-lived assets for impairment indicators on an ongoing basis. If impairment indicators exist, we analyze the undiscounted cash flows expected to be generated from the long-lived asset group compared to the related net book values. If the net book value exceeds the undiscounted cash flows, an impairmentloss is measured and recognized. An impairmentloss is measured as the difference between the net book value and the fair value of the long-lived assets. Fair value is determined by using various valuation approaches depending on the asset type. Fair value of machinery and equipment is based upon either estimated salvage value or estimated orderly liquidation value. Fair value of leased buildings is based on a discounted cash flow approach. Fair value of owned buildings is based on a sales comparison approach or cost approach. When determining fair value, cash flows are estimated using internal budgets based on recent sales data, independent automotive production volume estimates, and customer commitments. If applicable, discount rates are used in fair value calculations where required. Changes in economic or operating conditions impacting these estimates and assumptions could result in the impairment of long-lived assets.
In 2025, 2024 and 2023, we recorded impairment charges related to buildings and machinery and equipment. The 2025 and 2024 impairments were related solely to idle assets and were based on internal assessments. In contrast, for 2023, we engaged a third-party valuation firm to determine fair values in order to calculate impairment charges. See Note 8. “Property, Plant and Equipment, Net” to the consolidated financial statements included in Item 8. “Financial Statements and Supplementary Data” of this Report for additional information.
Income Taxes. In determining the provision for income taxes for financial statement purposes, we make estimates and judgments which affect our evaluation of the carrying value of our deferred tax assets as well as our calculation of certain tax liabilities. We evaluate the carrying value of our deferred tax assets on a quarterly basis. In completing this evaluation, we consider all available positive and negative evidence. Such evidence includes historical operating results, the existence of cumulative earnings and losses in the most recent fiscal years, taxable income in prior carryback year(s) if permitted under the tax law, expectations for future pretax operating income which considers forecasted revenue trends within the automotive industry, the time period over which our temporary differences will reverse, and the implementation of feasible and prudent tax planning strategies. Deferred tax assets are reduced by a valuation allowance if, based on the weight of this evidence, it is more likely than not that all or a portion of the recorded deferred tax assets will not be realized in future periods.
Concluding that a valuation allowance is not required is difficult when there is significant negative evidence which is objective and verifiable, such as cumulative losses in recent years. We utilize three years’ cumulative pre-tax book results adjusted for significant permanent book to tax differences as a measure of cumulative results in recent years. In certain jurisdictions, our analysis indicates that we have cumulative three-year historical losses on this basis. This is considered significant negative evidence which is difficult to overcome. However, the three-year loss position is not solely determinative, and, accordingly, management considers all other available positive and negative evidence in its analysis. In the U.S. and certain foreign jurisdictions, we concluded that it is more likely than not that the net deferred tax assets may not be realized in the future. Accordingly, we continue to maintain and adjust as appropriate the valuation allowance related to those net deferred tax assets. However, since future financial results may differ from previous estimates, periodic adjustments to our valuation allowances may be necessary.
In addition, the calculation of our tax benefits and liabilities includes uncertainties in the application of complex tax regulations in a multitude of jurisdictions across our global operations. We recognize tax benefits and liabilities based on our estimate of whether, and the extent to which, additional taxes will be due. We adjust these liabilities based on changing facts and circumstances; however, due to the complexity of some of these uncertainties and the impact of any tax audits, the ultimate resolutions may be materially different from our estimated liabilities. See Note 15. “Income Taxes” to the consolidated financial statements included in Item 8. “Financial Statements and Supplementary Data” of this Report for additional information.
Pensions and Postretirement Benefits Other Than Pensions . Included in our results of operations are significant pension and postretirement benefit costs, which are measured using actuarial valuations. Inherent in these valuations are key assumptions,
including discount rates, mortality rates, expected returns on plan assets and health care cost trend rates. These assumptions are determined as of the current year measurement date. We consider current market conditions, including changes in interest rates, in making these assumptions. Changes in pension and postretirement benefit costs may occur in the future due to changes in these assumptions. Experience gains and losses as well as the effects of changes in actuarial assumptions are recognized in other comprehensive income. Cumulative actuarial gains and losses in excess of 10% of the projected benefit obligations or the fair value of plan assets for a particular plan are amortized over the average future service period of the employees in that plan. Our net pension and postretirement benefit costs (income), which included net pension settlement charges of $0.1 million, were approximately $7.3 million and $(0.9) million, respectively, for the year ended December 31, 2025.
To develop the discount rate for each pension plan, the expected cash flows underlying the plan’s benefit obligations were discounted using a December 31, 2025 pension index to determine a single equivalent rate. To develop our expected return on plan assets, we considered historical long-term asset return experience, the expected investment portfolio mix of plan assets and an estimate of long-term investment returns.
Weighted average assumptions used to determine pension benefit obligations as of December 31, 2025 were as follows:
Non-U.S.
Discount rate
Rate of compensation increase
* The U.S assumptions relate only to the Company’s U.S. SERP which is a frozen plan; therefore, the rate of compensation increase was not applicable.
Weighted average assumptions used to determine net periodic benefit costs for the year ended December 31, 2025 were as follows:
Non-U.S.
Discount rate
Expected return on plan assets
Rate of compensation increase
* There were no U.S. plan assets as of December 31, 2025; therefore, the expected return on plan assets was not applicable.
** The U.S assumptions relate only to the Company’s U.S. SERP which is a frozen plan; therefore, the rate of compensation increase was not applicable.
The sensitivity of our pension cost and obligations to changes in key assumptions, holding all other assumptions constant, is as follows:
Change in assumption
Impact on 2026 net periodic benefit cost
Impact on PBO as of December 31, 2025
1% increase in discount rate
- $0.6 million
- $11.3 million
1% decrease in discount rate
+ $0.6 million
+ $13.5 million
1% increase in expected return on plan assets
- $0.3 million
1% decrease in expected return on plan assets
+ $0.3 million
Aggregate pension net periodic benefit cost is forecasted to be approximately $6.7 million in 2026.
Health care cost trend rates are assumed to reflect market trend, actual experience and future expectations. Health care cost trend rate assumptions used to determine the postretirement benefit obligations as of December 31, 2025 were as follows:
Non-U.S.
Health care cost trend rate
Ultimate health care cost trend rate
Year that the rate reaches the ultimate trend rate
Aggregate other postretirement net periodic benefit income is forecasted to be approximately $0.5 million in 2026.
The Company’s policy is to fund pension plans such that sufficient assets will be available to meet future benefit requirements and contribute amounts required by local statute. The Company does not anticipate making cash contributions to its
U.S. SERP in 2026 but does expect to make immaterial minimum funding cash contributions to its non-U.S. pension plans in 2026.
The Company does not prefund its postretirement benefit obligations. Rather, payments are made as costs are incurred by covered retirees. We expect net other postretirement benefit payments to be approximately $2.1 million in 2026.
Historical Periods
Refer to Part II - Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Form 10-K for the fiscal year ended December 31, 2024 for discussion of the Results of Operations, Segment Results of Operations, and Liquidity and Capital Resources for the year ended December 31, 2024 compared to the year ended December 31, 2023, which is incorporated by reference herein.
Results of Operations
Year Ended December 31,
Change
(Dollar amounts in thousands)
Sales
Cost of products sold
Gross profit
Selling, administration & engineering expenses
Gain on sale of businesses, net
Gain on sale of buildings and land, net
Amortization of intangibles
Restructuring charges
Impairment charges
Operating income
Interest expense, net of interest income
Equity in earnings of affiliates
Pension settlement and curtailment charges
Other expense, net
Loss before income taxes
Income tax benefit
Net loss
Net loss (income) attributable to noncontrolling interests
Net loss attributable to Cooper-Standard Holdings Inc.
Year Ended December 31, 2025 Compared with Year Ended December 31, 2024
Sales
Year Ended December 31,
Variance Due To:
Change
Volume / Mix*
Foreign Exchange
(Dollar amounts in thousands)
Total sales
* Net of customer price adjustments, including recoveries.
Sales for the year ended December 31, 2025 increased 0.4%, compared to the year ended December 31, 2024. The increase in sales was driven by favorable foreign exchange, partially offset by unfavorable volume and mix, net of customer price adjustments including recoveries.
Gross Profit
Year Ended December 31,
Variance Due To:
Change
Volume / Mix*
Foreign Exchange
Cost (Decreases) / Increases**
(Dollar amounts in thousands)
Cost of products sold
Gross profit
Gross profit percentage of sales
* Net of customer price adjustments, including recoveries.
** Net of savings from restructuring initiatives.
Cost of products sold is primarily comprised of direct materials, labor, manufacturing overhead, freight, depreciation, and other direct operating expenses. Among these, direct materials represent the largest component, accounting for approximately 52% and 51% of total cost of products sold for the years ended December 31, 2025 and December 31, 2024, respectively. The change in cost of products sold was impacted by manufacturing and purchasing cost savings through lean initiatives and savings from prior year restructuring initiatives, partially offset by unfavorable foreign exchange, unfavorable volume and mix, net of recoveries, and higher labor and overhead inflation.
Gross profit for the year ended December 31, 2025 increased 8.1% compared to the year ended December 31, 2024. As a percentage of sales, gross profit was 11.9% and 11.1% for the years ended December 31, 2025 and December 31, 2024, respectively. The change was driven by manufacturing and purchasing savings through lean initiatives, savings from prior year restructuring initiatives and favorable foreign exchange, partially offset by unfavorable volume and mix, net of recoveries, and higher labor and overhead inflation.
Selling, Administration and Engineering Expenses. Selling, administration and engineering expenses include administrative expenses as well as product engineering and design and development costs. Selling, administration and engineering expenses for the year ended December 31, 2025 were $214.4 million, or 7.8% of sales, compared to $207.6 million, or 7.6% of sales, for the year ended December 31, 2024. The increase, in both dollar terms and as a percentage of sales, was primarily due to higher stock-based compensation expense driven by stock price appreciation during the year ended December 31, 2025, partially offset by savings realized from restructuring actions and spending reductions initiated in 2024.
Gain on Sale of Businesses, Net. Gain on sale of businesses, net for the year ended December 31, 2024 was $2.0 million, resulting from the net effect of the sale of our Canadian tooling business. See Note 4. “Divestitures” to the consolidated financial statements included in Item 8. “Financial Statements and Supplementary Data” of this Report for additional information.
Gain on Sale of Buildings and Land, Net. Gain on sale of buildings and land, net for the year ended December 31, 2024 was $3.3 million, resulting from the sale of a building and land related to one of our Canadian facilities. See Note 8. “Property, Plant and Equipment, Net” to the consolidated financial statements included in Item 8. “Financial Statements and Supplementary Data” of this Report for additional information.
Restructuring Charges . Restructuring charges for the year ended December 31, 2025 decreased $3.6 million compared to the year ended December 31, 2024. Our restructuring actions, which include plant and facility closures as well as workforce reductions, are initiated to maintain a competitive footprint or in response to changes in global and regional automotive markets. The decrease was primarily driven by a cost optimization restructuring plan that was implemented in the second quarter of 2024, resulting in higher restructuring-related expenses recognized in the prior year. See Note 6. “Restructuring” to the consolidated financial statements included in Item 8. “Financial Statements and Supplementary Data” of this Report for additional information.
Impairment Charges. Non-cash asset impairment charges of $0.4 million and $0.7 million for the years ended December 31, 2025 and December 31, 2024, respectively, related to property, plant and equipment impairment charges.
Pension Settlement and Curtailment Charges. Non-cash settlement and curtailment charges for the year ended December 31, 2025 decreased $44.4 million compared to the year ended December 31, 2024. The decrease was primarily related to the termination of a certain U.S. pension plan that was completed during the year ended December 31, 2024. See Note 12. “Pensions” to the consolidated financial statements included in Item 8. “Financial Statements and Supplementary Data” of this Report for additional information.
Other Expense, Net. Other expense, net for the year ended December 31, 2025 decreased $17.0 million compared to the year ended December 31, 2024. The change was primarily driven by $10.3 million of income recognized in connection with certain royalty settlements during the year ended December 31, 2025 and a decrease in foreign currency losses by $5.7 million year-over-year.
Income Tax Benefit. Income tax benefit for the year ended December 31, 2025 was $19.2 million on losses before taxes of $23.5 million. This compared to an income tax benefit of $23.3 million on losses before taxes of $101.5 million for the year ended December 31, 2024. The tax expense in 2025 and 2024 differed from the statutory rate primarily due to incremental valuation allowances recorded on tax losses generated in the U.S. and certain foreign jurisdictions, the mix of income between the U.S. and foreign sources, tax credits and incentives, and other nonrecurring discrete items. Additionally, the year ended December 31, 2025 included a $45.4 million benefit for valuation allowance reversals in France, Spain, and a Korean location while the year ended December 31, 2024 included a $41.5 million benefit for valuation allowance reversals in Brazil, Poland, and a Chinese location.
Segment Results of Operations
Our business is organized in two reportable segments: Sealing Systems and Fluid Handling Systems. All other business activities are reported in Corporate, eliminations and other. The Company uses segment adjusted EBITDA as the measure of earnings to assess the performance of each segment and determine the resources to be allocated to the segments. We have defined adjusted EBITDA as net income before interest, taxes, depreciation, amortization, restructuring expense, and special items.
The following tables present sales and segment adjusted EBITDA for each of the reportable segments.
Year Ended December 31, 2025 Compared with Year Ended December 31, 2024
Sales
Year Ended December 31,
Variance Due To:
Change
Volume / Mix *
Foreign Exchange
(Dollar amounts in thousands)
Sales to external customers
Sealing Systems
Fluid Handling Systems
* Net of customer price adjustments, including recoveries.
Sealing Systems. The variance in volume and mix was driven by lower customer volumes, unfavorable product mix and unfavorable customer price adjustments. Th e foreign currency exchange variance was primarily driven by the strengthening of the Euro relative to the U.S. dollar, which resulted in an $18.4 million favorable impact, partially offset by a $3.9 million unfavorable impact of the Brazilian Real, a $3.0 million unfavorable impact of the Canadian Dollar, and a $0.6 million unfavorable impact of all other currencies.
Fluid Handling Systems. The variance in volume and mix was driven by favorable customer price adjustments, including tariff recoveries and increased pass-through pricing associated with directed-buy components, partially offset by lower customer volumes and unfavorable product mix. Th e foreign currency exchange variance was primarily driven by the strengthening of the Euro relative to the U.S. dollar, which resulted in a $5.2 million favorable impact, partially offset by a $3.2 million unfavorable impact of the Korean Won, and a $1.1 million unfavorable impact of all other currencies.
Segment adjusted EBITDA
Year Ended December 31,
Variance Due To:
Change
Volume / Mix *
Foreign Exchange
Cost (Increases)/Decreases**
(Dollar amounts in thousands)
Segment adjusted EBITDA
Sealing Systems
Fluid Handling Systems
* Net of customer price adjustments, including recoveries.
** Net of savings from restructuring initiatives.
Sealing Systems. The variance in volume and mix, including customer price adjustments, was driven by lower customer volumes and unfavorable product mix. The foreign currency exchange variance was primarily driven by a $4.8 million unfavorable impact of the Canadian Dollar. The cost decreases were primarily driven by $43.4 million of manufacturing and purchasing savings through lean initiatives. These savings were partially offset by $12.9 million of unfavorable inflation in labor and $5.7 million of other operational cost increases.
Fluid Handling Systems. The variance in volume and mix was driven by lower customer volumes and unfavorable product mix, partially offset by favorable customer price adjustments. The foreign currency exchange variance was primarily driven by a $16.6 million favorable impact of the Mexican Peso. The cost increases were primarily driven by $11.3 million of unfavorable inflation in labor and other operational costs, $3.2 million of higher tariff-related costs incurred but not yet recovered, and $3.4 million of other operational cost increases. These cost increases were partially offset by $15.1 million of manufacturing and purchasing savings through lean initiatives.
Liquidity and Capital Resources
Short and Long-Term Liquidity Considerations and Risks
The sources to fund our ongoing working capital, capital expenditures, debt service and other funding requirements are a combination of cash flows from operations, cash on hand, borrowings under our senior asset-based revolving credit facility (“ABL Facility”) and receivables factoring. We utilize intercompany loans and equity contributions to fund our worldwide operations. However, certain country-specific regulations may impose restrictions or result in increased costs when repatriating funds. See Note 10. “Debt and Other Financing” to the consolidated financial statements in Item 8. “Financial Statements and Supplementary Data” of this Report for additional information.
We continue to actively preserve cash and enhance liquidity, including proactively managing our capital expenditures. We continuously monitor and forecast our liquidity situation in light of automotive industry, customer and economic factors, and take the necessary actions to preserve our liquidity and evaluate other financial alternatives that may be available to us should the need arise. Our ability to fund our working capital needs, debt payments and other obligations, and to comply with the financial covenants, including borrowing base limitations under our ABL Facility, depends on our future operating performance and cash flows. These may be impacted by many factors outside of our control, including but not limited to industry production levels, the costs of raw materials, the state of the overall automotive industry, general financial and economic conditions, including global trade and tariff policies, work stoppages, and potential public health events. Considering these factors, current projections for light vehicle production and customer demand for our products, we believe that our cash flows from operations, cash on hand, availability under our ABL Facility and receivables factoring will enable us to meet our ongoing working capital requirements, capital expenditures, debt service and other funding requirements for the foreseeable future, despite the challenges facing the industry .
Cash Flows
Operating Activities. Net cash provided by operating activities was $64.4 million for the year ended December 31, 2025, compared to net cash provided by operating activities of $76.4 million for the year ended December 31, 2024. The net change was primarily due to lower net cash earnings year-over-year, changes in working capital and an increase in cash interest payments by $12.4 million year-over-year. Working capital was negatively impacted primarily by a larger increase in receivables, reflecting timing of collections from customers during the year ended December 31, 2025 compared to the year ended December 31, 2024.
Investing Activities . Net cash used in investing activities was $45.6 million for the year ended December 31, 2025, compared to net cash used in investing activities of $45.1 million for the year ended December 31, 2024. The net change was primarily due to proceeds from the sale of fixed assets of $4.3 million received during the year ended December 31, 2024, partially offset by lower capital expenditures year-over-year, as well as a net increase in proceeds from the sale of businesses by $1.8 million year-over-year. Capital expenditures were $48.2 million for the year ended December 31, 2025 compared to $50.5 million for the year ended December 31, 2024. We expect to maintain disciplined capital spending and anticipate total capital expenditures of approximately $55 million to $65 million in 2026.
Financing Activities. Net cash used in financing activities totaled $4.0 million for the year ended December 31, 2025, compared to net cash used in financing activities of $9.6 million for the year ended December 31, 2024. The net change was primarily due to a net decrease in principal payments on outstanding debt by $7.5 million year-over-year and a net decrease in debt issuance costs by $1.9 million year-over-year. The prior year debt issuance costs were paid in connection with Amendment No. 4 to the Company’s ABL Facility, which was executed in May 2024. These changes were partially offset by a net increase in tax withholding amounts related to employees’ share-based payment awards by $1.1 million year-over-year.
Off-Balance Sheet Arrangements
As a part of our working capital management, we sell accounts receivable from certain European customers through a third-party financial institution in off-balance sheet arrangements. The amount sold varies each month based on the amount of underlying receivables and cash flow needs. As of December 31, 2025 and 2024, we had $70.7 million and $53.4 million, respectively, of receivables outstanding under receivable transfer agreements entered into by various locations. For the years ended December 31, 2025 and 2024, total accounts receivable factored were $463.0 million and $497.4 million, respectively. Costs incurred on the sale of receivables were $2.1 million, $2.9 million and $2.2 million for the years ended December 31, 2025, 2024 and 2023, respectively. These amounts are recorded in other expense, net in the consolidated statements of operations. These are permitted transactions under the credit agreements governing the ABL Facility and the indentures governing the First Lien Notes, Third Lien Notes, and 2026 Senior Notes.
Other Capital Transactions Impacting Liquidity
Share Repurchase Program
In June 2018, our Board of Directors approved a common stock repurchase program (the “2018 Program”) authorizing us to repurchase, in the aggregate, up to $150.0 million of our outstanding common stock. Under the 2018 Program, repurchases may be made on the open market, through private transactions, accelerated share repurchases, round lot or block transactions on the New York Stock Exchange or otherwise, as determined by management and in accordance with prevailing market conditions and federal securities laws and regulations. We expect to fund any future repurchases from cash on hand and future cash flows from operations. The specific timing and amount of any future repurchase will vary based on market and business conditions, changes in tax laws and other factors. We are not obligated to acquire a particular amount of securities, and the 2018 Program may be discontinued at any time at our discretion. The 2018 Program was effective beginning November 2018. As of December 31, 2025, we had approximately $98.7 million of repurchase authorization under the 2018 Program. We did not make any repurchases under the 2018 Program during the years ended December 31, 2025, 2024 or 2023.
The First Lien Notes, Third Lien Notes, and ABL Facility each contain covenants that restrict the Company’s ability to pay dividends or make distributions on, or repurchases of, the Common Stock, subject to certain exceptions.
Contractual Obligations
Our contractual obligations consist of legal commitments requiring us to make fixed or determinable cash payments, regardless of the contractual requirements of the vendor to provide future goods or services. Except as otherwise disclosed, this table does not include information on our recurring purchase of materials for use in production because our raw materials purchase contracts typically do not require fixed or minimum quantities.
The following table summarizes the total amounts due in future periods under all debt agreements at nominal value, undiscounted finance lease commitments and other contractual obligations as of December 31, 2025:
Payment due by period
Total
Less than
1 year
1-3 years
3-5 years
More than
5 years
(Dollar amounts in millions)
Debt obligations
Interest on debt obligations
Operating lease obligations
Finance lease obligations
Total
As of December 31, 2025, undiscounted lease payments of the Company’s future operating leases that have not yet commenced were immaterial.
In addition to our contractual obligations and commitments set forth in the table above, we have employment arrangements with certain key executives that provide for continuity of management. These arrangements include payments of multiples of annual salary, certain incentives and continuation of benefits upon the occurrence of specified events in a manner believed to be consistent with comparable companies.
We also have funding requirements with respect to our pension obligations. We do not expect to make cash contributions to our U.S. SERP in 2026, but we do expect to make immaterial minimum funding cash contributions to our foreign pension plans in 2026. Our minimum funding requirements after 2026 will depend on several factors, including the investment performance of our retirement plans and prevailing interest rates. Our funding obligations may also be affected by changes in applicable legal requirements. We also have payments due with respect to our postretirement benefit obligations. Unlike our pension obligations, we do not prefund our postretirement benefit obligations; instead, payments are made as costs are incurred by covered retirees. We expect net other postretirement benefit payments to be approximately $2.1 million in 2026.
We may be required to make significant cash outlays due to our unrecognized tax benefits. However, due to the uncertainty of the timing of future cash flows associated with our unrecognized tax benefits, we are unable to make reasonably reliable estimates of the period of cash settlement, if any, with the respective taxing authorities. Accordingly, unrecognized tax benefits of $12.3 million as of December 31, 2025 have been excluded from the contractual obligations table above. See Note 15. “Income Taxes” to the consolidated financial statements included in Item 8. “Financial Statements and Supplementary Data” of this Report for additional information.
Excluded from the contractual obligations table above are open purchase orders as of December 31, 2025 for raw materials, supplies and capital expenditures in the normal course of business, supply contracts with customers, distribution agreements, joint venture agreements and other contracts without express funding requirements.
Other Matters
We may, from time to time, seek to purchase our outstanding debt securities or loans, including the First Lien Notes, Third Lien Notes, and 2026 Senior Notes. Such transactions could be privately negotiated or open market transactions, pursuant to tender offers or otherwise. Any such purchases will be made in our sole discretion in light of market conditions, applicable limitations contained in the agreements governing our indebtedness and other relevant factors. The amounts involved in any such purchase transactions, individually or in the aggregate, may be material. Any such purchases may equate to a substantial amount of a particular class or series of debt, which may reduce the trading liquidity of such class or series.
In the third quarter of 2023, we designated Liveline Technologies, Inc. (“Liveline”) as an unrestricted subsidiary under the terms of certain of its debt agreements. Liveline remains a wholly-owned subsidiary of Cooper-Standard Automotive Inc. Liveline incurred a net loss of $1.7 million, $2.5 million and $0.6 million for the years ended December 31, 2025, 2024 and 2023, respectively. As of December 31, 2025 and 2024, Liveline had approximately $1.0 million and less than $0.5 million of gross assets, respectively. Liveline will look to the Company for necessary funding until it is able to sustain itself through sales of its products and services.
Non-GAAP Financial Measures
In evaluating our business, management considers EBITDA and Adjusted EBITDA to be key indicators of our operating performance. Our management also uses EBITDA and Adjusted EBITDA:
• because similar measures are utilized in the calculation of the financial covenants and ratios contained in our financing arrangements;
• in developing our internal budgets and forecasts;
• as a significant factor in evaluating our management for compensation purposes;
• in evaluating potential acquisitions;
• in comparing our current operating results with corresponding historical periods and with the operational performance of other companies in our industry; and
• in presentations to the members of our board of directors to enable our board of directors to have the same measurement basis of operating performance as is used by management in their assessments of performance and in forecasting and budgeting for our company.
In addition, we believe EBITDA and Adjusted EBITDA and similar measures are widely used by investors, securities analysts and other interested parties in evaluating our performance. We define Adjusted EBITDA as net income (loss) plus income tax expense (benefit), interest expense, net of interest income, depreciation and amortization or EBITDA, as adjusted for items that management does not consider to be reflective of our core operating performance. These adjustments include, but are not limited to, restructuring costs, certain impairment charges, non-cash fair value adjustments and acquisition-related costs.
EBITDA and Adjusted EBITDA are not financial measurements recognized under U.S. GAAP, and when analyzing our operating performance, investors should use EBITDA and Adjusted EBITDA as a supplement to, and not as alternatives for, net income (loss), operating income, or any other performance measure derived in accordance with U.S. GAAP, nor as an alternative to cash flow from operating activities as a measure of our liquidity. EBITDA and Adjusted EBITDA have limitations as analytical tools, and they should not be considered in isolation or as substitutes for analysis of our results of operations as reported under U.S. GAAP. These limitations include the following:
• they do not reflect our cash expenditures or future requirements for capital expenditure or contractual commitments;
• they do not reflect changes in, or cash requirements for, our working capital needs;
• they do not reflect interest expense or cash requirements necessary to service interest or principal payments under our ABL Facility, First Lien Notes, Third Lien Notes, and 2026 Senior Notes;
• they do not reflect certain tax payments that may represent a reduction in cash available to us;
• although depreciation and amortization are non-cash charges, the assets being depreciated or amortized may have to be replaced in the future, and EBITDA and Adjusted EBITDA do not reflect cash requirements for such replacements; and
• other companies, including companies in our industry, may calculate these measures differently and, as the number of differences in the way companies calculate these measures increases, the degree of their usefulness as a comparative measure correspondingly decreases.
In addition, in evaluating Adjusted EBITDA, it should be noted that in the future, we may incur expenses similar to the adjustments in the below presentation. Our presentation of Adjusted EBITDA should not be construed as an inference that our future results will be unaffected by special items.
The following table provides a reconciliation of EBITDA and Adjusted EBITDA from net loss, which is the most comparable financial measure in accordance with U.S. GAAP:
Year Ended December 31,
(Dollar amounts in thousands)
Net loss attributable to Cooper-Standard Holdings Inc.
Income tax (benefit) expense
Interest expense, net of interest income
Depreciation and amortization
EBITDA
Restructuring charges
Impairment charges (1)
Gain on sale of businesses, net (2)
Gain on sale of buildings and land, net (3)
Loss on refinancing and extinguishment of debt (4)
Pension settlement and curtailment charges (5)
Adjusted EBITDA
(1) Non-cash impairment charges in 2025 and 2024 related to idle assets in certain locations in Asia Pacific. Non-cash impairment charges in 2023 related to certain assets in Europe and Asia Pacific.
(2) Gain on sale of businesses related to divestitures in 2024 and 2023. Gain recognized in 2025 related to final purchase price adjustments associated with the divestiture in 2024.
(3) In 2024, the Company recognized a gain on the sale of building and land related to a Canadian facility.
(4) Loss on refinancing and extinguishment of debt related to refinancing transactions in 2023.
(5) Non-cash net pension settlement and curtailment charges and administrative fees incurred related to certain of our U.S. and non-U.S. pension plans.
Recent Accounting Pronouncements
See Note 3. “New Accounting Pronouncements” to the consolidated financial statements included in Item 8. “Financial Statements and Supplementary Data” of this Report for additional information.
