Restructuring Activities

6 Months Ended

Jun. 30, 2011

Restructuring Activities [Abstract]

Restructuring Activities

10. Restructuring Activities

In 2009, we announced the following restructuring plans:

• A reduction in workforce and the closure of certain manufacturing, warehousing and assembly facilities. The facilities closed included an assembly and sequencing facility in Kent, Washington; seat sequencing and assembly facility in Statesville, North Carolina; manufacturing facility in Lake Oswego, Oregon; inventory and product warehouse in Concord, North Carolina; and seat assembly and distribution facility in Seneffs, Belgium. The decision to reduce our workforce was the result of the extended downturn of the global economy and, in particular, the commercial vehicle markets. We substantially completed these activities as of December 31, 2009.

• The closure of our Vancouver, Washington manufacturing facility. The decision to close the facility was the result of the extended downturn of the global economy and, in particular, the commercial vehicle markets. We substantially completed this closure as of December 31, 2009.

• The closure and consolidation of one of our facilities located in Liberec, Czech Republic and the closing of our Norwalk, Ohio truck cab assembly facility. The closure and consolidation of our Liberec, Czech Republic facility was a result of management’s continued focus on reducing fixed costs and eliminating excess capacity. The closure of this facility was substantially completed as of December 31, 2009. The closure of our Norwalk, Ohio facility was a result of Navistar’s decision to insource the cab assembly operations into its existing assembly facility in Escobedo, Mexico. We substantially completed the Norwalk closure as of September 30, 2010.

We estimate that we will record total cash expenditures for all of these restructurings of approximately $6.7 million, consisting of approximately $2.5 million of severance costs and $4.2 million of facility closure costs. For the three months ended June 30, 2011, we incurred charges of approximately $0.2 million in facility closure costs. We have incurred cumulative restructuring charges of $5.9 million consisting of approximately $2.5 million of severance costs and $3.4 million of facility closure costs as of June 30, 2011.

A summary of the restructuring liability for the six months ended June 30, 2011 is as follows (in thousands):

				Facility Exit
				and Other
	Employee			Contractual
	Costs			Costs			Total
Balance — December 31, 2010	$	101		$	1,362		$	1,463
Provisions		71			471			542
Utilizations		(165	)		(967	)		(1,132	)
Currency		—			80			80
Balance — June 30, 2011	$	7		$	946		$	953

During the three-month period ended June 30, 2011, we reclassified our held-for-sale assets pertaining to our Norwalk, Ohio facility consisting of $1.4 million in land and buildings and approximately $0.7 million in machinery and equipment to property, plant and equipment within our condensed consolidated balance sheet. This reclassification resulted from management’s decision to no longer actively market the sale of the assets.