Benefit Plans

6 Months Ended

Jun. 30, 2020

Retirement Benefits [Abstract]

Benefit Plans

Benefit Plans:

Pension coverage for employees of PMI’s subsidiaries is provided, to the extent deemed appropriate, through separate plans, many of which are governed by local statutory requirements. In addition, PMI provides health care and other benefits to substantially all U.S. retired employees and certain non-U.S. retired employees. In general, health care benefits for non-U.S. retired employees are covered through local government plans.

Pension and other employee benefit costs per the condensed consolidated statements of earnings consisted of the following:

	For the Six Months Ended June 30,						For the Three Months Ended June 30,
(in millions)	2020			2019			2020			2019
Net pension costs (income)	$	(8	)	$	(10	)	$	(4	)	$	(5	)
Net postemployment costs	49			47			24			23
Net postretirement costs	4			4			2			2
Total pension and other employee benefit costs	$	45		$	41		$	22		$	20

Pension Plans

Components of Net Periodic Benefit Cost

Net periodic pension cost consisted of the following:

	Pension (1)
	For the Six Months Ended June 30,						For the Three Months Ended June 30,
(in millions)	2020			2019			2020			2019
Service cost	$	130		$	107		$	65		$	53
Interest cost	35			60			18			31
Expected return on plan assets	(173		)	(165		)	(87		)	(86		)
Amortization:
Net loss	129			95			64			50
Prior service cost	1			—			1			—
Net periodic pension cost	$	122		$	97		$	61		$	48

⁽¹⁾ Primarily non-U.S. based defined benefit retirement plans.

Employer Contributions

PMI makes, and plans to make, contributions, to the extent that they are tax deductible and to meet specific funding requirements of its funded pension plans. Employer contributions of $52 million were made to the pension plans during the six months ended June 30, 2020. Currently, PMI anticipates making additional contributions during the remainder of 2020 of approximately $45 million to its pension plans, based on current tax and benefit laws. However, this estimate is subject to change as a result of changes in tax and other benefit laws, as well as asset performance significantly above or below the assumed long-term rate of return on pension assets, or changes in interest and currency rates.