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LEASES
 12 Months Ended
Dec. 31, 2024
Leases [Abstract]  
LEASES LEASES
Eaton leases certain manufacturing facilities, warehouses, distribution centers, office space, vehicles, and equipment. Most real estate leases contain renewal options. The exercise of lease renewal options is at the Company's sole discretion. The Company's lease agreements typically do not contain any significant guarantees of asset values at the end of a lease or restrictive covenants. Payments within certain lease agreements are adjusted periodically for changes in an index or rate.
The components of lease expense are as follows:
(In millions)202420232022
Operating lease cost$227 $200 $179 
Finance lease cost:
Amortization of lease assets12 15 11 
Interest on lease liabilities1 1 1 
Short-term lease cost19 18 17 
Variable lease cost29 28 27 
Sublease income(1)(1)(1)
Total lease cost$287 $261 $234 
During 2024, 2023 and 2022, Eaton entered into sale leaseback transactions primarily for certain non-production facilities and recorded gains of $56 million, $53 million and $81 million, respectively, in Other income - net. The terms of the new operating leases ranged from 5 to 20 years.
Supplemental cash flow information related to leases is as follows:
(In millions)202420232022
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash outflows - payments on operating leases$(200)$(180)$(159)
Operating cash outflows - interest payments on finance leases(1)(1)(2)
Financing cash outflows - payments on finance lease obligations(14)(18)(11)
Lease assets obtained in exchange for new lease obligations, including leases acquired:
Operating leases$268 $183 $245 
Finance leases13 38 10 
Supplemental balance sheet information related to leases is as follows:
December 31
(In millions)20242023
Operating Leases
Operating lease assets$806 $648 
Other current liabilities163 135 
Operating lease liabilities669 533 
Total operating lease liabilities$832 $668 
Finance Leases
Land and buildings$5 $13 
Machinery and equipment61 62 
Accumulated depreciation(37)(36)
Net property, plant and equipment$29 $39 
Current portion of long-term debt$9 $13 
Long-term debt19 22 
Total finance lease liabilities$28 $35 
December 31
20242023
Weighted-average remaining lease term
Operating leases7.1 years7.6 years
Finance leases4.2 years4.4 years
Weighted-average discount rate
Operating leases4.4 %4.0 %
Finance leases3.7 %3.6 %
Maturities of lease liabilities at December 31, 2024 are as follows:
(In millions)Operating LeasesFinance Leases
2025$195 $10 
2026176 8 
2027149 6 
2028121 3 
202978 2 
Thereafter266 3 
Total lease payments985 31 
Less imputed interest153 3 
Total present value of lease liabilities$832 $28 
LEASES LEASES
Eaton leases certain manufacturing facilities, warehouses, distribution centers, office space, vehicles, and equipment. Most real estate leases contain renewal options. The exercise of lease renewal options is at the Company's sole discretion. The Company's lease agreements typically do not contain any significant guarantees of asset values at the end of a lease or restrictive covenants. Payments within certain lease agreements are adjusted periodically for changes in an index or rate.
The components of lease expense are as follows:
(In millions)202420232022
Operating lease cost$227 $200 $179 
Finance lease cost:
Amortization of lease assets12 15 11 
Interest on lease liabilities1 1 1 
Short-term lease cost19 18 17 
Variable lease cost29 28 27 
Sublease income(1)(1)(1)
Total lease cost$287 $261 $234 
During 2024, 2023 and 2022, Eaton entered into sale leaseback transactions primarily for certain non-production facilities and recorded gains of $56 million, $53 million and $81 million, respectively, in Other income - net. The terms of the new operating leases ranged from 5 to 20 years.
Supplemental cash flow information related to leases is as follows:
(In millions)202420232022
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash outflows - payments on operating leases$(200)$(180)$(159)
Operating cash outflows - interest payments on finance leases(1)(1)(2)
Financing cash outflows - payments on finance lease obligations(14)(18)(11)
Lease assets obtained in exchange for new lease obligations, including leases acquired:
Operating leases$268 $183 $245 
Finance leases13 38 10 
Supplemental balance sheet information related to leases is as follows:
December 31
(In millions)20242023
Operating Leases
Operating lease assets$806 $648 
Other current liabilities163 135 
Operating lease liabilities669 533 
Total operating lease liabilities$832 $668 
Finance Leases
Land and buildings$5 $13 
Machinery and equipment61 62 
Accumulated depreciation(37)(36)
Net property, plant and equipment$29 $39 
Current portion of long-term debt$9 $13 
Long-term debt19 22 
Total finance lease liabilities$28 $35 
December 31
20242023
Weighted-average remaining lease term
Operating leases7.1 years7.6 years
Finance leases4.2 years4.4 years
Weighted-average discount rate
Operating leases4.4 %4.0 %
Finance leases3.7 %3.6 %
Maturities of lease liabilities at December 31, 2024 are as follows:
(In millions)Operating LeasesFinance Leases
2025$195 $10 
2026176 8 
2027149 6 
2028121 3 
202978 2 
Thereafter266 3 
Total lease payments985 31 
Less imputed interest153 3 
Total present value of lease liabilities$832 $28