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RETIREMENT BENEFITS PLANS
 12 Months Ended
Dec. 31, 2024
Retirement Benefits [Abstract]  
RETIREMENT BENEFITS PLANS RETIREMENT BENEFITS PLANS
Eaton has defined benefits pension plans and other postretirement benefits plans.
Obligations and Funded Status
United States
pension liabilities		Non-United States
pension liabilities		Other postretirement
liabilities
(In millions)202420232024202320242023
Funded status
Fair value of plan assets$2,445 $2,604 $1,548 $1,633 $18 $17 
Benefit obligations(2,700)(2,824)(1,863)(2,022)(196)(212)
Funded status$(255)$(220)$(315)$(389)$(178)$(195)
Amounts recognized in the Consolidated
   Balance Sheets
Other assets$— $— $231 $210 $— $— 
Other current liabilities(29)(18)(31)(33)(14)(15)
Pension liabilities and Other postretirement
  benefits liabilities		(226)(202)(515)(566)(164)(180)
Total$(255)$(220)$(315)$(389)$(178)$(195)
Amounts recognized in Accumulated other
   comprehensive loss (pre-tax)
Net actuarial loss (gain)$904 $867 $678 $649 $(87)$(92)
Prior service cost (credit)5 4 6 12 — (1)
Total$909 $871 $684 $661 $(87)$(93)
Change in Benefit Obligations
United States
pension liabilities		Non-United States
pension liabilities		Other postretirement
liabilities
(In millions)202420232024202320242023
Balance at January 1$2,824 $2,807 $2,022 $1,813 $212 $209 
Service cost18 19 46 43 1 1 
Interest cost134 142 85 85 10 10 
Actuarial loss (gain) (20)104 (82)104 (11)11 
Gross benefits paid(258)(250)(121)(110)(29)(31)
Currency translation— — (87)85 (3)1 
Plan amendments2 1 (3)(1)— — 
Other— — 3 3 16 11 
Balance at December 31$2,700 $2,824 $1,863 $2,022 $196 $212 
Accumulated benefit obligation$2,686 $2,807 $1,766 $1,922 
During 2020, the Company announced it was freezing its United States pension plans for its non-union employees. The freeze was effective January 1, 2021 for non-union U.S. employees whose retirement benefit was determined under a cash balance formula and is effective January 1, 2026 for non-union U.S. employees whose retirement benefit is determined under a final average pay formula.
Actuarial gains related to changes in the United States and Non-United States benefit obligations in 2024 of $20 million and $82 million, respectively, were primarily due to increases in the discount rates used to measure the obligations. Actuarial losses related to changes in the United States and Non-United States benefit obligations in 2023 of $104 million and $104 million, respectively, were primarily due to decreases in the discount rates used to measure the obligations.
Change in Plan Assets
United States
pension liabilities		Non-United States
pension liabilities		Other postretirement
liabilities
(In millions)202420232024202320242023
Balance at January 1$2,604 $2,635 $1,633 $1,486 $17 $16 
Actual return on plan assets84 203 (10)86 1 1 
Employer contributions15 16 95 97 18 20 
Gross benefits paid(258)(250)(121)(110)(29)(31)
Currency translation— — (52)71 — — 
Other— — 3 3 11 11 
Balance at December 31$2,445 $2,604 $1,548 $1,633 $18 $17 
The components of pension plans with an accumulated benefit obligation in excess of plan assets at December 31 are as follows:
United States
pension liabilities		Non-United States
pension liabilities
(In millions)2024202320242023
Accumulated benefit obligation$2,686 $2,807 $701 $742 
Fair value of plan assets2,445 2,604 209 203 
The components of pension plans with a projected benefit obligation in excess of plan assets at December 31 are as follows:
United States
pension liabilities		Non-United States
pension liabilities
(In millions)2024202320242023
Projected benefit obligation$2,700 $2,824 $772 $827 
Fair value of plan assets2,445 2,604 225 228 
Other postretirement benefit plans with accumulated postretirement benefit obligations in excess of plan assets have been disclosed in the Obligations and Funded Status table.
Changes in pension and other postretirement benefit liabilities recognized in Accumulated other comprehensive loss are as follows:
United States
pension liabilities		Non-United States
pension liabilities		Other postretirement
liabilities
(In millions)202420232024202320242023
Balance at January 1$871 $811 $661 $505 $(93)$(120)
Prior service cost arising during the year2 1 (3)(1)— — 
Net loss (gain) arising during the year86 97 62 139 (7)10 
Currency translation— — (18)29 — — 
Less amounts included in expense during the year(50)(38)(18)(11)13 17 
Net change for the year38 60 23 156 6 27 
Balance at December 31$909 $871 $684 $661 $(87)$(93)
Benefits Expense
The components of retirement benefits expense (income) are as follows:
United States
pension benefit expense		Non-United States pension benefit expenseOther postretirement
benefits expense (income)
(In millions)202420232022202420232022202420232022
Service cost$18 $19 $27 $46 $43 $59 $1 $1 $1 
Interest cost134 142 117 85 85 47 10 10 7 
Expected return on plan assets(190)(195)(204)(134)(121)(115)(1)(1)(1)
Amortization9 4 15 11 7 45 (13)(17)(7)
(29)(30)(46)8 14 37 (3)(7)— 
Settlements, curtailments, and special termination benefits41 34 61 7 4 2 — — — 
Total expense (income)$12 $4 $15 $15 $18 $39 $(3)$(7)$— 
The components of retirement benefits expense (income) other than service costs are included in Other income - net.
Retirement Benefits Plans Assumptions
In 2024, 2023 and 2022, for purposes of determining liabilities related to the majority of its plans in the United States, the Company used the Pri-2012 mortality tables as well as mortality tables that are based on the Company's own experience and generational improvement scales that are based on MP-2021.
To estimate the service and interest cost components of net periodic benefit cost for the vast majority of its defined benefits pension and other postretirement benefits plans, the Company used a spot rate approach by applying the specific spot rates along the yield curve used to measure the benefit obligation at the beginning of the period to the relevant projected cash flows.
Pension Plans
United States
pension plans		Non-United States
pension plans
202420232022202420232022
Assumptions used to determine benefit obligation at year-end
Discount rate5.61 %5.14 %5.47 %4.92 %4.52 %4.83 %
Rate of compensation increase3.32 %3.40 %3.33 %3.16 %3.17 %3.12 %
Interest rate used to credit cash balance plans4.79 %4.01 %3.67 %2.01 %1.59 %2.32 %
Assumptions used to determine expense
Discount rate used to determine benefit obligation5.14 %5.47 %4.30 %4.52 %4.83 %2.01 %
Discount rate used to determine service cost5.24 %5.54 %4.41 %6.00 %5.90 %2.98 %
Discount rate used to determine interest cost4.98 %5.33 %3.94 %4.47 %4.80 %1.84 %
Expected long-term return on plan assets6.50 %6.50 %6.50 %6.79 %6.32 %5.70 %
Rate of compensation increase3.40 %3.33 %3.12 %3.17 %3.12 %3.01 %
Interest rate used to credit cash balance plans4.01 %3.67 %2.62 %1.59 %2.32 %0.56 %
The expected long-term rate of return on pension assets was determined for each country and reflects long-term historical data taking into account each plan's target asset allocation. The expected long-term rates of return on pension assets for United States pension plans and Non-United States pension plans for 2025 are 7.00% and 6.63%, respectively. The discount rates were determined using appropriate bond data for each country.
Other Postretirement Benefits Plans
Substantially all of the obligation for other postretirement benefits plans relates to United States plans. Assumptions used to determine other postretirement benefits obligations and expense are as follows:
Other postretirement
benefits plans
202420232022
Assumptions used to determine benefit obligation at year-end
Discount rate5.57 %5.11 %5.46 %
Health care cost trend rate assumed for next year6.70 %7.70 %7.10 %
Ultimate health care cost trend rate4.75 %4.75 %4.75 %
Year ultimate health care cost trend rate is achieved203420332031
Assumptions used to determine expense
Discount rate used to determine benefit obligation5.11 %5.46 %2.79 %
Discount rate used to determine service cost5.25 %5.53 %3.03 %
Discount rate used to determine interest cost4.96 %5.32 %2.24 %
Initial health care cost trend rate7.70 %7.10 %7.45 %
Ultimate health care cost trend rate4.75 %4.75 %4.75 %
Year ultimate health care cost trend rate is achieved203320312031
Employer Contributions to Retirement Benefits Plans
Contributions to pension plans that Eaton expects to make in 2025, and made in 2024, 2023 and 2022, are as follows:
(In millions)
Expected in 2025
202420232022
United States plans$29 $15 $16 $30 
Non-United States plans72 95 97 85 
Total contributions$101 $110 $113 $116 
The following table provides the estimated pension and other postretirement benefit payments for each of the next five years, and the five years thereafter in the aggregate. For other postretirement benefits liabilities, the Company expects minor subsidy receipts related to the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 that would reduce the estimated payments listed below.
(In millions)Estimated
United States
pension payments		Estimated
non-United States
pension payments		Estimated other postretirement
benefit payments
2025$291 $112 $16 
2026269 119 15 
2027254 118 19 
2028248 120 18 
2029236 126 17 
2030 - 20341,049 669 78 
Pension Plan Assets
Investment policies and strategies are developed on a country and plan specific basis. The United States plan, representing 61% of worldwide pension assets, and the United Kingdom plans representing 25% of worldwide pension assets, are invested primarily in debt securities largely for liability hedging, as the majority of the assets are in plans that are well-funded. In general, the plans are primarily allocated to diversified high-quality publicly traded debt, primarily through separately managed accounts and commingled funds in the form of common collective and other trusts. The United States plan's target allocation is 15% United States equities, 7% non-United States equities, 3% public real estate (primarily equity of real estate investment trusts), 64% debt securities and 11% other, including private equity, private debt and cash equivalents. The United Kingdom plans' target asset allocations are 16% equities and the remainder in debt securities, cash equivalents and real estate investments. The equity risk for the plans is managed through broad diversification across industries, geographies, and levels of market capitalization. The majority of debt allocations for these plans are longer duration government and corporate debt. The United States, United Kingdom and Canada pension plans are authorized to use derivatives, including the use of futures, swaps and options, to achieve more economically desired market exposures.
Fair Value Measurements
Financial instruments included in pension and other postretirement benefits plan assets are categorized into a fair value hierarchy of three levels, based on the degree of subjectivity inherent in the valuation methodology are as follows:
Level 1 -Quoted prices (unadjusted) for identical assets in active markets.
Level 2 -Quoted prices for similar assets in active markets, and inputs that are observable for the asset, either directly or indirectly, for substantially the full term of the financial instrument.
Level 3 -Unobservable prices or inputs.
Certain investments that are measured at fair value using the net asset value per share practical expedient have not been categorized in the fair value hierarchy and are being presented in the tables to permit a reconciliation to total plan assets.
Pension Plans
A summary of the fair value of pension plan assets at December 31, 2024 and 2023, is as follows:
(In millions)TotalQuoted prices
in active
markets for
identical assets
(Level 1)		Other
observable
inputs
(Level 2)
Unobservable
inputs
(Level 3)1
2024  
Common collective trusts
Non-United States equity and global equities$241 $— $241 $— 
Fixed income28 — 28 — 
Fixed income securities1,582 — 1,582 — 
United States treasuries461 453 8 — 
Real estate212 63 25 124 
Cash equivalents83 55 28 — 
Exchange traded funds91 91 — — 
Other402 — 40 362 
Common collective and other trusts measured at net asset value
978 
Pending purchases and sales of plan assets, and interest
    receivable		(85)
Total pension plan assets$3,993 $662 $1,952 $486 
1 These pension plan assets include private equity, private credit and private real estate funds that generally have redemption notice periods of six months or longer and are often not eligible for redemption until the underlying assets are liquidated or distributed. The Company has unfunded commitments to these funds of approximately $128 million at December 31, 2024, which will be satisfied by a reallocation of pension plan assets.
(In millions)TotalQuoted prices
in active
markets for
identical assets
(Level 1)		Other
observable
inputs
(Level 2)
Unobservable
inputs
(Level 3)1
2023    
Common collective trusts
Non-United States equity and global equities$154 $— $154 $— 
United States equity76 — 76 — 
Fixed income115 — 115 — 
Fixed income securities1,607 — 1,607 — 
United States treasuries566 566 — — 
Real estate291 65 27 199 
Cash equivalents36 14 22 — 
Exchange traded funds84 84 — — 
Other405 — 35 370 
Common collective and other trusts measured at net asset value
968 
Money market funds measured at net asset value2 
Pending purchases and sales of plan assets, and interest
    receivable		(67)
Total pension plan assets$4,237 $729 $2,036 $569 
1 These pension plan assets include private equity, private credit and private real estate funds that generally have redemption notice periods of six months or longer, and are often not eligible for redemption until the underlying assets are liquidated or distributed. The Company has unfunded commitments to these funds of approximately $154 million at December 31, 2023, which will be satisfied by a reallocation of pension plan assets.
The fair value measurement of plan assets using significant unobservable inputs (Level 3) changed during 2024 and 2023 due to the following:
(In millions)Real estateOtherTotal
Balance at January 1, 2023$199 $360 $559 
Actual return on plan assets:
Gains (losses) relating to assets still held at year-end
7 19 26 
Purchases, sales, settlements - net
(7)— (7)
Transfers into or out of Level 3— (9)(9)
Balance at December 31, 2023199 370 569 
Actual return on plan assets:
Gains (losses) relating to assets still held at year-end
(24)29 5 
Purchases, sales, settlements - net
(51)(37)(88)
Transfers into or out of Level 3— — — 
Balance at December 31, 2024$124 $362 $486 
Other Postretirement Benefits Plans
A summary of the fair value of other postretirement benefits plan assets at December 31, 2024 and 2023, is as follows:
(In millions)TotalQuoted prices
in active
markets for
identical assets
(Level 1)		Other
observable
inputs
(Level 2)		Unobservable
inputs
(Level 3)
2024    
Cash equivalents$3 $3 $— $— 
Common collective and other trusts measured at net asset value
15 
Total other postretirement benefits plan assets$18 $3 $— $— 
(In millions)TotalQuoted prices
in active
markets for
identical assets
(Level 1)		Other
observable
inputs
(Level 2)		Unobservable
inputs
(Level 3)
2023    
Cash equivalents$2 $2 $— $— 
Common collective and other trusts measured at net asset value
15 
Total other postretirement benefits plan assets$17 $2 $— $— 
Valuation Methodologies
Following is a description of the valuation methodologies used for pension and other postretirement benefits plan assets measured at fair value. There have been no changes in the methodologies used at December 31, 2024 and 2023.
Common collective and other trusts - Valued at the net unit value of units held by the trust at year end. The unit value is determined by the total value of fund assets divided by the total number of units of the fund owned. The equity investments in collective trusts are predominantly in index funds for which the underlying securities are actively traded in public markets based upon readily measurable prices. The investments in other trusts are predominantly in exchange traded funds for which the underlying securities are actively traded in public markets based upon readily measurable prices. Common collective and other trusts measured at fair value using the net asset value per share practical expedient have not been categorized in the fair value hierarchy and are being presented in the tables above to permit a reconciliation of the fair value hierarchy to the total plan assets.
Fixed income securities - These securities consist of publicly traded United States and non-United States fixed interest obligations (principally corporate and government bonds and debentures). The fair value of corporate and government debt securities is determined through third-party pricing models that consider various assumptions, including time value, yield curves, credit ratings, and current market prices. The Company verifies the results of trustees or custodians and evaluates the pricing classification of these securities by performing analyses using other third-party sources.
United States treasuries - Valued at the closing price of each security.
Real estate - Consists of direct investments in the stock of publicly traded companies and investments in pooled funds that invest directly in real estate. The publicly traded companies are valued based on the closing price reported in an active market on which the individual securities are traded and as such are classified as Level 1. The pooled funds rely on appraisal-based valuations and as such are classified as Level 3.
Cash equivalents - Primarily certificates of deposit, commercial paper, and repurchase agreements.
Exchange traded funds - Valued at the closing price of the exchange traded fund's shares.
Money market funds - Money market funds measured at fair value using the net asset value per share practical expedient have not been categorized in the fair value hierarchy and are being presented in the tables above to permit a reconciliation of the fair value hierarchy to the total plan assets.
Other - These assets consist of private equity, private debt, insurance contracts primarily for international plans, futures contracts, and over-the-counter options. Investments in private equity and private debt are valued at net asset value or estimated fair value based on quarterly financial information received from the investment advisor, third party appraisal or general partner. These estimates incorporate factors such as contributions and distributions, market transactions, market comparables and performance multiples. Futures contracts and options are valued based on the closing prices of contracts or indices as available using third-party sources.
For additional information regarding fair value measurements, see Note 15.
Defined Contribution Plans
The Company has various defined contribution benefit plans, primarily consisting of the plans in the United States. The total contributions related to these plans are charged to expense and are as follows:
(In millions)
2024$220 
2023201 
2022182