FINANCIAL INSTRUMENTS (Tables)

9 Months Ended

Sep. 30, 2020

Fair Value Disclosures [Abstract]

Gross Impact of Changes in Fair Value of Derivatives Designated as Cash Flow Hedges on AOCI and Net Income

The following table summarizes the gross impact of changes in the fair value of derivatives designated as cash flow hedges on accumulated other comprehensive income (loss) and net income (loss) during the three and nine months ended September 30, 2020 and 2019 (in millions):

			Recognized in Net Income
For the Three Months Ended September 30,	Gain (Loss) Recognized in Accumulated Other Comprehensive Income		Classification of Gain (Loss)	Gain (Loss) Reclassified from Accumulated Other Comprehensive Income into Income
2020
Foreign exchange contracts	$	40
			Net sales	(4)
			Cost of goods sold	12
			Other, Net	1
Interest rate contracts	8		Interest expense	(1)
Total	$	48		$	8
2019
Foreign exchange contracts	$	(42)
			Net sales	2
			Cost of goods sold	(17)
			Other, Net	(3)
Interest rate contracts	(6)		Interest expense	(3)
Total	$	(48)		$	(21)

			Recognized in Net Income
For the Nine Months Ended September 30,	Gain (Loss) Recognized in Accumulated Other Comprehensive Income		Classification of Gain (Loss)	Gain (Loss) Reclassified from Accumulated Other Comprehensive Income into Income
2020
Foreign exchange contracts	$	106
			Net sales	(5)
			Cost of goods sold	(7)
			Other, Net	11
Interest rate contracts	(11)		Interest expense	(4)
Total	$	95		$	(5)
2019
Foreign exchange contracts	$	(87)
			Net sales	(2)
			Cost of goods sold	(46)
			Other, Net	(10)
Interest rate contracts	(26)		Interest expense	(6)
Total	$	(113)		$	(64)

Significant amounts reclassified out of each component of accumulated other comprehensive income (loss) in the three and nine months ended September 30, 2020 and 2019 consisted of the following:

	Amounts Reclassified from Other Comprehensive Income (Loss)				Amount Reclassified from Other Comprehensive Income (Loss)				Consolidated Statement of Operations Line
	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2019		2020		2019
	(in millions)				(in millions)
Cash flow hedges	$	4	$	(2)	$	5	$	2	Net sales
	(12)		17		7		46		Cost of goods sold
	(1)		3		(11)		10		Other, net
	1		3		4		6		Interest expense
	—		(4)		(4)		(10)		Income taxes
	$	(8)	$	17	$	1	$	54
Change in retirement plans’ funded status:
Amortization of actuarial losses	$	12	$	18	$	33	$	52	*
Amortization of prior service cost	(33)		(32)		(98)		(91)		*
	(6)		(4)		(21)		(14)		Income taxes
	$	(27)	$	(18)	$	(86)	$	(53)
Total reclassifications, net of tax	$	(35)	$	(1)	$	(85)	$	1

(*) These amounts are included in net periodic pension and other postretirement benefit cost. See “Note 6: Employee Benefit Plans and Postretirement Benefits” for additional information.

Summary of Impact of Changes in Fair Value of Fair Value Hedges and Derivatives Not Designated as Hedging Instruments on Earnings

The following table summarizes the activity in accumulated other comprehensive income related to the derivatives held by the Company during the nine months ended September 30, 2020 and 2019:

In Millions	Before-Tax Amount		Income Tax		After-Tax Amount
Accumulated derivative net losses as of December 31, 2019	$	(62)	$	8	$	(54)
Net changes in fair value of derivatives	95		(9)		86
Net losses reclassified from accumulated other comprehensive income into income	5		(4)		1
Accumulated derivative net losses as of September 30, 2020	$	38	$	(5)	$	33

In Millions	Before-Tax Amount		Income Tax		After-Tax Amount
Accumulated derivative net losses as of December 31, 2018	$	(23)	$	1	$	(22)
Net changes in fair value of derivatives	(113)		20		(93)
Net losses reclassified from accumulated other comprehensive income into income	64		(10)		54
Accumulated derivative net losses as of September 30, 2019	$	(72)	$	11	$	(61)

The following tables summarize the impact that changes in the fair value of fair value hedges and derivatives not designated as hedging instruments had on earnings (in millions):

		For the Three Months Ended September 30,
	Classification of Gain	2020		2019
Fair Value Hedges
Interest rate derivatives	Interest expense	$	(5)	$	7
Not Designated as Hedges
Foreign exchange contracts	Other, Net	$	6	$	29

		For the Nine Months Ended September 30,
	Classification of Gain	2020		2019
Fair Value Hedges
Interest rate derivatives	Interest expense	$	37	$	38
Not Designated as Hedges
Foreign exchange contracts	Other, Net	$	160	$	(39)

Summary of Fair Value of Derivatives

The fair values of CNH Industrial’s derivatives as of September 30, 2020 and December 31, 2019 in the condensed consolidated balance sheets are recorded as follows:

	September 30, 2020		December 31, 2019
in millions of dollars	Balance Sheet Location	Fair Value	Balance Sheet Location	Fair Value
Derivatives designated as hedging instruments under Subtopic 815-20
Interest rate contracts	Derivative assets	81	Derivative assets	44
Foreign currency contracts	Derivative assets	72	Derivative assets	17
Total derivative assets designated as hedging instruments		153		61
Interest rate contracts	Derivative liabilities	41	Derivative liabilities	29
Foreign currency contracts	Derivative liabilities	32	Derivative liabilities	69
Total derivative liabilities designated as hedging instruments		73		98
Derivatives not designated as hedging instruments under Subtopic 815-20
Interest rate contracts	Derivative assets	—	Derivative assets	—
Foreign currency contracts	Derivative assets	35	Derivative assets	12
Total derivative assets not designated as hedging instruments		35		12
Interest rate contracts	Derivative liabilities	—	Derivative liabilities	—
Foreign currency contracts	Derivative liabilities	15	Derivative liabilities	23
Total derivative liabilities not designated as hedging instruments		15		23

Summary of Investments Measured on Recurring Basis

The following tables present for each of the fair-value hierarchy levels the Company’s assets and liabilities that are measured at fair value on a recurring basis at September 30, 2020 and December 31, 2019:

	Level 1				Level 2				Total
	September 30, 2020		December 31, 2019		September 30, 2020		December 31, 2019		September 30, 2020		December 31, 2019
	(in millions)
Assets
Foreign exchange derivatives	$	—	$	—	$	107	$	29	$	107	$	29
Interest rate derivatives	—		—		81		44		81		44
Investments	—		1		—		—		—		1
Investments at fair value through profit & loss	526		—		—		—		526		—
Total Assets	$	526	$	1	$	188	$	73	$	714	$	74
Liabilities
Foreign exchange derivatives	$	—	$	—	$	(46)	$	(92)	$	(46)	$	(92)
Interest rate derivatives	—		—		(41)		(29)		(41)		(29)
Commodities	—		—		(1)		—		(1)		—
Total Liabilities	$	—	$	—	$	(88)	$	(121)	$	(88)	$	(121)

Summary of Investments Measured on Nonrecurring Basis

The following tables present the fair value for nonrecurring Level 3 measurements from impairments as of September 30, 2020 and 2019:

	Fair Value				Losses
	2020		2019		2020		2019
	(in millions)
Property, plant and equipment	$	107	$	—	$	163	$	—
Other intangible assets	$	—	$	—	$	92	$	—

Summary of Estimated Fair Market Values

The estimated fair market values of financial instruments not carried at fair value in the condensed consolidated balance sheets as of September 30, 2020 and December 31, 2019 are as follows:

	September 30, 2020				December 31, 2019
	Carrying Amount		Fair Value		Carrying Amount		Fair Value
	(in millions)
Financing receivables	$	17,098	$	17,315	$	19,428	$	19,375
Debt	$	24,670	$	25,018	$	24,854	$	25,249