FINANCIAL INSTRUMENTS (Tables)

6 Months Ended

Jun. 30, 2023

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 recognized in accumulated other comprehensive income (loss) and net income (loss) during the three and six months ended June 30, 2023 and 2022 (in millions):

			Recognized in Net Income
For the Three Months Ended June 30,	Gain (Loss) Recognized in Accumulated Other Comprehensive Income		Classification of Gain (Loss)	Gain (Loss) Reclassified from Accumulated Other Comprehensive Income into Income
2023
Foreign exchange contracts	$	(26)
			Net sales	(3)
			Cost of goods sold	(5)
			Other, net	18
Interest rate contracts	(13)		Interest expense	3
Total	$	(39)		$	13
2022
Foreign exchange contracts	$	(21)
			Net sales	1
			Cost of goods sold	(41)
			Other, net	6
Interest rate contracts	13		Interest expense	9
Total	$	(8)		$	(25)

			Recognized in Net Income
For the Six Months Ended June 30,	Gain (Loss) Recognized in Accumulated Other Comprehensive Income		Classification of Gain (Loss)	Gain (Loss) Reclassified from Accumulated Other Comprehensive Income into Income
2023
Foreign exchange contracts	$	(11)
			Net sales	(4)
			Cost of goods sold	(32)
			Other, net	25
Interest rate contracts	(34)		Interest expense	8
Total	$	(45)		$	(3)
2022
Foreign exchange contracts	$	(172)
			Net sales	2
			Cost of goods sold	(58)
			Other, net	(4)
Interest rate contracts	50		Interest expense	17
Total	$	(122)		$	(43)

Significant amounts reclassified out of each component of accumulated other comprehensive income (loss) in the three and six months ended June 30, 2023 and 2022 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 June 30,				Six Months Ended June 30,
	2023		2022		2023		2022
	(in millions)
Cash flow hedges	$	3	$	(1)	$	4	$	(2)	Net sales
	5		41		32		58		Cost of goods sold
	(18)		(6)		(25)		4		Other, net
	(3)		(9)		(8)		(17)		Interest expense
	(1)		(5)		(3)		(8)		Income taxes
	$	(14)	$	20	$	—	$	35
Change in retirement plans’ funded status:
Amortization of actuarial losses	$	5	$	6	$	9	$	11	*
Amortization of prior service cost	(9)		(32)		(18)		(63)		*
	1		(7)		2		(14)		Income taxes
	$	(3)	$	(33)	$	(7)	$	(66)
Total reclassifications, net of tax	$	(17)	$	(13)	$	(7)	$	(31)

(*) 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 six months ended June 30, 2023 and 2022:

(In Millions)	Before-Tax Amount		Income Tax		After-Tax Amount
Accumulated derivative net gain as of December 31, 2022	$	71	$	(27)	$	44
Net changes in fair value of derivatives	(45)		19		(26)
Net losses reclassified from accumulated other comprehensive income into income	3		(3)		—
Accumulated derivative net gain as of June 30, 2023	$	29	$	(11)	$	18

(In Millions)	Before-Tax Amount		Income Tax		After-Tax Amount
Accumulated derivative net losses as of December 31, 2021	$	(3)	$	(14)	$	(17)
Impact of demerger	—		—		—
Net changes in fair value of derivatives	(122)		8		(114)
Net losses reclassified from accumulated other comprehensive income into income	43		(8)		35
Accumulated derivative net losses as of June 30, 2022	$	(82)	$	(14)	$	(96)

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 June 30,
	Classification of Gain (Loss)	2023		2022
Fair Value Hedges
Interest rate derivatives	Interest expense	$	(15)	$	(21)
Not Designated as Hedges
Foreign exchange contracts	Other, Net	$	(10)	$	—

		For the Six Months Ended June 30,
	Classification of Gain (Loss)	2023		2022
Fair Value Hedges
Interest rate derivatives	Interest expense	$	1	$	(76)
Not Designated as Hedges
Foreign exchange contracts	Other, Net	$	(34)	$	(47)

Summary of Fair Value of Derivatives

The fair values of CNH Industrial’s derivatives as of June 30, 2023 and December 31, 2022 in the consolidated balance sheets are recorded as follows:

	June 30, 2023		December 31, 2022
(In millions)	Balance Sheet Location	Fair Value	Balance Sheet Location	Fair Value
Derivatives designated as hedging instruments under Subtopic 815-20
Interest rate contracts	Derivative assets	59	Derivative assets	77
Foreign currency contracts	Derivative assets	74	Derivative assets	70
Total derivative assets designated as hedging instruments		133		147
Interest rate contracts	Derivative liabilities	136	Derivative liabilities	106
Foreign currency contracts	Derivative liabilities	60	Derivative liabilities	56
Total derivative liabilities designated as hedging instruments		196		162
Derivatives not designated as hedging instruments under Subtopic 815-20
Interest rate contracts	Derivative assets	34	Derivative assets	28
Foreign currency contracts	Derivative assets	28	Derivative assets	14
Total derivative assets not designated as hedging instruments		62		42
Interest rate contracts	Derivative liabilities	34	Derivative liabilities	28
Foreign currency contracts	Derivative liabilities	13	Derivative liabilities	14
Total derivative liabilities not designated as hedging instruments		47		42

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 June 30, 2023 and December 31, 2022:

	Level 1				Level 2				Total
	June 30, 2023		December 31, 2022		June 30, 2023		December 31, 2022		June 30, 2023		December 31, 2022
	(in millions)
Assets
Foreign exchange derivatives	$	—	$	—	$	93	$	84	$	93	$	84
Interest rate derivatives	—		—		102		105		102		105
Total Assets	$	—	$	—	$	195	$	189	$	195	$	189
Liabilities
Foreign exchange derivatives	$	—	$	—	$	170	$	70	$	170	$	70
Interest rate derivatives	—		—		73		134		73		134
Total Liabilities	$	—	$	—	$	243	$	204	$	243	$	204

Summary of Investments Measured on Nonrecurring Basis

The following tables present the fair value for nonrecurring Level 3 measurements from impairments recorded in the quarter ended June 30, 2023 and 2022. No impairments were recorded during the six months ended June 30, 2023.

	Fair Value				Losses
	2023		2022		2023		2022
	(in millions)
Property, plant and equipment	$	—	$	7	$	—	$	17

Summary of Estimated Fair Market Values

The estimated fair market values of financial instruments not carried at fair value in the consolidated balance sheets as of June 30, 2023 and December 31, 2022 were as follows:

	June 30, 2023				December 31, 2022
	Carrying Amount		Fair Value		Carrying Amount		Fair Value
	(in millions)
Financing receivables	$	21,541	$	21,406	$	19,260	$	18,827
Debt	$	24,870	$	24,744	$	22,962	$	22,651