Leases

3 Months Ended

Mar. 31, 2020

Leases [Abstract]

Leases

Note 11. Leases

The Company is party to operating leases for the majority of its manufacturing sites, offices, engineering and lab sites, stocking locations, warehouses, automobiles, and certain equipment. Certain of the Company’s real estate leases include variable rental payments which adjust periodically based on inflation, and certain automobile lease agreements include rental payments which fluctuate based on mileage. Generally, the Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants.

The Company’s operating lease costs for the three months ended March 31, 2020 and 2019 consisted of the following:

	Three Months Ended March 31,
	2020		2019
Selling, general & administrative	$	10	$	8
Cost of goods sold		4		4
Total operating lease costs	$	14	$	12

Total operating lease costs include variable lease costs of $3 million for the three months ended March 31, 2020 and 2019. Total operating lease costs also include offsetting sublease income which is immaterial for the three months ended March 31, 2020 and 2019.

The Company recognized the following related to its operating leases:

	Financial Statement Line Item	At March 31, 2020		At December 31, 2019
Operating right-of-use assets	Other assets	$	129	$	137
Operating lease liabilities - current	Accrued liabilities	$	32	$	31
Operating lease liabilities - noncurrent	Other liabilities	$	105	$	111

Maturities of the Company’s operating lease liabilities were as follows:

	At March 31, 2020
2020	$	28
2021		35
2022		30
2023		23
2024		12
Thereafter		32
Total lease payments		160
Less: imputed interest		23
Present value of operating lease liabilities	$	137
Weighted-average remaining lease term (years)		5.64
Weighted-average incremental borrowing rate		5.89	%

Supplemental cash flow information related to the Company’s operating leases was as follows:

	Three Months Ended March 31,
	2020		2019
Operating cash outflows	$	7	$	9
Operating right-of-use assets obtained in exchange for    operating lease liabilities	$	5	$	12

As of March 31, 2020, the Company has additional operating leases that have not yet commenced. Obligations under these leases are not material. Additionally, as a lessor, the Company leases all or a portion of certain owned properties. Rental income for the three months ended March 31, 2020 and 2019 was not material.