In order to maintain our global competitiveness, we have implemented rationalization actions over the past several years to reduce high-cost and excess manufacturing capacity and operating and administrative costs, and, more recently, related to the integration of Cooper Tire.

The following table presents a roll-forward of the liability balance between periods:


	Associate-
(In millions)	Related Costs			Other Costs			Total
Balance at December 31, 2022	$	115		$	2		$	117
2023 Charges		13			21			34
Incurred, net of foreign currency translation of $0 million and $0 million, respectively		(15	)		(6	)		(21	)
Reversed to the Statement of Operations		(2	)		—			(2	)
Balance at March 31, 2023	$	111		$	17		$	128

In April 2023, we approved a rationalization plan designed to streamline our Europe, Middle East and Africa (“EMEA”) distribution network that will result in the eventual closure of our Philippsburg, Germany distribution center. The rationalization plan will lower our operating costs while maintaining or improving the existing service levels to our customers. Relevant portions of the rationalization plan remain subject to consultation with employee and governmental representative bodies. We expect approximately 10 net headcount reductions related to this plan, which is expected to be substantially completed by the end of 2024. Total pre-tax cash charges are expected to be approximately $18 million, primarily for severance-related exit costs, including the exit of approximately 285 third party contract associates not included in our headcount. We have $17 million accrued for this plan at March 31, 2023 for estimated associate and non-associate severance costs. A majority of the cash outflows associated with this plan are expected to be paid during the first half of 2024.

In April 2023, we also approved a rationalization plan in EMEA designed to reduce staffing levels and capacity at several manufacturing facilities commensurate with the decline in demand. We expect approximately 280 net headcount reductions and total pre-tax charges of approximately $3 million related to this plan, which is expected to be substantially completed by the end of 2023. We have $3 million accrued for this plan at March 31, 2023, primarily consisting of associate severance costs.

The remainder of the accrual balance at March 31, 2023 is expected to be substantially utilized in the next 12 months and includes $45 million related to plans to reduce Selling, Administrative and General Expense ("SAG") headcount, $33 million related to the closure of Cooper Tire's Melksham, United Kingdom manufacturing facility ("Melksham"), $10 million related to the integration of Cooper Tire, $5 million related to the closed Amiens, France tire manufacturing facility, $2 million related to discontinued operations in Russia, $2 million related to the permanent closure of our Gadsden, Alabama tire manufacturing facility ("Gadsden"), and various other plans to reduce headcount and improve operating efficiency.

The following table shows net rationalization charges included in Income (Loss) before Income Taxes:


	Three Months Ended
	March 31,
(In millions)	2023		2022
Current Year Plans
Associate Severance and Other Related Costs	$	7	$	—
Other Exit Costs		13		—
Current Year Plans - Net Charges	$	20	$	—

Prior Year Plans
Associate Severance and Other Related Costs	$	4	$	4
Other Exit Costs		8		7
Prior Year Plans - Net Charges	$	12	$	11
Total Net Charges	$	32	$	11
Asset Write-offs (Recoveries) and Accelerated Depreciation, net	$	2	$	—

Substantially all of the new charges for the three months ended March 31, 2023 and 2022 relate to future cash outflows. Net current year plan charges for the three months ended March 31, 2023 relate to the plan to streamline our EMEA distribution network and the plan to reduce manufacturing staffing levels and capacity in EMEA.

Net prior year plan charges for the three months ended March 31, 2023 include $4 million for various plans to reduce global SAG headcount, $3 million related to the permanent closure of Gadsden, $2 million related to the closure of Melksham, $2 million related to discontinued operations in Russia, and reversals of $2 million for actions no longer needed for their originally

intended purpose. Net prior year plan charges for the three months ended March 31, 2022 included $7 million related to the permanent closure of Gadsden, $5 million related to the modernization of two of our tire manufacturing facilities in Germany, and reversals of $1 million for actions no longer needed for their originally intended purpose.

Ongoing rationalization plans had approximately $960 million in charges incurred prior to 2023 and approximately $50 million is expected to be incurred in future periods.

In the first three months of 2023, approximately 350 associates were released under plans initiated in prior years. Approximately 1,000 associates remain to be released under all ongoing rationalization plans.