Pension and Other Postretirement Benefits

9 Months Ended

Sep. 30, 2023

Retirement Benefits [Abstract]

Pension and Other Postretirement Benefits

Pension and Other Postretirement Benefits

The components of net periodic cost (benefit) were as follows:

	Third quarter ended				Nine months ended
	September 30,				September 30,
	2023		2022		2023		2022
Pension benefits
Service cost	$	—	$	1	$	2	$	3
Interest cost	20		13		60		38
Expected return on plan assets	(18)		(20)		(55)		(61)
Recognized net actuarial loss	7		12		21		37
Settlements	2		3		5		7
Net periodic cost(1)	$	11	$	9	$	33	$	24
Other postretirement benefits
Service cost	$	1	$	—	$	1	$	1
Interest cost	2		1		5		3
Recognized net actuarial (gain) loss	(1)		—		(2)		1
Amortization of prior service benefit	(3)		(2)		(7)		(7)
Net periodic benefit(1)	$	(1)	$	(1)	$	(3)	$	(2)

 

(1)Service cost was included within Cost of goods sold and Selling, general administrative, and other expenses; settlements were included in Restructuring and other charges; and all other cost components were recorded in Other expense, net in the Statement of Consolidated Operations.

Pension benefits

In the third quarter and nine months ended September 30, 2023, the Company applied settlement accounting to its Canadian pension plan due to lump sum payments made to participants, reducing gross pension obligations by $12. In June 2023, the Company also undertook additional actions to reduce gross pension obligations by $19 by purchasing group annuity contracts from a third-party carrier to pay and administer future annuity payments of a U.S. pension plan. Settlement charges of $2 and

$5 were recognized in the third quarter and nine months ended September 30, 2023, respectively. In the third quarter and nine months ended September 30, 2022, the Company applied settlement accounting to certain small U.S. and Canadian pension plans due to lump sum payments made to participants, which resulted in settlement charges of $3 and $7, respectively. All settlement charges were recorded in Restructuring and other charges in the Statement of Consolidated Operations.For the third quarter and nine months ended September 30, 2023, Howmet’s combined pension contributions and other postretirement benefit payments were approximately $9 and $28, respectively. For the third quarter and nine months ended September 30, 2022, Howmet’s combined pension contributions and other postretirement benefit payments were approximately $18 and $43, respectively.