Employee Benefit Plans (Tables)

12 Months Ended

Dec. 31, 2020

Changes in Projected Benefit Obligations, Plan Assets and Funded Status

The following table sets forth the changes in projected benefit obligations (“PBO”) (as calculated as of December 31), plan assets, the funded status and the amounts recognized on the accompanying consolidated balance sheet for the Company’s defined benefit pension and other postretirement benefit plans:

	Defined Benefit Pension Plans
	United States		International		Total PPG
($ in millions)	2020	2019	2020	2019	2020	2019
Projected benefit obligation, January 1	$1,842	$1,582	$1,719	$1,518	$3,561	$3,100
Service cost	13	13	11	10	24	23
Interest cost	54	64	33	41	87	105
Actuarial losses - net	251	263	165	186	416	449
Benefits paid	(133)	(80)	(60)	(64)	(193)	(144)
Foreign currency translation adjustments	—	—	87	34	87	34
Settlements and curtailments	13	—	(19)	(4)	(6)	(4)
Other	2	—	(3)	(2)	(1)	(2)
Projected benefit obligation, December 31	$2,042	$1,842	$1,933	$1,719	$3,975	$3,561
Market value of plan assets, January 1	$1,304	$1,140	$1,661	$1,478	$2,965	$2,618
Actual return on plan assets	144	219	198	190	342	409
Company contributions	—	—	17	13	17	13
Benefits paid	(113)	(55)	(51)	(56)	(164)	(111)
Plan settlements	—	—	(19)	(4)	(19)	(4)
Foreign currency translation adjustments	—	—	78	42	78	42
Other	—	—	(3)	(2)	(3)	(2)
Market value of plan assets, December 31	$1,335	$1,304	$1,881	$1,661	$3,216	$2,965
Funded Status	($707)	($538)	($52)	($58)	($759)	($596)
Amounts recognized in the Consolidated Balance Sheet:
Other assets (long-term)	—	—	218	183	218	183
Accounts payable and accrued liabilities	(23)	(26)	(9)	(8)	(32)	(34)
Accrued pensions	(684)	(512)	(261)	(233)	(945)	(745)
Net liability recognized	($707)	($538)	($52)	($58)	($759)	($596)

	Other Postretirement Benefit Plans
	United States		International		Total PPG
($ in millions)	2020	2019	2020	2019	2020	2019
Projected benefit obligation, January 1	$616	$587	$96	$94	$712	$681
Service cost	9	8	1	—	10	8
Interest cost	17	23	3	3	20	26
Plan amendments	4	(17)	—	—	4	(17)
Actuarial losses - net	75	59	7	1	82	60
Benefits paid	(39)	(44)	(5)	(5)	(44)	(49)
Foreign currency translation adjustments	—	—	2	4	2	4
Other	—	—	—	(1)	—	(1)
Projected benefit obligation, December 31	$682	$616	$104	$96	$786	$712
Amounts recognized in the Consolidated Balance Sheet:
Accounts payable and accrued liabilities	(48)	(46)	(5)	(5)	(53)	(51)
Other postretirement benefits	(634)	(570)	(99)	(91)	(733)	(661)
Net liability recognized	($682)	($616)	($104)	($96)	($786)	($712)

The PBO is the actuarial present value of benefits attributable to employee service rendered to date, including the effects of estimated future pay increases. The accumulated benefit obligation (“ABO”) is the actuarial present value of benefits attributable to employee service rendered to date, but does not include the effects of estimated future pay increases. The

ABO for all defined benefit pension plans as of December 31, 2020 and 2019 was $3.8 billion and $3.4 billion, respectively.

The following table details the pension plans where the benefit liability exceeds the fair value of the plan assets:

	Pensions
($ in millions)	2020	2019
Plans with PBO in Excess of Plan Assets:
Projected benefit obligation	$2,478	$2,223
Fair value of plan assets	$1,504	$1,449
Plans with ABO in Excess of Plan Assets:
Accumulated benefit obligation	$2,320	$2,176
Fair value of plan assets	$1,383	$1,449

Accumulated Other Comprehensive Loss Pretax Amounts Not Yet Reflected in Net Periodic Benefit Cost

	Pensions		Other Postretirement Benefits
($ in millions)	2020	2019	2020	2019
Accumulated net actuarial losses	$1,071	$920	$233	$166
Accumulated prior service cost (credit)	4	2	(75)	(138)
Total	$1,075	$922	$158	$28

Schedule of Amounts Recognized in Other Comprehensive Income (Loss) [Table Text Block]

The net increase in Accumulated other comprehensive loss (pretax) in 2020 relating to defined benefit pension and other postretirement benefits is primarily attributable to pension and other postretirement plan discount rate declines, as follows:

($ in millions)	Pensions	Other Postretirement Benefits
Net actuarial loss arising during the year	$218	$82
New prior service credit	2	4
Amortization of actuarial loss	(71)	(15)
Amortization of prior service credit	—	59
Foreign currency translation adjustments	9	—
Impact of settlements and curtailments	(5)	—
Net change	$153	$130

Net Periodic Benefit Cost

	Pensions			Other Postretirement Benefits
($ in millions)	2020	2019	2018	2020	2019	2018
Service cost	$24	$23	$28	$10	$8	$10
Interest cost	87	105	97	20	26	24
Expected return on plan assets	(144)	(139)	(150)	—	—	—
Amortization of prior service credit	—	—	—	(59)	(57)	(60)
Amortization of actuarial losses	71	62	63	15	8	19
Settlements, curtailments, and special termination benefits	18	3	5	—	—	—
Net periodic benefit cost/(income)	$56	$54	$43	($14)	($15)	($7)

Schedule of Contributions to Defined benefit Plans

Contributions to defined benefit pension plans

($ in millions)	2020	2019	2018
U.S. defined benefit pension plans	$—	$—	$75
Non-U.S. defined benefit pension plans	$17	$13	$24

Schedule of Expected Benefit Payments

The estimated benefits expected to be paid under the Company’s defined benefit pension and other postretirement benefit plans are:

($ in millions)	Pensions	Other Postretirement Benefits
2021	$171	$54
2022	$159	$53
2023	$166	$51
2024	$170	$50
2025	$173	$49
2026 to 2030	$890	$210

Weighted Average Target Pension Plan Asset Allocations

The following summarizes the weighted average target pension plan asset allocation as of December 31, 2020 and 2019 for all PPG defined benefit plans:

Asset Category	2020	2019
Equity securities	15-45%	15-45%
Debt securities	30-65%	30-65%
Real estate	0-10%	0-10%
Other	20-40%	20-40%

Fair Values of the Company's Pension Plan Assets by Asset Category

The fair values of the Company’s pension plan assets at December 31, 2020 and 2019, by asset category, are as follows:

	December 31, 2020				December 31, 2019
($ in millions)	Level 1(1)	Level 2(1)	Level 3(1)	Total	Level 1(1)	Level 2(1)	Level 3(1)	Total
Asset Category
Equity securities:
U.S.
Large cap	$65	$94	$—	$159	$58	$80	$—	$138
Small cap	42	—	—	42	41	—	—	41
Non-U.S.
Developed and emerging markets(2)	144	80	—	224	143	84	—	227
Debt securities:
Cash and cash equivalents	5	10	—	15	10	16	—	26
Corporate(3)
U.S.(4)	—	386	78	464	—	337	77	414
Developed and emerging markets(2)	—	2	—	2	—	2	—	2
Diversified(5)	—	126	—	126	—	237	—	237
Government
U.S.(4)	82	20	—	102	72	9	—	81
Developed markets	—	19	—	19	—	7	—	7
Other(6)	—	—	421	421	—	18	377	395
Real estate, hedge funds, and other	—	515	417	932	—	303	381	684
Total assets in the fair value hierarchy	$338	$1,252	$916	$2,506	$324	$1,093	$835	$2,252
Common-collective trusts(7)	—	—	—	710	—	—	—	713
Total Investments	$338	$1,252	$916	$3,216	$324	$1,093	$835	$2,965

(1)These levels refer to the accounting guidance on fair value measurement described in Note 11, “Financial Instruments, Hedging Activities and Fair Value Measurements.”

(2)These amounts represent holdings in investment grade debt or equity securities of issuers in both developed markets and emerging economies.

(3)This category represents investment grade debt securities from a diverse set of industry issuers.

(4)These investments are primarily long duration fixed income securities.

(5)This category represents commingled funds invested in diverse portfolios of debt securities.

(6)This category includes mortgage-backed and asset backed debt securities, municipal bonds and other debt securities including derivatives.

(7)Certain investments that are measured at net asset value per share (or its equivalent) are not required to be classified in the fair value hierarchy.

Change in the Fair Value of the Company's Level 3 Pension Assets

The change in the fair value of the Company’s Level 3 pension assets for the years ended December 31, 2020 and 2019 was as follows:

($ in millions)	Real Estate	Other Debt Securities	Hedge Funds and Other Assets	Total
January 1, 2019	$137	$359	$299	$795
Realized gains/(losses)	18	38	(3)	53
Unrealized (losses)/gains	(7)	—	15	8
Transfers (out)/in, net	(27)	(12)	17	(22)
Foreign currency gains/(losses)	2	(8)	7	1
December 31, 2019	$123	$377	$335	$835
Realized gains	4	24	2	30
Unrealized losses	(5)	—	(2)	(7)
Transfers in/(out), net	1	(14)	28	15
Foreign currency gains	1	34	8	43
December 31, 2020	$124	$421	$371	$916

Benefit Obligations

Weighted Average Assumptions Used for the Defined Benefit Pension and Other Postretirement Plans

The following weighted average assumptions were used to determine the benefit obligation for the Company’s defined benefit pension and other postretirement plans as of December 31, 2020 and 2019:

	United States				International				Total PPG
	2020		2019		2020		2019		2020		2019
Discount rate	2.4	%	3.3	%	1.6	%	2.2	%	2.1	%	2.8	%
Rate of compensation increase	2.5	%	2.5	%	1.1	%	2.8	%	1.5	%	2.6	%

Benefit Costs

Weighted Average Assumptions Used for the Defined Benefit Pension and Other Postretirement Plans

The following weighted average assumptions were used to determine the net periodic benefit cost for the Company’s defined benefit pension and other postretirement benefit plans for the three years in the period ended December 31, 2020:

	2020		2019		2018
Discount rate	2.8	%	3.7	%	3.2	%
Expected return on assets	5.0	%	5.4	%	5.4	%
Rate of compensation increase	2.6	%	1.8	%	1.2	%