Fair Value Measurements (Tables)

9 Months Ended

Jul. 31, 2016

Fair Value Disclosures [Abstract]

Financial instruments measured at fair value, recurring basis

The following table presents the financial instruments measured at fair value on a recurring basis:

	July 31, 2016								October 31, 2015
(in millions)	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
Assets
Marketable securities:
U.S. Treasury bills	$	49	$	—	$	—	$	49	$	53	$	—	$	—	$	53
Other	91		—		—		91		106		—		—		106
Derivative financial instruments:
Commodity forward contracts(A)	—		5		—		5		—		—		—		—
Foreign currency contracts(A)	—		—		—		—		—		1		—		1
Total assets	$	140	$	5	$	—	$	145	$	159	$	1	$	—	$	160
Liabilities
Derivative financial instruments:
Commodity forward contracts(B)	$	—	$	1	$	—	$	1	$	—	$	2	$	—	$	2
Foreign currency contracts(B)	—		1		—		1		—		2		—		2
Guarantees	—		—		23		23		—		—		10		10
Total liabilities	$	—	$	2	$	23	$	25	$	—	$	4	$	10	$	14

_________________________

(A) The asset value of commodity forward contracts and foreign currency contracts is included in Other current assets as of July 31, 2016 and October 31, 2015 in the accompanying Consolidated Balance Sheets.

(B) The liability value of commodity forward contracts and foreign currency contracts is included in Other current liabilities as of July 31, 2016 and October 31, 2015 in the accompanying Consolidated Balance Sheets.

Financial instruments classified within Level 3

The following table presents the changes for those financial instruments classified within Level 3 of the valuation hierarchy:

	Three Months Ended July 31,						Nine Months Ended July 31,
(in millions)	2016			2015			2016			2015
Guarantees, at beginning of period	$	(19	)	$	(7	)	$	(10	)	$	(8	)
Transfers out of Level 3	—			—			—			—
Issuances	(5		)	(4		)	(16		)	(4		)
Settlements	1			1			3			2
Guarantees, at end of period	$	(23	)	$	(10	)	$	(23	)	$	(10	)
Change in unrealized gains on assets (liabilities) still held	$	—		$	—		$	—		$	—

Financial instruments measured at fair value, nonrecurring basis

The following table presents the financial instruments measured at fair value on a nonrecurring basis:

(in millions)	July 31, 2016			October 31, 2015
Level 2 financial instruments
Carrying value of impaired finance receivables (A)	$	18		$	21
Specific loss reserve	(9		)	(9		)
Fair value	$	9		$	12

_________________________

(A) Certain impaired finance receivables are measured at fair value on a nonrecurring basis. An impairment charge is recorded for the amount by which the carrying value of the receivables exceeds the fair value of the underlying collateral, net of remarketing costs. Fair values of the underlying collateral are determined by reference to dealer vehicle value publications adjusted for certain market factors.

Carrying values and estimated fair values of financial instruments

The following tables present the carrying values and estimated fair values of financial instruments:

	As of July 31, 2016
	Estimated Fair Value								Carrying Value
(in millions)	Level 1		Level 2		Level 3		Total
Assets
Retail notes	$	—	$	—	$	144	$	144	$	136
Notes receivable	—		—		1		1		1
Liabilities
Debt:
Manufacturing operations
Senior Secured Term Loan Credit Facility, as Amended, due 2020	—		—		973		973		1,020
8.25% Senior Notes, due 2022	893		—		—		893		1,184
4.50% Senior Subordinated Convertible Notes, due 2018(A)	—		—		137		137		189
4.75% Senior Subordinated Convertible Notes, due 2019(A)	—		—		258		258		385
Debt of majority-owned dealerships	—		—		15		15		13
Financing arrangements	—		—		15		15		38
Loan Agreement related to 6.50% Tax Exempt Bonds, due 2040	—		227		—		227		225
Financed lease obligations	—		—		61		61		61
Other	—		—		10		10		10
Financial Services operations
Asset-backed debt issued by consolidated SPEs, at various rates, due serially through 2021	—		—		863		863		867
Bank credit facilities, at fixed and variable rates, due dates from 2016 through 2021	—		—		860		860		874
Commercial paper, at variable rates, program matures in 2017	93		—		—		93		93
Borrowings secured by operating and finance leases, at various rates, due serially through 2021	—		—		100		100		100

	As of October 31, 2015
	Estimated Fair Value								Carrying Value
(in millions)	Level 1		Level 2		Level 3		Total
Assets
Retail notes	$	—	$	—	$	170	$	170	$	166
Notes receivable	—		—		3		3		3
Liabilities
Debt:
Manufacturing operations
Senior Secured Term Loan Credit Facility, as Amended, due 2020	—		—		1,014		1,014		1,023
8.25% Senior Notes, due 2022	998		—		—		998		1,182
4.50% Senior Subordinated Convertible Notes, due 2018(A)	—		—		148		148		186
4.75% Senior Subordinated Convertible Notes, due 2019(A)	—		—		289		289		379
Debt of majority-owned dealerships	—		—		28		28		28
Financing arrangements	—		—		17		17		43
Loan Agreement related to 6.50% Tax Exempt Bonds, due 2040	—		233		—		233		225
Financed lease obligations	—		—		111		111		111
Other	—		—		17		17		15
Financial Services operations
Asset-backed debt issued by consolidated SPEs, at various rates, due serially through 2018	—		—		865		865		870
Bank credit facilities, at fixed and variable rates, due dates from 2016 through 2020	—		—		1,048		1,048		1,063
Commercial paper, at variable rates, program matures in 2017	86		—		—		86		86
Borrowings secured by operating and finance leases, at various rates, due serially through 2020	—		—		80		80		81

_________________________

(A) The carrying value represents the consolidated financial statement amount of the debt which excludes the allocation of the conversion feature to equity, while the fair value is based on internally developed valuation techniques such as discounted cash flow modeling for Level 3 convertible notes which include the equity feature.