Summary of Significant Accounting Policies (Tables)

9 Months Ended

Jul. 31, 2017

Product Warranty Liability [Line Items]

Schedule of Product Warranty Liability [Table Text Block]

The following table presents accrued product warranty and deferred warranty revenue activity:

	Nine Months Ended July 31,
(in millions)	2017			2016
Balance at beginning of period	$	818		$	994
Costs accrued and revenues deferred	137			141
Currency translation adjustment	—			2
Adjustments to pre-existing warranties(A)	(4		)	70
Payments and revenues recognized	(292		)	(339		)
Balance at end of period	659			868
Less: Current portion	340			423
Noncurrent accrued product warranty and deferred warranty revenue	$	319		$	445

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(A) Adjustments to pre-existing warranties reflect changes in our estimate of warranty costs for products sold in prior periods. Such adjustments typically occur when claims experience deviates from historic and expected trends. Our warranty liability is generally affected by component failure rates, repair costs, and the timing of failures. Future events and circumstances related to these factors could materially change our estimates and require adjustments to our liability. In addition, new product launches require a greater use of judgment in developing estimates until historical experience becomes available.

In the second quarter of 2016, we recorded a charge for adjustments to pre-existing warranties of $46 million or $0.56 per diluted share. The pre-existing charges primarily related to increases in both claim frequency and cost of repair across both the Medium Duty and Big Bore engine families. These charges increase the reserve for Navistar's standard warranty obligations as well as the loss positions related to our Big Bore extended service contract.