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Derivative Financial Instruments | 9 Months Ended
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Sep. 30, 2024
Derivative Instruments and Hedging Activities Disclosure [Abstract] |
Derivative Financial Instruments | Derivative Financial Instruments Cash Flow Hedges Our cash flow hedges include foreign currency forward contracts, commodity swaps and commodity purchase contracts. We use foreign currency forward contracts to manage currency risk associated with certain expected sales and purchases through 2031. We use commodity derivatives, such as fixed-price purchase commitments and swaps to hedge against potentially unfavorable price changes for commodities used in production. Our commodity contracts hedge forecasted transactions through 2028. Derivative Instruments Not Receiving Hedge Accounting Treatment We have entered into agreements to purchase and sell aluminum to address long-term strategic sourcing objectives and non-U.S. business requirements. These agreements are derivative instruments for accounting purposes. The quantities of aluminum in these agreements offset and are priced at prevailing market prices. We also hold certain foreign currency forward contracts and commodity swaps which do not qualify for hedge accounting treatment. Notional Amounts and Fair Values The notional amounts and fair values of derivative instruments in the Condensed Consolidated Statements of Financial Position were as follows:
| Notional amounts (1) | Other assets | Accrued liabilities
| September 30 2024 | December 31 2023 | September 30 2024 | December 31 2023 | September 30 2024 | December 31 2023
Derivatives designated as hedging instruments: |  |  |  |  |  |
Foreign exchange contracts | $3,838 |  | $4,120 |  | $84 |  | $85 |  | ($50) |  | ($63) |
Commodity contracts | 418 |  | 514 |  | 75 |  | 83 |  | (1) |  | (8) |
Derivatives not receiving hedge accounting treatment: |  |  |  |  |  |
Foreign exchange contracts | 720 |  | 254 |  | 10 |  | 1 |  | (25) |  | (32) |
Commodity contracts | 33 |  | 115 |  |  |  |  |  | (2) |
Total derivatives | $5,009 |  | $5,003 |  | $169 |  | $169 |  | ($76) |  | ($105) |
Netting arrangements |  |  | (47) |  | (47) |  | 47 |  | 47 |
Net recorded balance |  |  | $122 |  | $122 |  | ($29) |  | ($58) |
(1)Notional amounts represent the gross contract/notional amount of the derivatives outstanding. (Losses)/gains associated with our hedging transactions and forward points recognized in Other comprehensive (loss)/income are presented in the following table:
| Nine months ended September 30 |  | Three months ended September 30
| 2024 |  | 2023 |  | 2024 |  | 2023
Recognized in Other comprehensive (loss)/income, net of taxes: |  |  |  |  |  |  |
Foreign exchange contracts | ($18) |  |  | ($30) |  |  | $57 |  |  | ($41) |
Commodity contracts | 5 |  |  | (30) |  |  | 6 |  |  | 6 |
(Losses)/gains associated with our hedging transactions and forward points reclassified from AOCI to earnings are presented in the following table:
| Nine months ended September 30 |  | Three months ended September 30
| 2024 |  | 2023 |  | 2024 |  | 2023
Foreign exchange contracts |  |  |  |  |  |  |
Costs and expenses | ($19) |  |  | ($11) |  |  | ($7) |  |  | ($5) |
General and administrative expense | (13) |  |  | (21) |  |  |  |  | 2 |
Commodity contracts |  |  |  |  |  |  |
Costs and expenses | ($6) |  |  | $24 |  |  | $6 |  |  | ($3) |
General and administrative expense | 5 |  |  | 6 |  |  | 2 |  |  | 1 |
Gains/(losses) related to undesignated derivatives on foreign exchange and commodity cash flow hedging transactions recognized in Other income, net were insignificant for the nine and three months ended September 30, 2024 and 2023. Based on our portfolio of cash flow hedges, we expect to reclassify losses of $24 (pre-tax) out of AOCI into earnings during the next 12 months. We have derivative instruments with credit-risk-related contingent features. If we default on our five-year credit facilities, our derivative counterparties could require settlement for foreign exchange and certain commodity contracts with original maturities of at least five years. The fair value of those contracts in a net liability position at September 30, 2024 was $3. For other particular commodity contracts, our counterparties could require collateral posted in an amount determined by our credit ratings. At September 30, 2024, there was no collateral posted related to our derivatives.

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- Definition The entire disclosure for derivative instruments and hedging activities including, but not limited to, risk management strategies, non-hedging derivative instruments, assets, liabilities, revenue and expenses, and methodologies and assumptions used in determining the amounts. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 815 -SubTopic 40 -Name Accounting Standards Codification -Section 50 -Paragraph 5 -Subparagraph (f) -Publisher FASB -URI https://asc.fasb.org/1943274/2147480237/815-40-50-5 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 815 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 5C -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org/1943274/2147480434/815-10-50-5C Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 815 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/815/tableOfContent + Details
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