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REPOSITIONING AND OTHER CHARGES | 9 Months Ended
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Sep. 30, 2022
Restructuring and Related Activities [Abstract] |
REPOSITIONING AND OTHER CHARGES | REPOSITIONING AND OTHER CHARGES A summary of repositioning and other charges follows:
| Three Months Ended September 30, |  | Nine Months Ended September 30,
| 2022 | 2021 |  | 2022 | 2021
Severance |  | $ | 43 |  |  | $ | 3 |  |  |  | $ | 75 |  |  | $ | 63 |
Asset impairments |  | 5 |  |  | 20 |  |  |  | 153 |  |  | 107 |
Exit costs |  | 20 |  |  | 46 |  |  |  | 78 |  |  | 110 |
Reserve adjustments |  | (2) |  |  | 3 |  |  |  | (54) |  |  | (18) |
Total net repositioning charge |  | 66 |  |  | 72 |  |  |  | 252 |  |  | 262 |
Asbestos related litigation charges, net of insurance and reimbursements |  | 29 |  |  | 24 |  |  |  | 115 |  |  | 68 |
Probable and reasonably estimable environmental liabilities, net of reimbursements |  | 3 |  |  | 3 |  |  |  | 19 |  |  | 14 |
Other |  | 2 |  |  | (3) |  |  |  | 328 |  |  | (6) |
Total net repositioning and other charges |  | $ | 100 |  |  | $ | 96 |  |  |  | $ | 714 |  |  | $ | 338 |
The following table summarizes the pretax distribution of total net repositioning and other charges by classification:
| Three Months Ended September 30, |  | Nine Months Ended September 30,
| 2022 | 2021 |  | 2022 | 2021
Cost of products and services sold |  | $ | 85 |  |  | $ | 63 |  |  |  | $ | 429 |  |  | $ | 248 |
Selling, general and administrative expenses |  | 24 |  |  | 33 |  |  |  | 237 |  |  | 90 |
Other (income) expense |  | (9) |  |  | — |  |  |  | 48 |  |  | — |
|  | $ | 100 |  |  | $ | 96 |  |  |  | $ | 714 |  |  | $ | 338 |
The following table summarizes the pretax impact of total net repositioning and other charges by segment. These amounts are excluded from segment profit as described in Note 17 Segment Financial Data:
| Three Months Ended September 30, |  | Nine Months Ended September 30,
| 2022 | 2021 |  | 2022 | 2021
Aerospace |  | $ | (2) |  |  | $ | (2) |  |  |  | $ | 34 |  |  | $ | 55 |
Honeywell Building Technologies |  | 10 |  |  | 5 |  |  |  | 47 |  |  | 9 |
Performance Materials and Technologies |  | 15 |  |  | 5 |  |  |  | 262 |  |  | 12 |
Safety and Productivity Solutions |  | 55 |  |  | 40 |  |  |  | 197 |  |  | 136 |
Corporate and All Other |  | 22 |  |  | 48 |  |  |  | 174 |  |  | 126 |
|  | $ | 100 |  |  | $ | 96 |  |  |  | $ | 714 |  |  | $ | 338 |
In the three months ended September 30, 2022, the Company recognized gross repositioning charges totaling $68 million, including severance costs of $43 million related to workforce reductions of 1,276 manufacturing and administrative positions primarily in the Company's Safety and Productivity Solutions reportable business segment. The workforce reductions were related to our productivity and ongoing functional transformation initiatives. The repositioning charge included asset impairments of $5 million related to the write-down of certain manufacturing equipment. The repositioning charge also included exit costs of $20 million related to current period costs incurred for closure obligations associated with site transitions in the Company's Safety and Productivity Solutions and Aerospace reportable business segments. In the three months ended September 30, 2021, the Company recognized gross repositioning charges totaling $69 million, including severance costs of $3 million related to workforce reductions of 603 manufacturing and administrative positions mainly in the Company's Safety and Productivity Solutions reportable business segment. The workforce reductions were primarily related to the re-alignment of a product line in the Company's Safety and Productivity Solutions reportable business segment and to our productivity and ongoing functional transformation initiatives. The repositioning charge included asset impairments of $20 million related to the write-down of certain manufacturing equipment. The repositioning charge also included exit costs of $46 million for current period costs incurred for, closure obligations associated with site transitions, and lease obligations for equipment. In the nine months ended September 30, 2022, the Company recognized gross repositioning charges totaling $306 million including asset impairments of $153 million for the write-down of certain manufacturing equipment, primarily related to closing and relocating the production of certain respiratory manufacturing from a U.S.-based facility to a non-U.S. facility in the Company's Safety Productivity and Solutions reportable business segment. The repositioning charge included exit costs of $78 million primarily related to current period exit costs incurred for new and previously approved repositioning projects and closure obligations associated with site transitions in the Company's Performance Materials and Technologies and Aerospace reportable business segments. The repositioning charge also included severance costs of $75 million related to workforce reductions of 2,940 manufacturing and administrative positions across our segments. The workforce reductions related to cost savings actions taken in connection with our productivity and ongoing functional transformation initiatives and to site transitions to more cost-effective locations. Also, $54 million of previously established reserves, primarily for severance, were returned to income due to higher than expected voluntary exits and adjustments to the scope of previously announced repositioning actions. In the nine months ended September 30, 2021, the Company recognized gross repositioning charges totaling $280 million including severance costs of $63 million related to workforce reductions of 5,252 manufacturing and administrative positions mainly in the Company's Safety and Productivity Solutions and Aerospace reportable business segments. The workforce reductions were primarily related to the re-alignment of a product line in the Company's Safety and Productivity Solutions reportable business segment, site transitions, mainly in the Company's Aerospace reportable business segment, to more cost-effective locations, and our productivity and ongoing functional transformation initiatives. The repositioning charge included asset impairments of $107 million related to the write-down of certain manufacturing and other equipment. The repositioning charge included exit costs of $110 million for current period costs incurred for closure obligations associated with site transitions, and lease obligations for equipment. Also, $18 million of previously established reserves, primarily for severance, were returned to income due to adjustments to the scope of previously announced repositioning actions. The following table summarizes the status of the Company's total repositioning reserves:
| Severance Costs | Asset Impairments | Exit Costs | Total
Balance at December 31, 2021 |  | $ | 289 |  |  | $ | — |  |  | $ | 122 |  |  | $ | 411 |
Charges |  | 75 |  |  | 153 |  |  | 78 |  |  | 306 |
Usage - cash |  | (120) |  |  | — |  |  | (86) |  |  | (206) |
Usage - noncash |  | — |  |  | (145) |  |  | (14) |  |  | (159) |
Foreign currency translation |  | (18) |  |  | — |  |  | (2) |  |  | (20) |
Adjustments |  | (40) |  |  | (8) |  |  | (6) |  |  | (54) |
Balance at September 30, 2022 |  | $ | 186 |  |  | $ | — |  |  | $ | 92 |  |  | $ | 278 |
Certain repositioning projects will recognize exit costs in future periods when the actual liability is incurred. Such exit costs incurred in the nine months ended September 30, 2022 and 2021, were $46 million and $30 million, respectively. During the three months ended September 30, 2022, the Company recognized a net reduction of Other charges previously recognized of $16 million. The Other charges include costs incurred related to the Wind down of our operations in Russia. The reduction of Other charges primarily relates to a favorable foreign exchange revaluation on an intercompany loan with a Russian affiliate, in addition to the recovery of outstanding accounts receivable previously reserved against, recorded to Other (income) expense and Selling, general and administrative expense on the Consolidated Statement of Operations, respectively. This was partially offset by the recognition of an additional expense for called guarantees recorded to Other (income) expense on the Consolidated Statement of Operations. During the nine months ended September 30, 2022, the Company recognized $291 million of Other charges. The Other charges include costs incurred related to the initial suspension (the Suspension) and Wind down of our businesses and operations in Russia. These costs impacted all reportable business segments, with the most significant impact within the Performance Materials and Technologies reportable business segment. The Other charges include costs recorded in Cost of products sold, Selling, general and administrative expenses, or Other (income) expense on the Consolidated Statement of Operations. For the nine months ended September 30, 2022, Cost of products and services sold includes $60 million primarily related to inventory reserves and the write-down of other assets, Selling, general and administrative includes $183 million primarily related to reserves against outstanding accounts receivable and contract assets, impairment of intangible assets, the write-down of other assets, and employee severance, and Other (income) expense includes $48 million related to foreign exchange revaluation on an intercompany loan with a Russian affiliate, impairment of property, plant and equipment, and expenses for called guarantees. For the nine months ended September 30, 2022, the Other charges does not include a $2 million tax valuation allowance recorded to Tax expense on the Consolidated Statement of Operations, directly attributable to our Wind down of businesses and operations in Russia. Given the uncertainty inherent in the Company's remaining obligations related to our contracts with Russian counterparties, the Company does not believe it is possible to develop estimates of reasonably possible loss in excess of current accruals for these matters (other than as specifically set forth above). Based on available information to date, the Company’s estimate of potential future losses or other contingencies related to Suspension and Wind down activities, including any guarantee payments or any litigation costs or as otherwise related to the Company's Wind down in Russia, could adversely affect the Company's consolidated results of operations in the periods recognized but would not be material with respect to the Company's consolidated financial position. See Note 14 Commitments and Contingencies for a discussion of the recognition and measurement of estimate for contingencies.

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- Definition The entire disclosure for restructuring and related activities. Description of restructuring activities such as exit and disposal activities, include facts and circumstances leading to the plan, the expected plan completion date, the major types of costs associated with the plan activities, total expected costs, the accrual balance at the end of the period, and the periods over which the remaining accrual will be settled. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 420 -SubTopic 10 -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 5.P.4(e)) -URI https://asc.fasb.org/extlink&oid=115931487&loc=d3e140904-122747 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 420 -SubTopic 10 -Section 50 -Paragraph 1 -Subparagraph (a) -URI https://asc.fasb.org/extlink&oid=6394359&loc=d3e17939-110869 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 420 -URI https://asc.fasb.org/topic&trid=2175745 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 420 -SubTopic 10 -Section 50 -Paragraph 1 -Subparagraph (e) -URI https://asc.fasb.org/extlink&oid=6394359&loc=d3e17939-110869 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 420 -SubTopic 10 -Section 50 -Paragraph 1 -Subparagraph (b)(2) -URI https://asc.fasb.org/extlink&oid=6394359&loc=d3e17939-110869 + Details
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