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Business Restructuring | 9 Months Ended
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Sep. 30, 2020
Restructuring and Related Activities [Abstract] |
Business Restructuring | Business Restructuring The Company records restructuring liabilities that represent charges incurred in connection with consolidations of certain operations, including operations from acquisitions, as well as headcount reduction programs. These charges consist primarily of severance costs and certain other cash costs. As a result of these programs, the Company will also incur incremental non-cash accelerated depreciation expense for certain assets due to their reduced expected asset life. These charges are not allocated to the Company’s reportable business segments. Refer to Note 17 Reportable Business Segment Information for additional information. 2020 Restructuring Program In June 2020, the Company approved a business restructuring plan which included actions to reduce its global cost structure. The program addresses weakened global economic conditions stemming from the COVID-19 pandemic and related pace of recovery in a few end-use markets along with further opportunities to optimize supply chain and functional costs. The plan includes a voluntary separation program that was offered in the U.S. and Canada. A pretax restructuring charge of $176 million was recorded in PPG's second quarter 2020 financial results. This charge represents employee severance and other cash costs. The majority of restructuring actions are expected to be completed by the end of 2020 with the remainder of the actions expected to be completed in 2021. 2019 and 2018 Restructuring Programs As a result of the COVID-19 pandemic, the Company expects delays in the timing of certain previously recorded restructuring actions. Program completion dates may differ from the originally targeted timeline, as noted below. In June 2019, the Company approved a business restructuring plan which included actions to reduce its global cost structure. The program is the result of a comprehensive internal operational assessment to identify further opportunities to improve the profitability of the overall business portfolio. This program includes further manufacturing optimization; targeted pruning of low-profit business in certain regions; exiting certain smaller product lines that are not meeting profitability objectives; reorganization of certain business unit cost structures based on the current economic climate; and certain redundancy actions related to recent acquisitions. The majority of restructuring actions are now expected to be completed by the end of the first quarter 2021 with the remainder of the actions expected to be completed in 2022. In April 2018, the Company approved a business restructuring plan which included actions to reduce its global cost structure. The program was in response to the impacts of customer assortment changes in our U.S. architectural coatings business during the first quarter 2018 and sustained, elevated raw material inflation. The program aims to further right-size employee headcount and production capacity in certain businesses based on product demand, as well as reductions in various global functional and administrative costs. The majority of restructuring actions are now expected to be completed by the end of the fourth quarter of 2020. The following table summarizes the reserve activity for the nine months ended September 30, 2020 and 2019:
| Total Reserve |  |
($ in millions) | 2020 |  | 2019
January 1 | $224 |  |  | $110 |
Approved restructuring actions (a) | 198 |  |  | 194 |
Release of prior reserves and other adjustments | (26) |  |  | (19) |
Cash payments | (98) |  |  | (35) |
Foreign currency impact | 10 |  |  | (8) |
September 30 | $308 |  |  | $242 |

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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://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 420 -URI http://asc.fasb.org/topic&trid=2175745 + Details
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