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Restructuring Charges | 6 Months Ended
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Jun. 30, 2020
Restructuring Charges [Abstract] |
Restructuring Charges | RESTRUCTURING CHARGES We periodically take action to improve operating efficiencies, typically in connection with business acquisitions or changes in the economic environment. Our footprint and headcount reductions and organizational integration actions relate to discrete, unique restructuring events, primarily reflected in the following plans. On June 26, 2020, the Company committed to a workforce reduction plan in the United States, as part of the Company’s continued cost reduction efforts. The workforce reduction plan includes a voluntary retirement program and involuntary severance actions which were effective as of the end of the second quarter of 2020. The Company expects the actions to be substantially complete in 2020. As such, the Company estimates that it will incur a total of approximately $95 million in employee termination costs, and expects substantially all of the costs to result in cash expenditures in 2020. Additionally, the Company has committed to other global fixed cost actions which did not have material impact in the second quarter of 2020. On May 31, 2019, we announced our intention to reconvert our Naples, Italy manufacturing plant and potentially sell the plant to a third party. On September 16, 2019, we entered into a preliminary agreement to sell the plant to a third-party purchaser and to support costs associated with the transition. In October 2019, we announced that, based on further discussions with unions and the Italian government, we will continue production at the Naples manufacturing plant in the near-term and resume negotiations with unions and the Italian government related to our exit of the plant. Our preliminary agreement to sell the plant to a third-party purchaser terminated in accordance with its terms in March 2020. We intend to cease production in the plant and exit the facility in 2020 as previously disclosed. In connection with this action, we have incurred approximately $43 million in asset impairment costs, $12 million in other associated costs and $6 million in employee-related costs through June 30, 2020. As of June 30, 2020, we continue to expect estimated total costs of $135 million and cash expenditures of $87 million. We estimate that the remaining costs of approximately $74 million, including approximately $46 million in employee-related costs and approximately $28 million in other associated costs, will be substantially incurred in 2020. The Company also believes that substantially all of the $87 million in estimated cash expenditures will occur in 2020. We expect these actions to be substantially complete in 2020. In 2018, we announced actions in EMEA to reduce fixed costs by $50 million. The initiatives primarily include headcount reductions throughout the EMEA region. Additionally, we exited domestic sales operations in Turkey. These actions were substantially complete as of March 31, 2020. The following table contains a subset of our restructuring actions above for the six months ended June 30, 2020 and the total costs to date for each plan:
Millions of dollars | 2020 | Total
North America Fixed Cost Actions | $ | 88 |  | $ | 88 |
EMEA Fixed Cost Actions | 7 |  | 84 |
EMEA Naples Facility Closure | 7 |  | 61 |
Other Global Fixed Cost Actions | 7 |  | 7 |
The following table summarizes the changes to our restructuring liability during the six months ended June 30, 2020:
Millions of dollars | December 31, 2019 | Charges to Earnings | Cash Paid | Non-Cash and Other | June 30, 2020
Employee termination costs | $ | 57 |  | $ | 106 |  | $ | (34 | ) | $ | — |  | $ | 129 |
Asset impairment costs | 8 |  | — |  | — |  | — |  | 8 |
Other exit costs | 12 |  | 17 |  | (14 | ) | (1 | ) | 14 |
Total | $ | 77 |  | $ | 123 |  | $ | (48 | ) | $ | (1 | ) | $ | 151 |
The following table summarizes the restructuring charges by operating segment for the period presented:
| Six Months Ended
Millions of dollars | June 30, 2020
North America | $ | 70 |
EMEA | 22 |
Latin America | 5 |
Asia | 7 |
Corporate / Other | 19 |
Total | $ | 123 |

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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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- References No definition available. + Details
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