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v3.20.2

Retirement Plans (Tables) | 12 Months Ended
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Sep. 30, 2020
Retirement Benefits [Abstract] |
Schedule of projected benefit payments | Projected benefit payments from the plans as of September 30, 2020 are estimated as follows (in millions):
2021 | $ | 21 |
2022 | 24 |
2023 | 22 |
2024 | 24 |
2025 | 26 |
2026-2030 | 168 |
Schedule of plan assets by asset category | Adient's plan assets by asset category, are as follows:
|  | Fair Value Measurements Using: |  |
(in millions) |  | Total as of September 30, 2020 |  | Quoted Prices in Active Markets (Level 1) |  | Significant Other Observable Inputs (Level 2) |  | Significant Unobservable Inputs (Level 3) |  | Net Asset Value (NAV)
Pension |  |  |  |  |  |  |  |  |  |
Cash |  | $ | 37 |  |  | $ | 37 |  |  | $ | — |  |  | $ | — |  |  | $ | — |
Equity Securities |  |  |  |  |  |  |  |  |  |
Domestic |  | 15 |  |  | 1 |  |  | 7 |  |  | — |  |  | 7 |
International - Developed |  | 51 |  |  | 29 |  |  | 11 |  |  | — |  |  | 11 |
International - Emerging |  | 3 |  |  | — |  |  | 3 |  |  | — |  |  | — |
Fixed Income Securities |  |  |  |  |  |  |  |  |  |
Government |  | 219 |  |  | 63 |  |  | 128 |  |  | — |  |  | 28 |
Corporate/Other |  | 64 |  |  | 42 |  |  | 11 |  |  | — |  |  | 11 |
Hedge Fund |  | 75 |  |  | — |  |  | 75 |  |  | — |  |  | — |
Real Estate |  | 22 |  |  | — |  |  | — |  |  | 6 |  |  | 16 |
Total |  | $ | 486 |  |  | $ | 172 |  |  | $ | 235 |  |  | $ | 6 |  |  | $ | 73 |
|  | Fair Value Measurements Using: |  |
(in millions) |  | Total as of September 30, 2019 |  | Quoted Prices in Active Markets (Level 1) |  | Significant Other Observable Inputs (Level 2) |  | Significant Unobservable Inputs (Level 3) |  | Net Asset Value (NAV)
Pension |  |  |  |  |  |  |  |  |  |
Cash |  | $ | 31 |  |  | $ | 31 |  |  | $ | — |  |  | $ | — |  |  | $ | — |
Equity Securities |  |  |  |  |  |  |  |  |  |
Domestic |  | 15 |  |  | 2 |  |  | 7 |  |  | — |  |  | 6 |
International - Developed |  | 49 |  |  | 36 |  |  | 10 |  |  | — |  |  | 3 |
International - Emerging |  | 5 |  |  | 2 |  |  | 3 |  |  | — |  |  | — |
Fixed Income Securities |  |  |  |  |  |  |  |  |  |
Government |  | 218 |  |  | 75 |  |  | 117 |  |  | — |  |  | 26 |
Corporate/Other |  | 66 |  |  | 55 |  |  | — |  |  | — |  |  | 11 |
Hedge Fund |  | 65 |  |  | — |  |  | 65 |  |  | — |  |  | — |
Real Estate |  | 21 |  |  | — |  |  | — |  |  | 6 |  |  | 15 |
Total |  | $ | 470 |  |  | $ | 201 |  |  | $ | 202 |  |  | $ | 6 |  |  | $ | 61 |
Schedule of changes in fair value of pension assets | The following sets forth a summary of changes in the fair value of pension assets measured using significant unobservable inputs (Level 3):
(in millions) |  | Real Estate
Pension |  |
Asset value as of September 30, 2018 |  | $ | 6 |
Redemptions |  | — |
Asset value as of September 30, 2019 |  | $ | 6 |
Redemptions |  | — |
Asset value as of September 30, 2020 |  | $ | 6 |
Schedule of changes in projected benefit obligations, changes in plan assets and funded status | The table that follows contains the ABO and reconciliations of the changes in the PBO, the changes in plan assets and the funded status:
|  | Pension Benefits |  |
(in millions) |  | 2020 |  | 2019 |  |  |  |
Accumulated Benefit Obligation |  | $ | 582 |  |  | $ | 571 |  |  |  |  |
Change in Projected Benefit Obligation: |  |  |  |  |  |  |  |
Projected benefit obligation at beginning of year |  | $ | 598 |  |  | $ | 547 |  |  |  |  |
Service cost |  | 7 |  |  | 7 |  |  |  |  |
Interest cost |  | 10 |  |  | 13 |  |  |  |  |
Actuarial (gain) loss |  | 16 |  |  | 96 |  |  |  |  |
Benefits paid |  | (22) |  |  | (40) |  |  |  |  |
Settlements and curtailments |  | (11) |  |  | — |  |  |  |  |
Divestitures |  | (12) |  |  | — |  |  |  |  |
Currency translation adjustment |  | 20 |  |  | (25) |  |  |  |  |
Projected benefit obligation at end of year |  | $ | 606 |  |  | $ | 598 |  |  |  |  |
Change in Plan Assets: |  |  |  |  |  |  |  |
Fair value of plan assets at beginning of year |  | $ | 470 |  |  | $ | 449 |  |  |  |  |
Actual return on plan assets |  | 12 |  |  | 63 |  |  |  |  |
Employer contributions/(distributions) |  | 19 |  |  | 19 |  |  |  |  |
Benefits paid |  | (22) |  |  | (40) |  |  |  |  |
Settlements and curtailments |  | (10) |  |  | — |  |  |  |  |
Divestitures |  | (1) |  |  | — |  |  |  |  |
Currency translation adjustment |  | 18 |  |  | (21) |  |  |  |  |
Fair value of plan assets at end of year |  | $ | 486 |  |  | $ | 470 |  |  |  |  |
Funded status |  | $ | (120) |  |  | $ | (128) |  |  |  |  |
Amounts recognized in the statement of financial position consist of: |  |  |  |  |  |  |  |
Prepaid benefit cost |  | $ | 26 |  |  | $ | 24 |  |  |  |  |
Accrued benefit liability |  | (146) |  |  | (152) |  |  |  |  |
Net amount recognized |  | $ | (120) |  |  | $ | (128) |  |  |  |  |
Schedule of weighted average assumptions |
|  | Pension Benefits
|  | U.S. Plans |  | Non-U.S. Plans
|  | 2020 |  | 2019 |  | 2020 |  | 2019
Weighted Average Assumptions (1): |  |  |  |  |  |  |  |
Discount rate (2) |  | 2.91 | % |  | 3.22 | % |  | 1.87 | % |  | 1.85 | %
Rate of compensation increase |  | NA |  | NA |  | 3.64 | % |  | 3.54 | %
(1) Plan assets and obligations are determined based on a September 30 measurement date. (2) Adient considers the expected benefit payments on a plan-by-plan basis when setting assumed discount rates. As a result, Adient uses different discount rates for each plan depending on the plan jurisdiction, the demographics of participants and the expected timing of benefit payments. For the U.S. pension plan, Adient uses a discount rate provided by an independent third party calculated based on an appropriate mix of high quality bonds. For the non-U.S. pension plans, Adient consistently uses the relevant country specific benchmark indices for determining the various discount rates.
Schedule of components and key assumptions of net periodic benefit cost | The tables that follow contain the components and key assumptions of net periodic benefit cost related to Adient’s pension plans:
|  | Pension Benefits |  |
(in millions) |  | 2020 |  | 2019 |  | 2018 |  |  |  |  |  |
Components of Net Periodic Benefit Cost (Credit): |  |  |  |  |  |  |  |  |  |  |  |
Service cost |  | $ | 7 |  |  | $ | 7 |  |  | $ | 8 |  |  |  |  |  |  |
Interest cost |  | 10 |  |  | 13 |  |  | 14 |  |  |  |  |  |  |
Expected return on plan assets |  | (19) |  |  | (18) |  |  | (18) |  |  |  |  |  |  |
Net actuarial (gain) loss |  | 22 |  |  | 49 |  |  | (24) |  |  |  |  |  |  |
Settlement (gain) loss |  | 1 |  |  | 2 |  |  | — |  |  |  |  |  |  |
Net periodic benefit cost (credit) |  | $ | 21 |  |  | $ | 53 |  |  | $ | (20) |  |  |  |  |  |  |
A $15 million settlement gain was recorded in fiscal 2018 related to the termination of a postretirement plan.
|  | Pension Benefits |  |
|  | U.S. Plans |  | Non-U.S. Plans |  |  |  |  |  |
|  | 2020 |  | 2019 |  | 2018 |  | 2020 |  | 2019 |  | 2018 |  |  |  |  |  |
Expense Assumptions: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Discount rate |  | 3.34 | % |  | 4.29 | % |  | 3.85 | % |  | 1.85 | % |  | 2.71 | % |  | 2.62 | % |  |  |  |  |  |
Expected return on plan assets |  | 5.00 | % |  | 5.00 | % |  | 5.15 | % |  | 4.01 | % |  | 4.08 | % |  | 4.19 | % |  |  |  |  |  |
Rate of compensation increase |  | N/A |  | NA |  | NA |  | 3.66 | % |  | 3.46 | % |  | 3.53 | % |  |  |  |  |  |

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- Definition Tabular disclosure of benefits expected to be paid by pension plans and/or other employee benefit plans in each of the next five fiscal years and in the aggregate for the five fiscal years thereafter. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 715 -SubTopic 20 -Section 50 -Paragraph 1 -Subparagraph (f) -URI http://asc.fasb.org/extlink&oid=118255775&loc=d3e1928-114920 + Details
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