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FINANCIAL INSTRUMENTS (Tables)

6 Months Ended

Jun. 30, 2019

Fair Value Disclosures [Abstract]

Gross Impact of Changes in Fair Value of Derivatives Designated as Cash Flow Hedges on AOCI and Net Income

The following table summarizes the gross impact of changes in the fair value of derivatives designated as cash flow hedges on accumulated other comprehensive income (loss) and net income during the three months and six months ended June 30, 2019 and 2018 (in millions):

						Recognized in Net Income
For the Three Months Ended June 30,		Gain (Loss) Recognized in Accumulated Other Comprehensive Income				Classification of Gain (Loss)		Gain (Loss) Reclassified from Accumulated Other Comprehensive Income into Income
2019
Foreign exchange contracts		$	18
						Net sales		1
						Cost of goods sold		(18		)
						Other, Net		4
Interest rate contracts		(11		)		Interest expense		(2		)
Total		$	7					$	(15	)
2018
Foreign currency contracts		$	(17	)
						Net sales		1
						Cost of goods sold		8
						Other, Net		9
Interest rate contracts		11				Interest expense		(1		)
Total		$	(6	)				$	17

						Recognized in Net Income
For the Six Months Ended June 30,		Gain (Loss) Recognized in Accumulated Other Comprehensive Income				Classification of Gain (Loss)		Gain (Loss) Reclassified from Accumulated Other Comprehensive Income into Income
2019
Foreign exchange contracts		(44		)
						Net sales		(4		)
						Cost of goods sold		(29		)
						Other, Net		(7		)
Interest rate contracts		(20		)		Interest expense		(3		)
Total		(64		)				$	(43	)
2018
Foreign currency contracts		11
						Net sales		1
						Cost of goods sold		20
						Other, Net		14
Interest rate contracts		14				Interest expense		(2		)
Total		$	25					$	33

Significant amounts reclassified out of each component of accumulated other comprehensive income (loss) in the three and six months ended June 30, 2019 and 2018 consisted of the following:

	Amounts Reclassified from Other Comprehensive Income (Loss)								Amount Reclassified from Other Comprehensive Income (Loss)								Consolidated Statement of Operations Line
	Three Months Ended June 30,								Six Months Ended June 30,
	2019				2018				2019				2018
	(in millions)								(in millions)
Cash flow hedges	$	(1	)		$	(1	)		$	4			$	(1	)		Net sales
	18				(8		)		29				(20		)		Cost of goods sold
	(4		)		(9		)		7				(14		)		Other, net
	2				1				3				2				Interest expense
	(2		)		4				(6		)		4				Income taxes
	$	13			$	(13	)		$	37			$	(29	)
Change in retirement plans’ funded status:
Amortization of actuarial losses	$	(29	)		$	21			$	34			$	42			*
Amortization of prior service cost	17				(21		)		(59		)		(22		)		*
	(91		)		—				(9		)		5				Income taxes
	$	(103	)		$	—			$	(34	)		$	25
Total reclassifications, net of tax	$	(90	)		$	(13	)		$	3			$	(4	)

(*) These amounts are included in net periodic pension and other postretirement benefit cost. See “Note 6: Employee Benefit Plans and Postretirement Benefits” for additional information.

Summary of Impact of Changes in Fair Value of Fair Value Hedges and Derivatives Not Designated as Hedging Instruments on Earnings

The following tables summarize the impact that changes in the fair value of fair value hedges and derivatives not designated as hedging instruments had on earnings (in millions) for the three and six months ended June 30, 2019:

				For the Three Months Ended June 30,
		Classification of Gain		2019				2018
Fair Value Hedges
Interest rate derivatives		Interest expense		$	20			$	(3	)
Not Designated as Hedges
Foreign exchange contracts		Other, Net		$	(44	)		$	89

				For the Six Months Ended June 30,
		Classification of Gain		2019				2018
Fair Value Hedges
Interest rate derivatives		Interest expense		$	31			$	(10	)
Not Designated as Hedges
Foreign exchange contracts		Other, Net		$	(68	)		$	109

The following table summarizes the activity in accumulated other comprehensive income related to the derivatives held by the Company during the six months ended June 30, 2019 and 2018:

In Millions		Before-Tax Amount				Income Tax				After-Tax Amount
Accumulated derivative net losses as of December 31, 2018		$	(23	)		$	1			$	(22	)
Net changes in fair value of derivatives		(64		)		10				(54		)
Net losses reclassified from accumulated other comprehensive income into income		43				(6		)		37
Accumulated derivative net losses as of June 30, 2019		$	(44	)		$	5			$	(39	)

In Millions		Before-Tax Amount				Income Tax				After-Tax Amount
Accumulated derivative net losses as of December 31, 2017		$	1			$	—			$	1
Net changes in fair value of derivatives		25				(1		)		24
Net losses reclassified from accumulated other comprehensive income into income		(33		)		4				(29		)
Accumulated derivative net losses as of June 30, 2018		$	(7	)		$	3			$	(4	)

Summary of Fair Value of Derivatives

The fair values of CNH Industrial’s derivatives as of June 30, 2019 and December 31, 2018 in the condensed consolidated balance sheets are recorded as follows:

		June 30, 2019					December 31, 2018
in millions of dollars		Balance Sheet Location		Fair Value			Balance Sheet Location		Fair Value
Derivatives designated as hedging instruments under Subtopic 815-20
Interest rate contracts		Derivative assets		55			Derivative assets		21
Foreign currency contracts		Derivative assets		34			Derivative assets		52
Total derivative assets designated as hedging instruments				89					73
Interest rate contracts		Derivative liabilities		41			Derivative liabilities		29
Foreign currency contracts		Derivative liabilities		52			Derivative liabilities		41
Total derivative liabilities designated as hedging instruments				93					70
Derivatives not designated as hedging instruments under Subtopic 815-20
Interest rate contracts		Derivative assets		1			Derivative assets		1
Foreign currency contracts		Derivative assets		17			Derivative assets		24
Total derivative assets not designated as hedging instruments				18					25
Interest rate contracts		Derivative liabilities		1			Derivative liabilities		—
Foreign currency contracts		Derivative liabilities		28			Derivative liabilities		38
Total derivative liabilities not designated as hedging instruments				29					38

Summary of Fair Value Hierarchy Levels

The following tables present for each of the fair-value hierarchy levels the Company’s assets and liabilities that are measured at fair value on a recurring basis at June 30, 2019 and December 31, 2018:

	Level 1								Level 2								Total
	June 30, 2019				December 31, 2018				June 30, 2019				December 31, 2018				June 30, 2019				December 31, 2018
	(in millions)
Assets
Foreign exchange derivatives	$	—			$	—			$	51			$	76			$	51			$	76
Interest rate derivatives	—				—				56				22				56				22
Investments	1				1				—				—				1				1
Total Assets	$	1			$	1			$	107			$	98			$	108			$	99
Liabilities
Foreign exchange derivatives	$	—			$	—			$	(80	)		$	(79	)		$	(80	)		$	(79	)
Interest rate derivatives	—				—				(42		)		(29		)		(42		)		(29		)
Total Liabilities	$	—			$	—			$	(122	)		$	(108	)		$	(122	)		$	(108	)

Summary of Estimated Fair Market Values

The estimated fair market values of financial instruments not carried at fair value in the condensed consolidated balance sheets as of June 30, 2019 and December 31, 2018 are as follows:

	June 30, 2019								December 31, 2018
	Carrying Amount				Fair Value				Carrying Amount				Fair Value
	(in millions)
Financing receivables	$	19,734			$	19,577			$	19,167			$	19,017
Debt	$	24,369			$	24,653			$	24,445			$	24,481

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Tabular disclosure of the fair value of financial instruments, including financial assets and financial liabilities, and the measurements of those instruments, assets, and liabilities.

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