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Restructuring Charges, Net and Asset Impairments
 3 Months Ended
Mar. 31, 2020
Restructuring and Related Activities [Abstract]  
Restructuring Charges, Net and Asset Impairments
4. Restructuring Charges, Net and Asset Impairments

The Company's restructuring activities are undertaken as necessary to execute management's strategy and streamline operations, consolidate and take advantage of available capacity and resources, and ultimately achieve net cost reductions. Restructuring activities include efforts to integrate and rationalize the Company's businesses and to relocate operations to best cost locations.

The Company's restructuring charges consist primarily of employee costs (principally severance and/or termination benefits) and facility closure and exit costs. The 2019 amounts below reflect the reclassifications to the prior period as discussed in Note 2, Summary of Significant Accounting Policies.

For the three months ended March 31, 2020 and 2019, restructuring charges, net and asset impairments by segment are as follows:
 
Three Months Ended March 31, 2020
 
Clean Air
 
Powertrain
 
Ride Performance
 
Motorparts
 
Corporate
 
Total
Severance and other charges, net
$
—

 
$
1

 
$
6

 
$
2

 
$
4

 
$
13

Other non-restructuring asset impairments
—

 
—

 
455

 
—

 
16

 
471

Total restructuring charges, net and asset impairments
$
—

 
$
1

 
$
461

 
$
2

 
$
20

 
$
484


 
Three Months Ended March 31, 2019
 
Clean Air
 
Powertrain
 
Ride Performance
 
Motorparts
 
Corporate
 
Total
Severance and other charges, net
$
5

 
$
1

 
$
5

 
$
4

 
$
1

 
$
16

Other non-restructuring asset impairments
—

 
—

 
—

 
—

 
—

 
—

Total restructuring charges, net and asset impairments
$
5

 
$
1

 
$
5

 
$
4

 
$
1

 
$
16


Severance and other charges, net
During the three months ended March 31, 2020, the Company incurred $6 million in restructuring and other costs related to plant relocation and closures within its Ride Performance segment. The Company also incurred $4 million in restructuring for the elimination of certain redundant positions within its corporate component.

In response to the COVID-19 global pandemic, and in conjunction with the Company's previously announced Project Accelerate, the Company expects to reduce its headcount globally, subject to negotiation with works councils in certain jurisdictions. The Company will begin implementing headcount reductions during the second quarter of 2020 and expects these actions to be completed during 2020. The Company expects to record a charge in the range of $25 million to $30 million for the second quarter of 2020 in connection with the cash severance costs expected to be paid.

During the three months March 31, 2019, charges included the following items:
•
The Company incurred $6 million in restructuring and related costs related to a restructuring plan designed to achieve a portion of the synergies the Company anticipated achieving in connection with the Federal-Mogul Acquisition. Pursuant to the plan, the Company reduced its headcount globally across all segments. The Company began implementing headcount reductions in January 2019 and these actions continued through the end of 2019.
•
The Ride Performance segment incurred $3 million in restructuring and other costs related to a previously announced plant relocation in Beijing, China and the Hartwell and Owen Sound plant closures.
•
The Clean Air segment incurred $3 million restructuring and other costs related to the closing of a plant in Rennes, France.

Restructuring Reserve Rollforward
Amounts related to activities that were charges to restructuring reserves by reportable segments are as follows:
 
Reportable Segments
 
 
 
 
 
Clean Air
 
Powertrain
 
Ride Performance
 
Motorparts
 
Total Reportable Segments
 
Corporate
 
Total
Balance at December 31, 2019
$
23

 
$
30

 
$
23

 
$
16

 
$
92

 
$
9

 
$
101

Provisions
—

 
2

 
7

 
2

 
11

 
4

 
15

Revisions to estimates
—

 
(1
)
 
(1
)
 
—

 
(2
)
 
—

 
(2
)
Payments
(4
)
 
(4
)
 
(9
)
 
(4
)
 
(21
)
 
(9
)
 
(30
)
Foreign currency
—

 
—

 
(1
)
 
—

 
(1
)
 
—

 
(1
)
Balance at March 31, 2020
$
19

 
$
27

 
$
19

 
$
14

 
$
79

 
$
4

 
$
83

 
Reportable Segments
 
 
 
 
 
Clean Air
 
Powertrain
 
Ride Performance
 
Motorparts
 
Total Reportable Segments
 
Corporate
 
Total
Balance at December 31, 2018
$
17

 
$
15

 
$
25

 
$
43

 
$
100

 
$
3

 
$
103

Provisions
5

 
1

 
5

 
4

 
15

 
1

 
16

Payments
(6
)
 
(3
)
 
(5
)
 
(14
)
 
(28
)
 
(2
)
 
(30
)
Balance at March 31, 2019
$
16

 
$
13

 
$
25

 
$
33

 
$
87

 
$
2

 
$
89


The following table provides a summary of the Company's restructuring liabilities and related activity for each type of exit costs:
 
Three months ended March 31, 2020
 
Three months ended March 31, 2019
 
Employee Costs
 
Facility Closure and Other Costs
 
Total
 
Employee Costs
 
Facility Closure and Other Costs
 
Total
Balance at beginning of period
$
97

 
$
4

 
$
101

 
$
98

 
$
5

 
$
103

Provisions
10

 
5

 
15

 
11

 
5

 
16

Revisions to estimates
(2
)
 
—

 
(2
)
 
—

 
—

 
—

Payments
(23
)
 
(7
)
 
(30
)
 
(25
)
 
(5
)
 
(30
)
Foreign currency
(1
)
 
—

 
(1
)
 
—

 
—

 
—

Balance at end of period
$
81

 
$
2

 
$
83

 
$
84

 
$
5

 
$
89



Asset impairments
The Company evaluates its long-lived assets for impairment whenever events or circumstances indicate the value of these long-lived asset groups are not recoverable.

As a result of the effects of the COVID-19 global pandemic on the Company's projected financial information, the Company concluded impairment triggers had occurred for certain long-lived asset groups in the Ride Performance segment. Accordingly, the Company tested these long-lived asset groups for recoverability by performing undiscounted cash flow analyses. Based on these analyses, the net carrying values of these asset groups exceeded their undiscounted future cash flows. As such, the Company estimated the fair values of these asset groups at March 31, 2020 and compared them to their carrying values. As the fair values of these long-lived asset groups exceeded their carrying values, the Company recorded long-lived asset impairment charges for property, plant, and equipment of $455 million during the three months ended March 31, 2020. See Note 9, Fair Value for additional information on the fair value estimates used in these analyses.

As a result of changes in the business, the Company assessed and concluded an impairment trigger had occurred for a long-lived asset group in its corporate component. Accordingly, the Company tested this long-lived asset group for recoverability. The Company estimated the fair value of this asset group at March 31, 2020 and compared it to the carrying value. As the fair value of this long-lived asset group exceeded the carrying value, the Company recorded long-lived asset impairment charges of $16 million during the three months ended March 31, 2020, consisting of $11 million of property, plant, and equipment and $5 million of operating lease right-of-use assets, included in other assets within the condensed consolidated balance sheets.

There are many uncertainties regarding the COVID-19 global pandemic that could negatively affect the Company's results of operations, financial position, and cash flows. As a result, if there is an adverse change to the Company’s projected financial information, due to business performance or market conditions, this may be indicative the value of its long-lived assets are not recoverable, which may result in additional non-cash long-lived asset impairment charges in a future period.