RESTRUCTURING

In October 2016, the Company announced a restructuring plan to evolve and streamline its operating model. The majority of the charges are expected to be incurred through 2020, range between $1.5 billion to $2.0 billion and consist of employee termination benefit costs, contract termination costs, plant and equipment accelerated depreciation and impairment charges and other shutdown costs associated with early manufacturing and R&D site exits. Cash outlays in connection with these actions are expected to be approximately 40% to 50% of the total charges. Charges of approximately $922 million have been recognized for these actions since the announcement ($124 million and $452 million for the six months ended June 30, 2018 and 2017, respectively). Restructuring charges are recognized upon meeting certain criteria, including finalization of committed plans, reliable estimates and discussions with local works councils in certain markets.

Employee workforce reductions were approximately 300 and 1,000 for the six months ended June 30, 2018 and 2017, respectively.

The following tables summarize the charges and activity related to the restructuring actions:



	Three Months Ended June 30,				Six Months Ended June 30,
Dollars in Millions	2018		2017		2018		2017
Employee termination costs	$	26	$	11	$	35	$	172
Other termination costs	11		4		22		7
Provision for restructuring	37		15		57		179
Accelerated depreciation	31		82		52		152
Asset impairments	—		141		10		143
Other shutdown costs	2		3		5		3
Total charges	$	70	$	241	$	124	$	477



	Three Months Ended June 30,				Six Months Ended June 30,
Dollars in Millions	2018		2017		2018		2017
Cost of products sold	$	14	$	130	$	27	$	130
Marketing, selling and administrative	—		—		1		—
Research and development	19		96		39		168
Other income (net)	37		15		57		179
Total charges	$	70	$	241	$	124	$	477



	Six Months Ended June 30,
Dollars in Millions	2018			2017
Liability at January 1	$	186		$	114

Charges	61			198
Change in estimates	(4		)	(19		)
Provision for restructuring	57			179
Foreign currency translation	1			10
Payments	(129		)	(105		)
Liability at June 30	$	115		$	198