Financial Instruments (Tables)

12 Months Ended

Dec. 31, 2022

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 year ended December 31, 2022, December 31, 2021, and December 31, 2020 (in millions):

			Recognized in Net Income
For the Year Ended December 31,	Gain (Loss) Recognized in Accumulated Other Comprehensive Income		Classification of Gain (Loss)	Gain (Loss) Reclassified from Accumulated Other Comprehensive Income into Income
2022
Foreign exchange contracts	$	(191)	Net sales	$	(1)
			Cost of goods sold	(219)
			Other, net	3
			Interest expense, net	30
Interest rate contracts	59
Total	$	(132)		$	(187)
2021
Foreign exchange contracts	$	(57)	Net sales	$	2
			Cost of goods sold	(11)
			Other, net	(4)
			Interest expense, net	3
Interest rate contracts	49
Total	$	(8)		$	(10)
2020
Foreign exchange contracts	$	96	Net sales	$	(7)
			Cost of goods sold	31
			Other, net	6
			Interest expense, net	(5)
Interest rate contracts	(14)
Total	$	82		$	25

Significant amounts reclassified out of each component of accumulated other comprehensive income (loss) in December 31, 2022 and 2021 consisted of the following:

	Amount Reclassified from Other Comprehensive Income (Loss)				Consolidated Statement of Operations line
	2022		2021
	(in millions)
Cash flow hedges	$	1	$	(2)	Net sales
	219		11		Cost of goods sold
	(3)		4		Other, net
	(30)		(3)		Interest expense
	(17)		(1)		Income taxes
	$	170	$	9
Change in retirement plans’ funded status:
Amortization of actuarial losses	$	18	$	30	*
Amortization of prior service cost	(126)		(136)		*
	47		(14)		Income taxes
	$	(61)	$	(120)
Total reclassifications, net of tax	$	109	$	(111)

(*)    These amounts are included in net periodic pension and other postretirement benefit cost. See “Note 12: 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 table summarizes the activity in accumulated other comprehensive income related to the derivatives held by the Company during the years ended December 31, 2022, December 31, 2021, and December 31, 2020:

(in millions)	Before-Tax Amount		Income Tax		After-Tax Amount
Accumulated derivative net losses as of December 31, 2021	$	(3)	$	(14)	$	(17)
Impact of demerger	19		—		19
Net changes in fair value of derivatives	(132)		4		(128)
Net losses reclassified from accumulated other comprehensive income into income	187		(17)		170
Accumulated derivative net losses as of December 31, 2022	$	71	$	(27)	$	44

(in millions)	Before-Tax Amount		Income Tax		After-Tax Amount
Accumulated derivative net losses as of December 31, 2020	$	(5)	$	(1)	$	(6)
Net changes in fair value of derivatives	(8)		(12)		(20)
Net losses reclassified from accumulated other comprehensive income into income	10		(1)		9
Accumulated derivative net losses as of December 31, 2021	$	(3)	$	(14)	$	(17)

(in millions)	Before-Tax Amount		Income Tax		After-Tax Amount
Accumulated derivative net losses as of December 31, 2019	$	(62)	$	8	$	(54)
Net changes in fair value of derivatives	82		(8)		74
Net losses reclassified from accumulated other comprehensive income into income	(25)		(1)		(26)
Accumulated derivative net losses as of December 31, 2020	$	(5)	$	(1)	$	(6)

The following tables summarize the impact of the changes in the fair value of fair value hedges and derivatives not designated as hedging instruments had on earnings for the year ended December 31, 2022, December 31, 2021, and December 31, 2020:

		For the Year Ended December 31,
(in millions)	Classification of Gain	2022		2021		2020
Fair Value Hedges
Interest rate derivatives	Interest expense	$	(104)	$	(47)	$	31
Not Designated as Hedges
Foreign exchange contracts	Other, Net	$	(16)	$	(11)	$	86

Summary of fair value of derivatives

The fair values of CNH Industrial’s derivatives as of December 31, 2022 and December 31, 2021 in the consolidated balance sheets are recorded as follows:

	December 31, 2022		December 31, 2021
(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	77	Derivative assets	65
Foreign currency contracts	Derivative assets	70	Derivative assets	77
Total derivative assets designated as hedging instruments		147		142
Interest rate contracts	Derivative liabilities	106	Derivative liabilities	28
Foreign currency contracts	Derivative liabilities	56	Derivative liabilities	101
Total derivative liabilities designated as hedging instruments		162		129
Derivatives not designated as hedging instruments under Subtopic 815-20
Interest rate contracts	Derivative assets	28	Derivative assets	11
Foreign currency contracts	Derivative assets	14	Derivative assets	29
Total derivative assets not designated as hedging instruments		42		40
Interest rate contracts	Derivative liabilities	28	Derivative liabilities	12
Foreign currency contracts	Derivative liabilities	14	Derivative liabilities	40
Total derivative liabilities not designated as hedging instruments		42		52

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 December 31, 2022 and December 31, 2021:

	Level 1				Level 2				Total
	December 31, 2022		December 31, 2021		December 31, 2022		December 31, 2021		December 31, 2022		December 31, 2021
	(in millions)
Assets
Foreign exchange derivatives	$	—	$	—	$	84	$	106	$	84	$	106
Interest rate derivatives	—		—		105		76		105		76
Total Assets	$	—	$	—	$	189	$	182	$	189	$	182
Liabilities
Foreign exchange derivatives	$	—	$	—	$	70	$	141	$	70	$	141
Interest rate derivatives	—		—		134		40		134		40
Total Liabilities	$	—	$	—	$	204	$	181	$	204	$	181

Schedule of investments measured on nonrecurring basis

The following tables present the fair value for nonrecurring Level 3 measurements from impairments as of December 31, 2022 and 2021:

	Fair Value				Losses
	2022		2021		2022		2021
	(in millions)
Property, plant and equipment	$	7	$	—	$	17	$	—

Summary of estimated fair market values

The estimated fair market values of financial instruments not carried at fair value in the consolidated balance sheets as of December 31, 2022 and 2021 are as follows:

	December 31, 2022		December 31, 2021
	Carrying Amount	Fair Value	Carrying Amount	Fair Value
	(in millions)
Financing receivables	$19,260	$18,827	$15,376	$15,605
Debt	$22,962	$22,651	$20,897	$21,091