As discussed in Note 2, the Company adopted ASU No. 2016-02, Leases (Topic 842), effective January 1, 2019. The Company is party to operating leases for the majority of its manufacturing sites, offices, engineering and lab sites, stocking locations, warehouses, automobiles, and certain equipment. Certain of the Company’s real estate leases include variable rental payments which adjust periodically based on inflation, and certain automobile lease agreements include rental payments which fluctuate based on mileage. Generally, the Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants.

The Company’s operating lease costs for the three and nine months ended September 30, 2019 consisted of the following:

	Three Months Ended		Nine Months Ended
	September 30,		September 30,
	2019		2019
Operating Lease Costs
Selling, general & administrative	$	10	$	27
Cost of goods sold		4		12
Total operating lease costs	$	14	$	39

Total operating lease costs include variable lease costs of $3 million and $8 million for the three and nine months ended September 30, 2019. Total operating lease costs also include offsetting sublease income which is immaterial for the three and nine months ended September 30, 2019.

	Financial Statement Line Item	At September 30, 2019
Operating right-of-use assets	Other assets	$	130
Operating lease liabilities - current	Accrued liabilities	$	29
Operating lease liabilities - noncurrent	Other liabilities	$	106

	At September 30, 2019
2019	$	9
2020		35
2021		32
2022		27
2023		20
Thereafter		36
Total lease payments		159
Less: imputed interest		24
Present value of operating lease liabilities	$	135
Weighted-average remaining lease term (years)		5.64
Weighted-average incremental borrowing rate		6.00	%

Future minimum lease payments under operating leases having initial or remaining non-cancellable lease terms in excess of one year as of December 31, 2018 were as follows:

	At December 31, 2018
2019	$	39
2020		33
2021		28
2022		22
2023		15
Thereafter		17
	$	154

Supplemental cash flow information related to the Company’s operating leases was as follows:

	Nine Months Ended
	September 30, 2019
Operating cash outflows	$	28
Operating right-of-use assets obtained in exchange for operating lease liabilities	$	47

As of September 30, 2019, the Company has additional operating leases that have not yet commenced. Obligations under these leases are not material. Additionally, as a lessor, the Company leases all or a portion of certain owned properties. Rental income for the three and nine months ended September 30, 2019 was not material.