Guarantees and product warranty (Tables)

12 Months Ended

Dec. 31, 2020

Commitments and Contingencies Disclosure [Abstract]

Guarantees

The maximum potential amount of future payments (undiscounted and without reduction for any amounts that may possibly be recovered under recourse or collateralized provisions) we could be required to make under the guarantees at December 31 was as follows:

(Millions of dollars)	2020		2019
Caterpillar dealer performance guarantees	$	993	$	1,150
Supplier consortium performance guarantee	258		238
Other guarantees	234		221
Total guarantees	$	1,485	$	1,609

Product warranty

The reconciliation of the change in our product warranty liability balances for the years ended December 31 was as follows:

(Millions of dollars)	2020		2019
Warranty liability, beginning of period	$	1,541	$	1,391
Reduction in liability (payments)	(897)		(903)
Increase in liability (new warranties)	968		1,053
Warranty liability, end of period	$	1,612	$	1,541