Derivative Financial Instruments (Tables)

3 Months Ended

Mar. 31, 2020

Balance Sheet Classifications, Fair Value, Gross and Pro-Forma Net Amounts of Derivative Financial Instruments

The following table presents the balance sheet classification, fair value, gross and pro forma net amounts of derivative financial instruments:

	March 31, 2020						December 31, 2019
	ASSETS			LIABILITIES			ASSETS			LIABILITIES
Derivatives designated under hedge accounting:
Interest-rate contracts:
Financial Services:
Other assets	$	113.1					$	45.8
Deferred taxes and other liabilities				$	53.3					$	31.0
Foreign-exchange contracts:
Truck, Parts and Other:
Other current assets		73.6						10.1
Accounts payable, accrued expenses and other					8.9						9.2
	$	186.7		$	62.2		$	55.9		$	40.2
Derivatives not designated as hedging instruments:
Foreign-exchange contracts:
Truck, Parts and Other:
Other current assets	$	22.1					$	.4
Accounts payable, accrued expenses and other				$	5.4					$	1.8
Financial Services:
Other assets		5.1
Deferred taxes and other liabilities					.1						2.3
	$	27.2		$	5.5		$	.4		$	4.1
Gross amounts recognized in Balance Sheets	$	213.9		$	67.7		$	56.3		$	44.3
Less amounts not offset in financial instruments:
Truck, Parts and Other:
Foreign-exchange contracts		(8.5	)		(8.5	)		(.4	)		(.4	)
Financial Services:
Interest-rate contracts		(9.7	)		(9.7	)		(8.6	)		(8.6	)
Pro forma net amount	$	195.7		$	49.5		$	47.3		$	35.3

Amount of Expense (Income) from Derivative Financial Instruments Recognized in Consolidated Statements of Comprehensive Income

The following table presents the amount of (income) expense from derivative financial instruments recognized in the Consolidated Statements of Comprehensive Income:

Three Months Ended March 31,	2020			2019
Truck, Parts and Other:
Cash flow hedges	$	(7.2	)	$	7.8
Net investment hedges		2.5
Total	$	(4.7	)	$	7.8
Financial Services:
Fair value hedges	$	.3		$	.6
Cash flow hedges		(67.7	)		6.7
Total	$	(67.4	)	$	7.3

Amounts Related to Cumulative Basis Adjustments for Fair Value Hedges

The following table presents the amounts recorded on the Consolidated Balance Sheets related to cumulative basis adjustments for fair value hedges:

	March 31			December 31
	2020			2019
Financial Services
Term notes:
Carrying amount of the hedged liabilities	$	91.9		$	90.5
Cumulative basis adjustment included in the carrying amount		(1.9	)		(.5	)

Gains/Losses of Derivative Financial Instruments

The following table presents the pre-tax effects of derivative instruments recognized in other comprehensive income (loss) (OCI):

Three Months Ended March 31,	2020				2019
	INTEREST-		FOREIGN-		INTEREST-			FOREIGN-
	RATE		EXCHANGE		RATE			EXCHANGE
	CONTRACTS		CONTRACTS		CONTRACTS			CONTRACTS
Gain (loss) recognized in OCI:
Truck, Parts and Other			$	70.6				$	(16.0	)
Financial Services	$	55.7			$	(14.3	)
	$	55.7	$	70.6	$	(14.3	)	$	(16.0	)

Foreign Currency And Interest Rate Contract

Expense (Income) Recognized in Earnings to Derivatives not Designated as Hedging Instruments

The expense (income) recognized in earnings related to derivatives not designated as hedging instruments was as follows:

Three Months Ended March 31,	2020				2019
	INTEREST-	FOREIGN-			INTEREST-	FOREIGN-
	RATE	EXCHANGE			RATE	EXCHANGE
	CONTRACTS	CONTRACTS			CONTRACTS	CONTRACTS
Truck, Parts and Other:
Cost of sales and revenues		$	1.2			$	.2
Interest and other (income), net			(25.2	)			1.5
Financial Services:
Interest and other borrowing expenses			(12.0	)			(6.2	)
Selling, general and administrative			(.5	)
Total		$	(36.5	)		$	(4.5	)