REPOSITIONING AND OTHER CHARGES

9 Months Ended

Sep. 30, 2016

Repositioning And Other Charges [Abstract]

Note 4. Repositioning and Other Charges

	A summary of repositioning and other charges follows:

			Three Months Ended				Nine Months Ended
			September 30,				September 30,
			2016		2015		2016		2015
Severance		$	155	$	63	$	253	$	138
Asset impairments			11		1		42		9
Exit costs			36		1		41		3
Reserve adjustments			(31)		(31)		(92)		(43)
Total net repositioning charge			171		34		244		107

Asbestos related litigation charges,
net of insurance			64		50		173		142
Probable and reasonably estimable
environmental liabilities			49		49		132		144
Other			18		-		18		-

Total net repositioning and other charges		$	302	$	133	$	567	$	393

The following table summarizes the pretax distribution of total net repositioning and other charges by income statement classification:
		Three Months Ended				Nine Months Ended
		September 30,				September 30,
		2016		2015		2016		2015
Cost of products and services sold	$	226	$	129	$	410	$	363
Selling, general and administrative expenses		53		4		110		30
Other (income) expense		23		-		47		-
	$	302	$	133	$	567	$	393

The following table summarizes the pretax impact of total net repositioning and other charges by
segment:
		Three Months Ended				Nine Months Ended
		September 30,				September 30,
		2016		2015		2016		2015
Aerospace	$	144	$	38	$	265	$	134
Home and Building Technologies		24		12		36		38
Performance Materials and Technologies		35		9		71		30
Safety and Productivity Solutions		10		16		4		29
Corporate		89		58		191		162
	$	302	$	133	$	567	$	393

In the quarter ended September 30, 2016, we recognized a repositioning charge totaling $202 million including severance costs of $155 million related to workforce reductions of 3,017 manufacturing and administrative positions across our segments. The workforce reductions were primarily related to the separation of the former Automation and Control Solutions reporting segment into two new reporting segments (Home and Building Technologies and Safety and Productivity Solutions); factory transitions in Aerospace, Home and Building Technologies, Safety and Productivity Solutions and Performance Materials and Technologies to more cost-effective locations; and cost savings actions taken in connection with our productivity and ongoing functional transformation initiatives. The repositioning charge included exit costs of $36 million principally for expenses related to the spin-off of our AdvanSix business and closure obligations associated with factory transitions. Also, $31 million of previously established accruals for severance were returned to income as a result of higher attrition than anticipated in prior severance programs resulting in lower required severance payments, and changes in the scope of previously announced repositioning actions.

In the quarter ended September 30, 2015, we recognized a repositioning charge totaling $65 million primarily for severance costs related to workforce reductions of 902 manufacturing and administrative positions across our segments. The workforce reductions were primarily related to cost savings actions taken in connection with our productivity and ongoing functional transformation initiatives. Also, $31 million of previously established accruals for severance were returned to income as a result of higher attrition than anticipated in prior severance programs resulting in lower required severance payments, and changes in the scope of previously announced repositioning actions.

In the nine months ended September 30, 2016, we recognized a repositioning charge totaling $336 million including severance costs of $253 million related to workforce reductions of 5,888 manufacturing and administrative positions across our segments. The workforce reductions were primarily related to cost savings actions taken in connection with our productivity and ongoing functional transformation initiatives; the separation of the former Automation and Control Solutions reporting segment into two new reporting segments; factory transitions in Aerospace, Home and Building Technologies, Safety and Productivity Solutions and Performance Materials and Technologies to more cost-effective locations; and achieving acquisition-related synergies. The repositioning charge included asset impairments of $42 million principally related to the write-off of certain intangible assets in connection with the sale of a Performance Materials and Technologies business. The repositioning charge included exit costs of $41 million principally for expenses related to the spin-off of our AdvanSix business and closure obligations associated with factory transitions. Also, $92 million of previously established accruals, primarily for severance, were returned to income as a result of higher attrition than anticipated in prior severance programs resulting in lower required severance payments, lower than expected severance costs in certain repositioning actions, and changes in the scope of previously announced repositioning actions.

In the nine months ended September 30, 2015, we recognized a repositioning charge totaling $150 million primarily for severance costs related to workforce reductions of 4,882 manufacturing and administrative positions across our segments. The workforce reductions were primarily related to cost savings actions taken in connection with our productivity and ongoing functional transformation initiatives and outsourcing of certain component manufacturing in Home and Building Technologies. Also, $43 million of previously established accruals, primarily for severance, were returned to income as a result of higher attrition than anticipated in prior severance programs resulting in lower required severance payments, and changes in the scope of previously announced repositioning actions.

The following table summarizes the status of our total repositioning reserves:

		Severance		Asset		Exit
		Costs		Impairments		Costs		Total
December 31, 2015	$	329	$	-	$	21	$	350
Charges		253		42		41		336
Usage - cash		(135)		-		(8)		(143)
Usage - noncash		(6)		(42)		-		(48)
Foreign currency translation		7		-		-		7
Adjustments		(91)		-		(1)		(92)
September 30, 2016	$	357	$	-	$	53	$	410

Certain repositioning projects in 2016 and 2015 included exit or disposal activities, the costs related to which will be recognized in future periods when the actual liability is incurred. Such exit and disposal costs are not expected to be significant.