GOODYEAR TIRE & RUBBER CO /OH/ Leases Disclosure
Note 14. Leases
The components of lease expense included in Income (Loss) before Income Taxes for the years ended December 31, 2020 and 2019 are as follows:
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(In millions) |
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2020 |
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2019 |
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Operating Lease Expense |
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$ |
286 |
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$ |
292 |
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Finance Lease Expense: |
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Amortization of ROU assets |
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11 |
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11 |
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Interest on lease liabilities |
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21 |
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21 |
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Short Term Lease Expense |
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6 |
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6 |
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Variable Lease Expense |
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3 |
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7 |
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Sublease Income |
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(11 |
) |
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(15 |
) |
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Total Lease Expense |
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$ |
316 |
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$ |
322 |
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Net rental expense for the year ended December 31, 2018 is comprised of the following:
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(In millions) |
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2018 |
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Gross rental expense |
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$ |
333 |
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Sublease rental income |
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(16 |
) |
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$ |
317 |
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Supplemental cash flow information related to leases for the years ended December 31, 2020 and 2019 is as follows:
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(In millions) |
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2020 |
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2019 |
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Cash Paid for Amounts Included in the Measurement of Lease Liabilities |
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Operating Cash Flows for Operating Leases |
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$ |
268 |
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$ |
267 |
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Operating Cash Flows for Finance Leases |
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21 |
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21 |
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Financing Cash Flows for Finance Leases |
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7 |
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7 |
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ROU Assets Obtained in Exchange for Lease Obligations |
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Operating Leases |
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202 |
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197 |
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Finance Leases |
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3 |
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34 |
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Supplemental balance sheet information related to leases as of December 31, 2020 and 2019 is as follows:
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(In millions, except lease term and discount rate) |
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2020 |
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2019 |
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Operating Leases |
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Operating Lease ROU Assets |
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$ |
851 |
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$ |
855 |
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Operating Lease Liabilities due Within One Year |
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$ |
198 |
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$ |
199 |
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Operating Lease Liabilities |
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684 |
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668 |
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Total Operating Lease Liabilities |
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$ |
882 |
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$ |
867 |
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Finance Leases |
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Property, Plant and Equipment, at cost |
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$ |
262 |
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$ |
259 |
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Accumulated Depreciation |
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(60 |
) |
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(50 |
) |
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Property, Plant and Equipment, net |
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$ |
202 |
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$ |
209 |
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Long Term Debt and Finance Leases due Within One Year |
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$ |
18 |
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$ |
6 |
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Long Term Debt and Finance Leases |
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232 |
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243 |
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Total Finance Lease Liabilities |
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$ |
250 |
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$ |
249 |
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Weighted Average Remaining Lease Term (years) |
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Operating Leases |
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Finance Leases |
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Weighted Average Discount Rate |
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Operating Leases |
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6.85% |
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6.69% |
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Finance Leases |
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8.48% |
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8.46% |
Future maturities of our lease liabilities, excluding subleases, as of December 31, 2020 are as follows:
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(In millions) |
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Operating Leases |
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Finance Leases |
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2021 |
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$ |
245 |
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$ |
38 |
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2022 |
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186 |
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23 |
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2023 |
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146 |
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21 |
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2024 |
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110 |
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21 |
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2025 |
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|
88 |
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22 |
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Thereafter |
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|
376 |
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|
671 |
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Total Lease Payments |
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1,151 |
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|
796 |
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Less: Imputed Interest |
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|
269 |
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|
546 |
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Total |
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$ |
882 |
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$ |
250 |
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As of December 31, 2020, we have additional operating and finance leases that have not yet commenced for which the present value of lease payments over the respective lease terms totals $23 million. Accordingly, these leases are not recorded on the Consolidated Balance Sheets at December 31, 2020. These leases will commence in 2021 and 2022 with lease terms of 7 years to 15 years.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2020 | Feb 9, 2021 | Showing above |
| 2019 | Feb 11, 2020 | |
| 2018 | Feb 8, 2019 | |
| 2017 | Feb 8, 2018 | |
| 2016 | Feb 8, 2017 | |
| 2015 | Feb 9, 2016 | |
About Leases Disclosures
Lease disclosures under ASC 842 provide a comprehensive view of a company's leased asset portfolio, including the split between operating and finance leases, discount rates used to present-value future payments, and the maturity schedule of lease obligations. This section reveals a significant source of off-balance-sheet commitments that were largely hidden before the current standard.
Key signals: the weighted-average discount rate affects the size of recorded lease liabilities — a higher rate reduces the reported obligation, so compare the chosen rate against the company's incremental borrowing rate. The operating versus finance lease mix affects both EBITDA and operating income presentation. Watch the maturity table for concentration risk: large payment cliffs in specific years may create cash flow pressure. Variable lease payments excluded from the liability measurement represent real obligations that do not appear on the balance sheet. Compare total lease costs against prior-year operating lease expense to assess the true economic burden.