Ford Mtr Co del · NYSE:F
Ford Mtr Co del — Ford Motor Company — Investor Presentation (June 2011)
50 slides from Ford Mtr Co del's investor presentation, Jun 22, 2011
Slide 1: 2011 Canadian Investor Presentation
2011 CANADIAN INVESTOR PRESENTATION June 2011 0
Slide 2: Disclaimer
DISCLAIMER This presentation was prepared solely for informational purposes. Under no circumstances will the information in this presentation constitute an offer to sell or a solicitation of an offer to buy any security. Unless otherwise specified in this presentation, all information contained in t
Slide 3: Discussion Agenda
DISCUSSION AGENDA 1. The One Ford Plan 2 2. Ford Credit 8 3. Ford of Canada and Ford Credit Canada 24 4. Appendix 36 2
Slide 4: Total Company Our Plan
TOTAL COMPANY OUR PLAN -- • Continue implementation of our global • Aggressively restructure to operate profitably at the current demand and changing model mix • Accelerate development of new products our customers want and value • Finance our Plan and improve our balance sheet • Work together effec
Slide 5: The One Ford Plan Is Working
THE ONE FORD PLAN IS WORKING • Restructured the business significantly • New products well received in the marketplace • Improving the balance sheet • Completed the sale of Volvo; focusing on the Ford and Lincoln brands • Launched the all new Explorer, the F-150 with new powertrains and the global F
Slide 6: 2011 First Quarter Pre-Tax Results by Sector
TOTAL COMPANY 2011 FIRST QUARTER PRE-TAX RESULTS BY SECTOR* Millions $2,837 $2,131 Ford Credit $713 Other (7) $706 Total Automotive Financial Services Memo: B / (W) 2010 1Q $ 827 $ 936 $(109) B / (W) 2010 4Q 1,544 1,390 154 * Excludes special items; see Appendix for detail and reconciliation to GAAP
Slide 7: Trend of Credit Ratings for Ford
TREND OF CREDIT RATINGS FOR FORD S&P -- Issuer Rating Investment Grade A BBB+ BBB BBB- BB+ BB- BB- B+ B+ B B- B- CCC+ Speculative Grade CC 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Targeting To Return To Investment Grade 6
Slide 8: Mid-Decade Outlook
MID-DECADE OUTLOOK Mid-Decade Outlook* Wholesale Volumes About 8 million Revenue / Pricing Improving Automotive Operating Margins** - North America 8 - 10% - Global 8 - 9% Ford Credit Return on Equity Low Double Digits Capital Spending About $6 billion Total Automotive Debt About $10 billion Investm
Slide 9: Discussion Agenda
DISCUSSION AGENDA 1. The One Ford Plan 2 2. Ford Credit 8 3. Ford of Canada and Ford Credit Canada 24 4. Appendix 36 8
Slide 10: Ford Credit Products and Services
Capital and Facility Loans Inventory Financing Inventory Insurance ESB / Fee Income Dealer Consulting Commercial Loans Lease Financing Retail Financing 9
Slide 11: Ford Credit -- Strategic Priorities
FORD CREDIT -- STRATEGIC PRIORITIES • Profitably support the sale of Ford vehicles • Support synergies with automotive partners • Maximize customer and dealer satisfaction and loyalty • Make efficient use of capital 10
Slide 12: A Virtuous Circle: Integration Creates a Strategic Advantage
A VIRTUOUS CIRCLE: INTEGRATION CREATES A STRATEGIC ADVANTAGE • Trusted Brand • Access to Dealer Channel • Automotive Specialist with Vested Interest in Ford Dealer Success More • Training & Consulting Products, • Consistent Market Presence Faster • Fast, Flexible, Quality Service • Full Array of Pro
Slide 13: Ford Credit Results and Metrics -- 2011 First Quarter
FORD CREDIT RESULTS AND METRICS -- 2011 FIRST QUARTER Pre-Tax Profit (Mils.) Key Metrics First Quarter $(115) 2010 2011 On-Balance Sheet $828 Receivables (Bils.) $ 88 $ 83 Charge-Offs (Mils.) $ 133 $ 55 Loss-to-Receivables Ratio $713 - Worldwide 0.58% 0.27% - U.S. Retail and Lease 0.91 0.45 Allowanc
Slide 14: Ford Credit -- U.S. Ford and Lincoln Portfolio Credit Loss Metrics
FORD CREDIT -- U.S. FORD AND LINCOLN PORTFOLIO CREDIT LOSS METRICS* U.S. Retail & Lease Average Placement FICO Score Over-60-Day Delinquencies 730 726 719 715 714 0.36% 0.35% 710 706 0.24% 0.24% 685 0.18% 0.19% 674 0.15% 0.16% 0.15% 2002 2003 2004 2005 2006 2007 2008 2009 2010 2002 2003 2004 2005 20
Slide 15: Ford Credit -- Historical Credit Loss Metrics
FORD CREDIT -- HISTORICAL CREDIT LOSS METRICS Worldwide On-Balance Sheet Loss-to-Receivables Ratio (Pct.) 1.57% 1.51% Loss-to- 1.02% 1.07% Receivables 0.84% Ratio 0.57% 0.39% 0.46% 0.47% 2002 2003 2004 2005 2006 2007 2008 2009 2010 Worldwide On-Balance Sheet Charge-Offs and Allowance for Credit Loss
Slide 16: Ford Credit -- Credit Loss Metrics
FORD CREDIT -- CREDIT LOSS METRICS* Loss-to-Receivables Ratio Worldwide Ford and Lincoln U.S. Retail & Lease 1.35% 0.98% 0.91% 0.78% 0.58% 0.59% 0.47% 0.39% 0.45% 0.44% 0.45% 0.27% Q4 Q1 Q2 Q3 Q4 Q1 2009 2010 2011 Worldwide Charge-Offs (Mils.) $238 $133 $86 $95 $101 $55 Q4 Q1 Q2 Q3 Q4 Q1 2009 2010 2
Slide 17: Ford Credit -- Credit Loss Drivers
FORD CREDIT -- CREDIT LOSS DRIVERS -- FORD AND LINCOLN U.S. RETAIL AND LEASE* Repossessions (000) Severity 23 Repo. $7,700 Ratio $7,300 19 $6,700 $6,600 $6,900 $6,500 16 15 14 3.20% 12 2.77% 2.46% 2.18% 2.22% 1.98% Q4 Q1 Q2 Q3 Q4 Q1 Q4 Q1 Q2 Q3 Q4 Q1 2009 2010 2011 2009 2010 2011 Over-60-Day Delinqu
Slide 18: Ford Credit -- Liquidity Programs
FORD CREDIT -- LIQUIDITY PROGRAMS March 31, 2011 (Bils.) Committed Capacity = $33.6 billion* Capacity & $46.6 Securitization Cash**** $4.5** Cash Committed $6.6*** Excess Capacity Capacity / Liquidity $23.8 Liquidity $13.0 $35.5 $4.5** $8.7 $1.1 $8.5 Unsecured FCAR Conduits / Cash**** Total Credit L
Slide 19: Ford Credit -- Funding Strategy
FORD CREDIT -- FUNDING STRATEGY Funding of Managed Receivables (Bils.) $118 Ford Interest Advantage $2 Asset-Backed Commercial $12 $95 Paper $4 $83 $85 $82-87 $6 $5 ~$5 $5 Term Asset-Backed Securities $61 $7 $7 $6-7 $47 $37 $38 $39-42 Term Debt and Other $56 $44 $39 $38 $36-38 Equity $11 $11 $10 $10
Slide 20: Ford Credit's Balance Sheet Will Grow with Ford
FORD CREDIT’S BALANCE SHEET WILL GROW WITH FORD Managed Receivables (Bils.) $118 $110 - $120 $83 $82 - $87 2008 2010 2011 Mid-Decade 19
Slide 21: Ford Credit Mid-Decade Financial Metrics
FORD CREDIT MID-DECADE FINANCIAL METRICS ABS Debt as % of Mgd Receivables (~ 35%) Liquidity (Months of Protection) Mid- Mid- Decade Decade Target Target 2010 2011 Mid-Decade 2010 2011 Mid-Decade Managed Leverage (10-11 to 1) Return on Equity (Low Double Digits) Mid- Mid- Decade Decade Target Target
Slide 22: Ford Credit -- Term Funding Plan
FORD CREDIT -- TERM FUNDING PLAN 2011 2008 2009 2010 YTD Actual Actual Actual Forecast Actual* (Bils.) (Bils.) (Bils.) (Bils.) (Bils.) Public Transactions Unsecured $ 2 $ 5 $ 6 $ 7- 9 $ 4 Securitizations** 11 15 11 11 – 14 6 Total Public $ 13 $ 20 $ 17 $ 18 – 22 $ 10 Private Transactions*** $ 29 $ 1
Slide 23: Ford Credit Canada Unsecured Debt Overview
FORD CREDIT CANADA UNSECURED DEBT OVERVIEW • Ford Credit Canada Limited (FCCL) re-entered the unsecured debt markets in August 2010 and has completed two transactions with broad oversubscription – 7.50% Notes due August 2015 (Aug 2010) – 4.875% Notes due March 2014 (Mar 2011) • Path to solid investm
Slide 24: Ford Credit Canada Securitization Overview
FORD CREDIT CANADA SECURITIZATION OVERVIEW • FCCL has been an active participant in the Canadian ABS market since 1999 • FCCL has successfully established diverse platforms for funding all asset classes: retail auto loans, leases and floorplan receivables – First public retail auto loan securitizati
Slide 25: Discussion Agenda
DISCUSSION AGENDA 1. The One Ford Plan 2 2. Ford Credit 8 3. Ford of Canada and Ford Credit Canada 24 4. Appendix 36 24
Slide 26: Ford of Canada Update
FORD OF CANADA UPDATE • Best-selling automaker in 2010 for the Canadian market for the first time in more than 50 years • Posted 9% year-over-year sales increase in the first quarter 2011 • Car sales growth in the first quarter of 2011 with a year-over-year increase of more than 20% • Ford is the #1
Slide 27: FCCL Overview
FCCL OVERVIEW • Ford Credit Canada Limited (“FCCL”) was established in 1962 to provide financing for Ford vehicles and to support Ford dealers in Canada • FCCL and its affiliate Canadian Road Leasing Company provide automotive financing products to dealers and to retail customers through dealers in
Slide 28: FCCL Selected Financial Information
FCCL SELECTED FINANCIAL INFORMATION (In millions of US dollars) For the Three Months Ended March 31, 2011 2010 Balance Sheet a/ Finance receivables, net $ 7,510 $ 6,321 Net investment in operating leases 1,864 3,190 All other assets 1,323 b/ 1,672 c/ Total assets $ 10,697 $ 11,183 Memo: Allowance fo
Slide 29: FCCL Origination & Servicing Strategy
FCCL ORIGINATION & SERVICING STRATEGY • Collect it Effectively • Buy it Right • Operate Efficiently Originate Service Fund • Fund it Efficiently • Manage Balance Sheet Risk 28
Slide 30: FCCL -- Proprietary Originations Scoring Models
FCCL -- PROPRIETARY ORIGINATIONS SCORING MODELS • FCCL uses proprietary origination scoring models • FCCL's scoring models assess the creditworthiness of an applicant using: – Information provided in the applicant's credit application – The proposed terms of the retail contract – Credit bureau data
Slide 31: FCCL -- Collection Strategy Overview
FCCL -- COLLECTION STRATEGY OVERVIEW • FCCL uses a proprietary behaviour scoring model to assign a probability of default for all accounts monthly • This probability is used to rank accounts by risk for collection strategy purposes HIGH RISK LOW RISK EARLIER ASSIGNMENT TIMING LATER HIGHER FOLLOW-UP
Slide 32: FCCL Receivables Characteristics by Vintage Origination Year
FCCL RECEIVABLES CHARACTERISTICS BY VINTAGE ORIGINATION YEAR New/Used Car/Light Truck 100% 100% 75% 75% 50% 50% 25% 25% 0% 0% 2003 2004 2005 2006 2007 2008 2009 2010 2003 2004 2005 2006 2007 2008 2009 2010 New Used Car Light Truck % of Contracts > 60 month original term Weighted Average FICO® Score
Slide 33: FCCL Cumulative Losses by Vintage Origination Quarter
FCCL CUMULATIVE LOSSES BY VINTAGE ORIGINATION QUARTER FCCL Receivables Demonstrate Consistent Loss Performance 32
Slide 34: FCCL Floorplan Financing Overview
FCCL FLOORPLAN FINANCING OVERVIEW • Floorplan financing is a cornerstone product for FCCL that builds dealer satisfaction and develops long-term relationships • Financing is provided to dealers throughout Canada, over 90% of which are Ford-franchised dealers selling Ford and Lincoln products • Appro
Slide 35: Summary
SUMMARY • The One Ford Plan is working • On track to meet our financial targets for 2011 • Focused on growth • The funding environment continues to improve • Experiencing substantially improved credit loss performance • Ford Credit continues to focus and deliver on our strategic priorities 34
Slide 36: Safe Harbor
SAFE HARBOR Statements included or incorporated by reference herein may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on expectations, forecasts, and assumptions by our management and involve a
Slide 37: Appendix
APPENDIX 36
Slide 38: Income / (Loss) from Continuing Operations
TOTAL COMPANY INCOME / (LOSS) FROM CONTINUING OPERATIONS First Quarter 2010 2011 (Mils.) (Mils.) North America $ 1,253 $ 1,844 South America 203 210 Europe 107 293 Asia Pacific Africa 23 33 Other Automotive (391) (249) Total Automotive (excl. special items) $ 1,195 $ 2,131 Special items -- Automotiv
Slide 39: 2011 Special Items
TOTAL COMPANY 2011 SPECIAL ITEMS First Quarter 2010 2011 (Mils.) (Mils.) Personnel and Dealer-Related Items Personnel-reduction actions $ (86) $ (22) Mercury discontinuation / Other dealer actions (15) (1) Job Security Benefits / Other 38 (1) Total Personnel and Dealer-Related Items $ (63) $ (24) Ot
Slide 40: Revenue Reconciliation to GAAP
TOTAL COMPANY REVENUE RECONCILIATION TO GAAP First Quarter 2010 2011 (Bils.) (Bils.) North America $ 14.1 $ 17.9 South America 2.0 2.3 Europe 7.7 8.7 Asia Pacific Africa 1.6 2.1 Total Automotive (excl. special items) $ 25.4 $ 31.0 Special items -- Volvo 3.5 - Total Automotive $ 28.9 $ 31.0 Financial
Slide 41: Wholesales
TOTAL COMPANY WHOLESALES* First Quarter 2010 2011 (000) (000) North America 547 615 South America 101 114 Europe** 416 432 Asia Pacific Africa*** 189 242 Total Automotive (excl. special items) 1,253 1,403 Special items -- Volvo 92 - Total Automotive 1,345 1,403 * Wholesale unit volumes include all F
Slide 42: Gross Cash Reconciliation to GAAP
AUTOMOTIVE SECTOR GROSS CASH RECONCILIATION TO GAAP Mar. 31, Dec. 31, Mar. 31, 2010 2010 2011 (Bils.) (Bils.) (Bils.) Cash and cash equivalents $ 12.8 $ 6.3 $ 12.6 Marketable securities* 12.5 14.2 8.8 Total cash and marketable securities $ 25.3 $ 20.5 $ 21.4 Securities in transit** - - (0.1) Gross c
Slide 43: Operating-Related Cash Flows Reconciliation to GAAP
AUTOMOTIVE SECTOR OPERATING-RELATED CASH FLOWS RECONCILIATION TO GAAP First Quarter 2010 2011 (Bils.) (Bils.) Cash flows from operating activities of continuing operations* $ - $ 3.1 Items included in operating-related cash flows Capital expenditures (0.9) (0.9) Proceeds from the exercise of stock o
Slide 44: Ford Credit Key Metric Definitions
FORD CREDIT KEY METRIC DEFINITIONS In evaluating Ford Credit’s financial performance, Ford Credit management uses financial measures based on GAAP, as well as financial measures that include adjustments from GAAP; these measures are defined below. Information about the impact of on-balance sheet sec
Slide 45: Ford Credit Ratio Definitions
FINANCIAL SERVICES SECTOR FORD CREDIT RATIO DEFINITIONS In addition to evaluating Ford Credit’s financial performance on a GAAP financial statement basis, Ford Credit management also uses other criteria, some of which were previously disclosed in this presentation and are defined below: Charge-offs
Slide 46: Ford Credit Reconciliations of Managed Leverage to Financial Statement Leverage
FINANCIAL SERVICES SECTOR FORD CREDIT RECONCILIATIONS OF MANAGED LEVERAGE TO FINANCIAL STATEMENT LEVERAGE Mar. 31, Mar. 31, 2010 2011 (Bils.) (Bils.) Leverage Calculation Total Debt* $ 94.2 $ 82.9 Adjustments for Cash, Cash Equivalents, and Marketable Securities** (20.7) (13.0) Adjustments for Deriv
Slide 47: Liquidity Profile of Ford Credit's Balance Sheet
LIQUIDITY PROFILE OF FORD CREDIT’S BALANCE SHEET Cumulative Maturities -- As of December 31, 2010 (Bils.) Assets * Debt ** $97 $90 $81 $83 $69 $64 $61 $47 *** 2011 2012 2013 2014 & beyond Memo: Unsecured Long-term debt maturities (Bils.) $9.1 $6.8 $5.3 $12.7 * Includes finance receivables net of une
Slide 48: Calculation of Earnings Per Share
TOTAL COMPANY CALCULATION OF EARNINGS PER SHARE First Quarter 2011 After-Tax Net Income Oper. Attributable Excl. Special to Ford Items After-Tax Results (Mils.) After-tax results* $ 2,551 $ 2,612 Effect of dilutive 2016 Convertible Notes** 14 14 Effect of dilutive 2036 Convertible Notes** - - Effect
Slide 49: Retail -- FCCL Serviced Portfolio
RETAIL -- FCCL SERVICED PORTFOLIO Delinquency, Repossession and Credit Loss Experience Year Ended December 31, Amounts in C$ 2010 2009 2008 2007 2006 Average number of contracts outstanding (1) 282,441 274,493 259,859 242,212 227,277 Average portfolio outstanding during the period (in millions) (2)
Slide 50: Floorplan -- Portfolio Performance
FLOORPLAN -- PORTFOLIO PERFORMANCE Loss Experience of FCCL’s Dealer Floorplan Portfolio Year Ended December 31, 2010 2009 2008 2007 2006 (C$ in Millions) (1) Average principal balance $ 1,313 $ 1,156 $ 1,573 $ 1,776 $ 1,824 (2) Net losses (recoveries) $ 4.2 $ 0.2 $ 1.5 $ (0.0) $ (0.9) FCCL Net losse
Ford Motor Company — Investor Presentation (June 2011) on 6ix