2014 THIRD QUARTER EARNINGS REVIEW - Ford · 10/24/2014 · 2014 THIRD QUARTER EARNINGS REVIEW...

2014 THIRD QUARTER

EARNINGS REVIEWOCTOBER 24, 2014OCTOBER 24, 2014OCTOBER 24, 2014OCTOBER 24, 2014

(PRELIMINARY RESULTS)(PRELIMINARY RESULTS)(PRELIMINARY RESULTS)(PRELIMINARY RESULTS)

OUR PLAN --

• Continue implementation of our global Plan:

− Aggressively restructure to operate profitably at the current demandand changing model mix

− Accelerate development of new products our customers want and value

− Finance our Plan and improve our balance sheet

− Work together effectively as one team -- leveraging our global assets

+ + =Asia PacificAsia Pacific

AmericasAmericas

Europe, Middle East

& Africa

SmallSmallMediumMedium

LargeProfits & Cash

PROFITABLE GROWTH FOR ALL

2014 THIRD QUARTER SUMMARY*

• Company profitable for 21st consecutive quarter; liquidity strong; Automotive operating-related cash flow negative

• Company wholesale volume and revenue down 2% - 3% from a year ago. Market share up in Europe and a Third Quarter record in Asia Pacific, including record China share

• North America and Asia Pacific profitable; results lower than a year ago for all Automotive Business Units except Middle East & Africa

• Strong results at Ford Credit, better than a year ago

• Global new product launches on track, including F-150

• Guidance unchanged from Investor Day, including Company 2014 Full Year pre-tax profit of about $6 billion

A Profitable But Challenging Quarter. Full Year Guidance Unchanged,Including Company Full Year Pre-Tax Profit Of About $6 Billion

* Excludes special items; Business Unit records are since at least 2000 when we began reporting specific Business Unit results

2014 THIRD QUARTER HIGHLIGHTS

• Began production of all-new 2015 Ford Mustang, refreshed Expedition and Lincoln Navigator in North America; new Ka and F-350 and F-4000 in South America; and Lincoln MKZ and MKC for China

• Announced new C-MAX, Grand C-MAX, and S-MAX in Europe

• Announced 25 new vehicles coming to Middle East & Africa by 2016

• 7 Ford vehicles finished in the top 3 of their segment in the J.D. Power APEAL study, with F-150, F-250, and F-350 ranking highest in their segments

• Hosted auto industry’s first app developer conference

• Created 1,200 new jobs in Kansas City for second shift of Transit production and 300 new jobs in Louisville for Lincoln MKC; created more than 1,800 jobs in Asia Pacific to support growth

• Completed previously announced share repurchase program

2014 THIRD QUARTER KEY FINANCIAL SUMMARY

B / (W) B / (W)

2014 2013 2014 2013

Wholesales (000) 1,493 (52) 4,743 23

Revenue (Bils.) 34.9$ (0.9)$ 108.2$ (1.1)$

Operating results*

Pre-tax results (Mils.) 1,181$ (1,408)$ 5,161$ (2,129)$

After-tax results (Mils.) 936 (885) 3,585 (1,711)

Earnings per share 0.24 (0.21) 0.89 (0.42)

Special items pre-tax (Mils.) (160)$ 338$ (763)$ 494$

Net income attributable to Ford

After-tax results (Mils.) 835$ (437)$ 3,135$ (981)$

Earnings per share 0.21 (0.10) 0.78 (0.24)

Automotive

Operating-related cash flow (Bils.)** (0.7)$ (2.3)$ 3.1$ (2.5)$

Gross cash (Bils.)** 22.8$ (3.3)$ 22.8$ (3.3)$

Debt (Bils.) (14.9) 0.9 (14.9) 0.9

Net cash (Bils.)** 7.9$ (2.4)$ 7.9$ (2.4)$

* Excludes special items; see Appendix for detail and reconciliation to Generally Accepted Accounting Principles (GAAP)

** See Appendix for reconciliation to GAAP; net cash is calculated as Automotive gross cash net of Automotive debt

Third Quarter First Nine Months

2014 THIRD QUARTER PRE-TAX RESULTS

BY SECTOR*

* Excludes special items; see Appendix for detail and reconciliation to GAAP

Memo:B / (W) 2013 3Q $(1,408) $(1,540) $132B / (W) 2014 2Q (1,418) (1,484) 66

FinancialServices

Automotive

Millions

Company

$1,181

$686

$495

Ford Credit $498Other (3)

AUTOMOTIVE SECTOR

2014 THIRD QUARTER KEY METRICS

COMPARED WITH 2013*

* Excludes special items; see Appendix for detail, reconciliation to GAAP, and definition of wholesales** Automotive operating margin defined as Automotive pre-tax results, excluding special items and Other Automotive, divided by Automotive revenue

*** Based, in part, on estimated vehicle registrations; includes medium and heavy trucks

1,4931,545

20142013

Wholesales (000)

$32.8$33.9

20142013

Revenue (Bils.)

2.5%

7.0%

20142013

OperatingMargin (Pct.)**

$686

$2,226

20142013

Pre-TaxResults (Mils.)

Memo:First Nine Months 4,720 4,743 $103.8 $102.0 6.2% 4.2% $5,973 $3,775

Third QuarterGlobal Industry SAAR (Mils.)*** 84.4 86.7Global Market Share*** 7.4% 7.4%

AUTOMOTIVE SECTOR


COMPARED WITH 2013*

* Excludes special items; see Appendix for detail and reconciliation to GAAP** Cost changes are measured primarily at present-year exchange, and exclude special items and discontinued operations. In addition, costs that vary directly with volume, such as material,

freight, and warranty costs, are measured at present-year volume and mix

$686

$2,226

20143Q

20133Q

Volume /Mix

NetPricing

OtherCost**

Exchange

Industry $ 486 Share (318)Stocks (718)Mix / Other 218

$(332) $(412)$(245)

$597

$(554)

Millions

NetInterest /

Other

Market Factors

$(1,540)

Memo:B / (W) Than 2014 2Q $(1,484) $(1,182) $612 $(247) $(320) $(99) $(261) $13

Pricing $1,004Incentives / Other (407)

Mfg. / Engineering $(209)Spending Related (151)Admin. & Selling (98)Other (10)Total Structural Costs $(468)

All Other $ (86)

Warranty** Material /Freight**

$(658)

$64

Total Cost

Balance Sheet Effects $(166)Operating (246)

AUTOMOTIVE SECTOR

2014 THIRD QUARTER PRE-TAX RESULTS BY

SEGMENT*

* Excludes special items; see Appendix for detail and reconciliation to GAAP

Millions

SouthAmerica

Total NorthAmerica

OtherAutomotive

AsiaPacific

Europe

Net Interest $(171)Other 27

$686

$1,410

$(170)

$(439)

$44

$(144)

Memo:B / (W) 2013 3Q $(1,540) $ (886) $(330) $(257) $ 10 $ (72) $ (5)B / (W) 2014 2Q (1,484) (1,030) 125 (453) (38) (115) 27

Middle East& Africa

$(15)

AUTOMOTIVE SECTOR -- NORTH AMERICA


COMPARED WITH 2013

Memo:First Nine Months 2,262 2,142 $64.5 $61.5 10.9% 8.7% $7,009 $5,350

Third QuarterN.A. Industry SAAR (Mils.)* 19.3 20.6N.A. Market Share* 14.6% 13.8%U.S. Industry SAAR (Mils.)* 16.1 17.2U.S. Market Share* 14.9% 14.1%

665725

20142013

Wholesales (000)

$19.9$21.2

20142013

Revenue (Bils.)

7.1%

10.9%

20142013

OperatingMargin (Pct.)

$1,410

$2,296

20142013


* Based, in part, on estimated vehicle registrations; includes medium and heavy trucks

AUTOMOTIVE SECTOR -- NORTH AMERICA


COMPARED WITH 2013Millions

$2,296

$(303)

$281

$(171)$(25)

$1

Memo:B / (W) Than 2014 2Q $(1,030) $(829) $499 $(340) $(181) $41 $(51) $(169)

$(632)

* Cost changes are measured primarily at present-year exchange, and exclude special items and discontinued operations. In addition, costs that vary directly with volume, such as material,freight, and warranty costs, are measured at present-year volume and mix

$1,410

$(886)

20143Q

20133Q

Volume /Mix

NetPricing

OtherCost*

Exchange Other

$(37)

Industry $ 554Share (376)Stocks (759)Mix / Other 278

Warranty* Material /Freight*

Structural Costs $(92)All Other (79)

Pricing $340Incentives / Other (59)

AUTOMOTIVE SECTOR -- SOUTH AMERICA


COMPARED WITH 2013

113

143

20142013

Wholesales (000)

$2.3

$2.8

20142013

Revenue (Bils.)

(7.3)%

5.7%

20142013


$(170)

$160

20142013



Memo:First Nine Months 403 331 $8.1 $6.3 1.1% (15.4)% $93 $(975)

Third Quarter S.A. Industry SAAR (Mils.)* 5.7 5.0S.A. Market Share* 9.2% 8.8%Brazil Industry SAAR (Mils.)* 3.7 3.2Brazil Market Share* 10.0% 9.1%

AUTOMOTIVE SECTOR -- SOUTH AMERICA


COMPARED WITH 2013Millions

Industry $(173)Share 6Stocks (26)Mix / Other (95)

20143Q

20133Q

Volume /Mix

OtherCost*

Exchange Other

Memo:B / (W) Than 2014 2Q $125 $(7) $114 $(84) $(38) $(64) $204

NetPricing

ContributionCost*

$160

$(170)

$(288)

$392

$(90)

$(249)

$45

* Cost changes are measured primarily at present-year exchange, and exclude special items and discontinued operations. In addition, costs that vary directly with volume, such as material,freight, and warranty costs, are measured at present-year volume and mix

$(140)

Pricing $465Incentives / Other (73)

$(330)

Material Excl. Commod. $(33)Commodities (86)Warranty / Freight (21)

Balance Sheet Effects $(109)Operating (140)

(6.4)%

(2.8)% $(182)

AUTOMOTIVE SECTOR -- EUROPE


COMPARED WITH 2013

* Includes Ford brand vehicles produced and sold by our unconsolidated affiliates in Turkey (totaling about 12,000 and 15,000 units in Third Quarter 2013 and 2014, respectively) and in Russia (totaling about23,000 and 13,000 units in Third Quarter 2013 and 2014, respectively); revenue does not include these sales

** Based, in part, on estimated vehicle registrations; includes medium and heavy trucks

321303

20142013

Wholesales (000)*

$6.9$6.4

20142013

Revenue (Bils.)

20142013


20142013


Memo:First Nine Months 1,010 1,064 $20.3 $22.7 (4.5)% (2.7)% $(913) $(619)

Third Quarter Europe Industry SAAR (Mils.)** 18.3 18.1Europe Market Share** 7.3% 7.6%Europe 20 Industry SAAR (Mils.)** 13.8 14.5Europe 20 Market Share** 8.0% 8.4%

$(439)

AUTOMOTIVE SECTOR -- EUROPE


COMPARED WITH 2013

* Cost changes are measured primarily at present-year exchange, and exclude special items and discontinued operations. In addition, costs that vary directly with volume, such as material, freight, and warranty costs, are measured at present-year volume and mix

Millions

OtherExchangeOtherCost*

NetPricing

Volume /Mix

20133Q

ContributionCost*

20143Q

RestructuringCost*

$(182)

$(439)

$105

$(74)

$177

$(116)$(47)

Memo:B / (W) Than 2014 2Q $(453) $(281) $19 $(18) $(21) $(112) $(40) $(52) $14

$(257)

Industry $ 69Share 30Stocks 41Mix / Other (35)

$(302)

Memo:(Included in standard

variance columns)

$26

Structural Costs $(115)All Other (1)

Russia

$(83)

Material Excl. Commod. $139Commodities 15Warranty / Freight 23

Component Pricing $(100)Prior Year Gains (37)Parts & Accessories (28)Other (137)

AUTOMOTIVE SECTOR -- MIDDLE EAST & AFRICA


COMPARED WITH 2013

44 $1.048 $1.1

Revenue (Bils.)Wholesales (000)

20142013 20142013

$(25)

$(15)

Pre-Tax Results (Mils.)

20142013

(2.4)%

(1.4)%


20142013

Memo:First Nine Months 150 148 $3.5 $3.4 1.0% 1.8% $35 $62

Third Quarter MEA Industry SAAR (Mils.)* 4.0 4.1MEA Market Share* 5.1% 5.1%


AUTOMOTIVE SECTOR -- ASIA PACIFIC


COMPARED WITH 2013

* Includes Ford brand and Jiangling Motors Corporation (JMC) brand vehicles produced and sold in China by our unconsolidated affiliates (totaling about 234,000 and 255,000 units in Third Quarter 2013 and2014, respectively); revenue does not include these sales

** Based, in part, on estimated vehicle registrations; includes medium and heavy trucks

330 $2.5346 $2.6

Revenue (Bils.)Wholesales (000)*

$116

$44

Pre-Tax Results (Mils.)

4.6%

1.7%


Memo:First Nine Months 895 1,058 $7.4 $8.1 3.0% 6.1% $218 $494

Third QuarterAP Industry SAAR (Mils.)** 37.1 38.9AP Market Share** 3.4% 3.6%China Industry SAAR (Mils.)** 22.1 23.7China Market Share** 4.3% 4.7%

20142013 20142013 2014201320142013

Millions

Memo:B / (W) Than 2014 2Q $(115) $(49) $(17) $54 $(85) $(35) $17

$(173)

$(16)

$116

$(55)

$44

20143Q

20133Q

Volume /Mix

OtherCost*

Exchange OtherNetPricing

ContributionCost*

$25

* Cost changes are measured primarily at present-year exchange, and exclude special items and discontinued operations. In addition, costs that vary directly with volume, such as material, freight, and warranty costs, are measured at present-year volume and mix

Industry $38Share 25 Stocks 21Mix / Other 81

$(18)

$165

AUTOMOTIVE SECTOR -- ASIA PACIFIC


COMPARED WITH 2013

$(72)Mfg. / Engineering $(102)Advert. & Sales Promo. (31)Spending Related (26)Other (15)Total Structural Costs $(174)

All Other $ 1

FORD CREDIT


COMPARED WITH 2013

Memo:B / (W) 2014 2Q $ 64 $16 $24 $(30) $(10) $64

Receivables (Bils.)Net* $96 $106Managed** 99 110

* Net receivables reflect net finance receivables and net investment in operating leases reported on Ford Credit’s balance sheet. The prior period was revised to conform to the presentation in our 2013 10-K Report

** Managed receivables equal net receivables, excluding unearned interest supplements and residual support, allowance for credit losses, and other (primarily accumulated supplemental depreciation).The prior period was revised to conform to the presentation in our 2013 10-K Report

LeaseResidual

Volume20143Q

20133Q

CreditLoss

OtherFinancingMargin

$427

$498

$103

$18

$(25) $(37)

$12

Millions

$71

AUTOMOTIVE SECTOR

2014 CASH* First

Third Nine

Quarter Months

(Bils.) (Bils.)

Gross cash at end of period 22.8$ 22.8$

Gross cash at beginning of period 25.8 24.8

Change in gross cash (3.0)$ (2.0)$

Automotive pre-tax profits** 0.7$ 3.8$

Capital spending (1.8) (5.2)

Depreciation and tooling amortization 1.1 3.1

Changes in working capital (1.5) (0.5)

Other / Timing differences 0.8 1.9

Automotive operating-related cash flow (0.7)$ 3.1$

Separation payments - (0.1)

Net receipts from Financial Services sector 0.2 0.4

Other (0.3) (0.2)

Cash flow before other actions (0.8)$ 3.2$

Changes in debt (0.3) (0.7)

Funded pension contributions (0.3) (1.1)

Dividends / Other items (1.6) (3.4)

Change in gross cash (3.0)$ (2.0)$

* See Appendix for reconciliation to GAAP

** Excludes special items; see Appendix for detail and reconciliation to GAAP

AUTOMOTIVE SECTOR

2014 AUTOMOTIVE FINANCIAL RESOURCES

June 30, Sep. 30,2014 2014

(Bils.) (Bils.)

Automotive gross cash* 25.8$ 22.8$

Less:

Long-term debt (13.2)$ (12.2)$

Debt payable within one year (2.2) (2.7)

Total debt (15.4)$ (14.9)$

Net cash** 10.4$ 7.9$

Memo: Liquidity*** 36.7$ 33.6$

* See Appendix for reconciliation to GAAP

** Net cash is calculated as Automotive gross cash net of Automotive debt

*** Total available committed Automotive credit lines (including local lines available to foreign affiliates)

were $10.8 billion at September 30, 2014

2014 BUSINESS ENVIRONMENT OVERVIEW

2014 Global Economic Growth In The 2.5% Range

Global

• Global economy to expand 2.5% with weaker trends in Europe and South America; global industry sales of about 87 million units

Americas

• U.S. economic indicators remain consistent with growth in the 3% range in the Second Half

• South America faces continued volatility, policy uncertainty, and recessionary conditions in Brazil and other key markets

Europe

• Incoming data reflect deceleration in Euro Area, with Full Year 2014 growth less than 1%; U.K. growth is projected in the 3% range

Asia Pacific

• China’s economic growth projected in the 7.5% range

• India GDP growth now projected to be in the 5% - 5.5% range

2014 KEY METRICS -- BUSINESS UNITS

Business Unit Guidance Unchanged From Investor Day

Memo:First Nine

2013 Full Year MonthsResults Plan Outlook

Automotive (Mils.)*

North America 8,809$ Lower On Track 5,350$

- Operating Margin 10.2 8% - 9% Low End Of Range 8.7

South America (33)$ About Equal About $(1,000) (975)$

Europe (1,442) Better About $(1,200) (619)

Middle East & Africa (69) About Breakeven On Track 62

Asia Pacific 327 About Equal About $700 494

Net Interest Expense (801) About Equal About $(700) (500)

Ford Credit (Mils.) 1,756$ About Equal $1,800 - $1,900 1,431$

* Excludes special items

2014 Full Year Compared With 2013Results

% %

2014 PLANNING ASSUMPTIONS AND KEY METRICS

Total Company 2014 Pre-Tax Profit Outlook Unchanged At About $6 Billion.Strong Growth And Financial Performance Expected For 2015

Memo:

First Nine

2013 Full Year Months

Results Plan Outlook Results

Planning Assumptions (Mils.)

Industry Volume* -- U.S. 15.9 16.0 - 17.0 16.8 16.7

-- Europe 20 13.8 13.5 - 14.5 14.5 14.5

-- China 22.2 22.5 - 24.5 23.8 23.5

Key Metrics

Automotive (Compared with 2013):

- Revenue (Bils.) 139.4$ About Equal On Track 102.0$

- Operating Margin** 5.4 Lower On Track 4.2

- Operating-Related Cash Flow (Bils.)*** 6.1$ Substantially Lower Lower 3.1$

Ford Credit (Compared with 2013):

- Pre-Tax Profit (Bils.) 1.8$ About Equal $1.8 - $1.9 1.4$

Company:

- Pre-Tax Profit (Bils.)*** 8.6$ $7 - $8 About $6 5.2$

* B ased, in part , o n est imated vehicle registrat io ns; inc ludes medium and heavy trucks

** A uto mo tive o perat ing margin is def ined as A uto mo tive pre-tax results , excluding specia l items and Other A uto mo tive, divided by A uto mo tive revenue

*** Excludes specia l items; see A ppendix fo r deta il and reco ncilia t io n to GA A P

2014 Full Year

% %

• Continue implementation of our global Plan:

− Aggressively restructure to operate profitably at the current demandand changing model mix

− Accelerate development of new products our customers want and value

− Finance our Plan and improve our balance sheet

− Work together effectively as one team -- leveraging our global assets

OUR PLAN --

+ + =Asia PacificAsia Pacific

AmericasAmericas

Europe, Middle East

& Africa

SmallSmallMediumMedium

LargeProfits & Cash

PROFITABLE GROWTH FOR ALL

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 number of risks, uncertainties, and other factors that could

cause actual results to differ materially from those stated, including, without limitation:

• Decline in industry sales volume, particularly in the United States or Europe, due to financial crisis, recession, geopolitical events, or other factors;

• Decline in Ford's market share or failure to achieve growth;

• Lower-than-anticipated market acceptance of Ford's new or existing products;

• Market shift away from sales of larger, more profitable vehicles beyond Ford's current planning assumption, particularly in the United States;

• An increase in or continued volatility of fuel prices, or reduced availability of fuel;

• Continued or increased price competition resulting from industry excess capacity, currency fluctuations, or other factors;

• Fluctuations in foreign currency exchange rates, commodity prices, and interest rates;

• Adverse effects resulting from economic, geopolitical, or other events;

• Economic distress of suppliers that may require Ford to provide substantial financial support or take other measures to ensure supplies of components or materials and could

increase costs, affect liquidity, or cause production constraints or disruptions;

• Work stoppages at Ford or supplier facilities or other limitations on production (whether as a result of labor disputes, natural or man-made disasters, tight credit markets or other

financial distress, production constraints or difficulties, or other factors);

• Single-source supply of components or materials;

• Labor or other constraints on Ford's ability to maintain competitive cost structure;

• Substantial pension and postretirement health care and life insurance liabilities impairing our liquidity or financial condition;

• Worse-than-assumed economic and demographic experience for postretirement benefit plans (e.g., discount rates or investment returns);

• Restriction on use of tax attributes from tax law "ownership change;"

• The discovery of defects in vehicles resulting in delays in new model launches, recall campaigns, or increased warranty costs;

• Increased safety, emissions, fuel economy, or other regulations resulting in higher costs, cash expenditures, and / or sales restrictions;

• Unusual or significant litigation, governmental investigations, or adverse publicity arising out of alleged defects in products, perceived environmental impacts, or otherwise;

• A change in requirements under long-term supply arrangements committing Ford to purchase minimum or fixed quantities of certain parts, or to pay a minimum amount to the

seller ("take-or-pay" contracts);

• Adverse effects on results from a decrease in or cessation or clawback of government incentives related to investments;

• Inherent limitations of internal controls impacting financial statements and safeguarding of assets;

• Cybersecurity risks to operational systems, security systems, or infrastructure owned by Ford, Ford Credit, or a third-party vendor or supplier;

• Failure of financial institutions to fulfill commitments under committed credit and liquidity facilities;

• Inability of Ford Credit to access debt, securitization, or derivative markets around the world at competitive rates or in sufficient amounts, due to credit rating downgrades, market

volatility, market disruption, regulatory requirements, or other factors;

• Higher-than-expected credit losses, lower-than-anticipated residual values, or higher-than-expected return volumes for leased vehicles;

• Increased competition from banks or other financial institutions seeking to increase their share of financing Ford vehicles; and

• New or increased credit, consumer, or data protection or other regulations resulting in higher costs and / or additional financing restrictions.

We cannot be certain that any expectation, forecast, or assumption made in preparing forward-looking statements will prove accurate, or that any projection will be realized. It is to

be expected that there may be differences between projected and actual results. Our forward-looking statements speak only as of the date of their initial issuance, and we do not

undertake any obligation to update or revise publicly any forward-looking statement, whether as a result of new information, future events, or otherwise. For additional discussion,

see "Item 1A. Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2013, as updated by our subsequent Quarterly Reports on Form 10-Q and

Current Reports on Form 8-K.

RISK FACTORS

APPENDIX

• Calculation of Earnings Per Share 1

• Income from Continuing Operations 2

• Special Items 3

• Preliminary Sector Income Statement 4

Automotive Sector

• Production Volumes 5

• Dealer Stocks and Definition of Wholesales 6

• Market Share 7

• Automotive Debt 8

Reconciliation to GAAP (Automotive Sector)

• Net Interest 9

• Gross Cash 10

• Operating-Related Cash Flows 11

• 2015 Guidance 12

Slide

2014 THIRD QUARTER EARNINGS --

APPENDIX INDEX

2014 CALCULATION OF EARNINGS PER SHARE

APPENDIX 1

2014 INCOME FROM CONTINUING OPERATIONS

APPENDIX 2

SPECIAL ITEMS

APPENDIX 3

PRELIMINARY SECTOR INCOME STATEMENT DATA

APPENDIX 4

For the periods ended September 30 2013 2014 2013 2014

(Unaudited) (Mils.) (Mils.) (Mils.) (Mils.)

AUTOMOTIVE

Revenues 33,857$ 32,779$ 103,794$ 102,020$

Costs and Expenses

Cost of sales 30,030 30,197 92,559 92,465

Selling, administrative, and other expenses 2,382 2,489 7,351 7,516

Total costs and expenses 32,412 32,686 99,910 99,981

Interest expense 204 204 617 619

Interest income and other income / (loss), net 200 255 686 739

Equity in net income / (loss) of affiliated companies 287 382 763 853

Income before income taxes -- Automotive 1,728 526 4,716 3,012

FINANCIAL SERVICES

Revenues 1,918 2,141 5,553 6,187

Costs and expenses

Interest expense 762 673 2,173 2,034

Depreciation on vehicles subject to operating leases 632 808 1,673 2,256

Operating and other expenses 221 187 538 560

Provision for credit and insurance losses 46 74 139 217

Total costs and expenses 1,661 1,742 4,523 5,067

Other income / (loss), net 100 90 270 245

Equity in net income / (loss) of affiliated companies 6 6 17 21

Income before income taxes -- Financial Services 363 495 1,317 1,386

COMPANY

Income before income taxes 2,091 1,021 6,033 4,398

Provision for / (Benefit from) income taxes 818 188 1,914 1,261

Net income 1,273 833 4,119 3,137

Less: Income / (Loss) attributable to non-controlling interests 1 (2) 3 2

Net income attributable to Ford Motor Company 1,272$ 835$ 4,116$ 3,135$

Third Quarter First Nine Months

AUTOMOTIVE SECTOR

PRODUCTION VOLUMES*

APPENDIX 5

SELECTED MARKETS

2014 THIRD QUARTER DEALER STOCKS AND

DEFINITION OF WHOLESALES*

APPENDIX 6

AUTOMOTIVE SECTOR

MARKET SHARE*

APPENDIX 7

3Q 4Q 1Q 2Q 3Q 2Q 3Q 2013 2014

(Pct.) (Pct.) (Pct.) (Pct.) (Pct.) (Pts.) (Pts.) (Pct.) (Pct.)

Total Share of Total Industry

North America

Total 14.6 14.6 14.6 14.8 13.8 (1.2) (0.8) 15.3 14.4

U.S. 14.9 15.4 15.3 15.3 14.1 (1.2) (0.8) 15.8 14.9

South America

Total 9.2 8.5 8.6 8.9 8.8 (0.2) (0.4) 9.1 8.7

Brazil 10.0 9.4 9.2 9.1 9.1 (0.1) (0.9) 9.5 9.1

Europe

Total 7.3 7.1 7.2 7.1 7.6 (0.4) 0.3 7.3 7.3

Europe 20 8.0 7.4 8.0 7.9 8.4 (0.2) 0.4 7.9 8.1

Middle East & Africa

Total 5.1 5.3 4.4 4.4 5.1 (0.5) - 4.9 4.7

Asia Pacific**

Total 3.4 3.6 3.4 3.7 3.6 0.4 0.2 3.1 3.5

China 4.3 4.4 4.5 4.6 4.7 0.3 0.4 4.0 4.6

Global 7.4 7.1 6.9 7.5 7.4 (0.2) - 7.3 7.2

Retail Share of Retail Industry

U.S.*** 13.2 13.7 13.5 12.8 13.0 (0.9) (0.2) 13.6 13.1

Europe**** 8.3 7.6 8.2 8.3 8.8 (0.1) 0.5 8.4 8.4

* Ba se d, in pa rt, on e stima te d ve hic le re gistra tions; inc lude s me dium a nd he a vy truc ks; prior pe riods re vise d to re fle c t pre se nt ye a r Automotive se gme nt struc ture

** Asia P a c ific ma rke t sha re inc lude s Ford bra nd a nd JMC bra nd ve hic le s produc e d a nd sold in China by our unc onsolida te d a fflia te s

*** P re se nt qua rte r is e stima te d, prior qua rte rs a re ba se d on la ste st P olk da ta

**** Europe pa sse nge r c a r re ta il sha re of re ta il industry re fle c ts the five ma jor ma rke ts (U.K. , Ge rma ny, Fra nc e , Ita ly, a nd S pa in); pre se nt qua rte r is e stima te d, prior

qua rte rs a re ba se d on la ste st Da ta Forc e da ta

Memo:

2013 2014 2014 B / (W) 2013 First Nine Months

AUTOMOTIVE SECTOR

AUTOMOTIVE DEBT

APPENDIX 8

Dec. 31,

2013 June 30 Sep. 30

(Bils.) (Bils.) (Bils.)

Public unsecured debt 6.7$ 6.6$ 6.7$

Convertible notes 0.8 0.8 0.8

U.S. Department of Energy 5.0 4.7 4.6

Other debt (including International) 3.2 3.3 2.8

Total Automotive debt 15.7$ 15.4$ 14.9$

Memo:

Automotive debt payable within one year 1.3$ 2.2$ 2.7$

2014

AUTOMOTIVE SECTOR

NET INTEREST RECONCILIATION TO GAAP

APPENDIX 9

AUTOMOTIVE SECTOR

GROSS CASH RECONCILIATION TO GAAP

APPENDIX 10

Dec. 31 Mar. 31 June 30 Sep. 30

(Bils.) (Bils.) (Bils.) (Bils.) (Bils.)

Cash and cash equivalents 5.7$ 5.0$ 4.5$ 4.7$ 6.0$

Marketable securities 20.4 20.1 20.7 21.1 16.9

Total cash and marketable securities (GAAP) 26.1$ 25.1$ 25.2$ 25.8$ 22.9$

Securities in transit* - (0.3) - - (0.1)

Gross cash 26.1$ 24.8$ 25.2$ 25.8$ 22.8$

* The purchase or sale of marketable securities for which the cash settlement was not made by period end and the related payable or receivable remained on the balance sheet

Sep. 30

2013 2014

AUTOMOTIVE SECTOR

OPERATING-RELATED CASH FLOWS

RECONCILIATION TO GAAP

APPENDIX 11

2015 GUIDANCE

APPENDIX 12

Strong Growth And Financial Performance Expected For 2015

Outlook

Planning Assumptions (Mils.)

Industry Volume* -- U.S. 16.8 - 17.5

-- Europe 20 14.8 - 15.3

-- China 24.0 - 26.0

Key Metrics

Automotive:

- Revenue Higher

- Operating Margin** Higher

- Operating-Related Cash Flow** Positive

Ford Credit:

- Pre-Tax Profit Equal To Or Higher

Company:

- Pre-Tax Profit (Bils.)** $8.5 - $9.5

* Includes medium and heavy trucks

** Excludes special items

*** Compared with 2014

***

***

***

2014 THIRD QUARTER EARNINGS REVIEW - Ford · 10/24/2014 · 2014 THIRD QUARTER EARNINGS REVIEW...

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