Ford Mtr Co Del · NYSE:F
Ford Mtr Co Del — Ford Motor Company — Deutsche Bank Global Automotive Conference 2016
38 slides from Ford Mtr Co Del's conference presentation, Jan 12, 2016
Slide 1: Deutsche Bank Global Automotive Conference
DEUTSCHE BANK GLOBAL AUTOMOTIVE CONFERENCE Mark Fields President and CEO January 12, 2016
Slide 2: Creating Value: The Drivers Of Value
CREATING VALUE GROWTH RETURNS ! RISK REWARDS The Drivers Of Value SLIDE 2
Slide 3: 2015 A Breakthrough Year – Growth
2015 A BREAKTHROUGH YEAR – GROWTH V O L U M E Wholesale volume highest since 2005 R E V E N U E Automotive revenue highest since 2007 G LO B A L M A R K E T S H A R E Ford global market share estimated at 7.3%, up 0.2 percentage points F O R D C R E D I T Managed receivables grew 13% from 2014 refle
Slide 4: 2015 A Breakthrough Year – Returns
2015 A BREAKTHROUGH YEAR – RETURNS C O M PA N Y P R E -TA X P R O F I T (Excl. Special Items) All-time record A U T O M O T I V E O P E R AT I N G M A R G I N Highest since at least the 1990s A U T O M O T I V E O P E R AT I N G C A S H F LO W Best since at least 2001 C O R P O R AT E A F T E R -TA
Slide 5: 2015 A Breakthrough Year – Risk
2015 A BREAKTHROUGH YEAR – RISK R E G I O N A L P R O F I TA B I L I T Y All business units profitable except South America Returned Europe to profitability B R E A K E V E N Automotive – Healthy…about 80% of wholesale volume North America – On target…about 2/3 of wholesale volume C A S H A N D L I
Slide 6: 2015 A Breakthrough Year – Rewards
2015 A BREAKTHROUGH YEAR – REWARDS 2015 shareholder distributions: 20% increase in regular dividend $2.5 billion Customers Employees Dealers Suppliers Increased Regular Dividend; Profitable Growth For All SLIDE 6
Slide 7: 2015 A Breakthrough Year – Operating
2015 A BREAKTHROUGH YEAR – OPERATING 10 New Plants Record Sales in China, More Than 1.1 Million Vehicles Sold #1 Successfully launched Opened last of 10 new Quality and customer Ford Credit recognized 16 global products plants to support satisfaction to best- as No. 1 in J.D. Power growth in Asia Pa
Slide 8: Looking Ahead To 2016 – Our Focus
LOOKING AHEAD TO 2016 – OUR FOCUS One Ford THE PLAN Acceleration Product Excellence Delivered with Passion Innovation Asia Americas Large Medium Profits PROFITABLE GROWTH FOR ALL Pacific + Small + = In Every Part of Our Europe, Middle East & Cash & Africa Business SLIDE 8
Slide 9: One Foot In Today, One Foot In Tomorrow
ONE FOOT IN TODAY, ONE FOOT IN TOMORROW GROWTH RETURNS ! RISK REWARDS Strengthening Today’s Business; Preparing For New Opportunities SLIDE 9
Slide 10: Keeping Our Core Automotive Business Strong
KEEPING OUR CORE AUTOMOTIVE BUSINESS STRONG Building Our Future On A Strong Foundation SLIDE 10
Slide 11: Automotive Industry Trends
AUTOMOTIVE INDUSTRY TRENDS Disruptive Impact On New Mobility Business Start-Up OEMs New Retail Connectivity Non-Traditional Entrants Big Data / Analytics Shift To Asia Automated Electrification Driving Digital Experience Light-Weighting Alternative Fuels Driver Assist Low-Cost Brands Disruptive Tech
Slide 12: From Making Vehicles To Providing Transportation
FROM MAKING VEHICLES TO PROVIDING TRANSPORTATION $5.4 Trillion $2.3 Trillion Ford Share 6% Ford Share 0% Traditional Auto Other Transportation Revenue Services Revenue Transportation As A Service Represents A Significant Opportunity SLIDE 12
Slide 13: Ford Smart Mobility
FORD SMART MOBILITY Changing The Way The World Moves To Make People’s Lives Better SLIDE 13
Slide 14: Making People's Lives Better
MAKING PEOPLE’S LIVES BETTER Working Both Our Core Business And Emerging Opportunities To Build An Even Stronger Future SLIDE 14
Slide 15: Ford Smart Mobility Initiatives
FORD SMART MOBILITY INITIATIVES SYNC Connect • Ford Credit Link Tripling FordPass IBM partnership Autonomous fleet Apple Car Play, • GoDrive car Amazon Echo Pivotal Android Auto sharing Added testing partnership Lincoln Miles AppLink expansion • Multi-modal (M-City, CA) SmartDeviceLink mobility solu
Slide 16: 2016 Business Environment
2016 BUSINESS ENVIRONMENT Industry (Mils) GDP (Pct) 2015* 2016 2015* 2016 Global 88.8 88.0 – 92.0 2.4% 2.3 – 2.8% U.S. 17.8 17.5 – 18.5 2.5% 2.3 – 2.8% Brazil 2.6 2.0 – 2.5 (3.6)% (2.0) – (3.0)% Europe 19.2 19.0 – 20.0 1.0% 1.2 – 1.7% China 23.3 23.5 – 25.5 6.9% 6.5 - 7.0% * 2015 data estimated; Chi
Slide 17: 2016 Product Launches
2016 PRODUCT LAUNCHES 12 Global Focus RS Focus Electric Fusion / Mondeo 4-door | Hybrid | Energi Product Escape Super Duty Raptor Launches in 2016 GT Lincoln MKZ Lincoln Continental gas | Hybrid SLIDE 17
Slide 18: 2016 Company Key Metrics
2016 COMPANY KEY METRICS 2016 FY Plan Automotive – Revenue Equal To or Higher Than 2015 – Operating Margin* Equal To or Higher Than 2015 – Operating-Related Cash Flow* Strong, but Lower Than 2015 Total Company Pre-Tax Profit* Equal To or Higher Than 2015 Tax Rate (Pct) Low 30s Operating EPS* Equal T
Slide 19: Drivers Of 2016 Automotive Operating Margin
DRIVERS OF 2016 AUTOMOTIVE OPERATING MARGIN Margin Impact Volume And Mix Pricing Cost Parts And Service Overall Assessment Equal To or Higher Than 2015 Growing Lean Favorable Market Factors And Continued Investment For Profitable Growth SLIDE 19
Slide 20: 2016 Business Unit Pre-Tax Results
2016 BUSINESS UNIT PRE-TAX RESULTS 2016 FY Plan Automotive – North America About Equal To 2015 » Operating Margin (Pct) 9.5% or Higher – South America Greater Loss Than 2015 – Europe Higher Than 2015 – Middle East & Africa Equal To or Higher Than 2015 – Asia Pacific Higher Than 2015 – Other Automoti
Slide 21: Ford Return On Invested Capital
FORD RETURN ON INVESTED CAPITAL Five-Year Average ROIC* (Pct.) 25% 16% 11% 0% (6)% 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 * Based on Ford ROIC methodology ROIC Healthy And Higher Than Cost Of Capital In Majority Of Last Twenty Years SLIDE
Slide 22: Ford And Competitors Return On Invested Capital
FORD AND COMPETITORS RETURN ON INVESTED CAPITAL Five-Year Average ROIC* (Pct.) Ford 16% VW BMW 9% Toyota 4% Fiat Group / FCA GM (1)% (5)% 2010 2011 2012 2013 2014 * Based on Ford ROIC methodology. For Fiat Group and GM, cumulative ROIC since 2009 reflecting post-bankruptcy results; for Fiat Group, c
Slide 23: 2016 Ford Risk Profile
2016 FORD RISK PROFILE R E G I O N A L P R O F I T A B I L I T Y B A L A N C E S H E E T Al l r e g i o n s pr o f i t a ble e x c ept S o u t h Am e r i ca ; Le ve r ag e – Co n s i s t ent w i t h S i n g le- A r a t i n g E u r o pe pr o f i t a bili ty t o i m pr o ve G l o ba l f u n de d pe n
Slide 24: Capital Allocation Framework
CAPITAL ALLOCATION FRAMEWORK Investment Shareholder Grade Fund Strong Distribution Balance The Plan Ford Credit Strategy Sheet Cash and Renew Products Support Sale of Sustainable Liquidity Ford Vehicles Regular Dividend Profitable Leverage Growth Globally Eliminate Framework Target Return on Ongoing
Slide 25: Shareholder Distributions
SHAREHOLDER DISTRIBUTIONS Dividends Shareholder Distributions (Bils.) Regular dividend Supplemental Dividend $12.6 Anti-Dilutive Share Repurchases $1.0 ‒ Sustainable through a business cycle Regular Dividends ‒ Target top quartile auto yield $2.5 Supplemental cash dividend $6.6 ̶ Provides cash beyon
Slide 26: Wrap-Up
WRAP-UP Delivered six consecutive years of strong performance, including a breakthrough year in 2015, transforming Ford For 2016, continuing our journey with another outstanding year as we work toward automotive and mobility leadership in the years ahead Driving Toward Automotive And Mobility Leader
Slide 27: Deutsche Bank Global Automotive Conference
DEUTSCHE BANK GLOBAL AUTOMOTIVE CONFERENCE
Slide 28: Risk Factors
RISK FACTORS 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
Slide 29: Appendix
APPENDIX
Slide 30: Appendix Index
PENSION AND OPEB UPDATE APPENDIX INDEX Item Appendix 2015 Planning Assumptions and Key Metrics 1 Return on Invested Capital Methodology 2 Return on Invested Capital Calculations (Ford and Competitors) 3-8
Slide 31: 2015 Planning Assumptions And Key Metrics
2015 PLANNING ASSUMPTIONS AND KEY METRICS 2014 FY 2015 FY Outlook Results* Prior Updated* Planning Assumptions (Mils) Industry Volume - U.S. 16.8 About 17.7 - Europe 20 14.6 About 16.0 - China 24.0 About 24.0 Key Metrics Automotive: - Revenue (Bils) $ 135.8 Higher** - Operating Margin*** 4.6 % Highe
Slide 32: Return On Invested Capital – Methodology
RETURN ON INVESTED CAPITAL – METHODOLOGY Approach Reflects an “all-in” after-tax measure providing a true return on total capital employed Based on publicly available financial disclosures and developed in collaboration with outside advisors Operating Return (NOPAT) GAAP income before taxes Excludes
Slide 33: Ford – Return On Invested Capital Calculation
FORD – RETURN ON INVESTED CAPITAL CALCULATION 2010 2011 2012 2013 2014 Net Operating Profit After Tax (NOPAT) (Bils.) (Bils.) (Bils.) (Bils.) (Bils.) Pre-Tax Profit (Incl. Special Items) $ 7.1 $ 3.7 $ 2.0 $ 14.4 $ 1.2 Add Back: Costs Related to Invested Capital Automotive Interest Expense 1.8 0.8 0.
Slide 34: BMW – Return On Invested Capital Calculation
BMW – RETURN ON INVESTED CAPITAL CALCULATION 2010 2011 2012 2013 2014 Net Operating Profit After Tax (NOPAT) (Bils.) (Bils.) (Bils.) (Bils.) (Bils.) Pre-Tax Profit (Incl. Special Items) € 4.9 € 7.4 € 7.8 € 7.9 € 8.7 Add Back: Costs Related to Invested Capital Interest Expense 0.3 0.2 0.2 0.3 0.3 Fun
Slide 35: FCA – Return On Invested Capital Calculation
FCA – RETURN ON INVESTED CAPITAL CALCULATION* 2010 2011 2012 2013 2014 Net Operating Profit After Tax (NOPAT) (Bils.) (Bils.) (Bils.) (Bils.) (Bils.) Pre-Tax Profit (Incl. Special Items) € 0.7 € 1.9 € 1.5 € 1.0 € 1.2 Add Back: Costs Related to Invested Capital Interest Expense 1.0 1.6 2.0 1.9 1.9 Fu
Slide 36: GM – Return On Invested Capital Calculation
GM – RETURN ON INVESTED CAPITAL CALCULATION 2010 2011 2012 2013 2014 Net Operating Profit After Tax (NOPAT) (Bils.) (Bils.) (Bils.) (Bils.) (Bils.) Pre-Tax Profit (Incl. Special Items) $ 7.2 $ 9.2 $ (28.7) $ 7.5 $ 4.2 Add Back: Costs Related to Invested Capital Automotive Interest Expense 1.1 0.5 0.
Slide 37: Toyota – Return On Invested Capital Calculation
TOYOTA – RETURN ON INVESTED CAPITAL CALCULATION* 2010 2011 2012 2013 2014 Net Operating Profit After Tax (NOPAT) (Bils.) (Bils.) (Bils.) (Bils.) (Bils.) Pre-Tax Profit** (Incl. Special Items) ¥ 778 ¥ 631 ¥ 1,635 ¥ 2,759 ¥ 3,201 Add Back: Costs Related to Invested Capital Interest Expense 29 23 23 20
Slide 38: VW – Return On Invested Capital Calculation
VW – RETURN ON INVESTED CAPITAL CALCULATION 2010 2011 2012 2013 2014 Net Operating Profit After Tax (NOPAT) (Bils.) (Bils.) (Bils.) (Bils.) (Bils.) Pre-Tax Profit (Incl. Special Items) € 9.0 € 18.9 € 25.5 € 12.4 € 14.8 Add Back: Costs Related to Invested Capital Interest Expense 1.2 1.1 1.4 1.5 1.5
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