Ford Mtr Co Del · NYSE:F
Ford Mtr Co Del — Ford Motor Company — Investor Presentation (March 2016)
21 slides from Ford Mtr Co Del's investor presentation, Mar 22, 2016
Slide 1: Let's Chat
LET’S CHAT BOB SHANKS CFO March 22, 2016 1
Slide 2: Key Topics
KEY TOPICS Global Business Environment South America – Actions Taken North America – U.S. Industry And Europe Segmentation – Accelerating Plan – Stocks, Transaction Prices, And Incentives China – Used Vehicle Prices – Industry And Pricing – Downturn Scenario and Breakeven Supplemental Di
Slide 3: Consistently Strong Financial Performance
CONSISTENTLY STRONG FINANCIAL PERFORMANCE Company Pre-Tax Profits and Automotive Operating-Related Cash Flow* (Bils) Pre-Tax Profit Automotive Operating-Related Cash Flow 108% $10 $5 30% $0 2010 2011 2012 2013 2014 2015 * Excludes special items Profits And Cash Flow Have Been Strong Since 2010 3
Slide 4: 2016 Business Environment
2016 BUSINESS ENVIRONMENT Industry (Mils) GDP (Pct) 2015 2016 2015 2016 Global 88.2 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* 23.5 23.5 – 25.5 6.9% 6.5 – 7.0% * China industry reflects r
Slide 5: U.S. Business Cycle Indicators
U.S. BUSINESS CYCLE INDICATORS S&P 500 (Pct. Chg., YoY) Housing Starts & Building Permits (Mils) 60 1.0 3.0 1.0 0.9 40 2.5 0.8 0.8 20 2.0 0.7 0.6 0.6 0 1.5 0.5 (20) 0.4 0.4 1.0 0.3 0.2 Housing Starts 0.2 (40) 0.5 Recession Housing Permits 0.1 (60) 0.0 0.0 0.0 1977 1982 1987 1992 1997 2002 2007 2012
Slide 6: U.S. Business Cycle Indicators
U.S. BUSINESS CYCLE INDICATORS Jobless Claims (4-week Moving Avg., Thous.) Purchasing Managers’ Index (PMI) 700 1.0 80 1.0 Expansion 70 600 0.8 0.8 60 500 0.6 0.6 50 50 400 0.4 0.4 Contraction 40 Mfg. PMI 300 0.2 30 0.2 Recession Non-Mfg. PMI 200 0.0 20 0.0 1977 1982 1987 1992 1997 2002 2007 2012 20
Slide 7: U.S. Industry SAAR & Segmentation
U.S. INDUSTRY SAAR & SEGMENTATION U.S. Industry SAAR U.S. Segmentation FY: 17.8M YTD: 17.9M 18.3 18.3 18.0 17.9 17.6 17.2 18% 19% 46% 42% 36% 39% 1Q15 2Q15 3Q15 4Q15 Jan ‘16 Feb ‘16 2014 2015 U.S. Industry Strength Continues; Utility Segment Growing; Cars Declining 7
Slide 8: Ford U.S. Stocks
FORD U.S. STOCKS U.S. Gross Days Supply Stocks Higher In 1Q Ahead Actuals Of Spring Selling Season 2011 - 2015 Average 104 Several Plants Operating 91 87 At 3-Crew Patterns 73 75 67 Resulting In Stable Production Days Supply Slightly Higher Than Historical Level But Expected To Decline Through 2Q De
Slide 9: Average Transaction Prices & Incentives
AVERAGE TRANSACTION PRICES & INCENTIVES* Incentive Per Unit Increase U.S. ATPs Compared With Prior Year** Compared With Prior Year Ford Ford Industry Average Industry Average $2,108 $590 $1,589 $1,604 $1,153 $361 $319 $699 $737 $791 $258 $246 $605 $142 $122 $137 Dec Jan Feb Mar*** Dec Jan Feb Mar***
Slide 10: Used Vehicle Prices
USED VEHICLE PRICES Manheim Used Vehicle Value Index (January 1995 = 100) 123.4 124.4 123.9 125.2 Manheim Index Declined 122.3 121.8 Since December -- 119.2 123.3 Primarily Lower Fuel Prices And Higher Volume 2013 2014 2015 2016 Ford Credit Overall Lease Manheim Index – February 2016 Versus February
Slide 11: Ford Credit U.S. Financing Trends
FORD CREDIT U.S. FINANCING TRENDS Average Retail Term (Months) Lease Mix of Retail Sales 67 29% Industry 63 Industry Financing Industry Trends 64 17% 22% Toward Longer-Term Lending And Leasing Ford 59 Ford Credit 57 8% 8% Ford Credit’s Consistent 2005 2010 2015 2005 2010 2015 Underwriting Produces A
Slide 12: North America Downturn Scenario & Breakeven
NORTH AMERICA DOWNTURN SCENARIO & BREAKEVEN Impact on Pre-Tax Profit North America Profitable Downturn Scenario Year 1 Year 2 In A Downturn Industry (30% reduction in year 1 versus 2015) U.S. Breakeven Industry Dealer Stock Impact (37% wholesale reduction in year 1) About 11 Million Or Lower Net Rev
Slide 13: South America FY 2015 Pre-Tax Results
AUTOMOTIVE SECTOR – SOUTH AMERICA FY 2015 PRE-TAX RESULTS (MILS) Industry $(561) Share 139 Stocks (32) $332 Mix / Other (13) $627 $101 $65 $6 $- $(467) $(832) $(1,164) Volume / Net Contribution Structural FY 2014 FY 2015 Mix Pricing Cost Cost Exchange Other Traditional Analysis Shows Flat Cost Perfo
Slide 14: South America FY 2015 Pre-Tax Results – Alternative View
AUTOMOTIVE SECTOR – SOUTH AMERICA FY 2015 PRE-TAX RESULTS – ALTERNATIVE VIEW (MILS) Material Cost $112 Industry $(561) Warranty / Freight 121 Share 139 Structural Costs 182 Stocks (32) Mix / Other (13) $332 $415 $301 $248 $(165) Venezuela $344 $(467) Argentina (46) Net Pricing $389 Other 3 $(832) Ec
Slide 15: Europe Pre-Tax Results 2015 v 2012
AUTOMOTIVE SECTOR – EUROPE PRE-TAX RESULTS 2015 V 2012 (BILS) Industry $0.9 Share - Material Excl. Commodities $0.6 Stocks 0.6 Commodities 0.4 Mix / Other 0.1 Warranty / Freight / Other 0.2 $1.6 $2.1 $1.2 A Brand People Love $0.3 $0.4 Future-Focused Products Mobility Leadership $(0.2) $(0.3) $(0.6)
Slide 16: China Industry Performance
AUTOMOTIVE SECTOR – ASIA PACIFIC CHINA INDUSTRY PERFORMANCE SAAR Registrations (Mils) Sequential Pricing – Passenger Vehicles 27.2 (0.2)% 23.5 (0.8)% (1.8)% (3.0)% (3.4)% FY: (6.3)% FY Outlook: ~(6.0)% 2015 2016 YTD 1Q15 2Q15 3Q15 4Q15 2016 YTD China Industry Sales Remain Strong; Pricing Environment
Slide 17: Supplemental Dividends
SUPPLEMENTAL DIVIDENDS Amount of supplemental dividend based on several factors: – Cash and liquidity balances – View of future requirements and opportunities to invest in and grow the business – View of global external conditions, as well as other factors that may affect our financial position –
Slide 18: 2016 Guidance
2016 GUIDANCE Metric Guidance Automotive Revenue ≥ 2015 Automotive Operating Margin* ≥ 2015 Automotive Operating-Related Cash Flow* Strong, but < 2015 Tax Rate (Pct) Low 30s Operating EPS* ≥ 2015 * Excluding special items 2016 Expected To Be An Outstanding Year As We Build Off Of Record 2015; On Tra
Slide 19: Key Takeaways
KEY TAKEAWAYS 1. U.S. industry continues to be strong; continued shift by consumers to utilities 2. Ford in good shape for a North America downturn; breakeven at about 11 million unit U.S. industry or lower 3. U.S. inventory days’ supply to decline through 2Q; Ford average transaction prices remain
Slide 20: Go Further
Go Further
Slide 21: 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
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