Uoig Ford Final PDF

February 14, 2014
Consumer Goods
Ford Motor Company

Ticker: F Recommendation: Outperform
Current Price: $14.80 Implied Price: $17.04
Investment Thesis
Key Statistics With the introduction of the new, military-grade aluminum alloy Ford F-
150, the truck will continue to lead the pickup industry in sales and is
52 Week Price Range
$12.10 - $18.02 poised to extend the run as the best-selling pickup truck 37 years in a row,
with sales benefitting from the rebound in housing and construction
50-Day M oving Average $15.59
The average age of vehicles on the road is 11 years and near a historical
Estimated Beta 1.29 high which, combined with the recent consumer confidence increase and
pent-up demand for new vehicles, stands to drive vehicle sales in the near
Dividend Yield 3.30%
future
M arket Capitalization $58.54B
The release of 16 all-new or significantly refreshed vehicles in North
America in 2014, Fords largest geographic segment in terms of revenue,
3-Year Revenue CAGR 4.63%
combined with 25 new vehicles being released over the next five years in
Europe will draw new customers to Ford, increasing market share and in
Trading Statistics turn, growing both revenues and net income
Diluted Shares Outstanding 3,874M
Heavy investment in new factories and upgraded manufacturing facilities
along with the plan to hire over 10,000 new employees proves that Ford is
Average Volume (3-M onth) 44.76M
making the investment to meet current and future surging demand for
popular vehicles such as the F-150 and Fusion
Institutional Ownership 53.60%
The aluminum Ford F-150 may be adopted by consumers slower than
Insider Ownership 0.46%
expected due to higher insurance and repair costs, hurting sales and profits
EV/EBITDA (LTM ) 8.8x due to high margins typically earned on larger vehicles
One-Year Stock Chart
Margins and Ratios $20.00 250000000
$18.00
Gross M argin (LTM ) 18.36%
$16.00 200000000
EBITDA M argin (LTM ) 7.49% $14.00
$12.00 150000000
Net M argin (LTM ) 4.87%
$10.00
Debt to Enterprise Value 0.86 $8.00 100000000
$6.00
$4.00 50000000
$2.00
Covering Analyst: Tyler Markgraff $0.00 0

Aug-12 Oct-12 Dec-12 Feb-13 Apr-13 Jun-13 Aug-13 Oct-13 Dec-13
tmarkgra@uoregon.edu Volume Adj Close 50-Day Avg 200-Day Avg
1 University of Oregon Investment Group

University of Oregon Investment Group February 14, 2014
Business Overview
Figure 1: Ford Model T Ford Motor Company was founded by Henry Ford on June 16, 1903 in Detroit,
Michigan. The Model T, one of the most iconic cars in America, was the
beginning of an era for automobile production when Henry Ford implemented
the basic techniques of an assembly line and mass production. Ford continued to
pave the way by doubling wages and offering a variety of paint colors for the
cars. Since that point in history, Ford has continued to innovate, survived the
Great Recession better than any of the big three automotive manufacturers and
grown exponentially, now with worldwide operations and over $120 billion in
revenue annually.
Ford Motor Company is broken down into two separate segments: Automotive
and Financial Services.
Automotive
Source: Google The automotive sector operates in four different segments: Ford North America,
Ford South America, Ford Europe and Ford Asia Pacific Africa. Each of these
four automotive segments report their respective sales from Ford and Lincoln
brand vehicles, service parts and accessories, along with associated costs. While
Ford had owned a number of other automobile brands including Jaguar, Volvo,
Mercury and Aston Martin, the company has since either discontinued or sold
Figure 2: Government Bailout Funds to
those brands to refocus on the core brands of Ford and Lincoln and grow market
Automotive Manufacturers ($M) share. While Ford had held a significant stake in Mazda, that has since been
60,000
reduced and the interest in the company is now reported as a marketable
50,000
50,744 security. During 2013 Ford sold approximately 6,330,000 vehicles at wholesale
throughout the four operating segments.
40,000
Dollars ($M)
30,000
In addition to selling automobiles to dealers, Ford also sells vehicles to
20,000
10,748 dealerships for sale to fleet customers. Fleet customers are considered
10,000
commercial fleet customers, daily rental car companies and governments. Ford
0
(1,315)
also sells authorized parts and extended service contracts to retail customers.
(11,410)
(10,000)
General Motors Chrysler
(20,000) Financial Services
Bailout Return Under the financial services sector there are two separate reportable segments.
The first is Ford Motor Credit Company which includes vehicle-related
Source: ProPublica financing, leasing and insurance while the second segment is classified as
Other Financial Services which includes a number of business, holding
companies and real estate.
Industry
Figure 3: GDP Growth Forecast
Back in 2008 when the financial crisis began, the Big 3 (Chrysler, GM, Ford)
10.00%
9.00%
asked the government for a bailout of over $50 billion to avoid bankruptcy. With
8.00%
7.00%
bankruptcy would come an ever deeper recession and millions of layoffs.
6.00% Although Ford requested government bailout funds, it did not necessarily need it
5.00%
4.00% but felt compelled to ask for the funds as Ford did not want to compete against
3.00%
2.00% government-subsidized companies. Ford had requested $14 million from the
1.00%
0.00%
government and in return would accelerate the development of more fuel
United States Europe China India Brazil Mexico Middle East Russa, Central
& North Asia and
efficient (hybrid and electric) vehicles, focus on smaller cars and sell Volvo, all
Africa Southeast
Europe of which Ford has done. More importantly, Ford did not receive bailout
Actual Growth 2010-2012 Forecast Growth 2013 Forecast Growth 2014 money like General Motors and Chrysler. Since that point in time, Ford has
Projected Growth 2014-2019 Trend Growth 2020-2025 excelled under the leadership of Alan Mulally and his One Ford Plan, something
that will be touched on later.
Source: Conference Board
UOIG 2
Macroeconomic Environment
Due to the fact that the automobile industry is highly correlated with
Figure 4: Consumer Confidence Index macroeconomic conditions, the industry tanked during the recession. Across the
120.0 globe countries are beginning to recover from the financial crisis, grow GDP
and invest in infrastructure. With respect to the United States, consumer
110.0
confidence at a five-month high, GDP is growing steadily in the United States
100.0
and disposable income is projected to grow at 2.5% for the next five years,
90.0 signifying the North American automotive market is poised to continue the
80.0 rebound from the recession. Other areas such as Europe are trying to recover
70.0 from the debt crisis while China, which has been growing at an extremely rapid
60.0 pace the past few years, is beginning experience slower growth of the economy.
Along with the modest GDP growth, fiscal policy also plays a key role in the
50.0
automotive industry. With Fed Chair Janet Yellen stating that unemployment is
40.0
still too high, the federal stimulus will continue to instill confidence in investors,
even if currently being pared back. Outside of the United States, volatility in
South American countries such as Argentina and Venezuela will prove
challenging for automakers in the coming years. Due to the fact many of these
Source: BEA macroeconomic factors are region specific, they will be discussed further in the
revenue breakdown section.
Competition
Figure 5: Ford Vehicles Mileage The automotive industry has been a historically competitive industry due to the
high capital intensity, competitive pricing and increasing proliferation by foreign
2012 automotive manufacturers. Aspects that automakers typically compete on are
price, fuel economy, reliability, styling and the utility of the vehicle. Many
2011
domestic automakers are have been undergoing a heavy restructuring of their
2010
vehicle portfolio as consumers are concerned about gas mileage. Heavy capital
and supply-chain requirements prevent new competitors from entering the mass
2009 market and in addition, strict regulatory standards and heavy investments in
research and development further prove that the market is capital intensive.
2008
2007
With freshly redesigned vehicles, it is imperative for automakers to continue to
roll out new and redesigned models to retain customer interest and market share.
0 5 10 15 20 25 30 35 40 With federal fuel efficiency requirements impending, automakers are innovating
MPG
new ways to increase fuel efficiency such as turbocharged engines or more
Combined Car and Truck Fleet Trucks Cars (Domestic and Import) efficient transmissions.
Source: Ford Investor Relations

Fuel Efficiency Requirements
Throughout the last decade, research into and production of hybrid and electric
cars has grown significantly. Driven by a number of factors including rising fuel
prices, increasingly cost-conscious drivers and a green generation of drivers
coming of age, the demand for more fuel efficient vehicles has taken off. Further
Figure 6: Ford Vehicle Type Shift
driving this trend are the federal fuel efficiency requirements. As part of the
100% bailout during the recession, automakers had to accelerate the research and
10%
90%
27% development of more fuel efficient vehicles. While Toyotas Prius may be
80% 39%
widely considered the first mainstream hybrid vehicle, a number of automobile
Percent of Total Sales
70% 22%
18% manufacturers including Ford, General Motors, Volkswagen, Honda, BMW
60%
have all gone to great lengths to increase the fuel efficiency of their existing
50%
32% fleet, as well as developing newer and more fuel efficient vehicles. In addition,
40%
30%
manufacturers are beginning to develop plug-in hybrid vehicles (PHEV), such as
40% 55%
20%
the Chevrolet Volt, with batteries that can be charged through wall outlets but
10%
29% with a gasoline generator on board. While these smaller and more fuel efficient
0% cars are better for the environment, smaller vehicles typically have lower
2000 2010 2020 margins than larger vehicles such as the F-150. Small vehicles are projected to
Small Medium Large constitute a large portion of Ford revenue in the future (Figure 6) which will put
pressure on manufacturers to cut costs in other areas to make up for the smaller
UOIG 3
margins. Although there are relatively few pure electric cars in the market, this
Figure 7: Ford CO2 Tailpipe Emissions per Vehicle segment is poised for growth, driven by the increasing demand for fuel
efficiency.
2012 Under the One National Program administrative agencies and the Supreme
Court have established miles per gallon (mpg) requirements for future model
2011
year vehicles. The federal standards require light duty vehicles to reach an
2010 industry average fuel economy of approximately 35.5 mpg by the 2016 model
year. In 2012 the One National Program was amended and extended through
2009 2025, requiring light duty industry fuel average of approximately 45 mpg by the
2021 model year, and 54.5 mpg by the 2025 model year. A number of new
2008
requirements are also expected to come out for other vehicle segments, as well
2007 as other European countries.
260 280 300 320 340 360
With more countries and consumers becoming conscious of the carbon footprint,
Grams per Mile
there is a large shift toward more fuel efficient vehicles, something which Ford
Source: Ford Investor Relations will benefit from with existing and new lineup of fuel efficient cars, SUVs and
pickups.
Automobile Demand
As consumer sentiment and disposable income begin to recover, the option of
buying a new car is becoming an option for many consumers. The average age
Figure 8: Car Sharing Programs Member Growth of cars on the road is currently over 11 years; the oldest ever recorded. There is
a large amount of pent up demand in the industry that must be relieved at some
1,100,000
point in time in the near future. Consumers tended to hold onto their current cars
900,000
longer and postpone purchasing a new vehicle during the recession but with
economic indicators becoming more positive, a large number of consumers will
700,000
fuel new vehicle purchases in the coming years.
Number of Members
500,000 On the other hand, the Millennials (Generation Y) are posing a problem for the
automotive industry. A number of factors are causing manufacturers to worry
300,000 about demand from Millennials. An increasing number of car sharing programs,
the desire to live in a city and diminished job prospects by the economic
100,000 downturn are all driving factors in lower vehicle volume sales. Unable to find
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
employment, many young adults had to move back home at the peak of the
(100,000) recession. After accumulating savings to move out and secure employment and
Mexico Canada United States North America
housing, vehicles can be low on the priority list.
Borrowing Costs
As a result of the financial crisis, the Fed had initiated a stimulus effort to help
jump-start the economy and jumpstart spending and investment. For the past
five to six years, rates have been near historic lows to encourage banks to lend
more money, and therefore increasing consumer spending. As a result, rates for
consumer mortgages and loans have been near all-time lows as well, an
Figure 9: One Ford Plan opportunistic time for borrowing to make a large purchase such as a vehicle.
With the Fed trimming back the stimulus, rates will begin to rise, making
borrowing less appealing. Although this is a rising interest rate environment,
rates are still near historical lows and prove very attractive for prospective
automobile buyers.
Strategic Positioning
One Ford Plan
Source: Ford Investor Relations In 2006 Alan Mulally put the One Ford plan in place to help turn the
struggling automaker around. There are four key parts to the One Ford plan:
UOIG 4
Aggressively Restructure to Operate Profitably at the Current Demand
and Changing Model Mix
Figure 10: Percent of Nameplates Achieving IIHS
Throughout the past years Ford has eliminated a number of brands from their
Top Safety Pick automotive portfolio including Aston Martin, Jaguar, Land Rover and Volvo in
100% 93%
order to focus on the core two brands, Ford and Lincoln. Doing this allows Ford
90% to focus more resources toward providing customers with quality cars under
80% 75% 74%
77% 78% these two brands. More notably are the significant achievements in product
development. Through the hub and satellite approach, there is one lead
Percent of Nameplates
70% 65%
60%
52% 52% 54% product development engineering center, or the hub, which is designated to each
50% global vehicle line, ensuring global scale and efficiency through common parts
40%
and processes. The satellite then delivers vehicles to the appropriate market in
30%
a timely manner. Lastly, Fords commitment to platform consolidation is
20%
10%
notable. Back in 2007 Ford utilized 27 different vehicle platforms. By the end of
0%
this year there will be only 14 platforms with an ultimate goal of 9 different
2011 2012 2013 platforms for the whole globe.
Ford Toyota General Motors
Accelerate Development of New Products Customers Want and Value

Source: Ford Investor Relations Ford strives to produce vehicles with bold exterior designs that are great to drive
and provide exceptional value and quality. By focusing on those characteristics
along with developing cars that are increasingly greener, safer and smarter, Ford
has been and will continue to deliver a quality product to the customer. Crash
Figure 11: Things Gone Wrong per 1000 avoidance features such as Blind Spot Information System and adaptive cruise
Vehicles control, technologies typically found on higher-end cars, are now being put into
1600
Ford vehicles for the mass market. Ford will continue to invest in new
1405
1447
1373
technologies to develop a safer, more enjoyable and fuel-efficient driving
Total "Things Gone Wrong" per 1000
1400 1287 experience.

1206
1200 1140
1000
Finance Our Plan and Strengthen Our Balance Sheet
Through the implementation of the One Ford plan, the automotive sector has
Vehicles
800 been and is predicted to continue to generate significant operating-related cash

600 flow. With the cash, Ford has strengthened the balance sheet, invested in new
products, reduced debt when economically sensible and is paying a quality
400
dividend.
200
0 Work Together Effectively as One Team

2007 2008 2009 2010 2011 2012 Ford has implemented a business plan to review the business environment, risks,
opportunities and other key areas to identify areas that must be given further
Source: Ford Investor Relations attention, either to capitalize on growth or mitigate risk. The company
encourages an open workplace and partnerships with stakeholders to create a
more viable business.
Business Growth Strategies

Figure 12: Utility Patents Issued to Ford &
Subsidiaries Along with adhering to the proven One Ford plan, the company plans to pursue
700 661 a number of additional strategies to grow the automotive and financial segments
of the company.
600
Number of Patents Issued to Ford
500
444
Innovation & Vehicle Introduction
430
During early January 2014 Ford introduced an innovative refresh of the F-150,
400 357 343 325 the best-selling pickup truck for 37 years straight and best-selling vehicle for 31
300 years straight. Faced with imposing fuel efficiency requirements, automobile
manufacturers are continuously looking for areas to shave weight and improve
200
fuel-efficiency. Ford introduced the first pickup truck designed with a military-
100 grade aluminum alloy body and steel frame instead of the typical all-steel truck.
In all, the change in materials shaves over 700 pounds from the truck and
0
2007 2008 2009 2010 2011 2012 combined with the new EcoBoost engine offered in the truck, gives Ford trucks
UOIG 5
the advantage over other competitors. With bigger vehicles providing higher
Figure 13: Ford EcoBoost Twin Turbo margins, the introduction and adoption of this truck is vital to future revenues
Engine from trucks and market share. In addition, the housing and construction
industries are beginning to gain momentum, benefitting pickup sales even
further.
Besides the introduction of the new F-150, Ford is introducing 23 new vehicles
around the globe, including 16 here in the United States. Refreshing models is
vital to holding onto market share in the competitive automotive industry and
although margins may be lower in 2014 due to the retooling of factories and
down time, the investment made now by Ford will continue to pay off in the
long term.
Investment in EcoBoost Engines

Due to the pressure provided by the federal government to improve gas mileage,
Source: Google Ford has a significant advantage in the automotive market with the EcoBoost
engine. These engines are designed to deliver the power and torque consistent
with larger engines while lowering fuel consumption. With the combination of
turbocharging and direct fuel injection, Ford has accomplished the sought after
Figure 14: Ford Fusion Autonomous goal of improving fuel economy without sacrificing power. With the
introduction of the new 2015 F-150, Ford also introduced a new EcoBoost
Driving Technology engine that will pair with the truck. With this proprietary technology Ford will
continue to maintain an upper hand in the fuel efficiency fight among other
manufacturers.
Technology
Fords Sync technology allows drivers to operate the radio, navigation and
cellular phones with just their voice. While Sync had interface difficulties the
past few years, the technology is being further refined every year to provide
drivers with the best possible technology experience. In addition, Fords
Developer Program allows the company to tap into outside parties knowledge
to share innovative ideas with Ford to create valuable features for customers.
Source: Google As of recently Ford has paired with Stanford and MIT to further develop
autonomous driving technology and make a safer driving experience. The goal
of this program is to create real-time 3D maps of vehicle surroundings through
the use of algorithms that will also predict where moving vehicles and
Figure 15: Employment by Business Type pedestrians will be. While many cars can already park themselves, there is a
long road to autonomous driving, including many regulations and debate about
300000
the effectiveness and reliability of the technology.
250000
It is imperative for automotive manufacturers to maintain a technological edge
with technology becoming so intertwined with our lives on a day-to-day basis.
200000
Ford is continually investing in partnerships and ventures to maintain this
Number of Jobs
technological advantage and develop new products for customers.

150000
Investment in Production
100000
Anticipating a rebound in not only the United States but global economy, Ford
has made a number of investments to ramp production and meet forecasted
50000
demand while following the One Ford plan of offering customers products they
want and value. Over the last two years Ford has added 14,000 jobs in the
0
2007 2008 2009 2010 2011 2012 United States, with many of the positions focused on battery-based technology
Automotive Financial Services and improving fuel efficiency. Back in December of 2013 Ford announced that
they would be adding 5,000 jobs in the United States and another 6,000 abroad
Source: Ford Investor Relations all while opening three assembly plants, two of which will be in China and the
UOIG 6
other in Brazil. With surging demand for primarily the Fusion and F-150, Ford
needed to increase production capacity.
Figure 16: Ford Sales Changing
In addition to the added jobs mentioned above, Ford announced recently that
Geographic Mixture
they will be investing over $80 million and adding 350 jobs at the Kentucky
100% 4% Truck Plant in Louisville due to the fact production cannot keep up with
15%
90% demand. Adding the extra capacity will allow Ford to increase production by
24% 32%
80% 15%, or 55,000 F-Series Super Duty trucks.
70% 30%
60%
25%
Revenue
50%
40%
72% Automotive Sector
30%
55% Revenue in the automotive sector is primarily generated by the sales of vehicles,
20% 43%
parts and accessories with sales and marketing incentives as reductions to
10%
revenue. For vehicles that are sold to rental car companies or other agreements
0%
2000 2010 2020
in which there is a guaranteed repurchase option, the revenue is recognized over
Americas Europe Asia Pacific and Africa
the term of the lease. When the vehicles are returned at the end of the operating
term, a gain or loss is recognized after the vehicle is sold at auction and
Source: Ford Investor Relations depreciation is taken into account.
Ford manufactures the vehicles then sells them to individual dealers, a

Figure 17: North America Industry Share transaction typically financed by Ford Credit. Dealerships use Ford Credit to
finance their inventory purchases and Ford Credit ultimately pays cash to a legal
17.0%
entity in the automotive sector for the receivables of the dealers obligation for
16.5% the purchase price of the vehicle. When the vehicle is sold to the end user,
16.5%
dealers pay the wholesale finance receivable to Ford Credit.
Total Share of Total Industry
16.0% 15.9%
15.7%
The automotive sector revenue is broken down into four different regions: North
America, South America, Europe and Asia Pacific Africa.
15.5% 15.4%
North America
15.0% 14.9%
In 2013 the North America segment recorded $88.9 billion in revenue with
3,088,000 in wholesales. Among the top selling models for 2013 are the Focus,
14.5%
Fusion, Escape and F-Series pickup trucks. The Ford North America segment
accounted for 63% of revenue and 48% of wholesales in 2013, compared to 63%
14.0%
1Q 2013 2Q 2013 3Q 2013 4Q 2013 Full Year 2013
of revenue and 45% of wholesales in 2012.
Source: Ford Investor Relations South America

In 2013 the South America segment recorded $10.8 billion in revenue with
538,000 in wholesales. Recent model releases in the region include the Mondeo
sedan, EcoSport SUV and the new Ford Fiesta. The Ford South America
Figure 18: Europe Industry Share segment accounted for 8% of revenue and 9% of wholesales in 2013, compared
8.2% to 8% of revenue and 9% of wholesales in 2012.
8.1%
8.1%
8.0%
8.0% Europe
In 2013 the Europe segment recorded $27.9 billion in revenue with 1,360,000 in
Total Share of Total Industry
7.9%
7.8%
7.8% wholesales. Popular models in the region include the Fiesta, C-MAX, Focus,
7.7% Mondeo and Galaxy and Ford one of the broadest product offerings with the
7.7%
low-CO2 offerings. The Ford Europe segment accounted for 21% of revenue
7.6%
7.5% and 22% of wholesales in 2013, compared to 21% of revenue and 26% of
7.5%
wholesales in 2012.
7.4%
7.3%
Asia Pacific Africa
7.2%
1Q 2013 2Q 2013 3Q 2013 4Q 2013 Full Year 2013
In 2013 the Asia Pacific Africa segment recorded $11.8 billion in revenue with
1,344,000 in wholesales. Included in the automobile sales number are vehicles
Source: Ford Investor Relations produced by Fords Chinese joint venture, Jiangling Motors Corporation (JMC).
UOIG 7
Popular models in the region include the Mondeo, Edge, Fiesta and Kuga. The
Ford Asia Pacific Africa segment accounted for 8% of revenue and 21% of
wholesales in 2013, compared to 8% of revenue and 20% of wholesales in 2012.
Figure 19: Ford Financial Services Assets Financial Services

100,000 Revenue for the financial services sector are generated from interest on finance
90,000 receivables, net of certain deferred origination costs and operating leases, net of
80,000 certain deferred origination costs. The financing receivables are broken down
70,000 into two different segments, consumer and non-consumer.
60,000
Dollars ($B)
50,000 Finance Receivables: Consumer

40,000 Ford Credit purchases retail installment sale and lease contracts for new and
30,000 used vehicles from Ford and Lincoln dealers based on the credit-worthiness of
20,000 the sale and lease customers. The amount paid for retail installment sale
10,000 contracts is based on the negotiated purchase price, less trade-in allowance,
- down payment or special incentives. In most markets Ford Credit holds a
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Finance Receivables Net Investment in Operating Leases

security interest in vehicles purchased through the retail installment sales
contracts which provide repossession rights on the vehicles and insurance
Source: UOIG Spreads requirements for customers.
Finance Receivables: Non-Consumer

Ford Credit extends commercial credit to Ford and Lincoln dealers through
approved lines of credit to purchase new and used vehicles. These loans are also
used for purchasing inventory, dealership improvements, working capital or real
estate acquisition.
Net Investment in Operating Leases

In this segment Ford Credit has the option to purchase leases that are originated
by the dealer. Once the lease is purchased, the dealer typically has no further
obligation connected with the lease. At the termination of the lease the customer
has the option to purchase the vehicle for the price in the contract or return the
vehicle to the dealer. If returned, the vehicles are typically sold at auctions and
Figure 20: Alan Mulally Compensation Breakdown
recognized as a gain or loss.
35,000
30,000 Management and Employee Relations

4,253
25,000
6,978
Alan Mulally President & Chief Executive Officer
Dollars ($000)
7,500
20,000
6,306
15,000 7,500
Alan Mulally is President and Chief Executive Officer of Ford Motor Company.
10,000 13,925 7,500 He also is a member of the companys Board of Directors. Prior to joining Ford
7,492
in September 2006, Mulally served as executive vice president of The Boeing
5,000 3,825
3,150 1,820 1,325
Company, and President and Chief Executive Officer of Boeing Commercial
0 Airplanes. In that role, he was responsible for all of the companys commercial
2010 2011 2012
airplane programs and related services. The responsibility of chief executive
Salary Bonus Stock Awards Options Awards Other
officer for the business unit was added in March 2001. Mulally holds Bachelor
Source: SEC.gov and Master of Science degrees in aeronautical and astronautical engineering
from the University of Kansas, and earned a Masters in Management from the
Massachusetts Institute of Technology as a 1982 Alfred P. Sloan fellow. Ford
Website
UOIG 8
Mark Fields Chief Operating Officer
Figure 21: Mark Fields Compensation Breakdown Mark Fields is Chief Operating Officer of Ford Motor Company, effective Dec.
10,000
1, 2012. In this role, Fields is responsible for all business operations. Formerly,
9,000
Fields served as executive vice president of Ford Motor Company, and president
8,000 of The Americas, a position to which he was named in October 2005. He led the
7,000 4,069
2,887
3,855
development, manufacturing, marketing and sales of Ford and Lincoln vehicles
in the United States, Canada, Mexico and South America, and was responsible
Dollars ($000)
6,000
5,000
1,099 for the transformation of the companys North American operations and its
4,000 1,099 1,239 record profitability. Fields was named a Global Leader of Tomorrow by the
3,000 1,000 3,368 1,231 World Economic Forum in 2000 and CNBCs Asian Business Leader
2,000 1,301 1,156
Innovator of the Year for 2001. He holds an Economics degree from Rutgers
1,000 University (USA) and a Master of Business Administration from Harvard
1,385
Graduate School of Business. Ford Website
1,350 1,337
0
2010 2011 2012
Salary Bonus Stock Awards Options Awards Other
Source: SEC.gov Management Guidance

In conference calls management does not provide numerical guidance on very
many items. For 2014 the one figure that management identified was pre-tax
operating profit should be $7-8 billion. Management increased the first quarter
dividend by 25% to $0.125/share and has stated the dividend will be growing
Figure 22: 2014 Lincoln Navigator and consistent. Although Ford does not provide specific guidance, conference
call slides note that the company is on track to achieve key metrics such as
revenue and operating margin by the end of 2014.
Recent News
Ford to Boost Large Truck Production at Kentucky Plant
Reuters (January 30, 2014)

Ford is spending $80 million this year to boost production of large pickups and
SUVs, including the F-Series Super Duty trucks, Expedition and Navigator. The
plant will increase output by 55,000 vehicles per year, or about 15%, and add
Source: Google 350 jobs. While this is a large investment, Ford is continuing to put money into
production and expansion, signifying increasing demand in the near future.
Ford Increases Quarterly Dividend 25% in 2014 First

Quarter
Figure 23: 2014 Ford F-250 Atlas Ford Investor Relations Website (January 13, 2014)
Ford Motor Company declared a first quarter 2014 dividend of $0.125 per share
on outstanding Class B and common stock, a 25% increase from the level of
dividend paid in each quarter in 2013. Bob Shanks, CFO, stated that This
increase in the dividend provides our shareholders with a regular, growing
dividend that we believe is sustainable over an economic or business cycle.
Source: Google
UOIG 9
All New Ford F-150 Redefines Full-Size Trucks as the
Figure 24: 2015 Ford F-150 Toughest, Smartest, Most Capable F-150 Ever
Ford News Center (January 9, 2014)

Ford introduced the all-new F-150 that delivers an impressive combination of
power, capability and efficiency. This is the first pickup to use a high-strength,
military-grade aluminum alloys in the body. Combined with a high-strength
steel frame, the F-150 offers customers a strong and safe truck while improving
fuel efficiency through the use of lighter materials. With a range of four engine
options, including a new 2.7-liter EcoBoost with standard Auto Start-Stop, the
engines provide Ford with a competitive edge over the Chevy Silverado and
Ram trucks in the fiercely-competitive truck market.
Source: Google
Portfolio History
At no point in time has the Tall Firs, Svigals or DADCO portfolios ever held a
Figure 25: Average Age of U.S. Cars and position in Ford. While Europe and South America pose a challenge in terms of
Trucks profitability at this point in time, Ford is in perfect position to capture the
rebound of emerging markets, the growth in China and the continuing economic
12
recovery here in the United States. The Tall Firs is slightly underweight
consumer goods and Ford provides a quality long-term value opportunity with
11 dividends for the portfolio.
Age in Years
10 Catalysts
9
Upside
- Ford has created a market-first pickup using high-strength, military-grade
8
aluminum alloys designed to improve fuel efficiency, grow market share in
the competitive truck industry and continue the F-150s streak of 37 years
Source: AEI Ideas straight as the best-selling pickup truck
- Ford will launch 23 new models worldwide during 2014 and 16 in North
America, add over 5,000 jobs, build three new factories and expand
production to keep up with anticipated demand for vehicles such as the
Fusion and F-150
- Increasing momentum in construction and housing industries will spur
spending on vehicles, propelling the sales of Ford trucks and vans, the
Figure 26: U.S. Housing Starts
vehicles with the highest margins
2,500 - Increased consumer confidence, pent up demand and the average age of
New Privately Owned Housing Units
vehicles on the road being over 11 years combined with historically low
2,000
borrowing costs will encourage consumers to purchase or lease a new
1,500 vehicle
Started
- Rising interest rates will allow Ford to de-risk the underfunded pension
1,000 fund and put capital typically restricted for pension toward organic growth
and returning value to shareholders
500
0 Downside
2010-07-01
2012-01-01
2013-07-01
2000-01-01
2000-10-01
2001-07-01
2002-04-01
2003-01-01
2003-10-01
2004-07-01
2005-04-01
2006-01-01
2006-10-01
2007-07-01
2008-04-01
2009-01-01
2009-10-01
2011-04-01
2012-10-01
- Expensive down time in factories to prepare for new vehicle launches will
hurt 2014 margins and profitability
Source: FRED Economic Data
UOIG 10
- The weakness associated with aluminum may discourage loyal Ford truck
Figure 27: Ford F-Series U.S. Sales buyers from investing in a new F-150, dropping sales of the highest margin
1,000,000
vehicle and resulting in a loss of market share
- The consumer is shifting toward more fuel efficient and smaller vehicles
900,000
will decrease the sales of larger, higher-margin vehicles and increase the
800,000
sales of smaller, lower-margin vehicles, hurting the bottom line
700,000
Ford F-Series U.S. Sales
- Recent recalls associated with the EcoBoost technology may discourage

600,000
potential buyers from investing in a Ford vehicle with an EcoBoost engine
500,000
400,000
300,000
Comparable Analysis
200,000
100,000
Comparable companies were screened for beta, enterprise value, growth rates,
product offerings and global exposure. Extra consideration was given to
0
companies with strong pickup segments due to the fact that the F-150 is one of
Fords best-selling vehicles with the highest margins. While a number of
Source: Google comparable companies were based outside of the United States, the infiltration
of imports from Japan and Tokyo are pressuring American automobile
manufacturers to increase quality, warranties and decrease price. In addition, a
few companies representing macroeconomic trends and suppliers were included
Figure 28: General Motors Logo in the comparable analysis.
General Motors Company (GM) 30%
General Motors Company (GM) designs, manufactures, and markets cars,

crossovers, trucks, and automobile parts worldwide. The company markets its
vehicles primarily under the Buick, Cadillac, Chevrolet, GMC, Opel, Holden,
and Vauxhall brand names, as well as under the Alpheon, Jiefang, Baojun, and
Wuling brand names. The company, through its subsidiary, General Motors
Financial Company, Inc. provides automotive financing services and lease
products through GM dealerships in connection with the sale of used and new
automobiles that target customers with sub-prime and prime credit bureau
scores. The company was founded in 1908 and is based in Detroit, Michigan.
Yahoo! Finance
General Motors was weighted as the highest comparable because they compete
Source: Google directly with Ford in terms of market share, price point, automobile portfolios
and structure of company. General Motors also has a subsidiary that provides
automotive financing for customers and dealerships, similar to Ford. Both
companies were hit hard by the recession, operate in similar geographic regions
and face the same macroeconomic uncertainty.
Figure 29: Toyota Motor Corporation Logo
Toyota Motor Corporation 30%
Toyota Motor Corporation engages in the design, manufacture, assembly, and

sale of passenger cars, minivans, commercial vehicles, and related parts and
accessories primarily in Japan, North America, Europe, and Asia. It operates
through Automotive, Financial Services, and All Other segments. \Toyota Motor
Corporation sells its products through dealers. Further, it provides a range of
financial services comprising retail financing, retail leasing, wholesale
financing, insurance, credit cards, and housing loans. As of January 6, 2014, it
had approximately 270 dealerships in Southeast Asian countries. Toyota Motor
Corporation was founded in 1933 and is headquartered in Toyota City, Japan.
Yahoo! Finance
Source: Google
UOIG 11
Toyota Motor Corporation was weighted the same as General Motors and
although the company does not have headquarters in North America, it still
competes heavily with American automotive manufacturers. Toyota offers
Figure 30: Volvo Car Corporation Logo
similar product offerings, including the Toyota Prius and Toyota Tundra which
has gained traction in the United States in a highly-competitive environment.
With both an automotive and financial services arm, the company has a similar
structure to Ford and more importantly, is widely considered the pioneer of
hybrid vehicles. Using Toyota in the comparable analysis was also a proxy for
the hybrid automotive market, due to the shift toward greener and more fuel
efficient vehicles by consumers.
Volvo Car Corporation 25%
Volvo AB designs, manufactures and markets automobiles and industrial

trucks. It operates through following business areas: Volvo Group Trucks
Operations, Volvo Construction Equipment, Volvo Buses, Volvo Penta and
Source: Google Volvo Group Finance and Business Support. The Volvo Group Trucks
Operations business area covers operations in the geographic regions, including
North and South America, Europe, Middle East and Africa and Asia and Pacific.
The Volvo Group Finance & Business Support business area consists of
company's various operations in the financial sphere, such as customer
financing, as well as Information technology, treasury and human resources
services. Factset
Figure 31: Delphi Automotive Logo
Volvo Car Corporation was chosen as a comparable company due to their
similar company structure, with both an automotive and financial arm, even
though the company has a more diverse product offering. While Volvo does
manufacture heavy equipment and busses, the growth rates can be seen as an
indicative nature for GDP growth, infrastructure expansion and international
markets exposure.
Delphi Automotive PLC 15%

Source: Google
Delphi Automotive PLC, together with its subsidiaries, manufactures vehicle
components; and provides electrical and electronic, powertrain, safety, and
thermal technology solutions for the automotive and commercial vehicle
markets worldwide. Delphi Automotive PLC sells its products and services to
the automotive original equipment manufacturers (OEMs), as well as to the
aftermarket for replacement parts, including the aftermarket operations of its
Figure 32: Ford Automotive & Financial Revenue OEM customers, and to other distributors and retailers. Yahoo! Finance
200,000 15%
Delphi Automotive was chosen as a comparable company because it is global
180,000 10% supplier of electrical and safety components to vehicle markets. The product
160,000
offering of Delphi both includes a large portfolio of electric and hybrid systems,
5%
both areas that are becoming increasingly important as vehicles are utilizing
140,000
0% technology increasingly more in the future. As a key supplier, growth rates are
120,000 typically indicative of growth for larger automobile manufacturers such as Ford
Dollars ($M)
YoY Growth
(5%)
100,000
and General Motors.
(10%)
80,000
(15%)
Discounted Cash Flow Analysis
60,000
(20%)
40,000
Revenue Model
20,000 (25%)
To project revenues, the revenue model was initially broken down for the two
0 (30%)
operating segments: Automotive and Financial. The automotive section was
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
broken down into four geographic regions: North America, South America,
Automotive Financial Services
Source: UOIG Spread
UOIG 12
Figure 33: North America Revenue Europe and Asia Pacific Africa. Using historical revenue and wholesale sales
120,000 40% data, a revenue per vehicle figure was determined. Looking forward, the unit
sales growth for each region, including the largest markets in each region, was
100,000
30%
projected using a growth figure primarily determined by macroeconomic factors
20%
and any management guidance provided in earnings calls. In addition to the unit
80,000 sales, the revenue per vehicle figure was projected using a growth rate, also
dependent on any macroeconomic factors. Below is a short summary of each of
Revenue ($M)
YoY Growth
10%
60,000 the geographic regions along with any macroeconomic factors taken into
0%
consideration when projecting revenue.
40,000
(10%)
Automotive
20,000
(20%)
North America
0 (30%)
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Although 2013 was a solid year for North American sales, a number of factors
including volatility in the financial markets and the economic recovery pose
Source: UOIG Spread challenges for this segment. With that being said, a rebound in housing and
increasing consumer confidence, the number of refreshed models being rolled
Figure 34: South America Revenue out and increasing adoption of Lincoln vehicles will drive the unit sales and
14,000 30%
revenue per vehicle growth. During 2014 net pricing of vehicles is expected to
25%
12,000
be slightly lower than 2014 due to eliminating outgoing models from inventory
10,000
20% to create room for the new and refreshed models.
15%
Revenue ($M)
YoY Growth
8,000
South America
10%
6,000
In the recent weeks there has been concern about currency volatility in many
5% countries including Brazil and Argentina, two of the biggest sales segments in
4,000
0% South America. While growth is not as significant as 2013, 2014 growth will be
2,000 (5%)
driven by rising incomes and moderate GDP growth. Through implementation
of the One Ford Plan, many legacy products will be replaced with global
0
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
(10%)
products, helping increase revenue per vehicle and decreasing costs as a result of
uniformity. The government has also issued number of controls on vehicle
Source: UOIG Spread imports which may hurt sales slightly.
Figure 35: Ford Europe Revenue
Europe
45,000 20%
Europe is still recovering from the economic disaster that has plagued the region
40,000 15%
for the past few years. With unemployment beginning to fall and strong private
10%
35,000 investment in Germany, the moderate GDP growth will outweigh the declining
5%
30,000 sales and economic volatility in Turkey to moderately grow this segment and
0%
becoming profitable in 2015, according to Ford management. Helping drive this
Revenue ($M)
YoY Growth
25,000
20,000
(5%)
segment to profitability is the release of 25 new vehicles over the course of the
(10%) next five years along with the introduction of the EcoBoost engine in Germany.
15,000
(15%) Combined with higher volumes and improved operations after a thorough
10,000
(20%) restructuring, Europe is poised to grow profitability during the stabilization and
5,000 (25%) rebound of the economy.
0 (30%)
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Asia Pacific Africa
Source: UOIG Spreads China performed exceptionally well in 2013 and although the consensus on
growth is expected to be smaller than the prior year, this geographic segment
Figure 36: Asia Pacific Africa Revenue will continue to grow rapidly. Ford is continuing to expand the vehicle offerings
20,000 35%
18,000 30%
in the region with a number of One Ford products. In addition, a number of new
facilities and factories are being constructed in this region, driving revenue
16,000 25%
higher in the coming years by matching the manufacturers ability to produce to
14,000 20%
meet demand. With respect to Australia, the weakening Australian currency
12,000 15%
poses a challenge for sales but Ford is going through a number of restructuring
Revenue ($M)
YoY Growth
10,000 10%
efforts to decrease costs.
8,000 5%
6,000 0%
4,000 (5%)
2,000 (10%)
0 (15%)
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Source: UOIG Spreads UOIG 13

Financial Services
With the majority of revenue for the segment coming from receivables
generated by the automotive segment, growth is typically dependent on the sales
of automotive segment and the percentage of vehicles that are leased. The
operating leases grew significantly in 2013 and that growth is projected to
continue into the future. Looking at the financial services segment as a whole, a
rise in rates may diminish demand for new vehicles and leasing through Ford
Figure 37: Depreciation on Leased Vehicles
Motor Credit.
10,000
Depreciation on Leased Vehicles ($M)
9,000
8,000
Income Statement
7,000
Two income statements were created for the automotive and financial services
6,000 segments. Figures were projected forward using historical rates, combined with
5,000 any applicable management guidance. Below are summaries of key line items
4,000 and the projections for each respective line.
3,000
2,000 Automotive
1,000
Cost of Goods Sold
0
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
The cost of goods sold was trended down as a percentage of revenue in the
coming years due to continuing implementation of the One Ford Plan and
Source: UOIG Spreads increasing efficiency of manufacturing facilities. On the discounted cash flow
analysis, depreciation for the automotive segment was taken out of the cost of
goods sold, and added back to arrive at free cash flow, along with the
depreciation from the financial services segment.
Selling, Administrative and Other Expenses

Similar to the cost of goods sold, the selling, administrative and other expenses
amount was trended down slightly in the coming years due the continued
implementation of the One Ford Plan.
Financial Services
Figure 38: Ford Dividend vs. Share Price Depreciation on Leased Vehicles
$0.14 $18.00
Depreciation expense on leased vehicles is typically the largest or second-largest
$16.00
expense for the financial services segment. This non-cash expense reduces the
$0.12
value of the leased vehicles in Ford Credits lease portfolio from the original
$14.00
$0.10
acquisition cost down to the expected residual value at the end of the lease term.
$12.00
The residual values are carefully monitored and revised based on any changes in
Dividend/Share
$0.08
expected residual value or depreciation rate. The depreciation was projected
Share Price
$10.00
$0.06 $8.00 forward based a percentage of operating leases held by Ford Credit, while taking
$6.00 into account any management guidance.
$0.04
$4.00
$0.02
$2.00
Interest Expense
Typically the largest expense, the interest expense consists of discounts,
$0.00 $0.00
premiums, costs and interest all are related to the debt held. Looking forward,
1/1/2012
2/1/2012
3/1/2012
4/1/2012
5/1/2012
6/1/2012
7/1/2012
8/1/2012
9/1/2012
1/1/2013
2/1/2013
3/1/2013
4/1/2013
5/1/2013
6/1/2013
7/1/2013
8/1/2013
9/1/2013
1/1/2014
10/1/2012
11/1/2012
12/1/2012
10/1/2013
11/1/2013
12/1/2013
these expenses were projected to remain at historical levels while incorporating

Amount per Share Share Price
any fluctuations in automotive demand.
Source: Ford Investor Relations Statement of Cash Flows

The statement of cash flows was used to best predict the cash generated by each
segment for the company as a whole. Below are key line items in the statement
of cash flows for both segments.
Debt
Due to the fact that debt is such an instrumental piece to the operations of Ford,
proceeds from issuance of debt was kept constant for projections, assuming the
capital structure remains relatively the same, with the accompanying interest
expense already considered in the interest expense projections.
UOIG 14
Capital Expenditures
Capital expenditures were projected forward based off of a historical percentage
of revenue with one exception. In 2014 capital expenditures for the automotive
segment are higher than average due to the construction of new factories along
with the retooling of existing factories to prepare for production of new models.
Figure 39: Automotive Receivables Dividends

8,000
During 2012 Ford reinstated a dividend at $0.05 a share. For the first quarter of
7,000
2014, Ford increased the dividend by 25% from a year ago. After a pre-tax profit
6,000 of $8.6 billion, one of the companys best years ever, management explicitly
stated that the dividend will be regular and growing which is seen in the cash
Automotive Receivables ($M)
5,000
flows from financing activities in the automotive segment statement of cash
4,000
flows.
3,000
2,000
Balance Sheet
1,000
Similar to the income statement and statement of cash flows, there are two
balance sheets, one for each segment. In cases where management did not
0
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 provide much guidance, line items were projected at historical levels while
keeping any external factors that may have a material impact. Below is a
Source: UOIG Spreads summary of significant line items and factors considered when projecting the
line items.
Current Assets
Automotive Receivables
For the automotive segment, the receivables line items consists of receivables
generated from both vehicle/part sales to third parties and Ford Credit. This item
was projected to increase slightly due to an uptick in sales while using historical
data percentages of revenue and days outstanding as a guide.
Figure 40: Finance Receivables Finance Receivables

Finance receivables in the financial services segment are purchased typically
120,000
purchased from the automotive segment and originated from vehicle
purchases/leases along with miscellaneous non-consumer items. This line item
100,000
was projected as a percentage of total financial services assets and days
outstanding, trended down toward the historical average.
Finance Receivables ($M)
80,000
Non-Current Assets
60,000
Net Property
Net property for the automotive segment was projected based off the percentage
40,000
of total automotive assets. The net property line item includes land, buildings,
land improvements, machinery and equipment along with other assets used in
20,000
normal operations. These items are depreciated primarily using the straight-line
method over the estimated useful life of the asset.
0
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Source: UOIG Spreads Deferred Income Taxes

Deferred income taxes for the automotive segment were projected forward as a
percentage of revenue, using historical data as a guide for the projections.
Current Liabilities
Payables
In the automotive segment there are two types of payables: trade and other. The
majority of these payables are trade payables while both were projected forward
as a percentage of revenue while using historical data as a guide for the
projections.
UOIG 15
Accrued Liabilities and Deferred Revenue
This line item mainly consists of dealer/customer allowances and claims and
employee benefit plans and was projected forward based off a percentage of
Figure 41: Ford Beta revenue using historical percentages while keeping days outstanding in line with
historical figures.
Ford Beta
Type Beta SD Weighting
5 Year Weekly Regression 1.51 0.13 0% Non-Current Liabilities
5 Year Daily Regression 1.31 0.05 25% Long-Term Debt
3 Year Weekly Regression 1.38 0.12 0%
For both the automotive and financial services segment, debt is a key instrument
3 Year Daily Regression 1.29 0.04 40%
1 Year Daily Regression 1.35 0.10 0% to the continuing operations of the company. The outstanding debt for each
3 Year Weekly Vasicek 1.29 - 15% segment was projected as a percentage of total liabilities for each respective
3 Year Monthly Vasicek 1.27 - 15% segment under the assumption that the capital structure of the company would
Damodaran Automotive Industry Beta 1.28 - 5%
remain consistent. Under this assumption, the interest payments on the debt
Final Beta 1.29 - 100%
were packaged into the interest expense projections.
Source: UOIG Spreads
Discounted Cash Flow Analysis Assumptions
Beta
Beta was derived using a number of regressions against the S&P 500, a pair of
Vasicek betas and the Aswath Damodaran automobile industry beta (Figure 41).
Seven regressions were run using different time frames including the 5-year
weekly, 5-year daily, 3-year weekly, 3-year daily and 1-year daily. Using those
seven regressions, weightings were assigned to each regression depending on
the standard deviation, ultimately finding a weighted-average final beta of 1.29.
Figure 42: Intermediate Growth Rate
Intermediate Growth Rate Cost of Debt
2019E 2020E 2021E 2022E 2023E The cost of debt was derived from the debt outstanding and the respective rates,
Undiscounted CF $5,822.39 $6,288.18 $6,665.47 $6,932.09 $7,140.05
arriving at a cost of debt of 3.84%. Assuming a similar capital structure, a
Discounted CF $4,159.53 $4,247.41 $4,256.84 $4,185.79 $4,076.36
Growth Rate 10.00% 8.00% 6.00% 4.00% 3.00%
premium was added to the terminal risk-free rate to derive a terminal cost of
debt.
Risk-Free Rate
To determine the risk-free rate, the yield on the 10-Year Treasury was used. For
the terminal risk-free rate, the yield on the 30-Year Treasury was used.
Terminal Growth Rate

In accordance with group standards a 3.00% terminal growth rate was applied.
Intermediate Growth Rate

Figure 43: Final Price Target Due to the fact that free cash was growing 13.8% going into the terminal year,
an intermediate growth rate was used under the assumption that Ford cannot
Final Price Target Implied Price Weight continue to grow free cash flow at 13.8% year-over-year into perpetuity.
Discounted Cash Flow $18.41 50%
Forward Comparable Analysis $15.66 50% Therefore, the intermediate growth rate began at 10% in 2019 and decreased
Price Target $17.04 until it reached 3.00% in 2023.
Current Price 14.80
Undervalued 15.12%
Recommendation
Based on a 50% weighting of the discounted cash flow analysis and a 50%
weighting of the comparable analysis, I place an OUTPERFORM on Ford. The
continuing investment in production and innovative new vehicles across all
markets will continue to attract new customers and grow Fords market share.
With a price target of $17.04, this represents a 15.12% undervaluation in the
stock.
UOIG 16
Appendix 1 Comparables Analysis
Comparables Analysis (2014) F GM 7203-JP VOLV.B DLPH
Ford Motor Toyota Motor Delphi Automotive
($ in millions) Company General Motors Corporation Volvo PLC
Stock Characteristics Max Min Median Weight Avg. 30.00% 30.00% 25.00% 15.00%
Current Price $61.55 $0.00 $24.49 $40.26 $14.80 $35.23 $56.72 $13.75 $61.55
Beta 1.65 0.00 1.17 1.34 1.29 1.65 1.14 1.20 1.33
Size
Short-Term Debt 66,404.0 - 3,467.0 25,900.7 19,678.5 14,200.0 66,404.0 6,794.0 140.0
Long-Term Debt 91,549.0 676.9 12,630.5 32,206.8 91,549.0 17,923.0 82,156.0 7,338.0 2,324.0
Cash and Cash Equivalent 37,889.0 796.4 7,546.0 21,385.5 37,642.0 29,529.0 37,889.0 4,000.0 1,067.0
Non-Controlling Interest 6,303.0 - 507.5 2,168.9 372.0 538.0 6,303.0 180.0 477.0
Preferred Stock 7,964.0 - - 2,389.2 - 7,964.0 - - -
Diluted Basic Shares 3,874.0 - 848.4 1,497.3 3,874.0 1,389.0 3,448.0 - 307.7
Market Capitalization 199,000.0 18,737.0 39,142.0 84,587.3 59,009.0 50,114.0 199,000.0 28,170.0 18,737.0
Enterprise Value 321,414.0 20,565.0 53,487.5 129,314.0 132,361.0 61,225.0 321,414.0 45,750.0 20,565.0
Growth Expectations
% Revenue Growth 2014E 36.3% 3.9% 5.9% 5.1% 3.9% 4.9% 4.7% 5.0% 6.7%
% Revenue Growth 2015E 48.8% 3.2% 7.5% 5.8% 5.2% 3.2% 5.2% 7.3% 9.6%
% EBITDA Growth 2014E 125.4% 6.1% 12.5% 13.5% 6.1% 9.4% 6.3% 27.9% 12.2%
% EBITDA Growth 2015E 91.6% 8.6% 13.9% 17.1% 10.8% 14.9% 8.6% 32.6% 12.9%
% EPS Growth 2014E 166.1% (13.40%) 22.1% 32.5% (13.4%) 24.6% 6.6% 84.6% 13.4%
% EPS Growth 2015E 113.1% 11.1% 20.3% 28.5% 38.4% 23.5% 11.1% 62.3% 17.1%
Profitability Margins
Gross Margin 26.04% 15.19% 20.82% 18.67% 17.27% 15.19% 19.66% 21.98% 18.12%
EBIT Margin 11.54% 5.61% 7.39% 7.87% 6.43% 5.80% 9.98% 5.61% 11.54%
EBITDA Margin 14.80% 10.16% 10.96% 11.98% 10.16% 10.17% 13.80% 10.28% 14.80%
Net Margin 8.57% 3.30% 5.52% 5.64% 3.63% 4.33% 7.44% 3.30% 8.57%
Credit Metrics
Interest Expense $857.0 $0.0 $173.6 $262.6 $857.0 $347.0 $203.1 $304.1 $144.0
Debt/EV 0.8 0.0 0.4 0.4 0.8 0.5 0.5 0.3 0.1
Leverage Ratio 7.1 1.0 2.6 2.8 7.1 1.9 4.1 3.2 1.0
Interest Coverage Ratio 177.8 14.6 18.3 73.9 18.3 47.5 177.8 14.6 18.0
Operating Results
Revenue $261,584.0 $3,227.0 $85,146.0 $140,592.2 $154,000.9 $162,260.0 $261,584.0 $43,278.0 $17,463.0
Gross Profit $51,435.0 $798.0 $17,080.0 $25,677.4 $26,590.7 $24,646.0 $51,435.0 $9,514.0 $3,164.0
EBIT $26,118.0 $241.0 $5,852.5 $11,570.5 $9,901.7 $9,419.0 $26,118.0 $2,428.0 $2,016.0
EBITDA $36,108.0 $368.0 $8,896.5 $17,281.6 $15,642.5 $16,498.0 $36,108.0 $4,448.0 $2,585.0
Net Income $19,452.0 $176.0 $4,258.0 $8,523.3 $5,583.4 $7,020.0 $19,452.0 $1,429.0 $1,496.0
Capital Expenditures $13,845.0 $282.0 $7,589.0 $8,902.4 $6,548.8 $7,804.0 $9,948.0 $13,845.0 $770.0
Multiples
EV/Revenue 1.23x 0.38x 1.12x 0.92x 0.86x 0.38x 1.23x 1.06x 1.18x
EV/Gross Profit 6.50x 2.48x 5.53x 4.80x 4.98x 2.48x 6.25x 4.81x 6.50x
EV/EBIT 18.84x 6.50x 11.25x 11.88x 13.37x 6.50x 12.31x 18.84x 10.20x
EV/EBITDA 10.29x 3.71x 8.43x 7.55x 8.46x 3.71x 8.90x 10.29x 7.96x
EV/(EBITDA-Capex) 14.56x (4.87x) 9.19x 6.28x 14.56x 7.04x 12.29x (4.87x) 11.33x
Market Cap/Net Income = P/E 19.71x 7.14x 11.38x 12.02x 10.57x 7.14x 10.23x 19.71x 12.52x
Multiple Implied Price Weight
EV/Revenue $17.69 5.00%
EV/Gross Profit $13.93 15.00%
EV/EBITDA $11.48 20.00%
Market Cap/Net Income = P/E $17.32 60.00%
Price Target $15.66
Current Price 14.80
Undervalued 5.83% UOIG 17
Appendix 2 Income Statement
Income Statement
($ in millions) 2008A 2009A 2010A 2011A 2012A 2013E 2014E 2015E 2016E 2017E 2018E
Automotive
Revenue 128,800.0 105,500.0 119,300.0 128,200.0 126,600.0 139,513.7 145,031.5 152,859.3 159,796.0 166,817.4 174,958.7
Cost of Sales: Automotive 126,620.0 98,866.0 104,451.0 113,345.0 112,578.0 122,772.0 127,410.2 134,516.2 140,620.5 145,548.2 153,526.2
Gross Profit $2,180.0 $6,634.0 $14,849.0 $14,855.0 $14,022.0 $16,741.6 $17,621.3 $18,343.1 $19,175.5 $21,269.2 $21,432.4
Gross Margin 1.69% 6.29% 12.45% 11.59% 11.08% 12.00% 12.15% 12.00% 12.00% 12.75% 12.25%
Selling, Administrative and Other Expenses 11,356.0 8,583.0 9,040.0 9,060.0 9,006.0 9,766.0 9,934.7 9,095.1 10,946.0 11,677.2 11,984.7
Earnings Before Interest and Taxes ($9,176.0) ($1,949.0) $5,809.0 $5,795.0 $5,016.0 $6,975.7 $7,686.7 $9,248.0 $8,229.5 $9,592.0 $9,447.8
% Revenue (7.12%) (1.85%) 4.87% 4.52% 3.96% 5.00% 5.30% 6.05% 5.15% 5.75% 5.40%
Interest Expense 2,061.0 1,515.0 1,807.0 817.0 713.0 209.3 217.5 382.1 399.5 417.0 437.4
Net Interest Income/(Loss) (726.0) 5,288.0 (362.0) 825.0 1,185.0 697.6 725.2 764.3 799.0 834.1 874.8
Equity in Net Income/(Loss) of Affiliated Companies 163.0 145.0 526.0 479.0 555.0 488.3 1,087.7 764.3 399.5 166.8 87.5
Income Before Income Taxes: Automotive ($11,800.0) $1,969.0 $4,166.0 $6,282.0 $6,043.0 $7,952.3 $9,282.0 $10,394.4 $9,028.5 $10,175.9 $9,972.6
% Revenue (9.16%) 1.87% 3.49% 4.90% 4.77% 5.70% 6.40% 6.80% 5.65% 6.10% 5.70%
Provision for/(Benefit From) Income Taxes 952.0 (655.0) (514.0) (12,150.0) 1,573.0 2,147.1 2,552.6 2,910.4 2,618.3 3,052.8 3,141.4
Tax Rate (8.07%) (33.27%) (12.34%) (193.41%) 26.03% 27.00% 27.50% 28.00% 29.00% 30.00% 31.50%
Income/(Loss) from Continuing Operations (12,752.0) 2,624.0 4,680.0 18,432.0 4,470.0 5,805.2 6,729.5 7,484.0 6,410.2 7,123.1 6,831.3
Income/(Loss) from Discontinued Operations 9.0 5.0 - - - - - - - - -
Net Income (12,743.0) 2,629.0 4,680.0 18,432.0 4,470.0 5,805.2 6,729.5 7,484.0 6,410.2 7,123.1 6,831.3
Less: Income/(Loss) Attributable to Noncontrolling Interests 214.0 245.0 (4.0) 9.0 (1.0) - - - - - -
Net Income Attributable to Automotive Sector ($12,529.0) $2,874.0 $4,676.0 $18,441.0 $4,469.0 $5,805.2 $6,729.5 $7,484.0 $6,410.2 $7,123.1 $6,831.3
Net Margin (9.73%) 2.72% 3.92% 14.38% 3.53% 4.16% 4.64% 4.90% 4.01% 4.27% 3.90%
Income Statement
Financial Services
Financing Revenue
Operating Leases 6,519.0 4,879.0 3,312.0 2,454.0 2,689.0 3,409.1 3,545.5 3,620.3 3,719.8 3,837.0 3,932.9
Retail 3,270.0 2,940.0 2,335.0 2,059.0 1,889.0 1,851.2 1,906.8 1,916.3 1,938.3 1,957.7 1,999.8
Interest Supplements and Other Support Costs Earned from Affiliated Companies 4,774.0 3,725.0 3,226.0 2,800.0 2,401.0 2,160.9 2,139.3 2,160.7 2,135.8 2,199.9 2,249.4
Wholesale 1,721.0 921.0 894.0 952.0 920.0 910.8 942.7 971.0 985.5 994.9 1,012.3
Other 133.0 174.0 59.0 56.0 56.0 56.6 58.0 58.6 59.8 61.0 62.4
Other Revenue
Insurance Premiums Earned 140.0 100.0 98.0 100.0 105.0 118.7 121.0 123.7 124.3 125.5 126.0
Other Income, net 957.0 662.0 223.0 302.0 286.0 256.7 256.2 257.5 265.4 269.4 274.8
Total Financing Revenue $17,514.0 $13,401.0 $10,147.0 $8,723.0 $8,346.0 $8,763.9 $8,969.4 $9,108.0 $9,229.1 $9,445.5 $9,657.6
% YoY Growth (6.03%) (23.48%) (24.28%) (14.03%) (4.32%) 5.01% 2.34% 1.55% 1.33% 2.34% 2.25%
Depreciation on Vehicles Subject to Operating Leases 9,019.0 3,857.0 2,024.0 1,774.0 2,468.0 2,364.8 2,501.8 2,636.8 2,708.5 2,765.0 2,795.0
Interest Expense 7,634.0 5,162.0 4,222.0 3,507.0 3,027.0 2,892.1 2,959.9 2,823.5 2,768.7 2,833.6 2,897.3
Operating Expenses 1,548.0 1,262.0 1,149.0 1,076.0 1,004.0 876.4 896.9 910.8 922.9 944.5 965.8
Provision for Credit Losses 1,769.0 966.0 (269.0) (118.0) 7.0 26.3 26.9 27.3 27.7 28.3 29.0
Insurance Expenses 103.0 55.0 46.0 80.0 70.0 87.6 89.7 91.1 92.3 94.5 96.6
Income Before Income Taxes: Financial Serviecs ($2,559.0) $2,099.0 $2,975.0 $2,404.0 $1,770.0 $2,516.8 $2,494.1 $2,618.5 $2,708.9 $2,779.5 $2,874.0
% Revenue (14.61%) 15.66% 29.32% 27.56% 21.21% 28.72% 27.81% 28.75% 29.35% 29.43% 29.76%
Provision for Income Taxes (1,014.0) 724.0 1,106.0 609.0 483.0 830.5 823.1 864.1 893.9 917.2 948.4
Tax Rate 39.62% 34.49% 37.18% 25.33% 27.29% 33.00% 33.00% 33.00% 33.00% 33.00% 33.00%
Income from Continuing Operations (1,545.0) 1,375.0 1,869.0 1,795.0 1,287.0 1,686.2 1,671.1 1,754.4 1,815.0 1,862.3 1,925.6
Gain on Disposal of Discontinued Operations 9.0 2.0 - - - - - - - - -
Net Income Attributable to Financial Services ($1,536.0) $1,377.0 $1,869.0 $1,795.0 $1,287.0 $1,686.2 $1,671.1 $1,754.4 $1,815.0 $1,862.3 $1,925.6
Net Margin (8.77%) 10.28% 18.42% 20.58% 15.42% 19.24% 18.63% 19.26% 19.67% 19.72% 19.94%
Income Before Income Taxes: Total Company ($14,359.0) $4,068.0 $7,141.0 $8,686.0 $7,813.0 $10,469.0 $11,776.2 $13,012.9 $11,737.4 $12,955.4 $12,846.7
% Revenue (9.81%) 3.42% 5.52% 6.34% 5.79% 7.06% 7.65% 8.03% 6.94% 7.35% 6.96%
Provision for/(Benefit From) Income Taxes (62.0) 69.0 592.0 (11,541.0) 2,056.0 2,977.6 3,375.6 3,774.5 3,512.2 3,970.0 4,089.8
Tax Rate .43% 1.70% 8.29% (132.87%) 26.32% 28.44% 28.66% 29.01% 29.92% 30.64% 31.84%
Income/(Loss) from Continuing Operations (14,297.0) 3,999.0 6,549.0 20,227.0 5,757.0 7,491.4 8,400.5 9,238.4 8,225.2 8,985.4 8,756.9
Income/(Loss) from Discontinued Operations 9.0 5.0 - - - - - - - - -
Net Income (14,288.0) 4,004.0 6,549.0 20,227.0 5,757.0 7,491.4 8,400.5 9,238.4 8,225.2 8,985.4 8,756.9
Less: Income/(Loss) Attributable to Noncontrolling Interests 214.0 245.0 (4.0) (9.0) (1.0) - - - - - -
Net Income Attributable to Ford Motor Company ($14,502.0) $3,759.0 $6,553.0 $20,236.0 $5,758.0 $7,491.4 $8,400.5 $9,238.4 $8,225.2 $8,985.4 $8,756.9
Net Margin (9.91%) 3.16% 5.06% 14.78% 4.27% 5.05% 5.45% 5.70% 4.87% 5.10% 4.74%
UOIG 18
Appendix 3 Statement of Cash Flows (Automotive)
Statement of Cash Flows: Automotive
Cash Flows From Operating Activities:
Net Income (Loss) (12,529.0) 2,874.0 4,676.0 18,441.0 4,469.0 5,805.2 6,729.5 7,484.0 6,410.2 7,123.1 6,831.3
(Income)/Loss of Discontinued Operations - (3.0) - - - - - - - - -

Depreciation and Special Tools Amortization 5,513.0 3,743.0 3,876.0 3,533.0 3,655.0 3,242.5 3,239.0 3,360.6 3,024.6 2,467.0 2,350.6
Provision for Deferred Income Taxes 3,561.0 590.0 300.0 (11,566.0) 1,444.0 700.1 168.8 857.5 (2,003.7) 144.6 167.7
Decrease/(Increase) in Intersector Receivables/Payables 885.0 (598.0) 321.0 642.0 899.0 899.0 899.0 899.0 899.0 899.0 899.0
Decrease/(Increase) in Accounts Receivable and Other Assets (1,473.0) 407.0 (988.0) (1,658.0) (2,335.0) (3,442.8) 1,027.1 (3,178.6) 1,674.5 (95.5) (849.2)
Decrease/(Increase) in Inventory (137.0) 2,201.0 (903.0) (367.0) (1,401.0) (1,008.8) (331.1) (1,234.0) (450.9) (456.4) (529.2)
Increase/(Decrease) in Accounts Payable and Accrued and Other Liabilities (13,557.0) (1,838.0) (1,311.0) (168.0) (520.0) 1,882.3 1,519.6 1,632.9 (1,075.6) (1,312.8) 1,984.0
Decrease/(Increase) in Equity Method Investments (139.0) 74.0 - - - - - - - - -
Other 1,208.0 128.0 (599.0) 738.0 662.0 - - - - - -
Other Amortization 274.0 174.0 703.0 80.0 43.0 - - - - - -
Impairment Charges 5,318.0 157.0 - - - - - - - - -
Held-for-Sale Impairment 421.0 650.0 - - - - - - - - -
U.S. Dealerships Goodwill Impairment 88.0 - - - - - - - - - -
Provision for Credit and Insurance Losses - - 51.0 2.0 6.0 - - - - - -
Net (Gain)/Loss on Extinguishment of Debt (170.0) (4,666.0) 844.0 60.0 - - - - - - -
Net (Gain)/Loss on Investment Securities 1,364.0 (385.0) (102.0) 76.0 (89.0) - - - - - -
Net (Gain)/Loss on Pension and OPEB Curtailment (2,714.0) (4.0) (29.0) - - - - - - - -
Net (Gain)/Loss on Settlement of U.S. Health Care Obligation - 248.0 - - - - - - - -
Dividends in Excess of Equity Investment Earnings 42.0 (38.0) (198.0) (169.0) 20.0 - - - - - -
Foreign Currency Adjustements (499.0) 415.0 (347.0) (35.0) (121.0) - - - - - -
Net (Gain)/Loss on Sale of Businesses 551.0 29.0 23.0 (410.0) 183.0 - - - - - -
Gain on Changes in Investments in Affiliates - - - - (780.0) - - - - - -
Stock Compensation 32.0 27.0 32.0 163.0 134.0 - - - - - -
Net Cash Provided by/(Used In) Operating Activities (11,961.0) 4,185.0 6,349.0 9,362.0 6,269.0 8,077.3 13,251.9 9,821.5 8,478.1 8,769.1 10,854.1
Cash Flows Used for Investing Activities:
Capital Expenditures (6,620.0) (4,545.0) (4,066.0) (4,272.0) (5,459.0) (5,441.0) (6,526.4) (5,197.2) (5,033.6) (6,505.9) (6,123.6)
Purchase of Securities (41,347.0) (52,882.0) (53,614.0) (44,353.0) (73,100.0) (55,805.5) (58,012.6) (61,143.7) (63,918.4) (66,727.0) (69,983.5)
Sales & Maturities of Securities 43,617.0 47,009.0 54,857.0 43,525.0 70,202.0 54,369.1 55,774.1 59,633.6 65,307.0 67,358.9 70,716.2
Cash Paid for Acquisitions (13.0) - - - - - - - - - -
Proceeds from Sale of Business 9,854.0 382.0 1,318.0 310.0 54.0 - - - - - -
Settlements of Derivatives 1,157.0 (76.0) (196.0) 135.0 (788.0) - - - - - -
Investing Activity (to)/From Financial Services 9.0 19.0 2,455.0 2,903.0 925.0 - - - - - -
Transfer of Cash Balances Upon Disposition of Discontinued/Held-for-Sale Operations (928.0) - (456.0) (69.0) - - - - - - -
Other 40.0 (698.0) 279.0 280.0 142.0 - - - - - -
Net Cash Provided by/(Used In) Investing Activities 5,769.0 (10,791.0) 577.0 (1,541.0) (8,024.0) (6,877.4) (8,764.9) (6,707.3) (3,645.0) (5,874.0) (5,390.8)
Cash Flows from Financing Activities of Continuing Operations:
Cash Dividends - - - - (763.0) (1,549.4) (1,549.4) (1,936.8) (2,905.2) (3,486.2) (3,873.6)
Purchases of Common Stock - - - - (125.0) - - - - - -
Sales of Common Stock 756.0 2,450.0 1,339.0 - - - - - - - -
Changes in Short-Term Debt 104.0 227.0 391.0 (396.0) 154.0 (0.0) - - - - -
Proceeds from Issuance of Other Debt 203.0 14,727.0 264.0 2,452.0 1,553.0 2,000.0 2,000.0 2,000.0 2,000.0 2,000.0 2,000.0
Principal Payments on Other Debt (594.0) (3,013.0) (9,144.0) (8,058.0) (810.0) (1,382.0) (689.0) (1,895.0) (1,476.0) (699.0) (699.0)
Payments on Notes/Transfer of Cash Equivalents to the UAW VEBA Trust (2,574.0) (6,002.0) - - - - - - - -
Other (252.0) (395.0) 292.0 70.0 31.0 - - - - - -
Net Cash Provided By/(Used In) Financing Activities 217.0 11,422.0 (12,860.0) (5,932.0) 40.0 (931.4) (238.4) (1,831.8) (2,381.2) (2,185.2) (2,572.6)
Effect of Exchange Rates on Cash & Cash Equivalents (309.0) 179.0 75.0 (231.0) - - - - - - -
Net Change in Intersector Receivables/Payables and Other Liabilities (840.0) (595.0) - - - - - - - - -
Net Increase/(Decrease) in Cash & Cash Equivalents (7,124.0) 4,400.0 (5,859.0) 1,658.0 (1,715.0) 268.5 4,248.6 1,282.4 2,452.0 709.9 2,890.7
Cash & Cash Equivalents at January 1 20,678.0 6,377.0 9,762.0 6,301.0 7,965.0 6,250.0 6,518.5 10,767.1 12,049.5 14,501.4 15,211.3
Net Increase/(Decrease) in Cash & Cash Equivalents (7,124.0) 4,400.0 (5,859.0) 1,658.0 (1,715.0) 268.5 4,248.6 1,282.4 2,452.0 709.9 2,890.7
Cash & Cash Equivalents at December 31 13,554.0 10,777.0 3,903.0 7,959.0 6,250.0 6,518.5 10,767.1 12,049.5 14,501.4 15,211.3 18,102.0
UOIG 19
Appendix 4 Statement of Cash Flows (Financial Services)
Statement of Cash Flows: Financial Services
Cash Flows Provided by Operating Activities:
Net Income/(Loss) (1,536.0) 1,377.0 1,869.0 1,795.0 1,287.0 1,686.2 1,671.1 1,754.4 1,815.0 1,862.3 1,925.6
(Income)/Loss of Discontinued Operations (9.0) (2.0) - - - - - - - - -

Provision for Deferred Income Taxes (1,681.0) (1,336.0) (266.0) 495.0 545.0 284.9 91.1 31.9 27.8 (233.6) 332.2
Decrease/(Increase) in Intersector Receivables/Payables (885.0) 598.0 (321.0) (642.0) (899.0) (899.0) (899.0) (899.0) (899.0) (899.0) (899.0)
Decrease/(Increase) in Accounts Receivable and Other Assets 2,446.0 2,205.0 1,683.0 722.0 713.0 (3,370.2) (3,217.1) 1,604.0 (4,917.3) (2,071.1) (2,201.3)
Increase/(Decrease) in Accounts Payable and Accrued and Other Liabilities 1,258.0 (994.0) 475.0 (450.0) 1,005.0 (12.1) 288.3 76.2 66.6 119.0 213.2
Other (666.0) 753.0 (587.0) (165.0) (211.0) - - - - - -
Other Amortization (643.0) (1,261.0) (1,019.0) (1,200.0) (1,018.0) - - - - - -
Impairment Charges 2,086.0 154.0 - - - - - - - - -
Provision for Credit and Insurance Losses 1,874.0 1,030.0 (216.0) (33.0) 86.0 - - - - - -
Net (Gain)/Loss on Extinguishment of Debt - (71.0) 139.0 68.0 14.0 - - - - - -
Net (Gain)/Loss on Investment Securities 12.0 (25.0) 19.0 6.0 (16.0) - - - - - -
Dividends in Excess of Equity Investment Earnings (4.0) (7.0) - - - - - - - - -
Foreign Currency Adjustements (4.0) (323.0) (1.0) (2.0) 5.0 - - - - - -
Net (Gain)/Loss on Sale of Businesses (29.0) 4.0 (5.0) (11.0) 4.0 - - - - - -
Stock Compensation 3.0 2.0 2.0 8.0 6.0 - - - - - -
Net Cash Flows Provided By/(Used In) Operating Activities 9,245.0 6,028.0 3,796.0 2,434.0 4,045.0 54.6 436.1 5,204.3 (1,198.4) 1,542.6 2,165.7
Cash Flows Used for Investing Activities:
Capital Expenditures (76.0) (16.0) (26.0) (21.0) (29.0) (21.9) (22.4) (22.8) (23.1) (23.6) (24.1)
Acquisitions of Retail and Other Finance Receivables and Operating Leases (44,562.0) (26,392.0) (28,811.0) (35,845.0) (39,151.0) (39,063.8) (40,608.8) (42,800.6) (44,742.9) (46,708.9) (48,988.4)
Collections of Retail and Other Finance Receivables and Operating Leases & Net Collections/(Acquisitions) of
Wholesale Receivables 45,215.0 48,021.0 42,433.0 31,954.0 31,098.0 42,087.6 42,840.4 40,247.9 49,139.7 49,272.4 50,936.9
Purchase of Securities (23,831.0) (27,555.0) (46,728.0) (24,370.0) (22,035.0) (22,786.2) (23,320.4) (23,680.7) (23,995.5) (24,558.2) (25,109.7)
Sales & Maturities of Securities 18,429.0 28,326.0 46,866.0 27,270.0 23,748.0 23,747.6 22,764.4 23,719.5 23,752.6 24,612.3 25,162.8
Proceeds From Sales of Retail and Other Finance Receivables and Operating Leases - 911.0 - - - - - - - - -
Proceeds from Sale of Business 3,698.0 374.0 - 23.0 12.0 - - - - - -
Settlements of Derivatives 1,376.0 554.0 159.0 218.0 51.0 - - - - - -
Other 276.0 321.0 85.0 185.0 (12.0) - - - - - -
Net Cash Provided by/(Used In) Investing Activities 525.0 24,544.0 13,978.0 (586.0) (6,318.0) 3,963.2 1,653.2 (2,536.7) 4,130.8 2,594.0 1,977.4
Cash Flows from Financing Activities of Continuing Operations:
Changes in Short-Term Debt (5,224.0) (6,162.0) (2,145.0) 3,237.0 1,054.0 1,009.8 439.6 296.6 259.1 652.0 458.2
Proceeds from Issuance of Other Debt 41,960.0 31,263.0 28,173.0 33,469.0 30,883.0 30,000.0 30,000.0 30,000.0 30,000.0 30,000.0 30,000.0
Principal Payments on Othe Debt (45,281.0) (56,508.0) (38,935.0) (35,037.0) (28,601.0) (29,744.8) (27,596.4) (28,282.6) (30,211.3) (29,756.6) (28,054.9)
Financing Activity To/(From) Automotive (9.0) (19.0) (2,455.0) (2,903.0) (925.0) - - - - - -
Other (352.0) (601.0) (192.0) 22.0 128.0 - - - - - -
Net Cash Provided By/(Used In) Financing Activities (8,906.0) (32,027.0) (15,554.0) (1,212.0) 2,539.0 1,265.0 2,843.3 2,014.0 47.8 895.4 2,403.3
Effect of Exchange Rates on Cash & Cash Equivalents (499.0) 291.0 (128.0) 72.0 51.0 - - - - - -
Net Change in Intersector Receivables/Payables and Other Liabilities 840.0 595.0 - - - - - - - - -
Cumulative Correction of Prior Period-Error - (630.0) - - - - - - - - -
Net Increase/(Decrease) in Cash & Cash Equivalents From Continuing Operations 1,205.0 (1,199.0) 2,092.0 708.0 317.0 5,282.8 4,932.6 4,681.7 2,980.2 5,032.0 6,546.3
Cash Flow from Discountinued Operations
Cash Flow from Operating Activities of Discontinued Operations - - - - - - - - - - -
Cash & Cash Equivalents at January 1 14,605.0 15,672.0 11,132.0 8,504.0 9,183.0 9,500.0 14,782.8 19,715.5 24,397.1 27,377.3 32,409.4
Net Increase/(Decrease) in Cash & Cash Equivalents 1,205.0 (1,199.0) 2,092.0 708.0 317.0 5,282.8 4,932.6 4,681.7 2,980.2 5,032.0 6,546.3
Cash & Cash Equivalents at December 31 15,810.0 14,473.0 13,224.0 9,212.0 9,500.0 14,782.8 19,715.5 24,397.1 27,377.3 32,409.4 38,955.7
UOIG 20
Appendix 5 Balance Sheet
Balance Sheet
Assets
Automotive
Current Assets
Cash and Cash Equivalents 6,377.0 10,309.0 6,301.0 7,965.0 6,247.0 6,518.5 10,767.1 12,049.5 14,501.4 15,211.3 18,102.0
Marketable Securities 9,296.0 15,169.0 14,207.0 14,984.0 18,178.0 16,741.6 14,503.2 12,993.0 14,381.6 15,013.6 15,746.3
Total Cash, Marketable and Loaned Securities 15,673.0 25,478.0 20,508.0 22,949.0 24,425.0 23,260.2 25,270.3 25,042.5 28,883.1 30,224.9 33,848.3
Receivables, net 3,464.0 3,708.0 3,992.0 4,219.0 5,361.0 6,440.0 5,275.0 5,965.0 6,410.0 6,330.0 6,975.7
Inventories 8,618.0 5,450.0 5,917.0 5,901.0 7,362.0 8,370.8 8,701.9 9,935.9 10,386.7 10,843.1 11,372.3
Deferred Income Taxes Receivable 302.0 511.0 359.0 1,791.0 3,488.0 4,185.4 4,350.9 5,203.8 3,195.9 3,336.3 3,499.2
Net Investment in Operating Leases - - 1,282.0 1,356.0 1,415.0 2,696.5 2,900.6 3,057.2 3,195.9 3,336.3 3,499.2
Other Current Assets 4,032.0 2,845.0 610.0 1,053.0 1,124.0 3,487.8 3,625.8 6,114.4 3,994.9 4,170.4 4,374.0
Current Receivable from Financial Services 2,035.0 2,568.0 1,700.0 878.0 - - - - - - -
Total Current Assets 34,124.0 40,560.0 34,368.0 38,147.0 43,175.0 48,440.8 50,124.5 55,318.7 56,066.5 58,241.1 63,568.6
Equity in Net Assets of Affiliated Companies 1,069.0 1,429.0 2,441.0 2,797.0 3,112.0 1,395.1 3,039.1 4,585.8 4,793.9 5,004.5 5,248.8
Net Property 28,352.0 24,596.0 23,027.0 22,229.0 24,813.0 24,775.8 25,701.0 25,050.6 24,505.7 25,943.9 27,095.4
Deferred Income Taxes 7,204.0 5,663.0 2,468.0 13,932.0 13,325.0 13,477.7 14,113.1 18,191.8 19,818.1 19,093.9 20,967.0
Net Tangible Assets - - 102.0 100.0 87.0 69.8 65.3 61.1 79.9 636.4 131.7
Goodwill and Other Net Intangible Assets 1,584.0 200.0 - - - - - - - -
Assets of Discontinued/Held-For-Sale Operations - 7,923.0 - - - - - - - -
Non-Current Receivable from Financial Services - 181.0 32.0 - - - - - - -
Other Assets 1,512.0 1,631.0 2,019.0 1,549.0 1,946.0 1,953.2 2,030.4 1,681.5 1,598.0 1,668.2 1,749.6
Total Automotive Assets 73,845.0 82,002.0 64,606.0 78,786.0 86,458.0 90,112.4 95,073.5 104,889.5 106,862.0 110,588.1 118,761.2
Financial Services
Cash and Cash Equivalents 15,672.0 11,132.0 8,504.0 9,183.0 9,412.0 14,782.8 19,715.5 24,397.1 27,377.3 32,409.4 38,955.7
Marketable Securities 8,607.0 6,864.0 6,759.0 3,835.0 2,106.0 3,067.4 2,511.4 2,550.2 2,307.3 2,361.4 2,414.4
Finance Receivables, net 96,101.0 79,705.0 73,265.0 73,330.0 75,770.0 79,522.8 82,668.0 81,015.4 85,890.4 88,830.3 90,978.5
Net Investment in Operating Leases 23,120.0 15,062.0 10,393.0 11,482.0 15,036.0 15,765.0 16,678.6 17,578.8 18,057.0 18,433.3 18,633.1
Retained Interest in Sold Receivables 92.0 - - - - - - - - - -
Equity in Net Assets of Affiliated Companies 523.0 121.0 128.0 139.0 134.0 134.0 134.0 134.0 134.0 132.2 144.9
Goodwill and Other Net Intangible Assets 9.0 - - - - - - - - -
Assets of Discontinued/Held-For-Sale Operations 198.0 - - - - - - - - - -
Receivable From Automotive - - - - 252.0 - - - - - -
Other Assets 7,345.0 6,228.0 4,221.0 3,605.0 3,450.0 3,067.4 3,139.3 3,187.8 3,230.2 2,361.4 2,414.4
Total Financial Services Assets 151,667.0 119,112.0 103,270.0 101,574.0 106,160.0 116,339.4 124,846.8 128,863.4 136,996.1 144,527.9 153,541.0
Intersector Elimination (2,535.0) (3,224.0) (2,083.0) (1,112.0) (252.0) - - - - - -
Total Assets 222,977.0 197,890.0 165,793.0 179,248.0 192,366.0 206,451.8 219,920.3 233,752.9 243,858.1 255,116.1 272,302.1
UOIG 21
Appendix 5 Balance Sheet (contd.)
Balance Sheet
Liabilities and Stockholders' Equity
Automotive
Trade Payables 10,635.0 11,210.0 13,466.0 14,015.0 15,107.0 15,346.5 15,228.3 16,050.2 16,778.6 17,515.8 18,370.7
Other Payables 2,167.0 2,148.0 1,544.0 2,734.0 3,044.0 3,348.3 4,350.9 4,585.8 4,793.9 4,587.5 4,811.4
Accrued Liabilities and Deferred Revenue 32,395.0 18,465.0 17,065.0 15,003.0 15,358.0 15,695.3 15,590.9 15,668.1 15,979.6 16,264.7 16,533.6
Deferred Income Taxes Payable 2,790.0 3,119.0 392.0 40.0 81.0 83.7 87.0 91.7 95.9 100.1 105.0
Debt Payable Within One Year 1,191.0 2,095.0 2,049.0 1,033.0 1,386.0 2,188.1 2,231.0 2,290.8 2,343.7 2,398.0 2,460.6
Current Payable to Financial Services - - - - 252.0 697.6 725.2 764.3 799.0 1,668.2 1,312.2
Total Current Liabilities 49,178.0 37,037.0 34,516.0 32,825.0 35,228.0 37,359.5 38,213.3 39,450.9 40,790.6 42,534.2 43,593.4
Long-Term Debt 24,655.0 32,321.0 17,028.0 12,061.0 12,870.0 15,641.3 15,051.6 14,508.2 15,544.9 15,155.5 15,899.8
Other Liabilities 24,815.0 23,260.0 23,016.0 26,910.0 30,549.0 31,550.1 32,289.7 32,788.7 30,465.1 28,336.4 28,972.8
Deferred Income Taxes 614.0 561.0 344.0 255.0 514.0 788.5 520.2 546.5 553.7 566.7 579.5
Liabilities of Discontinued/Held-For-Sale Operations - 5,356.0 - - - - - - - - -
Total Automotive Liabilities 99,262.0 98,535.0 74,904.0 72,051.0 79,161.0 85,339.4 86,074.9 87,294.2 87,354.3 86,592.9 89,045.4
Financial Services
Payables 1,970.0 1,236.0 1,352.0 975.0 1,157.0 1,139.3 1,345.4 1,366.2 1,384.4 1,416.8 1,545.2
Debt 128,842.0 98,671.0 85,112.0 86,595.0 90,802.0 91,057.2 93,460.9 95,178.3 94,967.0 95,210.3 97,155.4
Other Liabilities and Deferred Income 6,184.0 4,884.0 3,764.0 3,457.0 3,500.0 3,505.6 3,587.7 3,643.2 3,691.6 3,778.2 3,863.0
Liabilities of Discontinued/Held-For-Sale Operations 55.0 - - - - - - - - - -
Payable to Automotive 2,035.0 2,568.0 1,881.0 910.0 - - - - - - -
Total Financial Services Liabilities 142,366.0 109,094.0 93,614.0 93,238.0 97,146.0 97,674.0 100,457.0 102,282.5 102,165.6 102,294.4 104,784.9
Intersector Elimination (2,535.0) (3,224.0) (2,083.0) (1,112.0) (252.0) - - - - - -
Total Liabilities 239,093.0 204,405.0 166,435.0 164,177.0 176,055.0 183,013.4 186,531.9 189,576.7 189,520.0 188,887.3 193,830.3
Minority Interests 1,195.0 - - - 322.0 - - - - - -
Stockholders' Equity
Capital Stock
Common Stock, Par Value $0.01 per share (2,341 million shares issued of 6 billion authorized) 23.0 33.0 37.0 37.0 39.0 39.0 39.0 39.0 39.0 39.0 39.0
Class B Stock, Par Value $0.01 per share (71 million shares issued of 530 million authorized) 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0
Capital in Excess of Par Value of Stock 9,076.0 16,786.0 20,803.0 20,905.0 20,976.0 20,976.0 20,976.0 20,976.0 20,976.0 20,976.0 20,976.0
Accumulated Other Comprehensive Income/(Loss) (10,085.0) (10,864.0) (14,313.0) (18,734.0) (22,854.0) (22,854.0) (22,854.0) (22,854.0) (22,854.0) (22,854.0) (22,854.0)
Treasury Stock (181.0) (177.0) (163.0) (166.0) (292.0) (292.0) (292.0) (292.0) (292.0) (292.0) (292.0)
Dividends Paid - - - - (763.0) (1,549.4) (1,549.4) (1,936.8) (2,905.2) (3,486.2) (3,873.6)
Retained Earnings/(Accumulated Defecit) (16,145.0) (13,599.0) (7,038.0) 12,985.0 18,077.0 27,117.8 37,067.8 48,243.0 59,373.3 71,844.9 84,475.4
Total Equity/(Defecit) Attributable to Ford Motor Company (17,311.0) (7,820.0) (673.0) 15,028.0 15,947.0 23,438.4 33,388.4 44,176.2 54,338.1 66,228.7 78,471.8
Equity/(Defecit) Attributable to Noncontrolling Interests - 1,305.0 31.0 43.0 42.0 - - - - - -
Total Equity/(Defecit) (17,311.0) (6,515.0) (642.0) 15,071.0 15,989.0 23,438.4 33,388.4 44,176.2 54,338.1 66,228.7 78,471.8
Total Liabilities and Stockholders' Equity 222,977.0 197,890.0 165,793.0 179,248.0 192,366.0 206,451.8 219,920.3 233,752.9 243,858.1 255,116.0 272,302.1
UOIG 22
Appendix 6 Discounted Cash Flows Analysis
Discounted Cash Flow Analysis
Total Company Revenue 146,314.0 118,901.0 129,447.0 136,923.0 134,946.0 148,277.6 154,000.9 161,967.3 169,025.1 176,262.9 184,616.3
% YoY Growth (18.74%) 8.87% 5.78% (1.44%) 9.88% 3.86% 5.17% 4.36% 4.28% 4.74%
Cost of Goods Sold 121,107.0 95,123.0 100,575.0 109,812.0 108,923.0 122,772.0 127,410.2 134,516.2 140,620.5 145,548.2 153,526.2
% Total Revenue 82.77% 80.00% 77.70% 80.20% 80.72% 82.80% 82.73% 83.05% 83.20% 82.57% 83.16%
Gross Profit $25,207.0 $23,778.0 $28,872.0 $27,111.0 $26,023.0 $25,505.6 $26,590.7 $27,451.1 $28,404.6 $30,714.7 $31,090.0
Gross Margin 17.23% 20.00% 22.30% 19.80% 19.28% 17.20% 17.27% 16.95% 16.80% 17.43% 16.84%
Selling, Administrative, and Other Expenses 11,356.0 8,583.0 9,040.0 9,060.0 9,006.0 9,766.0 9,934.7 9,095.1 10,946.0 11,677.2 11,984.7
% Total Revenue 7.76% 7.22% 6.98% 6.62% 6.67% 6.59% 6.45% 5.62% 6.48% 6.62% 6.49%
Depreciation on Leased Vehicles 9,019.0 3,857.0 2,024.0 1,774.0 2,468.0 2,364.8 2,501.8 2,636.8 2,708.5 2,765.0 2,795.0
% Total Revenue 6.16% 3.24% 1.56% 1.30% 1.83% 1.59% 1.62% 1.63% 1.60% 1.57% 1.51%
% Total Revenue 3.77% 3.15% 2.99% 2.58% 2.71% 2.19% 2.10% 2.07% 1.79% 1.40% 1.27%
Operating Expenses 1,548.0 1,262.0 1,149.0 1,076.0 1,004.0 876.4 896.9 910.8 922.9 944.5 965.8
% Total Revenue 1.06% 1.06% .89% .79% .74% .59% .58% .56% .55% .54% .52%
Provision for Credit Losses 1,769.0 966.0 (269.0) (118.0) 7.0 26.3 26.9 27.3 27.7 28.3 29.0
% Financial Services Revenue 10.10% 7.21% (2.65%) (1.35%) .08% .30% .30% .30% .30% .30% .30%
Insurance Expenses 103.0 55.0 46.0 80.0 70.0 87.6 89.7 91.1 92.3 94.5 96.6
% Financial Services Revenue .59% .41% .45% .92% .84% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00%
Earnings Before Interest & Taxes ($4,101.0) $5,312.0 $13,006.0 $11,706.0 $9,813.0 $9,142.1 $9,901.7 $11,329.3 $10,682.5 $12,738.1 $12,868.5
Operating Margin (2.80%) 4.47% 10.05% 8.55% 7.27% 6.17% 6.43% 6.99% 6.32% 7.23% 6.97%
Interest Expense (Automotive Segment) 2,061.0 1,515.0 1,807.0 817.0 713.0 209.3 217.5 382.1 399.5 417.0 437.4
% Automotive Revenue 1.60% 1.44% 1.51% .64% .56% .15% .15% .25% .25% .25% .25%
Interest Expense (Financial Segment) 7,634.0 5,162.0 4,222.0 3,507.0 3,027.0 2,892.1 2,959.9 2,823.5 2,768.7 2,833.6 2,897.3
% Financial Services Revenue 43.59% 38.52% 41.61% 40.20% 36.27% 33.00% 33.00% 31.00% 30.00% 30.00% 30.00%
Net Interest (Income) (726.0) 5,288.0 (362.0) 825.0 1,185.0 697.6 725.2 764.3 799.0 834.1 874.8
% Revenue (.50%) 4.45% (.28%) .60% .88% .47% .47% .47% .47% .47% .47%
Earnings Before Taxes (13,070.0) (6,653.0) 7,339.0 6,557.0 4,888.0 8,235.2 8,959.0 10,182.9 9,484.0 11,487.0 11,556.3
% Revenue (8.93%) (5.60%) 5.67% 4.79% 3.62% 5.55% 5.82% 6.29% 5.61% 6.52% 6.26%
Less Taxes (Benefits) (62.0) 69.0 592.0 (11,541.0) 2,056.0 2,977.6 3,375.6 3,774.5 3,512.2 3,970.0 4,089.8
Tax Rate 0.47% (1.04%) 8.07% (176.01%) 42.06% 36.16% 37.68% 37.07% 37.03% 34.56% 35.39%
Net Income ($13,008.0) ($6,722.0) $6,747.0 $18,098.0 $2,832.0 $5,257.6 $5,583.4 $6,408.3 $5,971.8 $7,517.0 $7,466.5
Net Margin (8.89%) (5.65%) 5.21% 13.22% 2.10% 3.55% 3.63% 3.96% 3.53% 4.26% 4.04%
Add Back: Depreciation and Amortization 14,532.0 7,600.0 5,900.0 5,307.0 6,123.0 5,607.2 5,740.8 5,997.4 5,733.2 5,232.0 5,145.5
Add Back: Interest Expense*(1-Tax Rate) 2,051.2 1,530.7 1,661.2 2,255.0 413.1 133.6 135.6 240.5 251.5 272.9 282.6
Operating Cash Flow $3,575.2 $2,408.7 $14,308.2 $25,660.0 $9,368.1 $10,998.4 $11,459.8 $12,646.3 $11,956.5 $13,021.9 $12,894.6
% Revenue 2.44% 2.03% 11.05% 18.74% 6.94% 7.42% 7.44% 7.81% 7.07% 7.39% 6.98%
Current Automotive & Financial Assets 137672.0 109849.0 97518.0 100010.0 109556.0 120468.4 124200.9 128870.5 131130.8 135279.9 139331.9
% Total Revenue 94.09% 92.39% 75.33% 73.04% 81.19% 81.25% 80.65% 79.57% 77.58% 76.75% 75.47%
Current Automotive & Financial Liabilities 123,201.0 86,762.0 80,755.0 77,283.0 78,323.0 83,731.0 86,002.2 88,036.9 89,705.1 92,013.9 94,612.1
% Total Revenue 84.20% 72.97% 62.38% 56.44% 58.04% 56.47% 55.85% 54.35% 53.07% 52.20% 51.25%
Net Working Capital 14,471.0 23,087.0 16,763.0 22,727.0 31,233.0 36,737.5 38,198.7 40,833.6 41,425.7 43,266.0 44,719.9
% Revenue 9.89% 19.42% 12.95% 16.60% 23.14% 24.78% 24.80% 25.21% 24.51% 24.55% 24.22%
Change in Working Capital 8,616.0 (6,324.0) 5,964.0 8,506.0 5,504.5 1,461.2 2,634.9 592.2 1,840.3 1,453.9
Capital Expenditures 6,696.0 4,561.0 4,092.0 4,293.0 5,462.9 6,548.8 5,220.0 5,056.6 6,529.5 6,147.7
% Revenue 5.63% 3.52% 2.99% 3.18% 3.68% 4.25% 3.22% 2.99% 3.70% 3.33%
Acquisitions - - - - - - - - - -
% Revenue - - - - - - - - - -
Unlevered Free Cash Flow $3,575.2 ($12,903.3) $16,071.2 $15,604.0 ($3,430.9) $31.0
UOIG $4,791.4
$3,449.7
23 $6,307.7 $4,652.2 $5,293.1
Discounted Free Cash Flow $3,261.6 $4,283.3 $5,331.5 $3,717.8 $3,999.4
Appendix 7 Revenue Model
Automotive Revenue Model
(Revenues in $millions, Unit Sales in $thousands) 2008A 2009A 2010A 2011A 2012A 2013A 2014E 2015E 2016E 2017E 2018E
Ford North America Wholesale Units
United States Unit Sales 1,825.0 1,563.0 1,947.0 2,224.0 2,302.0 2,693.3 2,801.1 2,899.1 2,957.1 3,031.0 3,106.8
% YoY Unit Sales Growth (22.77%) (14.36%) 24.57% 14.23% 3.51% 17.00% 4.00% 3.50% 2.00% 2.50% 2.50%
United States Revenue 44,842.4 42,048.6 54,209.6 64,526.1 68,990.9 77,692.4 81,204.1 85,853.2 88,883.9 92,244.8 96,583.7
% YoY Growth (25.98%) (6.23%) 28.92% 19.03% 6.92% 12.61% 4.52% 5.73% 3.53% 3.78% 4.70%
% of North America Unit Sales 84.61% 83.76% 84.18% 86.03% 86.35% 87.22% 87.50% 87.72% 87.78% 87.88% 87.93%
Canada Unit Sales 198.0 223.0 278.0 273.0 281.0 303.5 308.0 312.7 317.3 321.3 327.7
% YoY Unit Sales Growth (18.52%) 12.63% 24.66% (1.80%) 2.93% 8.00% 1.50% 1.50% 1.50% 1.25% 2.00%
Canada Revenue 4,865.1 5,999.2 7,740.3 7,920.7 8,421.6 8,754.2 8,930.0 9,258.8 9,538.6 9,778.6 10,188.6
% YoY Growth (21.91%) 23.31% 29.02% 2.33% 6.32% 3.95% 2.01% 3.68% 3.02% 2.52% 4.19%
% North America Unit Sales 9.18% 11.95% 12.02% 10.56% 10.54% 9.83% 9.62% 9.46% 9.42% 9.32% 9.28%
Mexico Unit Sales 134.0 80.0 88.0 88.0 83.0 91.3 92.2 93.1 94.3 96.7 98.7
% YoY Unit Sales Growth (4.29%) (40.30%) 10.00% 0.00% (5.68%) 10.00% 1.00% 1.00% 1.25% 2.50% 2.15%
Mexico Revenue 3,292.5 2,152.2 2,450.2 2,553.2 2,487.5 2,633.7 2,673.3 2,758.1 2,834.4 2,941.6 3,069.5
% YoY Growth (8.26%) (34.63%) 13.84% 4.21% (2.57%) 5.88% 1.51% 3.17% 2.77% 3.78% 4.35%
% North America Unit Sales 6.21% 4.29% 3.80% 3.40% 3.11% 2.96% 2.88% 2.82% 2.80% 2.80% 2.79%
Total Unit Sales 2,157.0 1,866.0 2,313.0 2,585.0 2,666.0 3,088.1 3,201.3 3,304.9 3,368.7 3,449.0 3,533.3
% YoY Growth (25.36%) (13.49%) 23.95% 11.76% 3.13% 15.83% 3.67% 3.24% 1.93% 2.38% 2.44%
Revenue/Vehicle 24.6 26.9 27.8 29.0 30.0 28.8 29.0 29.6 30.1 30.4 31.1
% YoY Growth (4.16%) 9.49% 3.49% 4.21% 3.30% (3.75%) .50% 2.15% 1.50% 1.25% 2.15%
Total Ford North America Revenue 53,000.0 50,200.0 64,400.0 75,000.0 79,900.0 89,080.3 92,807.3 97,870.1 101,256.9 104,965.0 109,841.8
% YoY Growth (24.72%) (5.28%) 28.29% 16.46% 6.53% 11.49% 4.18% 5.46% 3.46% 3.66% 4.65%
Ford South America Wholesale Units
Brazil Unit Sales 297.0 336.0 358.0 346.0 336.0 361.2 368.4 379.5 386.1 391.3 397.4
% YoY Unit Sales Growth 15.12% 13.13% 6.55% (3.35%) (2.89%) 7.50% 2.00% 3.00% 1.75% 1.35% 1.55%
Brazil Revenue 5,940.0 6,067.7 7,247.9 7,521.7 6,814.5 7,288.9 7,471.9 7,773.0 8,063.2 8,417.3 8,740.0
% YoY Growth 32.69% 2.15% 19.45% 3.78% (9.40%) 6.96% 2.51% 4.03% 3.73% 4.39% 3.83%
% South America Unit Sales 68.28% 75.85% 73.21% 68.38% 67.47% 67.17% 67.32% 67.75% 67.70% 67.76% 67.65%
Argentina Unit Sales 77.0 66.0 85.0 105.0 107.0 119.3 119.9 120.5 122.9 123.8 126.3
% YoY Unit Sales Growth - (14.29%) 28.79% 23.53% 1.90% 11.50% 0.50% 0.50% 2.00% 0.75% 2.00%
Argentina Revenue 1,540.0 1,191.9 1,720.9 2,282.6 2,170.1 2,407.5 2,431.7 2,468.3 2,566.7 2,663.6 2,778.0
% YoY Growth (95.43%) (22.61%) 44.38% 32.64% (4.93%) 10.94% 1.00% 1.50% 3.99% 3.77% 4.29%
Other Unit Sales 61.0 41.0 46.0 55.0 55.0 57.2 58.9 60.1 61.3 62.4 63.7
Other Revenue 1,220.0 740.4 931.3 1,195.7 1,115.5 1,154.3 1,194.9 1,230.9 1,280.0 1,341.5 1,401.2
% YoY Growth (31.74%) (39.31%) 25.78% 28.39% -6.71% 3.48% 3.52% 3.02% 3.99% 4.80% 4.45%
Total Unit Sales 435.0 443.0 489.0 506.0 498.0 537.7 547.2 560.1 570.3 577.5 587.4
% YoY Growth (0.68%) 1.84% 10.38% 3.48% (1.58%) 7.97% 1.77% 2.34% 1.83% 1.26% 1.71%
Revenue/Vehicle 20.0 18.1 20.2 21.7 20.3 20.2 20.3 20.5 20.9 21.5 22.0
% YoY Growth 15.26% (9.71%) 12.11% 7.38% (6.71%) (0.50%) 0.50% 1.00% 1.95% 3.00% 2.25%
Total Ford South America Revenue 8,700.0 8,000.0 9,900.0 11,000.0 10,100.0 10,850.7 11,098.4 11,472.2 11,910.0 12,422.3 12,919.2
% YoY Growth 14.47% (8.05%) 23.75% 11.11% (8.18%) 7.43% 2.28% 3.37% 3.82% 4.30% 4.00%
UOIG 24
Appendix 7 Revenue Model (contd.)
Ford Europe Wholesale Units
Britain Unit Sales 415.0 354.0 341.0 342.0 337.0 348.8 354.0 375.3 394.0 407.8 417.0
% YoY Unit Sales Growth 0.24% (14.70%) (3.67%) 0.29% (1.46%) 3.50% 1.50% 6.00% 5.00% 3.50% 2.25%
Britain Revenue 8,892.9 6,614.9 6,395.1 7,215.7 6,625.4 7,148.8 7,292.3 7,807.1 8,443.4 8,913.7 9,296.5
% YoY Growth 13.50% (25.62%) (3.32%) 12.83% (8.18%) 7.90% 2.01% 7.06% 8.15% 5.57% 4.30%
% European Unit Sales 22.80% 22.58% 21.68% 21.35% 24.91% 25.64% 25.69% 26.42% 26.90% 27.29% 27.20%
Germany Unit Sales 250.0 286.0 216.0 250.0 208.0 205.9 208.0 214.4 221.9 227.0 232.7
% YoY Unit Sales Growth 8.70% 14.40% (24.48%) 15.74% (16.80%) (1.00%) 1.00% 3.10% 3.50% 2.30% 2.50%
Germany Revenue 5,357.1 5,344.3 4,050.9 5,274.7 4,089.3 4,220.4 4,284.0 4,460.9 4,755.6 4,962.3 5,188.0
% YoY Growth 23.07% (0.24%) (24.20%) 30.21% (22.47%) 3.21% 1.51% 4.13% 6.60% 4.35% 4.55%
Turkey Unit Sales 78.0 79.0 130.0 140.0 108.0 103.1 103.7 104.2 104.7 105.7 107.3
% YoY Unit Sales Growth (22.00%) 1.28% 64.56% 7.69% (22.86%) (4.50%) 0.50% 0.50% 0.50% 1.00% 1.50%
Turkey Revenue 1,671.4 1,476.2 2,438.0 2,953.8 2,123.3 2,113.9 2,135.1 2,167.2 2,243.4 2,311.2 2,392.8
% YoY Growth (11.69%) (11.68%) 65.15% 21.16% (28.12%) (0.44%) 1.00% 1.51% 3.52% 3.02% 3.53%
Russia Unit Sales 183.0 74.0 93.0 124.0 134.0 142.0 146.3 150.7 153.7 157.5 162.3
% YoY Unit Sales Growth 1.67% (59.56%) 25.68% 33.33% 8.06% 6.00% 3.00% 3.00% 2.00% 2.50% 3.00%
Russia Revenue 3,921.4 1,382.8 1,744.1 2,616.2 2,634.4 2,911.2 3,013.5 3,135.0 3,293.6 3,443.5 3,617.7
% YoY Growth 15.11% (64.74%) 26.13% 50.00% 0.70% 10.51% 3.52% 4.03% 5.06% 4.55% 5.06%
Other Unit Sales 894.0 775.0 793.0 746.0 566.0 560.3 565.9 575.8 590.2 596.1 614.0
% YoY Unit Sales Growth (10.06%) (13.31%) 2.32% (5.93%) (24.13%) (1.00%) 1.00% 1.75% 2.50% 1.00% 3.00%
Other Revenue 19,157.1 14,481.8 14,871.9 15,739.6 11,127.6 11,484.5 11,657.3 11,979.9 12,647.8 13,029.8 13,689.1
% YoY Growth 1.83% (24.41%) 2.69% 5.83% (29.30%) 3.21% 1.50% 2.77% 5.58% 3.02% 5.06%
Total Unit Sales 1,820.0 1,568.0 1,573.0 1,602.0 1,353.0 1,360.2 1,377.9 1,420.4 1,464.6 1,494.3 1,533.3
% YoY Growth (5.11%) (13.85%) 0.32% 1.84% (15.54%) 0.53% 1.30% 3.08% 3.11% 2.03% 2.61%
Revenue/Vehicle 21.4 18.7 18.8 21.1 19.7 20.5 20.6 20.8 21.4 21.9 22.3
% YoY Growth 13.22% (12.80%) 0.36% 12.50% (6.82%) 4.25% 0.50% 1.00% 3.00% 2.00% 2.00%
Total Ford Europe Revenue 39,000.0 29,300.0 29,500.0 33,800.0 26,600.0 27,878.8 28,382.2 29,550.2 31,383.8 32,660.3 34,184.1
% YoY Growth 7.44% (24.87%) 0.68% 14.58% (21.30%) 4.81% 1.81% 4.12% 6.21% 4.07% 4.67%
UOIG 25
Ford Asia Pacific Africa Wholesale Units
China Unit Sales 251.0 345.0 483.0 519.0 627.0 846.5 931.1 996.3 1,066.0 1,140.6 1,197.7
% YoY Unit Sales Growth 23.65% 37.45% 40.00% 7.45% 20.81% 35.00% 10.00% 7.00% 7.00% 7.00% 5.00%
China Revenue 3,019.5 3,198.7 4,265.2 4,838.6 6,069.7 7,579.5 8,358.3 9,211.7 10,147.3 11,291.9 12,194.4
% YoY Growth 13.68% 5.93% 33.34% 13.45% 25.44% 24.88% 10.28% 10.21% 10.16% 11.28% 7.99%
% Asia Pacific Africa Unit Sales 47.18% 57.12% 57.64% 57.60% 60.70% 64.76% 65.59% 65.95% 66.56% 67.33% 67.70%
India Unit Sales 29.0 30.0 84.0 96.0 87.0 105.3 111.6 115.2 119.8 124.5 129.3
% YoY Unit Sales Growth (25.64%) 3.45% 180.00% 14.29% (9.38%) 21.00% 6.00% 3.20% 4.00% 3.95% 3.85%
India Revenue 348.9 278.1 741.8 895.0 842.2 942.6 1,001.7 1,064.8 1,140.0 1,232.5 1,316.4
% YoY Growth (31.63%) (20.27%) 166.68% 20.66% (5.90%) 11.93% 6.26% 6.30% 7.07% 8.11% 6.81%
Australia Unit Sales 102.0 92.0 104.0 83.0 94.0 108.1 115.7 118.0 122.2 124.6 128.0
% YoY Unit Sales Growth (5.56%) (9.80%) 13.04% (20.19%) 13.25% 15.00% 7.00% 2.00% 3.55% 2.00% 2.75%
Australia Revenue 1,227.1 853.0 918.4 773.8 910.0 968.0 1,038.3 1,090.9 1,162.9 1,233.6 1,303.7
% YoY Growth (13.16%) (30.49%) 7.67% (15.74%) 17.60% 6.38% 7.27% 5.06% 6.60% 6.08% 5.68%
South Africa Unit Sales 51.0 38.0 45.0 49.0 49.0 52.9 53.4 54.1 54.7 55.3 56.2
South Africa Revenue 613.5 352.3 397.4 456.8 474.3 473.9 479.8 499.9 521.1 547.3 572.2
% YoY Growth (23.13%) (42.58%) 12.79% 14.96% 3.84% (.10%) 1.25% 4.18% 4.24% 5.04% 4.55%
ASEAN Unit Sales 36.0 38.0 51.0 74.0 95.0 109.3 121.3 139.5 150.6 158.9 165.3
% YoY Unit Sales Growth (7.69%) 5.56% 34.21% 45.10% 28.38% 15.00% 11.00% 15.00% 8.00% 5.50% 4.00%
ASEAN Revenue 433.1 352.3 450.4 689.9 919.7 978.3 1,088.6 1,289.5 1,433.7 1,573.0 1,682.6
% YoY Growth (15.13%) (18.65%) 27.83% 53.19% 33.30% 6.38% 11.28% 18.45% 11.19% 9.72% 6.96%
Other Unit Sales 63.0 61.0 71.0 80.0 81.0 85.1 86.5 87.6 88.3 90.0 92.7
% YoY Unit Sales Growth (25.88%) (3.17%) 16.39% 12.68% 1.25% 5.00% 1.75% 1.25% .75% 2.00% 3.00%
Other Revenue 757.9 565.6 627.0 745.8 784.1 761.6 776.8 810.2 840.3 891.4 944.3
% YoY Growth (31.85%) (25.38%) 10.86% 18.96% 5.13% (2.88%) 2.00% 4.29% 3.72% 6.08% 5.94%
Total Unit Sales 532.0 604.0 838.0 901.0 1,033.0 1,307.0 1,419.6 1,510.6 1,601.6 1,694.0 1,769.2
% YoY Growth (.56%) 13.53% 38.74% 7.52% 14.65% 26.53% 8.61% 6.41% 6.03% 5.77% 4.44%
Revenue/Vehicle 12.0 9.3 8.8 9.3 9.7 9.0 9.0 9.2 9.5 9.9 10.2
% YoY Growth (8.06%) (22.93%) (4.76%) 5.58% 3.84% (7.50%) .25% 3.00% 2.95% 4.00% 2.85%
Total Asia Pacific Africa Revenue 6,400.0 5,600.0 7,400.0 8,400.0 10,000.0 11,703.9 12,743.6 13,966.8 15,245.3 16,769.8 18,013.6
% YoY Growth (8.57%) (12.50%) 32.14% 13.51% 19.05% 17.04% 8.88% 9.60% 9.15% 10.00% 7.42%
Ford Sold/Discontinued Brand Units
Units 484.0 324.0 - - - - - - - - -
% YoY Growth (37.47%) (33.06%) (100.00%) - - - - - - - -
Total Sold/Discontinued Brand Revenue 21,700.0 12,400.0 8,100.0 - - - - - - - -
% YoY Growth 21.91% (42.86%) - - - - - - - - -
Total Global Unit Sales 5,428.0 4,805.0 5,213.0 5,594.0 5,550.0 6,293.1 6,546.1 6,795.9 7,005.2 7,214.8 7,423.2
% YoY Growth (3.71%) (11.48%) 8.49% 7.31% (.79%) 13.39% 4.02% 3.82% 3.08% 2.99% 2.89%
Total Global Automotive Revenue 128,800.0 105,500.0 119,300.0 128,200.0 126,600.0 139,513.7 145,031.5 152,859.3 159,796.0 166,817.4 174,958.7
% YoY Growth (7.40%) (18.09%) 13.08% 7.46% (1.25%) 10.20% 3.96% 5.40% 4.54% 4.39% 4.88%
UOIG 26
Financial Services Revenue Model
Financing Revenue
Operating Leases 6,519.0 4,879.0 3,312.0 2,454.0 2,689.0 3,409.1 3,545.5 3,620.3 3,719.8 3,837.0 3,932.9
% YoY Growth 2.77% (25.16%) (32.12%) (25.91%) 9.58% 26.78% 4.00% 2.11% 2.75% 3.15% 2.50%
Retail 3,270.0 2,940.0 2,335.0 2,059.0 1,889.0 1,851.2 1,906.8 1,916.3 1,938.3 1,957.7 1,999.8
% YoY Growth (5.90%) (10.09%) (20.58%) (11.82%) (8.26%) (2.00%) 3.00% 0.50% 1.15% 1.00% 2.15%
Interest Supplements and Other Support Costs 4,774.0 3,725.0 3,226.0 2,800.0 2,401.0 2,160.9 2,139.3 2,160.7 2,135.8 2,199.9 2,249.4
% YoY Growth 3.96% (21.97%) (13.40%) (13.21%) (14.25%) (10.00%) (1.00%) 1.00% (1.15%) 3.00% 2.25%
Wholesale 1,721.0 921.0 894.0 952.0 920.0 910.8 942.7 971.0 985.5 994.9 1,012.3
% YoY Growth (19.28%) (46.48%) (2.93%) 6.49% (3.36%) (1.00%) 3.50% 3.00% 1.50% 0.95% 1.75%
Other 133.0 174.0 59.0 56.0 56.0 56.6 58.0 58.6 59.8 61.0 62.4
% YoY Growth 75.00% 30.83% (66.09%) (5.08%) 0.00% 1.00% 2.50% 1.10% 2.00% 2.00% 2.25%
Other Revenue
Insurance Premiums Earned 140.0 100.0 98.0 100.0 105.0 118.7 121.0 123.7 124.3 125.5 126.0
% YoY Growth (17.16%) (28.57%) (2.00%) 2.04% 5.00% 13.00% 2.00% 2.20% 0.50% 1.00% 0.35%
Other Income, Net 957.0 662.0 223.0 302.0 286.0 256.7 256.2 257.5 265.4 269.4 274.8
% YoY Growth (45.41%) (30.83%) (66.31%) 35.43% (5.30%) (10.25%) (0.20%) 0.50% 3.10% 1.50% 2.00%
Total Financing Revenue 17,514.0 13,401.0 10,147.0 8,723.0 8,346.0 8,763.9 8,969.4 9,108.0 9,229.1 9,445.5 9,657.6
% YoY Growth (5.53%) (23.48%) (24.28%) (14.03%) (4.32%) 5.01% 2.34% 1.55% 1.33% 2.34% 2.25%
Ford Motor Company Total Revenue

($ in millions) 2008A 2009A 2010A 2011A 2012A 2013A 2014E 2015E 2016E 2017E 2018E
Automobile Revenue 128,800.0 105,500.0 119,300.0 128,200.0 126,600.0 139,513.7 145,031.5 152,859.3 159,796.0 166,817.4 174,958.7
% YoY Growth (16.58%) (18.09%) 13.08% 7.46% (1.25%) 10.20% 3.96% 5.40% 4.54% 4.39% 4.88%
Financing Revenue 17,514.0 13,401.0 10,147.0 8,723.0 8,346.0 8,763.9 8,969.4 9,108.0 9,229.1 9,445.5 9,657.6
% YoY Growth 5.39% (23.48%) (24.28%) (14.03%) (4.32%) 5.01% 2.34% 1.55% 1.33% 2.34% 2.25%
Total Ford Motor Company Revenue 146,314.0 118,901.0 129,447.0 136,923.0 134,946.0 148,277.6 154,000.9 161,967.3 169,025.1 176,262.9 184,616.3
% YoY Growth (5.22%) (18.74%) 8.87% 5.78% (1.44%) 9.88% 3.86% 5.17% 4.36% 4.28% 4.74%
UOIG 27
Appendix 8 Working Capital Model
Working Capital Model
Total Automotive Revenue $128,800.0 $105,500.0 $119,300.0 $128,200.0 $126,600.0 $139,513.7 $145,031.5 $152,859.3 $159,796.0 $166,817.4 $174,958.7
Total Financial Services Revenue $17,514.0 $13,401.0 $10,147.0 $8,723.0 $8,346.0 $8,763.9 $8,969.4 $9,108.0 $9,229.1 $9,445.5 $9,657.6
Total Ford Motor Company Revenue $146,314.0 $118,901.0 $129,447.0 $136,923.0 $134,946.0 $148,277.6 $154,000.9 $161,967.3 $169,025.1 $176,262.9 $184,616.3
Current Assets
Automotive
Current Assets
Receivables, net 3,464.0 3,708.0 3,992.0 4,219.0 5,361.0 6,440.0 5,275.0 5,965.0 6,410.0 6,330.0 6,975.7
Days Sales Outstanding A/R 8.7 11.4 11.3 11.2 14.5 15.9 12.5 13.5 13.8 13.1 13.8
% of Automotive Revenue 2.69% 3.51% 3.35% 3.29% 4.23% 4.62% 3.64% 3.90% 4.01% 3.79% 3.99%
Inventories 8,618.0 5,450.0 5,917.0 5,901.0 7,362.0 8,370.8 8,701.9 9,935.9 10,386.7 10,843.1 11,372.3
Days Inventory Outstanding 26.0 20.9 21.5 19.6 24.7 24.9 24.9 27.0 27.0 27.2 27.0
Deferred Income Taxes Receivable 302.0 511.0 359.0 1,791.0 3,488.0 4,185.4 4,350.9 5,203.8 3,195.9 3,336.3 3,499.2
Days Deferred Taxes Outstanding 0.9 1.8 1.1 5.1 10.1 11.0 11.0 12.5 7.3 7.3 7.3
Net Investment in Operating Leases - - 1,282.0 1,356.0 1,415.0 2,696.5 2,900.6 3,057.2 3,195.9 3,336.3 3,499.2
Days Outstanding - - 3.9 3.9 4.1 7.1 7.3 7.3 7.3 7.3 7.3
% of Automotive Revenue - - 1.07% 1.06% 1.12% 1.93% 2.00% 2.00% 2.00% 2.00% 2.00%
Current Receivable from Financial Services 2,035.0 2,568.0 1,700.0 878.0 - - - - - - -
Days Outstanding 5.8 8.9 5.2 2.5 - - - - - - -
% of Automotive Revenue 1.58% 2.43% 1.42% 0.68% - - - - - - -
Other Current Assets 4,032.0 2,845.0 610.0 1,053.0 1,124.0 3,487.8 3,625.8 6,114.4 3,994.9 4,170.4 4,374.0
Days Outstanding 11.5 9.8 1.9 3.0 3.2 9.1 9.1 14.6 9.1 9.1 9.1
Total Automotive Current Assets $18,451.0 $15,082.0 $13,860.0 $15,198.0 $18,750.0 $25,180.6 $24,854.3 $30,276.2 $27,183.5 $28,016.3 $29,720.3
Financial Services
Current Assets
Finance Receivables, net 96,101.0 79,705.0 73,265.0 73,330.0 75,770.0 79,522.8 82,668.0 81,015.4 85,890.4 88,830.3 90,978.5
% of Total Revenue 65.68% 67.03% 56.60% 53.56% 56.15% 53.63% 53.68% 50.02% 50.82% 50.40% 49.28%
Net Investment in Operating Leases 23,120.0 15,062.0 10,393.0 11,482.0 15,036.0 15,765.0 16,678.6 17,578.8 18,057.0 18,433.3 18,633.1
Days Sales Outstanding A/R 57.8 46.2 29.3 30.6 40.8 38.8 39.5 39.7 39.0 38.2 36.8
% of Financial Services Revenue 132.01% 112.39% 102.42% 131.63% 180.16% 179.89% 185.95% 193.00% 195.65% 195.16% 192.94%
Total Financial Services Current Assets $119,221.0 $94,767.0 $83,658.0 $84,812.0 $90,806.0 $95,287.8 $99,346.6 $98,594.3 $103,947.3 $107,263.6 $109,611.6
% Total Revenue 81.48% 79.70% 64.63% 61.94% 67.29% 64.26% 64.51% 60.87% 61.50% 60.85% 59.37%
UOIG 28
Appendix 8 Working Capital Model (contd.)
Total Financial Services Current Assets $119,221.0 $94,767.0 $83,658.0 $84,812.0 $90,806.0 $95,287.8 $99,346.6 $98,594.3 $103,947.3 $107,263.6 $109,611.6
% of Revenue 680.72% 707.16% 824.46% 972.28% 1088.02% 1087.27% 1107.62% 1082.51% 1126.31% 1135.61% 1134.98%
Long Term Assets
Net Automotive PP&E Beginning 35,979.0 28,352.0 24,596.0 23,027.0 22,229.0 24,942.0 24,915.4 25,850.9 25,205.3 24,670.1 26,117.4
Net Financial Services PP&E Beginning - - - 142.0 129.0 139.6 149.8 154.6 164.4 173.4 184.2
Capital Expenditures 6,620.0 4,545.0 4,066.0 4,272.0 5,459.0 5,441.0 6,526.4 5,197.2 5,033.6 6,505.9 6,123.6
Acquistions, Less Goodwill - - - - - - - - - - -
Depreciation and Amortization (5,787.0) (3,917.0) (4,579.0) (3,613.0) (3,698.0) (5,607.2) (5,740.8) (5,997.4) (5,733.2) (5,232.0) (5,145.5)
Other 8,447.1 4,384.0 1,056.0 1,599.0 2,875.0 - - - - - -
Net PP&E Ending 28,352.0 24,596.0 23,027.0 22,229.0 24,942.0 24,915.4 25,850.9 25,205.3 24,670.1 26,117.4 27,279.7
Total Current Assets & Net PP&E $166,024.0 $134,445.0 $120,545.0 $122,239.0 $134,498.0 $145,383.9 $150,051.7 $154,075.7 $155,800.9 $161,397.2 $166,611.6
% of Revenue 113.47% 113.07% 93.12% 89.28% 99.67% 98.05% 97.44% 95.13% 92.18% 91.57% 90.25%
Current Liabilities
Automotive
Current Liabilities
Trade Payables 10,635.0 11,210.0 13,466.0 14,015.0 15,107.0 15,346.5 15,228.3 16,050.2 16,778.6 17,515.8 18,370.7
Days Payable Outstanding 32.1 43.0 48.9 46.6 50.8 45.6 43.6 43.7 43.6 43.9 43.6
Other Payables 2,167.0 2,148.0 1,544.0 2,734.0 3,044.0 3,348.3 4,350.9 4,585.8 4,793.9 4,587.5 4,811.4
Accrued Liabilities and Deferred Revenue 32,395.0 18,465.0 17,065.0 15,003.0 15,358.0 15,695.3 15,590.9 15,668.1 15,979.6 16,264.7 16,533.6
Deferred Income Taxes Payable 2,790.0 3,119.0 392.0 40.0 81.0 83.7 87.0 91.7 95.9 100.1 105.0
Debt Payable Within One Year 1,191.0 2,095.0 2,049.0 1,033.0 1,386.0 2,188.1 2,231.0 2,290.8 2,343.7 2,398.0 2,460.6
Current Payable to Financial Services - - - - 252.0 697.6 725.2 764.3 799.0 1,668.2 1,312.2
% of Automotive Revenue - - - - 0.20% 0.50% 0.50% 0.50% 0.50% 1.00% 0.75%
Total Current Automotive Liabilities $49,178.0 $37,037.0 $34,516.0 $32,825.0 $35,228.0 $37,359.5 $38,213.3 $39,450.9 $40,790.6 $42,534.2 $43,593.4
% of Revenue 38.18% 35.11% 28.93% 25.60% 27.83% 26.78% 26.35% 25.81% 25.53% 25.50% 24.92%
Financial Services
Current Liabilities
Payables 1,970.0 1,236.0 1,352.0 975.0 1,157.0 1,139.3 1,345.4 1,366.2 1,384.4 1,416.8 1,545.2
Short-Term Debt 20,085.0 15,825.0 13,656.0 16,072.0 17,406.0 18,754.8 19,194.5 19,491.1 19,750.2 20,402.2 20,860.4
Current Portion of Long-Term Debt 42,504.0 26,045.0 25,962.0 22,653.0 19,345.0 20,999.9 21,598.3 21,990.7 21,965.6 21,993.3 22,528.8
% of Financial Services Liabilities 29.86% 23.87% 27.73% 24.30% 19.91% 21.50% 21.50% 21.50% 21.50% 21.50% 21.50%
Other Liabilities and Deferred Income 6,184.0 4,884.0 3,764.0 3,457.0 3,500.0 3,505.6 3,587.7 3,643.2 3,691.6 3,778.2 3,863.0
Total Current Financial Services Liabilities $74,023.0 $49,725.0 $46,239.0 $44,458.0 $43,095.0 $46,371.5 $47,788.8 $48,586.0 $48,914.4 $49,479.6 $51,018.7
% of Total Revenue 50.59% 41.82% 35.72% 32.47% 31.93% 31.27% 31.03% 30.00% 28.94% 28.07% 27.63%
Total Current Liabilities $123,201.0 $86,762.0 $80,755.0 $77,283.0 $78,323.0 $83,731.0 $86,002.2 $88,036.9 $89,705.1 $92,013.9 $94,612.1
% of Total Revenue 84.20% 72.97% 62.38% 56.44% 58.04% 56.47% 55.85% 54.35% 53.07% 52.20% 51.25%
UOIG 29
Appendix 9 Discounted Cash Flows Analysis Assumptions
Discounted Free Cash Flow Assumptions Considerations

Tax Rate 35.39% Terminal Growth Rate 3.00%
Risk Free Rate 2.67% Terminal Value 265,954
Beta 1.29 PV of Terminal Value 141,030
Market Risk Premium 7.00% Sum of PV Free Cash Flows 41,519
% Equity 35.61% Firm Value 182,550
% Debt 64.39% Total Debt 111,228
Cost of Debt 3.84% Cash & Cash Equivalents 37,642
CAPM 11.71% Market Capitalization 71,322
WACC 5.77% Fully Diluted Shares 3,874
Terminal Risk-Free Rate 3.69% Implied Price $18.41
Terminal CAPM 12.73% Current Price $14.80
Terminal WACC 6.55% Undervalued 24.41%
Final Price Target Implied Price Weight

Discounted Cash Flow $18.41 50%
Forward Comparable Analysis $15.66 50%
Price Target $17.04
Current Price 14.80
Undervalued 15.12%
UOIG 30
Appendix 10 Sensitivity Analysis
Implied Price Undervalued/(Overvalued)

Terminal Growth Rate Terminal Growth Rate
17 2.0% 2.5% 3.0% 3.5% 4.0% 15.12% 2.00% 2.50% 3.00% 3.50% 4.00%
1.09 $14.97 $17.95 $22.25 $28.98 $41.03 1.09 1.14% 21.29% 50.34% 95.82% 177.22%
Adjusted Beta
Adjusted Beta
1.19 $13.42 $15.91 $19.39 $24.59 $33.23 1.19 (9.33%) 7.48% 30.99% 66.15% 124.50%
1.29 $12.07 $14.18 $17.04 $21.16 $27.63 1.29 (18.42%) (4.22%) 15.12% 43.00% 86.67%
1.39 $10.90 $12.69 $15.08 $18.42 $23.41 1.39 (26.38%) (14.26%) 1.88% 24.44% 58.19%
1.49 $9.85 $11.40 $13.42 $16.16 $20.13 1.49 (33.41%) (22.98%) (9.35%) 9.22% 35.98%

17 2.0% 2.5% 3.0% 3.5% 4.0% 0 2.0% 2.5% 3.0% 3.5% 4.0%
3.77% $27.68 $39.03 $65.22 $190.15 ($217.06) 3.77% 87.03% 163.74% 340.69% 1184.81% (1566.63%)
4.77% $17.15 $21.24 $27.64 $39.10 $65.55 4.77% 15.90% 43.51% 86.77% 164.22% 342.88%
WACC
WACC
5.77% $12.07 $14.18 $17.04 $21.16 $27.63 5.77% (18.42%) (4.22%) 15.12% 43.00% 86.67%
6.77% $9.02 $10.31 $11.93 $14.05 $16.94 6.77% (39.02%) (30.35%) (19.37%) (5.03%) 14.49%
7.77% $6.96 $7.83 $8.88 $10.17 $11.81 7.77% (52.98%) (47.12%) (40.03%) (31.27%) (20.19%)

17 2.3% 2.3% 3.0% 3.8% 4.5% 15.12% 2.25% 2.25% 3.00% 3.75% 4.50%
25.39% $11.66 $11.66 $14.99 $20.53 $31.56 25.39% (21.19%) (21.19%) 1.31% 38.72% 113.24%
Tax Rate
Tax Rate
30.39% $12.33 $12.33 $15.97 $22.16 $35.04 30.39% (16.67%) (16.67%) 7.91% 49.74% 136.74%
35.39% $13.05 $13.05 $17.04 $23.99 $39.20 35.39% (11.83%) (11.83%) 15.12% 62.13% 164.86%
40.39% $13.82 $13.82 $18.21 $26.07 $44.27 40.39% (6.62%) (6.62%) 23.01% 76.15% 199.09%
45.39% $14.65 $14.65 $19.49 $28.44 $50.57 45.39% (1.01%) (1.01%) 31.69% 92.14% 241.66%
UOIG 31
Appendix 11 Sources
FactSet
Forbes
Ford Credit Investor Relations
Ford Credit Website
Ford Investor Relations
Ford Website
Google
IBIS World
NPR
Sec.gov
Seeking Alpha
Yahoo! Finance
UOIG 32

Uoig Ford Final PDF

Transféré par

Informations du document

Copyright

Formats disponibles

Partager ce document

Partager ou intégrer le document

Options de partage

Avez-vous trouvé ce document utile ?

Ce contenu est-il inapproprié ?

Droits d'auteur :

Formats disponibles

Uoig Ford Final PDF

Transféré par

Droits d'auteur :

Formats disponibles

February 14, 2014

Ford Motor Company

Current Price: $14.80 Implied Price: $17.04

Debt to Enterprise Value 0.86 $8.00 100000000

Covering Analyst: Tyler Markgraff $0.00 0

tmarkgra@uoregon.edu Volume Adj Close 50-Day Avg 200-Day Avg

1 University of Oregon Investment Group

Source: Ford Investor Relations

Accelerate Development of New Products Customers Want and Value

1400 1287 experience.

800 been and is predicted to continue to generate significant operating-related cash

0 Work Together Effectively as One Team

Business Growth Strategies

Source: Ford Investor Relations

Investment in EcoBoost Engines

technological advantage and develop new products for customers.

Ford manufactures the vehicles then sells them to individual dealers, a

Source: Ford Investor Relations South America

Figure 19: Ford Financial Services Assets Financial Services

50,000 Finance Receivables: Consumer

Finance Receivables Net Investment in Operating Leases

Finance Receivables: Non-Consumer

Net Investment in Operating Leases

30,000 Management and Employee Relations

Salary Bonus Stock Awards Options Awards Other

Source: SEC.gov Management Guidance

Reuters (January 30, 2014)

Ford Increases Quarterly Dividend 25% in 2014 First

Ford News Center (January 9, 2014)

- Recent recalls associated with the EcoBoost technology may discourage

General Motors Company (GM) 30%

General Motors Company (GM) designs, manufactures, and markets cars,

Toyota Motor Corporation engages in the design, manufacture, assembly, and

Volvo Car Corporation 25%

Volvo AB designs, manufactures and markets automobiles and industrial

Delphi Automotive PLC 15%

Source: UOIG Spread

Source: UOIG Spreads UOIG 13

Selling, Administrative and Other Expenses

these expenses were projected to remain at historical levels while incorporating

Source: Ford Investor Relations Statement of Cash Flows

Figure 39: Automotive Receivables Dividends

Figure 40: Finance Receivables Finance Receivables

Source: UOIG Spreads Deferred Income Taxes

Terminal Growth Rate

Intermediate Growth Rate

(Income)/Loss of Discontinued Operations - (3.0) - - - - - - - - -

(Income)/Loss of Discontinued Operations (9.0) (2.0) - - - - - - - - -

Ford Motor Company Total Revenue

Discounted Free Cash Flow Assumptions Considerations

Final Price Target Implied Price Weight

Implied Price Undervalued/(Overvalued)

Implied Price Undervalued/(Overvalued)

Implied Price Undervalued/(Overvalued)

Vous aimerez peut-être aussi