Ford November Sales Call Notes

Ford Motor (F) November 2016 U.S. Sales Conference Call

Expecting 18m vehicles

“Our early read is a total sales including medium and heavy trucks came in at approximately 1.41 million vehicles last month. This will correspond to a total industry SAAR of about 18.3 million vehicles, providing the overall industry with an approximate 5% increase versus a year ago.”

Bryan Bezold

Residual values are something to keep an eye on

“Well Dan a good question. It kind of goes hand in hand with what’s been publicized in terms of overall residual pressure, you know pressure on residual values in the industry. That will go hand in hand with equity, obviously the less that a trade is worth with the customer more risk from an equity position. We’ve seen it, I don’t have it, a third in the industry. The latest number I saw is actually below 30%, but it would have been climbing over the last several years. This is, in terms of customers in a not equity position, it’s actually been climbing for several years, couple percentage points a year. With our strong residual values our lower lease penetration in the industry, we run at a more favorable position to that, but it is obviously something the overall residual values that’s some that we are keeping our eye on, we’ve talked about and that one of the reasons that our guidance was not having the industry going up next year is that’s in-line with a lot of positive factors in the industry that’s one of the drags in the industry that we keep an eye on.”

Anything that leads to economic growth is of course good for us

“I think one point I would make is that before we were to change our expectations or our guidance we have to have a better idea of what the set of policies would be proposed and eventually in active. So, I think that would be the first answer to your question. Generally of course anything that leads to faster economic growth, all of the things equal would be to faster industry volume and faster truck sales, but beyond that I don’t have any detail for you.”

Mark LaNeve

You’ve got a yin and yang of positive factors after the election

“Well another good question, we do have the union yang [indiscernible] of, you know you got positive factors, the customer is still in good shape, the consumer confidence is strong interest rates, although a risk of increasing restored relatively very low levels the Car Park is still average age of the vehicle is well over 11.5 years, you know these are all positive gas prices still relatively really low that’s all positive for the industry, but it could be looking at gradual rate increases. We just talked about residual values. So we are always looking at all those factors and trying to balance them up and it turned specifically of the presidential election, but we haven’t changed our financial guidance or our industrial volume guidance as a result specifically to the election Dan.”

Credit is in good shape

“We’ve seen the articles, have seen one or two references and we’ve probably seen from a standpoint of Ford credit our delinquencies are in great shape, not running any different than they’ve run over the last several years and the quality of the customers that we are seeing and buying remains very consistent. So, we haven’t really seen much evidence of what you are referencing.”