UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10-Q

☑ Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended March 31, ~~2021~~2022

☐ Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from __________ to __________

Commission file number 1-3950

Ford Motor Company

(Exact name of Registrant as specified in its charter)


Delaware		38-0549190
(State of incorporation)		(I.R.S. Employer Identification No.)

One American Road
Dearborn,	Michigan	48126
(Address of principal executive offices)		(Zip code)

313-322-3000

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading symbols

Name of each exchange on which registered

Common Stock, par value $.01 per share

New York Stock Exchange

6.200% Notes due June 1, 2059

FPRB

New York Stock Exchange

6.000% Notes due December 1, 2059

FPRC

New York Stock Exchange

Indicate by check mark if the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☑ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer ☑ Accelerated filer ☐ Non-accelerated filer ☐ Smaller reporting company ☐ Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑

As of April ~~23, 2021,~~22, 2022, Ford had outstanding ~~3,920,792,383~~3,948,913,279 shares of Common Stock and 70,852,076 shares of Class B Stock.

Exhibit Index begins on page 7067

FORD MOTOR COMPANY

QUARTERLY REPORT ON FORM 10-Q

For the Quarter Ended March 31, ~~2021~~2022


	Table of Contents	Page
	Part I - Financial Information
Item 1	Financial Statements	1
	Consolidated Statements of Cash Flows	1
	Consolidated Income Statements	2
	Consolidated Statements of Comprehensive Income	2
	Consolidated Balance Sheets	3
	Consolidated Statements of Equity	4
	Notes to the Financial Statements	5
Item 2	Management’s Discussion and Analysis of Financial Condition and Results of Operations	3331
	~~Recent Developments~~Key Trends and Economic Factors Affecting Ford and the Automotive Industry	3331
	Results of Operations	3432
	Automotive Segment	3634
	Mobility Segment	4240
	Ford Credit Segment	4341
	Corporate Other	4644
	Interest on Debt	4644
	Taxes	4644
	Liquidity and Capital Resources	4745
	Credit Ratings	5553
	Outlook	5654
	Cautionary Note on Forward-Looking Statements	5755
	Non-GAAP Financial Measures That Supplement GAAP Measures	5856
	Non-GAAP Financial Measure Reconciliations	6058
	Supplemental Information	6360
	Accounting Standards Issued But Not Yet Adopted	6663
Item 3	Quantitative and Qualitative Disclosures About Market Risk	6764
Item 4	Controls and Procedures	6764

	Part II - Other Information
Item 1	Legal Proceedings	6865
Item 2	Unregistered Sales of Equity Securities and Use of Proceeds	6966
Item 6	Exhibits	7067
	Signature	7168

PART I. FINANCIAL INFORMATION

ITEM 1. Financial Statements.

FORD MOTOR COMPANY AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in millions)


		For the periods ended March 31,					For the periods ended March 31,
		2020		2021			2021		2022
		First Quarter					First Quarter
		(unaudited)					(unaudited)
Cash flows from operating activities	Cash flows from operating activities					Cash flows from operating activities
Net income/(loss)	Net income/(loss)	$	(1,993)	$	3,262	Net income/(loss)	$	3,262	$	(3,119)
Depreciation and tooling amortization	Depreciation and tooling amortization	2,444		2,103		Depreciation and tooling amortization	2,103		1,857
Other amortization	Other amortization	(302)		(361)		Other amortization	(361)		(310)
Provision for credit and insurance losses		598		(36)
Provision for/(Benefit from) credit and insurance losses						Provision for/(Benefit from) credit and insurance losses	(36)		(66)
Pension and other post-retirement employee benefits (“OPEB”) expense/(income) (Note 13)	Pension and other post-retirement employee benefits (“OPEB”) expense/(income) (Note 13)	(178)		(318)		Pension and other post-retirement employee benefits (“OPEB”) expense/(income) (Note 13)	(318)		(213)
Equity investment dividends received in excess of (earnings)/losses		118		68
Equity method investment dividends received in excess of (earnings)/losses and impairments						Equity method investment dividends received in excess of (earnings)/losses and impairments	68		199
Foreign currency adjustments	Foreign currency adjustments	338		350		Foreign currency adjustments	350		32
Net unrealized (gain)/loss on Other Investments (Note 10)		8		(914)
Net realized and unrealized (gains)/losses on cash equivalents, marketable securities, and other investments (Note 4)						Net realized and unrealized (gains)/losses on cash equivalents, marketable securities, and other investments (Note 4)	(899)		5,454
Net (gain)/loss on changes in investments in affiliates (Note 4)	Net (gain)/loss on changes in investments in affiliates (Note 4)	(15)		(166)		Net (gain)/loss on changes in investments in affiliates (Note 4)	(166)		125
Stock compensation	Stock compensation	38		41		Stock compensation	41		67
Provision for deferred income taxes	Provision for deferred income taxes	702		427		Provision for deferred income taxes	427		(1,053)
Decrease/(Increase) in finance receivables (wholesale and other)	Decrease/(Increase) in finance receivables (wholesale and other)	(1,080)		2,699		Decrease/(Increase) in finance receivables (wholesale and other)	2,699		(2,192)
Decrease/(Increase) in accounts receivable and other assets	Decrease/(Increase) in accounts receivable and other assets	39		(588)		Decrease/(Increase) in accounts receivable and other assets	(588)		(956)
Decrease/(Increase) in inventory	Decrease/(Increase) in inventory	(1,177)		(2,176)		Decrease/(Increase) in inventory	(2,176)		(2,755)
Increase/(Decrease) in accounts payable and accrued and other liabilities	Increase/(Decrease) in accounts payable and accrued and other liabilities	194		193		Increase/(Decrease) in accounts payable and accrued and other liabilities	193		1,714
Other	Other	(207)		(92)		Other	(107)		132
Net cash provided by/(used in) operating activities	Net cash provided by/(used in) operating activities	(473)		4,492		Net cash provided by/(used in) operating activities	4,492		(1,084)

Cash flows from investing activities	Cash flows from investing activities					Cash flows from investing activities
Capital spending	Capital spending	(1,780)		(1,368)		Capital spending	(1,368)		(1,370)
Acquisitions of finance receivables and operating leases	Acquisitions of finance receivables and operating leases	(12,184)		(11,695)		Acquisitions of finance receivables and operating leases	(11,695)		(10,278)
Collections of finance receivables and operating leases	Collections of finance receivables and operating leases	12,709		12,482		Collections of finance receivables and operating leases	12,482		11,988
Proceeds from sale of business (Note 17)		1,340		7

Purchases of marketable securities and other investments	Purchases of marketable securities and other investments	(8,244)		(11,580)		Purchases of marketable securities and other investments	(11,580)		(4,319)
Sales and maturities of marketable securities and other investments	Sales and maturities of marketable securities and other investments	4,998		11,686		Sales and maturities of marketable securities and other investments	11,686		7,115
Settlements of derivatives	Settlements of derivatives	131		31		Settlements of derivatives	31		212
Other	Other	(84)		(54)		Other	(47)		(33)
Net cash provided by/(used in) investing activities	Net cash provided by/(used in) investing activities	(3,114)		(491)		Net cash provided by/(used in) investing activities	(491)		3,315

Cash flows from financing activities	Cash flows from financing activities					Cash flows from financing activities
Cash payments for dividends and dividend equivalents	Cash payments for dividends and dividend equivalents	(596)		(3)		Cash payments for dividends and dividend equivalents	(3)		(405)
Purchases of common stock	Purchases of common stock	0		0		Purchases of common stock	—		—
Net changes in short-term debt	Net changes in short-term debt	(622)		273		Net changes in short-term debt	273		(614)
Proceeds from issuance of long-term debt	Proceeds from issuance of long-term debt	26,691		6,931		Proceeds from issuance of long-term debt	6,931		12,489
Principal payments on long-term debt		(12,948)		(14,892)
Payments of long-term debt						Payments of long-term debt	(14,892)		(12,975)
Other	Other	(71)		(102)		Other	(102)		(156)
Net cash provided by/(used in) financing activities	Net cash provided by/(used in) financing activities	12,454		(7,793)		Net cash provided by/(used in) financing activities	(7,793)		(1,661)

Effect of exchange rate changes on cash, cash equivalents, and restricted cash	Effect of exchange rate changes on cash, cash equivalents, and restricted cash	(448)		(93)		Effect of exchange rate changes on cash, cash equivalents, and restricted cash	(93)		(24)

Net increase/(decrease) in cash, cash equivalents, and restricted cash	Net increase/(decrease) in cash, cash equivalents, and restricted cash	$	8,419	$	(3,885)	Net increase/(decrease) in cash, cash equivalents, and restricted cash	$	(3,885)	$	546

Cash, cash equivalents, and restricted cash at beginning of period (Note 7)	Cash, cash equivalents, and restricted cash at beginning of period (Note 7)	$	17,741	$	25,935	Cash, cash equivalents, and restricted cash at beginning of period (Note 7)	$	25,935	$	20,737
Net increase/(decrease) in cash, cash equivalents, and restricted cash	Net increase/(decrease) in cash, cash equivalents, and restricted cash	8,419		(3,885)		Net increase/(decrease) in cash, cash equivalents, and restricted cash	(3,885)		546
Cash, cash equivalents, and restricted cash at end of period (Note 7)	Cash, cash equivalents, and restricted cash at end of period (Note 7)	$	26,160	$	22,050	Cash, cash equivalents, and restricted cash at end of period (Note 7)	$	22,050	$	21,283

The accompanying notes are part of the consolidated financial statements.

Item 1. Financial Statements (continued)

FORD MOTOR COMPANY AND SUBSIDIARIES

CONSOLIDATED INCOME STATEMENTS

(in millions, except per share amounts)


				For the periods ended March 31,						For the periods ended March 31,
				2020			2021			2021		2022
		First Quarter				First Quarter
				(unaudited)						(unaudited)
Revenues	Revenues								Revenues
Automotive	Automotive			$	31,342		$	33,554	Automotive	$	33,554	$	32,111
Ford Credit	Ford Credit			2,967			2,663		Ford Credit	2,663		2,281
Mobility	Mobility			11			11		Mobility	11		84
Total revenues (Note 3)	Total revenues (Note 3)			34,320			36,228		Total revenues (Note 3)	36,228		34,476

Costs and expenses	Costs and expenses								Costs and expenses
Cost of sales	Cost of sales			30,522			29,297		Cost of sales	29,297		29,036
Selling, administrative, and other expenses	Selling, administrative, and other expenses			2,432			2,843		Selling, administrative, and other expenses	2,843		2,740
Ford Credit interest, operating, and other expenses	Ford Credit interest, operating, and other expenses			2,924			1,624		Ford Credit interest, operating, and other expenses	1,624		1,357
Total costs and expenses	Total costs and expenses			35,878			33,764		Total costs and expenses	33,764		33,133
Operating income/(loss)	Operating income/(loss)			(1,558)			2,464		Operating income/(loss)	2,464		1,343
Interest expense on Company debt excluding Ford Credit	Interest expense on Company debt excluding Ford Credit			227			473		Interest expense on Company debt excluding Ford Credit	473		308
Other income/(loss), net (Note 4 and Note 10)				680			1,872
Other income/(loss), net (Note 4 and Note 17)									Other income/(loss), net (Note 4 and Note 17)	1,872		(4,850)
Equity in net income/(loss) of affiliated companies	Equity in net income/(loss) of affiliated companies			(41)			79		Equity in net income/(loss) of affiliated companies	79		(33)
Income/(Loss) before income taxes	Income/(Loss) before income taxes			(1,146)			3,942		Income/(Loss) before income taxes	3,942		(3,848)
Provision for/(Benefit from) income taxes	Provision for/(Benefit from) income taxes			847			680		Provision for/(Benefit from) income taxes	680		(729)
Net income/(loss)	Net income/(loss)			(1,993)			3,262		Net income/(loss)	3,262		(3,119)
Less: Income/(Loss) attributable to noncontrolling interests	Less: Income/(Loss) attributable to noncontrolling interests			0			0		Less: Income/(Loss) attributable to noncontrolling interests	—		(9)
Net income/(loss) attributable to Ford Motor Company	Net income/(loss) attributable to Ford Motor Company			$	(1,993)		$	3,262	Net income/(loss) attributable to Ford Motor Company	$	3,262	$	(3,110)

EARNINGS/(LOSS) PER SHARE ATTRIBUTABLE TO FORD MOTOR COMPANY COMMON AND CLASS B STOCK (Note 6)	EARNINGS/(LOSS) PER SHARE ATTRIBUTABLE TO FORD MOTOR COMPANY COMMON AND CLASS B STOCK (Note 6)		EARNINGS/(LOSS) PER SHARE ATTRIBUTABLE TO FORD MOTOR COMPANY COMMON AND CLASS B STOCK (Note 6)
Basic income/(loss)	Basic income/(loss)			$	(0.50)		$	0.82	Basic income/(loss)	$	0.82	$	(0.78)
Diluted income/(loss)	Diluted income/(loss)			(0.50)			0.81		Diluted income/(loss)	0.81		(0.78)

Weighted-average shares used in computation of earnings/(loss) per share	Weighted-average shares used in computation of earnings/(loss) per share						Weighted-average shares used in computation of earnings/(loss) per share
Basic shares	Basic shares			3,963			3,980		Basic shares	3,980		4,008
Diluted shares	Diluted shares			3,963			4,016		Diluted shares	4,016		4,008

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(in millions)


			For the periods ended March 31,						For the periods ended March 31,
			2020			2021			2021		2022
		First Quarter			First Quarter
			(unaudited)						(unaudited)
Net income/(loss)	Net income/(loss)		$	(1,993)		$	3,262	Net income/(loss)	$	3,262	$	(3,119)
Other comprehensive income/(loss), net of tax (Note 18)	Other comprehensive income/(loss), net of tax (Note 18)							Other comprehensive income/(loss), net of tax (Note 18)
Foreign currency translation	Foreign currency translation		(1,453)			289		Foreign currency translation	289		146
Marketable securities	Marketable securities		14			(65)		Marketable securities	(65)		(253)
Derivative instruments	Derivative instruments		692			(301)		Derivative instruments	(301)		144
Pension and other postretirement benefits	Pension and other postretirement benefits		14			1		Pension and other postretirement benefits	1		8
Total other comprehensive income/(loss), net of tax	Total other comprehensive income/(loss), net of tax		(733)			(76)		Total other comprehensive income/(loss), net of tax	(76)		45
Comprehensive income/(loss)	Comprehensive income/(loss)		(2,726)			3,186		Comprehensive income/(loss)	3,186		(3,074)
Less: Comprehensive income/(loss) attributable to noncontrolling interests	Less: Comprehensive income/(loss) attributable to noncontrolling interests		0			0		Less: Comprehensive income/(loss) attributable to noncontrolling interests	—		(9)
Comprehensive income/(loss) attributable to Ford Motor Company	Comprehensive income/(loss) attributable to Ford Motor Company		$	(2,726)		$	3,186	Comprehensive income/(loss) attributable to Ford Motor Company	$	3,186	$	(3,065)

The accompanying notes are part of the consolidated financial statements.

Item 1. Financial Statements (continued)

FORD MOTOR COMPANY AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(in millions)


		December 31, 2020		March 31, 2021			December 31, 2021		March 31, 2022
		(unaudited)					(unaudited)
ASSETS	ASSETS					ASSETS
Cash and cash equivalents (Note 7)	Cash and cash equivalents (Note 7)	$	25,243	$	21,826	Cash and cash equivalents (Note 7)	$	20,540	$	21,013
Marketable securities (Note 7)	Marketable securities (Note 7)	24,718		24,281		Marketable securities (Note 7)	29,053		20,215
Ford Credit finance receivables, net of allowance for credit losses of $394 and $374 (Note 8)		42,401		40,664
Trade and other receivables, less allowances of $84 and $56		9,993		10,448
Ford Credit finance receivables, net of allowance for credit losses of $282 and $262 (Note 8)						Ford Credit finance receivables, net of allowance for credit losses of $282 and $262 (Note 8)	32,543		32,775
Trade and other receivables, less allowances of $48 and $77						Trade and other receivables, less allowances of $48 and $77	11,370		13,031
Inventories (Note 9)	Inventories (Note 9)	10,808		12,742		Inventories (Note 9)	12,065		14,647
Assets held for sale (Note 17)	Assets held for sale (Note 17)	47		335		Assets held for sale (Note 17)	—		826
Other assets	Other assets	3,534		3,636		Other assets	3,425		3,635
Total current assets	Total current assets	116,744		113,932		Total current assets	108,996		106,142
Ford Credit finance receivables, net of allowance for credit losses of $911 and $849 (Note 8)		55,277		52,570
Ford Credit finance receivables, net of allowance for credit losses of $643 and $583 (Note 8)						Ford Credit finance receivables, net of allowance for credit losses of $643 and $583 (Note 8)	51,256		50,000
Net investment in operating leases	Net investment in operating leases	27,951		27,811		Net investment in operating leases	26,361		25,546
Net property	Net property	37,083		36,361		Net property	37,139		36,625
Equity in net assets of affiliated companies	Equity in net assets of affiliated companies	4,901		4,694		Equity in net assets of affiliated companies	4,545		4,306
Deferred income taxes	Deferred income taxes	12,423		12,103		Deferred income taxes	13,796		14,991
Other assets	Other assets	12,882		13,348		Other assets	14,942		15,376
Total assets	Total assets	$	267,261	$	260,819	Total assets	$	257,035	$	252,986

LIABILITIES	LIABILITIES					LIABILITIES
Payables	Payables	$	22,204	$	23,492	Payables	$	22,349	$	23,256
Other liabilities and deferred revenue (Note 12 and Note 20)	Other liabilities and deferred revenue (Note 12 and Note 20)	23,645		20,995		Other liabilities and deferred revenue (Note 12 and Note 20)	18,686		18,263
Debt payable within one year (Note 14)	Debt payable within one year (Note 14)					Debt payable within one year (Note 14)
Company excluding Ford Credit	Company excluding Ford Credit	1,374		1,061		Company excluding Ford Credit	3,175		2,927
Ford Credit	Ford Credit	49,969		48,410		Ford Credit	46,517		45,359
Liabilities held for sale (Note 17)	Liabilities held for sale (Note 17)	0		291		Liabilities held for sale (Note 17)	—		547
Total current liabilities	Total current liabilities	97,192		94,249		Total current liabilities	90,727		90,352
Other liabilities and deferred revenue (Note 12 and Note 20)	Other liabilities and deferred revenue (Note 12 and Note 20)	28,379		28,707		Other liabilities and deferred revenue (Note 12 and Note 20)	27,705		28,501
Long-term debt (Note 14)	Long-term debt (Note 14)					Long-term debt (Note 14)
Company excluding Ford Credit	Company excluding Ford Credit	22,633		24,819		Company excluding Ford Credit	17,200		17,158
Ford Credit	Ford Credit	87,708		78,382		Ford Credit	71,200		70,157
Deferred income taxes	Deferred income taxes	538		688		Deferred income taxes	1,581		1,734
Total liabilities	Total liabilities	236,450		226,845		Total liabilities	208,413		207,902

EQUITY	EQUITY					EQUITY
Common Stock, par value $0.01 per share (4,038 million shares issued of 6 billion authorized)		40		40
Common Stock, par value $0.01 per share (4,066 million shares issued of 6 billion authorized)						Common Stock, par value $0.01 per share (4,066 million shares issued of 6 billion authorized)	40		41
Class B Stock, par value $0.01 per share (71 million shares issued of 530 million authorized)	Class B Stock, par value $0.01 per share (71 million shares issued of 530 million authorized)	1		1		Class B Stock, par value $0.01 per share (71 million shares issued of 530 million authorized)	1		1
Capital in excess of par value of stock	Capital in excess of par value of stock	22,290		22,240		Capital in excess of par value of stock	22,611		22,550
Retained earnings	Retained earnings	18,243		21,502		Retained earnings	35,769		32,251
Accumulated other comprehensive income/(loss) (Note 18)	Accumulated other comprehensive income/(loss) (Note 18)	(8,294)		(8,370)		Accumulated other comprehensive income/(loss) (Note 18)	(8,339)		(8,294)
Treasury stock	Treasury stock	(1,590)		(1,585)		Treasury stock	(1,563)		(1,564)
Total equity attributable to Ford Motor Company	Total equity attributable to Ford Motor Company	30,690		33,828		Total equity attributable to Ford Motor Company	48,519		44,985
Equity attributable to noncontrolling interests	Equity attributable to noncontrolling interests	121		146		Equity attributable to noncontrolling interests	103		99
Total equity	Total equity	30,811		33,974		Total equity	48,622		45,084
Total liabilities and equity	Total liabilities and equity	$	267,261	$	260,819	Total liabilities and equity	$	257,035	$	252,986


The following table includes assets to be used to settle liabilities of the consolidated variable interest entities (“VIEs”). These assets and liabilities are included in the consolidated balance sheets above.	The following table includes assets to be used to settle liabilities of the consolidated variable interest entities (“VIEs”). These assets and liabilities are included in the consolidated balance sheets above.					The following table includes assets to be used to settle liabilities of the consolidated variable interest entities (“VIEs”). These assets and liabilities are included in the consolidated balance sheets above.
		December 31, 2020		March 31, 2021			December 31, 2021		March 31, 2022
		(unaudited)					(unaudited)
ASSETS	ASSETS					ASSETS
Cash and cash equivalents	Cash and cash equivalents	$	2,822	$	4,794	Cash and cash equivalents	$	3,407	$	2,473
Ford Credit finance receivables, net	Ford Credit finance receivables, net	51,472		48,902		Ford Credit finance receivables, net	43,001		42,119
Net investment in operating leases	Net investment in operating leases	12,794		10,026		Net investment in operating leases	7,540		10,191
Other assets	Other assets	0		2		Other assets	39		152
LIABILITIES	LIABILITIES					LIABILITIES
Other liabilities and deferred revenue	Other liabilities and deferred revenue	$	56	$	30	Other liabilities and deferred revenue	$	6	$	1
Debt	Debt	46,770		43,387		Debt	38,274		40,139

The accompanying notes are part of the consolidated financial statements.

Item 1. Financial Statements (Continued)

FORD MOTOR COMPANY AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF EQUITY

(in millions, unaudited)


		Equity Attributable to Ford Motor Company
		Capital Stock		Cap. In Excess of Par Value of Stock		Retained Earnings		Accumulated Other Comprehensive Income/(Loss) (Note 18)		Treasury Stock		Total		Equity Attributable to Non-controlling Interests		Total Equity
Balance at December 31, 2019		$	41	$	22,165	$	20,320	$	(7,728)	$	(1,613)	$	33,185	$	45	$	33,230
Adoption of accounting standards		—		—		(202)		—		—		(202)		—		(202)
Net income/(loss)		0		0		(1,993)		0		0		(1,993)		0		(1,993)
Other comprehensive income/(loss), net		0		0		0		(733)		0		(733)		0		(733)
Common stock issued (a)		0		(15)		0		0		0		(15)		0		(15)
Treasury stock/other		0		0		0		0		6		6		3		9
Dividends and dividend equivalents declared ($0.15 per share) (b)		0		0		(598)		0		0		(598)		0		(598)
Balance at March 31, 2020		$	41	$	22,150	$	17,527	$	(8,461)	$	(1,607)	$	29,650	$	48	$	29,698

																			Equity Attributable to Ford Motor Company
																			Capital Stock		Cap. in Excess of Par Value of Stock		Retained Earnings		Accumulated Other Comprehensive Income/(Loss) (Note 18)		Treasury Stock		Total		Equity Attributable to Non-controlling Interests		Total Equity
Balance at December 31, 2020	Balance at December 31, 2020	$	41	$	22,290	$	18,243	$	(8,294)	$	(1,590)	$	30,690	$	121	$	30,811	Balance at December 31, 2020	$	41	$	22,290	$	18,243	$	(8,294)	$	(1,590)	$	30,690	$	121	$	30,811
Net income/(loss)	Net income/(loss)	0		0		3,262		0		0		3,262		0		3,262		Net income/(loss)	—		—		3,262		—		—		3,262		—		3,262
Other comprehensive income/(loss), net	Other comprehensive income/(loss), net	0		0		0		(76)		0		(76)		0		(76)		Other comprehensive income/(loss), net	—		—		—		(76)		—		(76)		—		(76)
Common stock issued (a)		0		(50)		0		0		0		(50)		0		(50)
Common Stock issued (a)																		Common Stock issued (a)	—		(50)		—		—		—		(50)		—		(50)
Treasury stock/other	Treasury stock/other	0		0		0		0		5		5		25		30		Treasury stock/other	—		—		—		—		5		5		25		30
Dividends and dividend equivalents declared (b)	Dividends and dividend equivalents declared (b)	0		0		(3)		0		0		(3)		0		(3)		Dividends and dividend equivalents declared (b)	—		—		(3)		—		—		(3)		—		(3)
Balance at March 31, 2021	Balance at March 31, 2021	$	41	$	22,240	$	21,502	$	(8,370)	$	(1,585)	$	33,828	$	146	$	33,974	Balance at March 31, 2021	$	41	$	22,240	$	21,502	$	(8,370)	$	(1,585)	$	33,828	$	146	$	33,974

Balance at December 31, 2021																		Balance at December 31, 2021	$	41	$	22,611	$	35,769	$	(8,339)	$	(1,563)	$	48,519	$	103	$	48,622
Net income/(loss)																		Net income/(loss)	—		—		(3,110)		—		—		(3,110)		(9)		(3,119)
Other comprehensive income/(loss), net																		Other comprehensive income/(loss), net	—		—		—		45		—		45		—		45
Common Stock issued (a)																		Common Stock issued (a)	1		(61)		—		—		—		(60)		—		(60)
Treasury stock/other																		Treasury stock/other	—		—		—		—		(1)		(1)		5		4
Dividends and dividend equivalents declared ($0.10 per share) (b)																		Dividends and dividend equivalents declared ($0.10 per share) (b)	—		—		(408)		—		—		(408)		—		(408)
Balance at March 31, 2022																		Balance at March 31, 2022	$	42	$	22,550	$	32,251	$	(8,294)	$	(1,564)	$	44,985	$	99	$	45,084

__________

(a)Includes impacts of share-based compensation.

(b)Dividends and dividend equivalents declared for Common and Class B Stock.

The accompanying notes are part of the consolidated financial statements.

Item 1. Financial Statements (Continued)

FORD MOTOR COMPANY AND SUBSIDIARIES

NOTES TO THE FINANCIAL STATEMENTS

Table of Contents


Footnote		Page
Note 1	Presentation	6
Note 2	New Accounting Standards	6
Note 3	Revenue	7
Note 4	Other Income/(Loss)	8
Note 5	Income Taxes	8
Note 6	Capital Stock and Earnings/(Loss) Per Share	8
Note 7	Cash, Cash Equivalents, and Marketable Securities	9
Note 8	Ford Credit Finance Receivables and Allowance for Credit Losses	12
Note 9	Inventories	16
Note 10	Other Investments	16
Note 11	Goodwill	16
Note 12	Other Liabilities and Deferred Revenue	17
Note 13	Retirement Benefits	18
Note 14	Debt	19
Note 15	Derivative Financial Instruments and Hedging Activities	2120
Note 16	Employee Separation Actions and Exit and Disposal Activities	2322
Note 17	~~Held-for-Sale Operations~~Acquisitions and ~~Changes in Investments in Affiliates~~Divestitures	2523
Note 18	Accumulated Other Comprehensive Income/(Loss)	2725
Note 19	Variable Interest Entities	2826
Note 20	Commitments and Contingencies	2826
Note 21	Segment Information	3129

Item 1. Financial Statements (Continued)

FORD MOTOR COMPANY AND SUBSIDIARIES

NOTES TO THE FINANCIAL STATEMENTS

NOTE 1. PRESENTATION

For purposes of this report, “Ford,” the “Company,” “we,” “our,” “us,” or similar references mean Ford Motor Company, our consolidated subsidiaries, and our consolidated VIEs of which we are the primary beneficiary, unless the context requires otherwise. We also make reference to Ford Motor Credit Company LLC, herein referenced to as Ford Credit. Our consolidated financial statements are presented in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information, instructions to the Quarterly Report on Form 10-Q, and Rule 10-01 of Regulation S-X. We reclassified certain prior year amounts in our consolidated financial statements to conform to the current year presentation.

In the opinion of management, these unaudited financial statements reflect a fair statement of our results of operations and financial condition for the periods, and at the dates, presented. The results for interim periods are not necessarily indicative of results that may be expected for any other interim period or for the full year. Reference should be made to the financial statements contained in our Annual Report on Form 10-K for the year ended December 31, ~~2020~~2021 (“~~2020~~2021 Form 10-K Report”).

NOTE 2. NEW ACCOUNTING STANDARDS

Adoption of New Accounting Standards

Accounting Standards Update (“ASU”) ~~2019-12, Income Taxes - Simplifying~~2021-10, Government Assistance: Disclosures by Business Entities about Government Assistance. In November 2021, the Financial Accounting Standards Board (“FASB”) issued an accounting standards update requiring entities to provide certain disclosures in annual period financial statements for ~~Income Taxes~~. Effective January 1, 2021, we adopted the amendments in this ASU to simplify the accounting for income taxes. The amendments clarified that an entity may elect, but is not required, to reflect an allocation of consolidated current and deferred tax expense for non-taxable legal entitiesthose transactions with governments that are ~~treated as disregarded~~accounted for by ~~taxing authorities in their separately issued~~applying a grant or contribution accounting model via analogy to other applicable accounting standards. We are assessing the effect on our annual consolidated financial statement disclosures; however, adoption will not impact our consolidated balance sheets or income statements.

~~With~~We also adopted the ~~adoption~~following ASUs during 2022, none of ~~the amendments in ASU 2019-12, Ford Credit’s separately issued financial statements no longer reflect an allocation of our consolidated U.S. current and deferred tax expense~~which had a material impact to it and certain of its U.S. subsidiaries that are treated as disregarded entities for U.S. tax purposes. Adoption of these amendments reduces complexity in accounting for income taxes and better reflects Ford Credit’s external obligations to tax authorities. Following the adoption, in April 2021, we entered into a Second Amended and Restated Tax Sharing Agreement with Ford Credit. The adoption of ASU 2019-12 and the Second Amended and Restated Tax Sharing Agreement had no impact on our consolidated financial ~~position and results of operations. The amendments were adopted on a retrospective basis and are reflected in Ford Credit’s standalone~~statements or financial ~~statements and disclosures.~~statement disclosures:


ASU ~~2020-06, Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity.~~ Effective January 1, 2021, we adopted the new standard, which simplified guidance on the issuer’s accounting for convertible debt instruments and amended certain guidance related to the computation of earnings per share for convertible instruments and contracts in an entity’s own equity. There was no impact on the date of adoption. During the first quarter of 2021, we issued convertible notes (see Note 14).		Effective Date
2021-04	Issuer’s Accounting for Certain Modifications or Exchanges of Warrants	January 1, 2022
2021-05	Lessors - Certain Leases with Variable Lease Payments	January 1, 2022
2021-08	Business Combinations: Accounting for Contract Assets and Contract Liabilities from Contracts with Customers	January 1, 2022

Accounting Standards Issued But Not Yet Adopted

ASU 2022-02, Financial Instruments – Credit Losses, Troubled Debt Restructurings and Vintage Disclosures. In March 2022, the FASB issued a new accounting standard that eliminates the troubled debt recognition and measurement guidance. The ~~Company considers~~new standard requires that an entity apply the ~~applicability~~loan refinancing and ~~impact~~restructuring guidance in ASC 310 to all loan modifications and/or receivable modifications. It also enhances disclosure requirements for certain refinancings and restructurings by creditors when a borrower is experiencing financial difficulty and requires disclosure of ~~all ASUs.~~current-period gross charge-offs by year of origination in the vintage disclosure. The new standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2022. We are assessing the effect of the new standard on our consolidated financial statements and disclosures.

All other ASUs issued but not yet adopted were assessed and determined to be either not applicable or are not expected to have ~~minimal~~a material impact onto our consolidated financial ~~statements.~~statements or financial statement disclosures.

Item 1. Financial Statements (Continued)

FORD MOTOR COMPANY AND SUBSIDIARIES

NOTES TO THE FINANCIAL STATEMENTS

NOTE 3. REVENUE

The following tables disaggregate our revenue by major source for the periods ended March 31 (in millions):


				First Quarter 2021
										Company excluding Ford Credit		Ford Credit		Consolidated
Vehicles, parts, and accessories									Vehicles, parts, and accessories	$	32,135	$	—	$	32,135
Used vehicles									Used vehicles	745		—		745
Services and other revenue (a)									Services and other revenue (a)	608		16		624
Revenues from sales and services									Revenues from sales and services	33,488		16		33,504

Leasing income									Leasing income	77		1,380		1,457
Financing income									Financing income	—		1,243		1,243
Insurance income									Insurance income	—		24		24
Total revenues									Total revenues	$	33,565	$	2,663	$	36,228

		First Quarter 2020								First Quarter 2022
		Company excluding Ford Credit			Ford Credit		Consolidated			Company excluding Ford Credit		Ford Credit		Consolidated
Vehicles, parts, and accessories	Vehicles, parts, and accessories	$	29,841		$	0	$	29,841	Vehicles, parts, and accessories	$	30,991	$	—	$	30,991
Used vehicles	Used vehicles	931			0		931		Used vehicles	429		—		429
Services and other revenue (a)	Services and other revenue (a)	523			41		564		Services and other revenue (a)	722		19		741
Revenues from sales and services	Revenues from sales and services	31,295			41		31,336		Revenues from sales and services	32,142		19		32,161

Leasing income	Leasing income	58			1,459		1,517		Leasing income	53		1,211		1,264
Financing income	Financing income	0			1,425		1,425		Financing income	—		1,040		1,040
Insurance income	Insurance income	0			42		42		Insurance income	—		11		11
Total revenues	Total revenues	$	31,353		$	2,967	$	34,320	Total revenues	$	32,195	$	2,281	$	34,476

		First Quarter 2021
		Company excluding Ford Credit			Ford Credit		Consolidated
Vehicles, parts, and accessories		$	32,135		$	0	$	32,135
Used vehicles		745			0		745
Services and other revenue (a)		608			16		624
Revenues from sales and services		33,488			16		33,504

Leasing income		77			1,380		1,457
Financing income		0			1,243		1,243
Insurance income		0			24		24
Total revenues		$	33,565		$	2,663	$	36,228

__________

(a)Includes extended service contract revenue.

The amount of consideration we receive and revenue we recognize on our vehicles, parts, and accessories varies with changes in return rights and marketing incentives we offer to our customers and their customers. Estimates of marketing incentives are based on expected retail and fleet sales volumes, mix of products to be sold, and incentive programs to be offered. Customer acceptance of products and programs, as well as other market conditions, will impact these estimates. As a result of changes in our estimate of marketing incentives, we recorded ~~a decrease in revenue of $885 million in the first quarter of 2020 and~~ an increase related to revenue recognized in ~~revenue~~prior periods of $359 million and $211 million in the first quarter of 2021 related to revenue recognized in prior periods. The change in estimate for the first quarter of 2020 includes additional marketing incentives offered to customers in connection with market conditions affected by the COVID-19 pandemic; conversely, the change in estimate for the first quarter of 2021 reflects lower than expected marketing incentives due to reduced dealer stock levels, which includes the effects of the semiconductor supply shortage.and 2022, respectively.

We ~~sell separately-priced service contracts that extend mechanical and maintenance coverages beyond our base warranty agreements to vehicle owners (“extended service contracts”). We~~ had a balance of ~~$4.2 billion and~~ $4.3 billion of unearned revenue associated primarily with outstanding extended service contracts reported in Other liabilities and deferred revenue at December 31, ~~2020~~2021 and March 31, ~~2021, respectively~~2022. We expect to recognize approximately $1 billion of the unearned amount in the remainder of ~~2021,~~2022, $1.2 billion in ~~2022,~~2023, and $2.1 billion thereafter. We recognized ~~$330~~$342 million and ~~$342~~$365 million of unearned amounts as revenue induring the first quarter of ~~2020~~2021 and ~~2021,~~2022, respectively.

Amounts paid to dealers to obtain ~~these~~extended service contracts are deferred and recorded as Other assets. We had a balance of ~~$283~~$309 million and ~~$302~~$317 million in deferred costs as of December 31, ~~2020~~2021 and March 31, ~~2021,~~2022, respectively. We recognized $20 million and $22 million of amortization during the first quarter of ~~2020~~2021 and ~~2021.~~2022, respectively.

Item 1. Financial Statements (Continued)

FORD MOTOR COMPANY AND SUBSIDIARIES

NOTES TO THE FINANCIAL STATEMENTS

NOTE 4. OTHER INCOME/(LOSS)

The amounts included in Other income/(loss), net for the periods ended March 31 were as follows (in millions):


		First Quarter				First Quarter
		2020		2021				2021		2022
Net periodic pension and OPEB income/(cost), excluding service cost(a)	Net periodic pension and OPEB income/(cost), excluding service cost(a)	$	451	$	612		Net periodic pension and OPEB income/(cost), excluding service cost(a)	$	612	$	459
Investment-related interest income	Investment-related interest income	162		72			Investment-related interest income	72		61
Interest income/(expense) on income taxes	Interest income/(expense) on income taxes	(23)		(3)			Interest income/(expense) on income taxes	(3)		5
Realized and unrealized gains/(losses) on cash equivalents, marketable securities, and other investments ~~(a)~~(b)	Realized and unrealized gains/(losses) on cash equivalents, marketable securities, and other investments ~~(a)~~(b)	(32)		899			Realized and unrealized gains/(losses) on cash equivalents, marketable securities, and other investments ~~(a)~~(b)	899		(5,454)
Gains/(Losses) on changes in investments in affiliates(c)	Gains/(Losses) on changes in investments in affiliates(c)	15		166			Gains/(Losses) on changes in investments in affiliates(c)	166		(125)
Royalty income	Royalty income	89		171			Royalty income	171		144
Other	Other	18		(45)			Other	(45)		60
Total	Total	$	680	$	1,872		Total	$	1,872	$	(4,850)

__________

(a)See Note 1013 for additional information relating to our pension and OPEB remeasurements.

(b) Includes a $0.9 billion unrealized gain and a $5.4 billion unrealized loss on our Rivian equity investment in ~~Rivian~~the first quarter of 2021 and 2022, respectively.

(c) Primarily reflects a gain on Getrag Ford Transmission GmbH in first quarter 2021 (see Note 17), and a loss on the Ford Credit Brazil liquidation in first quarter 2022 (see Note 16).

NOTE 5. INCOME TAXES

For interim tax reporting, we estimate one single effective tax rate for tax jurisdictions not subject to a valuation allowance, which is applied to the year-to-date ordinary income/(loss). Tax effects of significant unusual or infrequently occurring items are excluded from the estimated annual effective tax rate calculation and recognized in the interim period in which they occur.

NOTE 6. CAPITAL STOCK AND EARNINGS/(LOSS) PER SHARE

Earnings/(Loss) Per Share Attributable to Ford Motor Company Common and Class B Stock

Basic and diluted earnings/(loss) per share were calculated using the following (in millions):


		First Quarter			First Quarter
			2020			2021			2021		2022
Net income/(loss) attributable to Ford Motor Company	Net income/(loss) attributable to Ford Motor Company		$	(1,993)		$	3,262	Net income/(loss) attributable to Ford Motor Company	$	3,262	$	(3,110)

Basic and Diluted Shares	Basic and Diluted Shares							Basic and Diluted Shares
Basic shares (average shares outstanding)	Basic shares (average shares outstanding)		3,963			3,980		Basic shares (average shares outstanding)	3,980		4,008
Net dilutive options, unvested restricted stock units, and unvested restricted stock shares (a)			0			36
Net dilutive options, unvested restricted stock units, unvested restricted stock shares, and convertible debt (a)								Net dilutive options, unvested restricted stock units, unvested restricted stock shares, and convertible debt (a)	36		—
Diluted shares	Diluted shares		3,963			4,016		Diluted shares	4,016		4,008

__________

(a)In the first quarter of ~~2020,~~2022, there were 3056 million shares excluded from the calculation of diluted earnings/(loss) per share, due to their anti-dilutive effect.

Item 1. Financial Statements (Continued)

FORD MOTOR COMPANY AND SUBSIDIARIES

NOTES TO THE FINANCIAL STATEMENTS

NOTE 7. CASH, CASH EQUIVALENTS, AND MARKETABLE SECURITIES

The fair values of cash, cash equivalents, and marketable securities measured at fair value on a recurring basis were as follows (in millions):


			December 31, 2020								December 31, 2021
		Fair Value Level	Company excluding Ford Credit		Ford Credit		Consolidated			Fair Value Level	Company excluding Ford Credit		Ford Credit		Consolidated
Cash and cash equivalents	Cash and cash equivalents								Cash and cash equivalents
U.S. government	U.S. government	1	$	2,940	$	3,255	$	6,195	U.S. government	1	$	2,877	$	711	$	3,588
U.S. government agencies	U.S. government agencies	2	850		640		1,490		U.S. government agencies	2	355		240		595
Non-U.S. government and agencies	Non-U.S. government and agencies	2	600		717		1,317		Non-U.S. government and agencies	2	55		152		207
Corporate debt	Corporate debt	2	605		970		1,575		Corporate debt	2	105		940		1,045
Total marketable securities classified as cash equivalents	Total marketable securities classified as cash equivalents		4,995		5,582		10,577		Total marketable securities classified as cash equivalents		3,392		2,043		5,435
Cash, time deposits, and money market funds	Cash, time deposits, and money market funds		5,899		8,767		14,666		Cash, time deposits, and money market funds		6,185		8,920		15,105
Total cash and cash equivalents	Total cash and cash equivalents		$	10,894	$	14,349	$	25,243	Total cash and cash equivalents		$	9,577	$	10,963	$	20,540

Marketable securities	Marketable securities								Marketable securities
U.S. government	U.S. government	1	$	4,709	$	1,082	$	5,791	U.S. government	1	$	4,018	$	864	$	4,882
U.S. government agencies	U.S. government agencies	2	3,259		485		3,744		U.S. government agencies	2	2,270		75		2,345
Non-U.S. government and agencies	Non-U.S. government and agencies	2	4,448		2,693		7,141		Non-U.S. government and agencies	2	3,373		697		4,070
Corporate debt	Corporate debt	2	7,095		308		7,403		Corporate debt	2	6,299		304		6,603
Equities (a)	Equities (a)	1	113		0		113		Equities (a)	1	10,673		—		10,673
Other marketable securities	Other marketable securities	2	234		292		526		Other marketable securities	2	247		233		480
Total marketable securities	Total marketable securities		$	19,858	$	4,860	$	24,718	Total marketable securities		$	26,880	$	2,173	$	29,053

Restricted cash	Restricted cash		$	45	$	647	$	692	Restricted cash		$	69	$	128	$	197

Cash, cash equivalents, and restricted cash in held-for-sale assets	Cash, cash equivalents, and restricted cash in held-for-sale assets		$	0	$	0	$	0	Cash, cash equivalents, and restricted cash in held-for-sale assets		$	—	$	—	$	—
			March 31, 2021								March 31, 2022
		Fair Value Level	Company excluding Ford Credit		Ford Credit		Consolidated			Fair Value Level	Company excluding Ford Credit		Ford Credit		Consolidated
Cash and cash equivalents	Cash and cash equivalents								Cash and cash equivalents
U.S. government	U.S. government	1	$	1,733	$	16	$	1,749	U.S. government	1	$	1,723	$	615	$	2,338
U.S. government agencies	U.S. government agencies	2	129		50		179		U.S. government agencies	2	1,072		200		1,272
Non-U.S. government and agencies	Non-U.S. government and agencies	2	1,197		1,345		2,542		Non-U.S. government and agencies	2	830		436		1,266
Corporate debt	Corporate debt	2	453		945		1,398		Corporate debt	2	50		889		939
Total marketable securities classified as cash equivalents	Total marketable securities classified as cash equivalents		3,512		2,356		5,868		Total marketable securities classified as cash equivalents		3,675		2,140		5,815
Cash, time deposits, and money market funds	Cash, time deposits, and money market funds		7,445		8,513		15,958		Cash, time deposits, and money market funds		6,759		8,439		15,198
Total cash and cash equivalents	Total cash and cash equivalents		$	10,957	$	10,869	$	21,826	Total cash and cash equivalents		$	10,434	$	10,579	$	21,013

Marketable securities	Marketable securities								Marketable securities
U.S. government	U.S. government	1	$	4,955	$	537	$	5,492	U.S. government	1	$	2,928	$	413	$	3,341
U.S. government agencies	U.S. government agencies	2	3,176		600		3,776		U.S. government agencies	2	2,120		75		2,195
Non-U.S. government and agencies	Non-U.S. government and agencies	2	4,462		2,195		6,657		Non-U.S. government and agencies	2	2,486		1,036		3,522
Corporate debt	Corporate debt	2	7,388		342		7,730		Corporate debt	2	5,151		297		5,448
Equities (a)	Equities (a)	1	100		0		100		Equities (a)	1	5,223		—		5,223
Other marketable securities	Other marketable securities	2	252		274		526		Other marketable securities	2	271		215		486
Total marketable securities	Total marketable securities		$	20,333	$	3,948	$	24,281	Total marketable securities		$	18,179	$	2,036	$	20,215

Restricted cash	Restricted cash		$	46	$	162	$	208	Restricted cash		$	75	$	119	$	194

Cash, cash equivalents, and restricted cash in held-for-sale assets	Cash, cash equivalents, and restricted cash in held-for-sale assets		$	16	$	0	$	16	Cash, cash equivalents, and restricted cash in held-for-sale assets		$	76	$	—	$	76

__________

(a)~~Net unrealized gains/losses incurred during the reporting periods on equity securities still held~~Includes $10.6 billion and $5.1 billion of Rivian common shares valued at $103.69 and $50.24 per share as of December 31, ~~2020~~2021 and March 31, 2022, respectively. During full year 2021 and first quarter 2022, we recognized an unrealized gain of $8.3 billion and an unrealized loss of $5.4 billion, respectively. At April 26, 2022, Rivian common shares were valued at $30.68 per share. Ford’s Rivian shares are subject to a ~~$24 million gain and a $13 million loss, respectively.~~contractual 180-day lock-up period that commenced with Rivian’s initial public offering (“IPO”) on November 10, 2021.

Item 1. Financial Statements (Continued)

FORD MOTOR COMPANY AND SUBSIDIARIES

NOTES TO THE FINANCIAL STATEMENTS

NOTE 7. CASH, CASH EQUIVALENTS, AND MARKETABLE SECURITIES (Continued)

The cash equivalents and marketable securities accounted for as available-for-sale (“AFS”) securities were as follows (in millions):


		December 31, 2020															December 31, 2021
										Fair Value of Securities with Contractual Maturities															Fair Value of Securities with Contractual Maturities
		Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value		Within 1 Year		After 1 Year through 5 Years		After 5 Years			Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value		Within 1 Year		After 1 Year through 5 Years		After 5 Years
Company excluding Ford Credit	Company excluding Ford Credit															Company excluding Ford Credit
U.S. government	U.S. government	$	2,894	$	44	$	0	$	2,938	$	1,649	$	1,286	$	3	U.S. government	$	3,821	$	12	$	(14)	$	3,819	$	1,360	$	2,435	$	24
U.S. government agencies	U.S. government agencies	2,588		15		0		2,603		772		1,629		202		U.S. government agencies	2,249		2		(21)		2,230		316		1,802		112
Non-U.S. government and agencies	Non-U.S. government and agencies	2,926		31		0		2,957		1,330		1,617		10		Non-U.S. government and agencies	2,599		6		(21)		2,584		854		1,708		22
Corporate debt	Corporate debt	7,482		102		(1)		7,583		3,566		3,987		30		Corporate debt	6,373		21		(23)		6,371		2,645		3,726		—
Other marketable securities	Other marketable securities	212		3		0		215		1		147		67		Other marketable securities	228		1		(1)		228		—		150		78
Total	Total	$	16,102	$	195	$	(1)	$	16,296	$	7,318	$	8,666	$	312	Total	$	15,270	$	42	$	(80)	$	15,232	$	5,175	$	9,821	$	236

		March 31, 2021															March 31, 2022
										Fair Value of Securities with Contractual Maturities															Fair Value of Securities with Contractual Maturities
		Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value		Within 1 Year		After 1 Year through 5 Years		After 5 Years			Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value		Within 1 Year		After 1 Year through 5 Years		After 5 Years
Company excluding Ford Credit	Company excluding Ford Credit															Company excluding Ford Credit
U.S. government	U.S. government	$	3,590	$	33	$	0	$	3,623	$	1,600	$	2,023	$	0	U.S. government	$	2,910	$	—	$	(79)	$	2,831	$	935	$	1,874	$	22
U.S. government agencies	U.S. government agencies	2,399		7		(11)		2,395		418		1,805		172		U.S. government agencies	2,220		—		(78)		2,142		427		1,629		86
Non-U.S. government and agencies	Non-U.S. government and agencies	2,517		21		(7)		2,531		1,172		1,336		23		Non-U.S. government and agencies	2,384		—		(82)		2,302		441		1,847		14
Corporate debt	Corporate debt	7,689		68		(6)		7,751		3,895		3,846		10		Corporate debt	5,290		2		(125)		5,167		1,558��		3,601		8
Other marketable securities	Other marketable securities	232		2		0		234		1		167		66		Other marketable securities	261		—		(6)		255		—		186		69
Total	Total	$	16,427	$	131	$	(24)	$	16,534	$	7,086	$	9,177	$	271	Total	$	13,065	$	2	$	(370)	$	12,697	$	3,361	$	9,137	$	199

Sales proceeds and gross realized gains/losses from the sale of AFS securities for the periods ended March 31 were as follows (in millions):


		First Quarter			First Quarter
			2020			2021			2021		2022
Company excluding Ford Credit	Company excluding Ford Credit							Company excluding Ford Credit
Sales proceeds	Sales proceeds		$	1,865		$	2,880	Sales proceeds	$	2,880	$	4,004
Gross realized gains	Gross realized gains		7			13		Gross realized gains	13		6
Gross realized losses	Gross realized losses		7			2		Gross realized losses	2		6

Item 1. Financial Statements (Continued)

FORD MOTOR COMPANY AND SUBSIDIARIES

NOTES TO THE FINANCIAL STATEMENTS

NOTE 7. CASH, CASH EQUIVALENTS, AND MARKETABLE SECURITIES (Continued)

The present fair values and gross unrealized losses for cash equivalents and marketable securities accounted for as AFS securities that were in an unrealized loss position, aggregated by investment category and the length of time that individual securities have been in a continuous loss position, were as follows (in millions):


		December 31, 2020													December 31, 2021
		Less than 1 Year				1 Year or Greater				Total					Less than 1 Year				1 Year or Greater				Total
		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses			Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
Company excluding Ford Credit	Company excluding Ford Credit													Company excluding Ford Credit
U.S. government	U.S. government	$	181	$	0	$	0	$	0	$	181	$	0	U.S. government	$	2,598	$	(14)	$	—	$	—	$	2,598	$	(14)
U.S. government agencies	U.S. government agencies	83		0		0		0		83		0		U.S. government agencies	1,809		(19)		73		(2)		1,882		(21)
Non-U.S. government and agencies	Non-U.S. government and agencies	164		0		10		0		174		0		Non-U.S. government and agencies	1,614		(20)		38		(1)		1,652		(21)
Corporate debt	Corporate debt	1,538		(1)		9		0		1,547		(1)		Corporate debt	3,637		(21)		71		(2)		3,708		(23)
Other marketable securities	Other marketable securities	23		0		13		0		36		0		Other marketable securities	178		(1)		15		—		193		(1)
Total	Total	$	1,989	$	(1)	$	32	$	0	$	2,021	$	(1)	Total	$	9,836	$	(75)	$	197	$	(5)	$	10,033	$	(80)

		March 31, 2021													March 31, 2022
		Less than 1 Year				1 Year or Greater				Total					Less than 1 Year				1 Year or Greater				Total
		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses			Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
Company excluding Ford Credit	Company excluding Ford Credit													Company excluding Ford Credit
U.S. government	U.S. government	$	641	$	0	$	0	$	0	$	641	$	0	U.S. government	$	2,788	$	(79)	$	—	$	—	$	2,788	$	(79)
U.S. government agencies	U.S. government agencies	1,126		(11)		0		0		1,126		(11)		U.S. government agencies	1,966		(77)		73		(1)		2,039		(78)
Non-U.S. government and agencies	Non-U.S. government and agencies	703		(7)		0		0		703		(7)		Non-U.S. government and agencies	2,120		(81)		38		(1)		2,158		(82)
Corporate debt	Corporate debt	1,199		(6)		9		0		1,208		(6)		Corporate debt	4,683		(123)		71		(2)		4,754		(125)
Other marketable securities	Other marketable securities	94		0		8		0		102		0		Other marketable securities	236		(6)		15		—		251		(6)
Total	Total	$	3,763	$	(24)	$	17	$	0	$	3,780	$	(24)	Total	$	11,793	$	(366)	$	197	$	(4)	$	11,990	$	(370)

We determine credit losses on AFS debt securities using the specific identification method. During the first quarter of ~~2021,~~2022, we did not recognize any credit loss. The unrealized losses on securities are due to changes in interest rates and market liquidity.

Cash, Cash Equivalents, and Restricted Cash

Cash, cash equivalents, and restricted cash, as reported in the consolidated statements of cash flows, were as follows (in millions):


		December 31, 2020		March 31, 2021			December 31, 2021		March 31, 2022
Cash and cash equivalents	Cash and cash equivalents	$	25,243	$	21,826	Cash and cash equivalents	$	20,540	$	21,013
Restricted cash (a)	Restricted cash (a)	692		208		Restricted cash (a)	197		194
Cash, cash equivalents, and restricted cash in held-for-sale assets	Cash, cash equivalents, and restricted cash in held-for-sale assets	0		16		Cash, cash equivalents, and restricted cash in held-for-sale assets	—		76
Total cash, cash equivalents, and restricted cash	Total cash, cash equivalents, and restricted cash	$	25,935	$	22,050	Total cash, cash equivalents, and restricted cash	$	20,737	$	21,283

__________

(a)Included in Other assets in the non-current assets section of our consolidated balance sheets.

Item 1. Financial Statements (Continued)

FORD MOTOR COMPANY AND SUBSIDIARIES

NOTES TO THE FINANCIAL STATEMENTS

NOTE 8. FORD CREDIT FINANCE RECEIVABLES AND ALLOWANCE FOR CREDIT LOSSES

Ford Credit manages finance receivables as “consumer” and “non-consumer” portfolios. The receivables are generally secured by the vehicles, inventory, or other property being financed.

Finance receivables are recorded at the time of origination or purchase at fair value and are subsequently reported at amortized cost, net of any allowance for credit losses.

For all finance receivables, Ford Credit defines “past due” as any payment, including principal and interest, that is at least 31 days past the contractual due date.

Ford Credit finance receivables, net were as follows (in millions):


		December 31, 2020		March 31, 2021			December 31, 2021		March 31, 2022
Consumer	Consumer					Consumer
Retail installment contracts, gross	Retail installment contracts, gross	$	73,631	$	71,981	Retail installment contracts, gross	$	69,148	$	67,699
Finance leases, gross	Finance leases, gross	8,431		8,192		Finance leases, gross	7,318		7,079
Retail financing, gross	Retail financing, gross	82,062		80,173		Retail financing, gross	76,466		74,778
Unearned interest supplements	Unearned interest supplements	(3,987)		(3,696)		Unearned interest supplements	(3,020)		(2,796)
Consumer finance receivables	Consumer finance receivables	78,075		76,477		Consumer finance receivables	73,446		71,982
Non-Consumer	Non-Consumer					Non-Consumer
Dealer financing	Dealer financing	20,908		17,980		Dealer financing	11,278		11,638
Non-Consumer finance receivables	Non-Consumer finance receivables	20,908		17,980		Non-Consumer finance receivables	11,278		11,638
Total recorded investment	Total recorded investment	$	98,983	$	94,457	Total recorded investment	$	84,724	$	83,620

Recorded investment in finance receivables	Recorded investment in finance receivables	$	98,983	$	94,457	Recorded investment in finance receivables	$	84,724	$	83,620
Allowance for credit losses	Allowance for credit losses	(1,305)		(1,223)		Allowance for credit losses	(925)		(845)
Total finance receivables, net	Total finance receivables, net	$	97,678	$	93,234	Total finance receivables, net	$	83,799	$	82,775

Current portion	Current portion	$	42,401	$	40,664	Current portion	$	32,543	$	32,775
Non-current portion	Non-current portion	55,277		52,570		Non-current portion	51,256		50,000
Total finance receivables, net	Total finance receivables, net	$	97,678	$	93,234	Total finance receivables, net	$	83,799	$	82,775

Net finance receivables subject to fair value (a)	Net finance receivables subject to fair value (a)	$	89,651	$	85,436	Net finance receivables subject to fair value (a)	$	76,796	$	76,005
Fair value (b)	Fair value (b)	91,238		86,808		Fair value (b)	77,648		75,229

__________

(a)Net finance receivables subject to fair value exclude finance leases.

(b)The fair value of finance receivables is categorized within Level 3 of the fair value hierarchy.

Ford Credit’s finance leases are comprised of sales-type and direct financing leases. Financing revenue from finance leases for the first quarter of ~~2020~~2021 and ~~2021~~2022 was ~~$95~~$90 million and ~~$90~~$77 million, respectively, and is included in Ford Credit revenues on our consolidated income statements.

At December 31, ~~2020~~2021 and March 31, ~~2021,~~2022, accrued interest was ~~$181~~$125 million and ~~$164~~$122 million, respectively, which we report in Other assets in the current assets section of our consolidated balance sheets.

Included in the recorded investment in finance receivables at December 31, ~~2020~~2021 and March 31, ~~2021,~~2022, were consumer receivables of ~~$43.7~~$39 billion and ~~$41.2~~$38.3 billion, respectively, and non-consumer receivables of ~~$16.4~~$12 billion and ~~$15.3~~$11.9 billion, respectively, (including Automotive receivables sold to Ford Credit, which we report in Trade and other receivables), that have been sold for legal purposes in securitization transactions but continue to be reported in our consolidated financial statements. The receivables are available only for payment of the debt issued by, and other obligations of, the securitization entities that are parties to those securitization transactions; they are not available to pay the other obligations or the claims of Ford Credit’s other creditors. Ford Credit holds the right to receive the excess cash flows not needed to pay the debt issued by, and other obligations of, the securitization entities that are parties to those securitization transactions.

Item 1. Financial Statements (Continued)

FORD MOTOR COMPANY AND SUBSIDIARIES

NOTES TO THE FINANCIAL STATEMENTS

NOTE 8. FORD CREDIT FINANCE RECEIVABLES AND ALLOWANCE FOR CREDIT LOSSES (Continued)

Credit Quality

Consumer Portfolio. Credit quality ratings for consumer receivables are based on Ford Credit’s aging analysis. Consumer receivables credit quality ratings are as follows:

•Pass – current to 60 days past due;

•Special Mention – 61 to 120 days past due and in intensified collection status; and

•Substandard – greater than 120 days past due and for which the uncollectible portion of the receivables has already been charged off, as measured using the fair value of collateral less costs to sell.

The credit quality analysis of consumer receivables at December 31, ~~2020~~2021 was as follows (in millions):


		Amortized Cost Basis by Origination Year																	Amortized Cost Basis by Origination Year
		Prior to 2016		2016		2017		2018		2019		2020		Total		Percent			Prior to 2017		2017		2018		2019		2020		2021		Total		Percent
Consumer	Consumer																	Consumer
31 - 60 days past due	31 - 60 days past due	$	45	$	62	$	103	$	162	$	166	$	143	$	681	0.9	%	31 - 60 days past due	$	39	$	52	$	98	$	120	$	186	$	91	$	586	0.8	%
61 - 120 days past due	61 - 120 days past due	7		12		24		44		45		31		163		0.2		61 - 120 days past due	7		10		20		29		40		21		127		0.2
Greater than 120 days past due	Greater than 120 days past due	11		6		7		8		7		2		41		0		Greater than 120 days past due	10		6		6		9		11		1		43		—
Total past due	Total past due	63		80		134		214		218		176		885		1.1		Total past due	56		68		124		158		237		113		756		1.0
Current	Current	782		2,518		6,648		13,704		20,822		32,716		77,190		98.9		Current	812		2,607		6,559		12,689		22,701		27,322		72,690		99.0
Total	Total	$	845	$	2,598	$	6,782	$	13,918	$	21,040	$	32,892	$	78,075	100.0	%	Total	$	868	$	2,675	$	6,683	$	12,847	$	22,938	$	27,435	$	73,446	100.0	%

The credit quality analysis of consumer receivables at March 31, ~~2021~~2022 was as follows (in millions):


		Amortized Cost Basis by Origination Year																	Amortized Cost Basis by Origination Year
		Prior to 2017		2017		2018		2019		2020		2021		Total		Percent			Prior to 2018		2018		2019		2020		2021		2022		Total		Percent
Consumer	Consumer																	Consumer
31 - 60 days past due	31 - 60 days past due	$	57	$	64	$	106	$	117	$	117	$	5	$	466	0.6	%	31 - 60 days past due	$	76	$	84	$	116	$	192	$	123	$	9	$	600	0.8	%
61 - 120 days past due	61 - 120 days past due	9		14		25		31		30		1		110		0.1		61 - 120 days past due	11		16		20		31		26		1		105		0.2
Greater than 120 days past due	Greater than 120 days past due	16		7		7		7		3		0		40		0.1		Greater than 120 days past due	15		6		8		13		1		—		43		—
Total past due	Total past due	82		85		138		155		150		6		616		0.8		Total past due	102		106		144		236		150		10		748		1.0
Current	Current	2,452		5,450		11,743		18,729		30,560		6,927		75,861		99.2		Current	2,564		5,354		10,871		20,319		25,281		6,845		71,234		99.0
Total	Total	$	2,534	$	5,535	$	11,881	$	18,884	$	30,710	$	6,933	$	76,477	100.0	%	Total	$	2,666	$	5,460	$	11,015	$	20,555	$	25,431	$	6,855	$	71,982	100.0	%

Non-Consumer Portfolio. The credit quality of dealer financing receivables is evaluated based on Ford Credit’s internal dealer risk rating analysis. Ford Credit uses a proprietary model to assign each dealer a risk rating. This model uses historical dealer performance data to identify key factors about a dealer that are considered most significant in predicting a dealer’s ability to meet its financial obligations. Ford Credit also considers numerous other financial and qualitative factors of the dealer’s operations, including capitalization and leverage, liquidity and cash flow, profitability, and credit history with Ford Credit and other creditors.

Dealers are assigned to one of four groups according to risk ratings as follows:

•Group I – strong to superior financial metrics;

•Group II – fair to favorable financial metrics;

•Group III – marginal to weak financial metrics; and

•Group IV – poor financial metrics, including dealers classified as uncollectible.

Item 1. Financial Statements (Continued)

FORD MOTOR COMPANY AND SUBSIDIARIES

NOTES TO THE FINANCIAL STATEMENTS

NOTE 8. FORD CREDIT FINANCE RECEIVABLES AND ALLOWANCE FOR CREDIT LOSSES (Continued)

The credit quality analysis of dealer financing receivables at December 31, ~~2020~~2021 was as follows (in millions):


		Amortized Cost Basis by Origination Year														Wholesale Loans													Amortized Cost Basis by Origination Year																												Wholesale Loans
		Dealer Loans																									Dealer Loans
		Prior to 2016		2016		2017		2018		2019		2020		Total				Total				Percent					Prior to 2017				2017				2018				2019				2020				2021				Total								Total			Percent
Group I	Group I	$	503	$	129	$	110	$	188	$	70	$	248	$	1,248			$	13,160			$	14,408			68.9	%	Group I			$	391			$	68			$	151			$	45			$	109			$	345			$	1,109				$	6,751		$	7,860			69.7	%
Group II	Group II	38		20		11		35		3		87		194				4,680				4,874				23.3		Group II			11				7				26				2				4				54				104				2,689			2,793				24.8
Group III	Group III	9		0		3		19		3		35		69		1,464				1,533				7.3		Group III			8				—				1				—				1				20				30				529			559			4.9
Group IV	Group IV	2		0		0		0		2		6		10		83				93				0.5		Group IV			—				—				4				—				—				6				10				56			66			0.6
Total (a)	Total (a)	$	552	$	149	$	124	$	242	$	78	$	376	$	1,521	$	19,387			$	20,908			100.0	%	Total (a)			$	410			$	75			$	182			$	47			$	114			$	425			$	1,253			$	10,025		$	11,278		100.0		%

__________

(a)Total past due dealer financing receivables at December 31, ~~2020~~2021 were ~~$99~~$62 million.

The credit quality analysis of dealer financing receivables at March 31, ~~2021~~2022 was as follows (in millions):


		Amortized Cost Basis by Origination Year														Wholesale Loans													Amortized Cost Basis by Origination Year																												Wholesale Loans
		Dealer Loans																									Dealer Loans
		Prior to 2017		2017		2018		2019		2020		2021		Total				Total				Percent					Prior to 2018				2018				2019				2020				2021				2022				Total								Total			Percent
Group I	Group I	$	582	$	108	$	178	$	55	$	146	$	124	$	1,193			$	10,737			$	11,930			66.4	%	Group I			$	470			$	155			$	44			$	78			$	232			$	111			$	1,090				$	7,096		$	8,186			70.3	%
Group II	Group II	31		11		40		3		23		63		171				4,358				4,529				25.2		Group II			12				26				1				5				13				42				99				2,845			2,944				25.3
Group III	Group III	17		0		9		2		13		24		65		1,380				1,445				8.0		Group III			8				—				—				—				5				11				24				423			447			3.9
Group IV	Group IV	0		0		1		1		3		3		8		68				76				0.4		Group IV			—				5				—				1				2				2				10				51			61			0.5
Total (a)	Total (a)	$	630	$	119	$	228	$	61	$	185	$	214	$	1,437	$	16,543			$	17,980			100.0	%	Total (a)			$	490			$	186			$	45			$	84			$	252			$	166			$	1,223			$	10,415		$	11,638		100.0		%

__________

(a)Total past due dealer financing receivables at March 31, ~~2021~~2022 were ~~$70~~$13 million.

Non-Accrual of Revenue. The accrual of financing revenue is discontinued at the time a receivable is determined to be uncollectible or when it is 90 days past due. Accounts may be restored to accrual status only when a customer settles all past-due deficiency balances and future payments are reasonably assured. For receivables in non-accrual status, subsequent financing revenue is recognized only to the extent a payment is received. Payments are generally applied first to outstanding interest and then to the unpaid principal balance.

Troubled Debt Restructuring (“TDR”). A restructuring of debt constitutes a TDR if Ford Credit grants a concession ~~is granted~~ to a debtor for economic or legal reasons related to the debtor’s financial difficulties that Ford Credit otherwise would not consider. Consumer and non-consumer receivables that have a modified interest rate below market rate or that were modified in reorganization proceedings pursuant to the U.S. Bankruptcy Code, except non-consumer receivables that are current with minimal risk of loss, are considered to be TDRs. Ford Credit does not grant concessions on the principal balance of the receivables. If a receivable is modified in a reorganization proceeding, all payment requirements of the reorganization plan need to be met before remaining balances are forgiven.

Allowance for Credit Losses

The allowance for credit losses represents an estimate of the lifetime expected credit losses inherent in finance receivables as of the balance sheet date. The adequacy of the allowance for credit losses is assessed quarterly.

Adjustments to the allowance for credit losses are made by recording charges to Ford Credit interest, operating, and other expenses on our consolidated income statements. The uncollectible portion of a finance receivable is charged to the allowance for credit losses at the earlier of when an account is deemed to be uncollectible or when an account is 120 days delinquent, taking into consideration the financial condition of the customer or borrower, the value of the collateral, recourse to guarantors, and other factors.

Item 1. Financial Statements (Continued)

FORD MOTOR COMPANY AND SUBSIDIARIES

NOTES TO THE FINANCIAL STATEMENTS

NOTE 8. FORD CREDIT FINANCE RECEIVABLES AND ALLOWANCE FOR CREDIT LOSSES (Continued)

Charge-offs on finance receivables include uncollected amounts related to principal, interest, late fees, and other allowable charges. Recoveries on finance receivables previously charged off as uncollectible are credited to the allowance for credit losses. In the event Ford Credit repossesses the collateral, the receivable is charged off and the collateral is recorded at its estimated fair value less costs to sell and reported in Other assets on our consolidated balance sheets.

An analysis of the allowance for credit losses related to finance receivables for the periods ended March 31 was as follows (in millions):


		First Quarter 2020			First Quarter 2021
			Consumer			Non-Consumer		Total			Consumer		Non-Consumer		Total
Allowance for credit losses	Allowance for credit losses									Allowance for credit losses
Beginning balance	Beginning balance		$	496		$	17	$	513	Beginning balance	$	1,245	$	60	$	1,305
Adoption of ASU 2016-13 (a)			247			5		252
Charge-offs	Charge-offs		(145)			(1)		(146)		Charge-offs	(97)		—		(97)
Recoveries	Recoveries		43			2		45		Recoveries	53		3		56
Provision for credit losses			534			52		586
Other (b)			(18)			(1)		(19)
Provision for/(Benefit from) credit losses										Provision for/(Benefit from) credit losses	(30)		(10)		(40)
Other (a)										Other (a)	(1)		—		(1)
Ending balance	Ending balance		$	1,157		$	74	$	1,231	Ending balance	$	1,170	$	53	$	1,223


		First Quarter 2021			First Quarter 2022
			Consumer			Non-Consumer		Total			Consumer		Non-Consumer		Total
Allowance for credit losses	Allowance for credit losses									Allowance for credit losses
Beginning balance	Beginning balance		$	1,245		$	60	$	1,305	Beginning balance	$	903	$	22	$	925
Charge-offs	Charge-offs		(97)			0		(97)		Charge-offs	(62)		—		(62)
Recoveries	Recoveries		53			3		56		Recoveries	43		1		44
Provision for credit losses			(30)			(10)		(40)
Provision for/(Benefit from) credit losses										Provision for/(Benefit from) credit losses	(59)		(5)		(64)
Other ~~(b)~~(a)	Other ~~(b)~~(a)		(1)			0		(1)		Other ~~(b)~~(a)	1		1		2
Ending balance	Ending balance		$	1,170		$	53	$	1,223	Ending balance	$	826	$	19	$	845

__________

(a)~~Cumulative pre-tax adjustments related to the adoption of ASU 2016-13, Credit Losses - Measurement of Credit Losses on Financial Instruments, were recorded in retained earnings as of January 1, 2020.~~

~~(b)~~Primarily represents amounts related to translation adjustments.

The allowance for credit losses considers economic conditions attributable to the COVID-19 pandemic. The allowance reflects economic uncertainty and an expectation of continued higher unemployment which increases the probability of default and loss given default rates used in Ford Credit’s estimate of the lifetime expected credit losses for its consumer portfolio, especially in the United States.

During the first quarter of ~~2021,~~2022, the allowance for credit losses decreased ~~$82~~$80 million, primarily reflecting improvement in the economic outlook that caused Ford Credit to lower its expectation of lifetime losses attributable to COVID-19. The full impact of COVID-19 on Ford Credit’s credit losses depends on future developments, such as the ultimate duration and scope of the outbreak (including any potential future waves and the success of vaccination programs), resolution of macroeconomic ~~uncertainty, and the extent to which its customers and dealers are able to utilize government relief and payment deferral programs.~~assumptions driven by COVID-19. Although net charge-offs ~~remained low~~ in the quarter ended March 31, ~~2021,~~2022 remained low, due in part to high vehicle auction values, the ~~future~~ impact of ~~COVID-19~~higher inflation on future credit losses remains uncertain. Ford Credit will continue to monitor economic trends and conditions and portfolio performance and will adjust the reserve accordingly.

Item 1. Financial Statements (Continued)

FORD MOTOR COMPANY AND SUBSIDIARIES

NOTES TO THE FINANCIAL STATEMENTS

NOTE 9. INVENTORIES

Inventories were as follows (in millions):


		December 31, 2020		March 31, 2021			December 31, 2021		March 31, 2022
Raw materials, work-in-process, and supplies	Raw materials, work-in-process, and supplies	$	4,676	$	5,184	Raw materials, work-in-process, and supplies	$	5,785	$	6,117
Finished products	Finished products	6,132		7,558		Finished products	6,280		8,530
Total inventories	Total inventories	$	10,808	$	12,742	Total inventories	$	12,065	$	14,647

Finished products at March 31, ~~2021~~2022 in the table above ~~include~~includes approximately 53,000 vehicles completed but awaiting installation of components affected by the semiconductor supply shortage, after which, they will proceed through an additional quality review process prior to being shipped to our dealers.

NOTE 10. OTHER INVESTMENTS

We have investments in entities not accounted for under the equity method for which fair values are not readily available. We record these investments at cost (less impairment, if any), adjusted for observable price changes in orderly transactions for the identical or a similar investment of the same issuer. We report the carrying value of these investments in Other assets in the non-current assets section of our consolidated balance sheets. These investments were ~~$1.7~~$0.9 billion and ~~$2.8~~$1.2 billion at December 31, ~~2020~~2021 and March 31, ~~2021,~~2022, respectively. ~~The increase from December 31, 2020 primarily reflects an observable event of $902 million (measured using an option pricing model) for our investment in Rivian, reported in~~ ~~Other income/(loss), net~~ ~~on our consolidated income statements.~~ The cumulative net unrealized gain from adjustments related to Other Investments held at March 31, ~~2021~~2022 is ~~$1.2 billion.~~$138 million.

NOTE 11. GOODWILL

The net carrying amount of goodwill was ~~$258~~$619 million and ~~$566~~$617 million at December 31, ~~2020~~2021 and March 31, ~~2021,~~2022, respectively, and is reported in Other assets in the non-current assets section of our consolidated balance sheets. ~~The increase from December 31, 2020 reflects the acquisition of Getrag Ford Transmissions GmbH in March 2021 (see Note 17).~~

Item 1. Financial Statements (Continued)

FORD MOTOR COMPANY AND SUBSIDIARIES

NOTES TO THE FINANCIAL STATEMENTS

NOTE 12. OTHER LIABILITIES AND DEFERRED REVENUE

Other liabilities and deferred revenue were as follows (in millions):


		December 31, 2020		March 31, 2021			December 31, 2021		March 31, 2022
Current	Current					Current
Dealer and dealers’ customer allowances and claims	Dealer and dealers’ customer allowances and claims	$	12,702	$	10,882	Dealer and dealers’ customer allowances and claims	$	8,300	$	8,134
Deferred revenue	Deferred revenue	2,161		2,062		Deferred revenue	2,349		2,328
Employee benefit plans	Employee benefit plans	1,752		1,604		Employee benefit plans	1,687		1,289
Accrued interest	Accrued interest	1,215		1,130		Accrued interest	888		781
OPEB (a)	OPEB (a)	339		340		OPEB (a)	332		333
Pension (a)	Pension (a)	193		192		Pension (a)	202		202
Operating lease liabilities	Operating lease liabilities	323		329		Operating lease liabilities	345		351
Other	Other	4,960		4,456		Other	4,583		4,845
Total current other liabilities and deferred revenue	Total current other liabilities and deferred revenue	$	23,645	$	20,995	Total current other liabilities and deferred revenue	$	18,686	$	18,263
Non-current	Non-current					Non-current
Pension (a)	Pension (a)	$	10,738	$	10,253	Pension (a)	$	8,658	$	8,407
OPEB (a)	OPEB (a)	6,236		6,182		OPEB (a)	5,708		5,669
Dealer and dealers’ customer allowances and claims	Dealer and dealers’ customer allowances and claims	3,072		3,272		Dealer and dealers’ customer allowances and claims	4,909		5,076
Deferred revenue	Deferred revenue	4,559		4,550		Deferred revenue	4,683		4,864
Operating lease liabilities	Operating lease liabilities	991		965		Operating lease liabilities	1,048		1,032
Employee benefit plans	Employee benefit plans	1,074		1,066		Employee benefit plans	1,007		990
Other	Other	1,709		2,419		Other	1,692		2,463
Total non-current other liabilities and deferred revenue	Total non-current other liabilities and deferred revenue	$	28,379	$	28,707	Total non-current other liabilities and deferred revenue	$	27,705	$	28,501

__________

(a)Balances at March 31, ~~2021~~2022 reflect pension and OPEB liabilities at December 31, ~~2020,~~2021, updated ~~for:~~(where applicable) for service and interest ~~cost;~~cost, expected return on ~~assets; curtailments, settlements, and associated interim remeasurement (where applicable);~~assets, separation ~~expense;~~expense, actual benefit ~~payments;~~payments, and cash contributions. ~~For plans without interim remeasurement, the~~The discount rate and rate of expected return assumptions are unchanged from year-end ~~2020.~~2021. Included in Other assets are pension assets of ~~$4.3~~$8.5 billion and ~~$4.8~~$8.8 billion at December 31, ~~2020~~2021 and March 31, ~~2021,~~2022, respectively.

Item 1. Financial Statements (Continued)

FORD MOTOR COMPANY AND SUBSIDIARIES

NOTES TO THE FINANCIAL STATEMENTS

NOTE 13. RETIREMENT BENEFITS

Defined Benefit Plans - Expense

The pre-tax net periodic benefit cost/(income) for our defined benefit pension and OPEB plans for the periods ended March 31 were as follows (in millions):


														First Quarter
														Pension Benefits
														U.S. Plans				Non-U.S. Plans				Worldwide OPEB
														2021		2022		2021		2022		2021		2022
Service cost													Service cost	$	138	$	125	$	144	$	111	$	12	$	10
Interest cost													Interest cost	223		263		99		134		32		37
Expected return on assets													Expected return on assets	(702)		(642)		(285)		(268)		—		—
Amortization of prior service costs/(credits)													Amortization of prior service costs/(credits)	1		—		5		7		(3)		(1)
Net remeasurement (gain)/loss													Net remeasurement (gain)/loss	423		—		(484)		—		—		—
Separation programs/other													Separation programs/other	2		4		37		7		—		—
Settlements and curtailments													Settlements and curtailments	39		—		1		—		—		—
Net periodic benefit cost/(income)													Net periodic benefit cost/(income)	$	124	$	(250)	$	(483)	$	(9)	$	41	$	46

	First Quarter
	Pension Benefits
	U.S. Plans				Non-U.S. Plans				Worldwide OPEB
	2020		2021		2020		2021		2020		2021
Service cost	$	130	$	138	$	131	$	144	$	12	$	12
Interest cost	323		223		133		99		43		32
Expected return on assets	(699)		(702)		(267)		(285)		0		0
Amortization of prior service costs/(credits)	1		1		9		5		(4)		(3)
Net remeasurement (gain)/loss	0		423		(80)		(484)		58		0
Separation programs/other	10		2		24		37		(1)		0
Settlements and curtailments	0		39		1		1		(2)		0
Net periodic benefit cost/(income)	$	(235)	$	124	$	(49)	$	(483)	$	106	$	41

The service cost component is included in Cost of sales and Selling, administrative, and other expenses. Other components of net periodic benefit cost/(income) are included in Other income/(loss), net on our consolidated income statements.

In the first quarter of ~~2020~~2021 and ~~2021,~~2022, we recognized ~~$24~~expenses of $38 million and ~~$38~~$7 million, respectively, ~~of expenses~~in non-U.S. pension plans related to ongoing ~~global~~ redesign programs. Until our ~~global redesign actions~~Global Redesign programs are completed, we anticipate further adjustments to our plans in subsequent periods.

Pension Plan Contributions

During ~~2021,~~2022, we expect to contribute between ~~$600~~$700 million and $800 million of cash to our global funded pension plans. We also expect to make about ~~$380~~$400 million of benefit payments to participants in unfunded plans. In the first quarter of ~~2021,~~2022, we contributed ~~$229~~$174 million to our ~~worldwide~~global funded pension plans and made ~~$96~~$98 million of benefit payments to participants in unfunded plans.

Item 1. Financial Statements (Continued)

FORD MOTOR COMPANY AND SUBSIDIARIES

NOTES TO THE FINANCIAL STATEMENTS

NOTE 14. DEBT

The carrying value of Company debt excluding Ford Credit and Ford Credit debt was as follows (in millions):


		December 31, 2020		March 31, 2021			December 31, 2021		March 31, 2022
Company excluding Ford Credit	Company excluding Ford Credit					Company excluding Ford Credit
Debt payable within one year	Debt payable within one year					Debt payable within one year
Short-term	Short-term	$	613	$	185	Short-term	$	286	$	275
Long-term payable within one year	Long-term payable within one year					Long-term payable within one year
Public unsecured debt securities	Public unsecured debt securities	180		266		Public unsecured debt securities	86		—
U.S. Department of Energy Advanced Technology Vehicles Manufacturing (“DOE ATVM”) Incentive Program	U.S. Department of Energy Advanced Technology Vehicles Manufacturing (“DOE ATVM”) Incentive Program	148		148		U.S. Department of Energy Advanced Technology Vehicles Manufacturing (“DOE ATVM”) Incentive Program	953		806
Delayed draw term loan						Delayed draw term loan	1,500		1,500
Other debt	Other debt	434		463		Other debt	348		345
Unamortized (discount)/premium	Unamortized (discount)/premium	(1)		(1)		Unamortized (discount)/premium	2		1
Total debt payable within one year	Total debt payable within one year	1,374		1,061		Total debt payable within one year	3,175		2,927
Long-term debt payable after one year	Long-term debt payable after one year					Long-term debt payable after one year
Public unsecured debt securities	Public unsecured debt securities	18,877		18,792		Public unsecured debt securities	13,643		13,643
Convertible notes		0		2,300
Delayed draw term loan		1,500		1,500
DOE ATVM Incentive Program		1,064		1,027
Convertible notes (a)						Convertible notes (a)	2,300		2,300
U.K. Export Finance Program	U.K. Export Finance Program	854		861		U.K. Export Finance Program	843		820
Other debt	Other debt	768		790		Other debt	768		735
Unamortized (discount)/premium	Unamortized (discount)/premium	(242)		(234)		Unamortized (discount)/premium	(188)		(180)
Unamortized issuance costs	Unamortized issuance costs	(188)		(217)		Unamortized issuance costs	(166)		(160)
Total long-term debt payable after one year	Total long-term debt payable after one year	22,633		24,819		Total long-term debt payable after one year	17,200		17,158
Total Company excluding Ford Credit	Total Company excluding Ford Credit	$	24,007	$	25,880	Total Company excluding Ford Credit	$	20,375	$	20,085
Fair value of Company debt excluding Ford Credit (a)		$	27,794	$	29,653
Fair value of Company debt excluding Ford Credit (b)						Fair value of Company debt excluding Ford Credit (b)	$	24,044	$	21,395
Ford Credit	Ford Credit					Ford Credit
Debt payable within one year	Debt payable within one year					Debt payable within one year
Short-term	Short-term	$	11,429	$	11,976	Short-term	$	14,810	$	14,088
Long-term payable within one year	Long-term payable within one year					Long-term payable within one year
Unsecured debt	Unsecured debt	17,185		16,222		Unsecured debt	13,660		12,045
Asset-backed debt	Asset-backed debt	21,345		20,207		Asset-backed debt	18,049		19,219
Unamortized (discount)/premium	Unamortized (discount)/premium	2		3		Unamortized (discount)/premium	1		1
Unamortized issuance costs	Unamortized issuance costs	(17)		(19)		Unamortized issuance costs	(13)		(14)
Fair value adjustments (b)		25		21
Fair value adjustments (c)						Fair value adjustments (c)	10		20
Total debt payable within one year	Total debt payable within one year	49,969		48,410		Total debt payable within one year	46,517		45,359
Long-term debt payable after one year	Long-term debt payable after one year					Long-term debt payable after one year
Unsecured debt	Unsecured debt	54,197		48,880		Unsecured debt	44,337		43,651
Asset-backed debt	Asset-backed debt	32,276		28,867		Asset-backed debt	26,654		27,365
Unamortized (discount)/premium	Unamortized (discount)/premium	28		33		Unamortized (discount)/premium	28		26
Unamortized issuance costs	Unamortized issuance costs	(235)		(224)		Unamortized issuance costs	(199)		(205)
Fair value adjustments (b)		1,442		826
Fair value adjustments (c)						Fair value adjustments (c)	380		(680)
Total long-term debt payable after one year	Total long-term debt payable after one year	87,708		78,382		Total long-term debt payable after one year	71,200		70,157
Total Ford Credit	Total Ford Credit	$	137,677	$	126,792	Total Ford Credit	$	117,717	$	115,516
Fair value of Ford Credit debt (a)		$	139,796	$	128,979
Fair value of Ford Credit debt (b)						Fair value of Ford Credit debt (b)	$	120,204	$	115,576

__________

(a)As of March 31, 2022, each $1,000 principal amount of the notes will be convertible into 57.7721 shares of our Common Stock, which is equivalent to a conversion price of approximately $17.31 per share. We recognized $0.2 million and $1.7 million of issuance cost amortization during the first quarter of 2021 and 2022, respectively.

(b)At December 31, ~~2020~~2021 and March 31, ~~2021,~~2022, the fair value of debt includes ~~$529~~$209 million and ~~$72~~$201 million of Company excluding Ford Credit short-term debt and ~~$10.4~~$14.1 billion and ~~$10.8~~$13.5 billion of Ford Credit short-term debt, respectively, carried at cost, which approximates fair value. All other debt is categorized within Level 2 of the fair value hierarchy.

~~(b)~~(c)These adjustments are related to hedging activity and include discontinued hedging relationship adjustments of ~~$299~~$257 million and ~~$273~~$242 million at December 31, ~~2020~~2021 and March 31, ~~2021,~~2022, respectively. The carrying value of hedged debt was ~~$45.5~~$37.5 billion and ~~$40.7~~$36.3 billion at December 31, ~~2020~~2021 and March 31, ~~2021,~~2022, respectively.

~~Item 1. Financial Statements (Continued)~~

~~FORD MOTOR COMPANY AND SUBSIDIARIES~~

~~NOTES TO THE FINANCIAL STATEMENTS~~

~~NOTE 14. DEBT~~ ~~(Continued)~~

In March 2021, we issued $2.3 billion aggregate principal amount of 0% unsecured Convertible Senior Notes due 2026, including $300 million aggregate principal amount of such notes pursuant to the exercise in full of the overallotment option granted to the initial purchasers. The notes will not bear regular interest and the principal amount of the notes will not accrete. The total net proceeds from the offering, after deducting debt issuance costs, were approximately $2.267 billion.

Each $1,000 principal amount of the notes will initially be convertible into 57.1886 shares of our Common Stock, which is equivalent to an initial conversion price of approximately $17.49 per share, subject to adjustment upon the occurrence of specified events. The notes are convertible, at the option of the noteholders, on or after December 15, 2025. Prior to December 15, 2025, the notes are convertible only under the following circumstances:

•During any fiscal quarter commencing after the fiscal quarter ending on September 30, 2021 (and only during such fiscal quarter), if the last reported sale price of our Common Stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price of the notes on each applicable trading day;

•During the 5 business day period after any 5 consecutive trading day period in which the trading price per $1,000 principal amount of the notes for each day of that 5 consecutive trading day period was less than 98% of the product of the last reported sale price of our Common Stock and the conversion rate of the notes on such trading day;

•~~If we call any or all of the notes for redemption; or~~

•~~Upon the occurrence of specific corporate events such as a change in control or certain beneficial distributions to common stockholders (as set forth in the indenture governing the notes).~~

Upon conversion, we will pay cash up to the aggregate principal amount of the notes to be converted and cash, shares of our Common Stock, or a combination of cash and shares of our Common Stock, at our election for the remainder of our obligation in excess, if any, of the aggregate principal amount of the notes being converted.

We may not redeem the notes prior to March 20, 2024. On or after March 20, 2024, we may redeem all or any portion of the notes for cash equal to 100% of the principal amount of the notes being redeemed if the last reported sale price of our Common Stock has been at least 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period.

If we undergo a fundamental change (e.g., change of control), subject to certain conditions, holders of the notes may require us to repurchase for cash all or any portion of their notes at a repurchase price equal to 100% of the principal amount of the notes. In addition, if specific corporate events occur prior to the maturity date or if we issue a notice of redemption, we will increase the conversion rate by pre-defined amounts for a holder who elects to convert their notes in connection with such a corporate event. During the first quarter of 2021, the conditions allowing holders of the notes to convert were not met.

~~The notes were issued at par and fees associated with the issuance of these notes is amortized to~~ ~~Interest expense on Company debt excluding Ford Credit~~ ~~over the contractual term of the notes. Amortization of issuance costs for the first quarter of 2021 was de minimis. The effective interest rate of the notes is 0.3%.~~

The total estimated fair value of the notes as of March 31, 2021 was approximately $2.3 billion. The fair value was determined using commonly employed valuation methodologies applying observable market inputs and is classified within Level 2 of the fair value hierarchy.

~~The notes did not have an impact on our first quarter 2021 diluted EPS as the average market price of our Common Stock during the quarter did not exceed the conversion price of the notes.~~

Item 1. Financial Statements (Continued)

FORD MOTOR COMPANY AND SUBSIDIARIES

NOTES TO THE FINANCIAL STATEMENTS

NOTE 15. DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES

In the normal course of business, our operations are exposed to global market risks, including the effect of changes in foreign currency exchange rates, certain commodity prices, and interest rates. To manage these risks, we enter into highly effective derivative contracts. We have elected to apply hedge accounting to certain derivatives. Derivatives that are designated in hedging relationships are evaluated for effectiveness using regression analysis at the time they are designated and throughout the hedge period. Some derivatives do not qualify for hedge accounting; for others, we elect not to apply hedge accounting.

Income Effect of Derivative Financial Instruments

The gains/(losses), by hedge designation, reported in income for the periods ended March 31 were as follows (in millions):


		First Quarter			First Quarter
Cash flow hedges	Cash flow hedges		2020			2021		Cash flow hedges	2021		2022
Reclassified from AOCI to Cost of sales	Reclassified from AOCI to Cost of sales							Reclassified from AOCI to Cost of sales
Foreign currency exchange contracts (a)	Foreign currency exchange contracts (a)		$	(70)		$	(15)	Foreign currency exchange contracts (a)	$	(15)	$	(90)
Commodity contracts (b)	Commodity contracts (b)		(14)			8		Commodity contracts (b)	8		58
Fair value hedges	Fair value hedges							Fair value hedges
Interest rate contracts	Interest rate contracts							Interest rate contracts
Net interest settlements and accruals on hedging instruments	Net interest settlements and accruals on hedging instruments		28			101		Net interest settlements and accruals on hedging instruments	101		76
Fair value changes on hedging instruments	Fair value changes on hedging instruments		1,110			(641)		Fair value changes on hedging instruments	(641)		(986)
Fair value changes on hedged debt	Fair value changes on hedged debt		(1,093)			590		Fair value changes on hedged debt	590		991
Cross-currency interest rate swap contracts	Cross-currency interest rate swap contracts							Cross-currency interest rate swap contracts
Net interest settlements and accruals on hedging instruments	Net interest settlements and accruals on hedging instruments		0			(3)		Net interest settlements and accruals on hedging instruments	(3)		(3)
Fair value changes on hedging instruments	Fair value changes on hedging instruments		0			(50)		Fair value changes on hedging instruments	(50)		(37)
Fair value changes on hedged debt	Fair value changes on hedged debt		0			44		Fair value changes on hedged debt	44		41
Derivatives not designated as hedging instruments	Derivatives not designated as hedging instruments							Derivatives not designated as hedging instruments
Foreign currency exchange contracts (c)	Foreign currency exchange contracts (c)		586			233		Foreign currency exchange contracts (c)	233		(46)
Cross-currency interest rate swap contracts	Cross-currency interest rate swap contracts		(151)			(245)		Cross-currency interest rate swap contracts	(245)		(227)
Interest rate contracts	Interest rate contracts		(74)			(31)		Interest rate contracts	(31)		123
Commodity contracts	Commodity contracts		(43)			55		Commodity contracts	55		109
Total	Total		$	279		$	46	Total	$	46	$	9

__________

(a)For the first quarter of ~~2020~~2021 and ~~2021, an $897~~2022, a $461 million ~~gain~~loss and a ~~$461~~$128 million loss, respectively, were reported in Other comprehensive income/(loss), net of tax.

(b)For the first quarter of ~~2020~~2021 and ~~2021,~~2022, an $80 million gain and a ~~$101 million loss and an $80~~$284 million gain, respectively, were reported in Other comprehensive income/(loss), net of tax.

(c)For the first quarter of ~~2020~~2021 and ~~2021,~~2022, a ~~$376~~$181 million gain and a ~~$181~~$44 million ~~gain~~loss, respectively, were reported in Cost of sales, ~~respectively,~~ and a ~~$210~~$52 million gain and a ~~$52~~$2 million ~~gain~~loss, respectively, were reported in Other income/(loss), net ~~respectively.~~.

2120

Item 1. Financial Statements (Continued)

FORD MOTOR COMPANY AND SUBSIDIARIES

NOTES TO THE FINANCIAL STATEMENTS

NOTE 15. DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES (Continued)

Balance Sheet Effect of Derivative Financial Instruments

Derivative assets and liabilities are reported on our consolidated balance sheets at fair value and are presented on a gross basis. The notional amounts of the derivative instruments do not necessarily represent amounts exchanged by the parties and are not a direct measure of our financial exposure. We also enter into master agreements with counterparties that may allow for netting of exposures in the event of default or breach of the counterparty agreement. Collateral represents cash received or paid under reciprocal arrangements that we have entered into with our derivative counterparties, which we do not use to offset our derivative assets and liabilities.

The fair value of our derivative instruments and the associated notional amounts were as follows (in millions):


		December 31, 2020						March 31, 2021							December 31, 2021						March 31, 2022
		Notional		Fair Value of Assets		Fair Value of Liabilities		Notional		Fair Value of Assets		Fair Value of Liabilities			Notional		Fair Value of Assets		Fair Value of Liabilities		Notional		Fair Value of Assets		Fair Value of Liabilities
Cash flow hedges	Cash flow hedges													Cash flow hedges
Foreign currency exchange contracts	Foreign currency exchange contracts	$	15,860	$	47	$	383	$	14,192	$	2	$	677	Foreign currency exchange contracts	$	11,534	$	74	$	346	$	10,359	$	13	$	336
Commodity contracts	Commodity contracts	703		40		5		750		103		1		Commodity contracts	931		182		5		890		374		—
Fair value hedges	Fair value hedges													Fair value hedges
Interest rate contracts	Interest rate contracts	26,924		1,331		4		25,646		934		204		Interest rate contracts	23,893		544		274		21,985		41		758
Cross-currency interest rate swap contracts	Cross-currency interest rate swap contracts	885		46		0		885		2		0		Cross-currency interest rate swap contracts	885		—		49		885		—		79
Derivatives not designated as hedging instruments	Derivatives not designated as hedging instruments													Derivatives not designated as hedging instruments
Foreign currency exchange contracts	Foreign currency exchange contracts	25,956		172		399		24,341		258		274		Foreign currency exchange contracts	28,463		281		198		25,535		177		294
Cross-currency interest rate swap contracts	Cross-currency interest rate swap contracts	6,849		557		1		6,822		275		25		Cross-currency interest rate swap contracts	6,533		117		61		6,520		51		276
Interest rate contracts	Interest rate contracts	70,318		663		439		61,608		425		314		Interest rate contracts	50,060		338		126		49,854		496		195
Commodity contracts	Commodity contracts	599		74		4		696		97		4		Commodity contracts	997		54		11		823		163		11
Total derivative financial instruments, gross (a) (b)	Total derivative financial instruments, gross (a) (b)	$	148,094	$	2,930	$	1,235	$	134,940	$	2,096	$	1,499	Total derivative financial instruments, gross (a) (b)	$	123,296	$	1,590	$	1,070	$	116,851	$	1,315	$	1,949

Current portion	Current portion			$	974	$	859			$	956	$	816	Current portion			$	924	$	535			$	837	$	753
Non-current portion	Non-current portion			1,956		376				1,140		683		Non-current portion			666		535				478		1,196
Total derivative financial instruments, gross	Total derivative financial instruments, gross			$	2,930	$	1,235			$	2,096	$	1,499	Total derivative financial instruments, gross			$	1,590	$	1,070			$	1,315	$	1,949

__________

(a)At December 31, ~~2020~~2021 and March 31, ~~2021,~~2022, we held collateral of $9$26 million and $3$102 million, respectively, and we posted collateral of ~~$96~~$71 million and ~~$87~~$109 million, respectively.

(b)At December 31, ~~2020~~2021 and March 31, ~~2021,~~2022, the fair value of assets and liabilities available for counterparty netting was ~~$505~~$719 million and ~~$664~~$429 million, respectively. All derivatives are categorized within Level 2 of the fair value hierarchy.

Item 1. Financial Statements (Continued)

FORD MOTOR COMPANY AND SUBSIDIARIES

NOTES TO THE FINANCIAL STATEMENTS

NOTE 16. EMPLOYEE SEPARATION ACTIONS AND EXIT AND DISPOSAL ACTIVITIES

We record costs associated with voluntary separations at the time of employee acceptance, unless the acceptance requires explicit approval by the Company. We record costs associated with involuntary separation programs when management has approved the plan for separation, the affected employees are identified, and it is unlikely that actions required to complete the separation plan will change significantly. Costs associated with benefits that are contingent on the employee continuing to provide service are accrued over the required service period.

Company Excluding Ford Credit

~~Global Redesign~~

~~As previously announced, we are executing a global redesign of our business. Redesign-related~~Employee separation actions and exit and disposal activities ~~including~~include employee separation costs, facility and other asset-related charges (e.g., impairment, accelerated depreciation), dealer and supplier payments, other statutory and contractual obligations, and other expenses, which are recorded in Cost of salesand ~~and~~ Selling, administrative, and other ~~expenses~~expenses. . Below are actions ~~we have~~ initiated, ~~as part~~primarily related to the global redesign of ~~the redesign.~~our business:

~~Brazil.~~ •~~In February 2019,~~ Ford Motor Company Brasil Ltda. (“Ford Brazil”), our subsidiary in Brazil, committed to a plan to exit the commercial heavy truck business in South America. As a result, Ford Brazil ceased production at the São Bernardo do Campo plant in Brazil during 2019. Ford Brazil completed a sale of the plant machinery and equipment in the third quarter of 2020 and the land and buildings in the fourth quarter of 2020.

~~In December 2020, Ford Brazil committed to a plan to exit~~exited manufacturing operations in Brazil, which ~~will result~~resulted in the closure of facilities in Camaçari, Taubaté, and Troller in ~~2021. Operations supporting new vehicle production ceased at Camaçari and Taubaté in January 2021; limited service parts production will continue until the second quarter of~~ 2021 to build inventories for aftermarket sales. The Troller plant will cease operations in the fourth quarter of 2021. These actions will not result in Ford Brazil being substantially liquidated, as it will continue imported vehicle sales and customer support operations, and maintain the product development center in Bahia, the proving grounds in Tatuí, São Paulo, and the regional headquarters in São Paulo.

~~Russia.~~• In March 2019, Ford Sollers Netherlands B.V. (“Ford Sollers”), a joint venture between Ford and Sollers PJSC (“Sollers”) in which Ford had control, announced its plan to restructure its business in Russia to focus exclusively on commercial vehicles and to exit the passenger car segment. As a result of these actions, Ford acquired 100% ownership of Ford Sollers and ceased production at the Naberezhnye Chelny and St. Petersburg vehicle assembly plants and the Elabuga engine plant during the second quarter of 2019.

Subsequent to completion of the restructuring actions, in July 2019, Ford sold a 51% controlling interest in the restructured entity to Sollers, which resulted in deconsolidation of the Ford Sollers subsidiary. Our continued involvement in Ford Sollers is accounted for as an equity method investment.

~~In the fourth quarter of 2020, we also completed a sale of certain manufacturing assets.~~

~~United Kingdom.~~ ~~In June 2019,~~ Ford Motor Company Limited ~~(“Ford of Britain”), a subsidiary of Ford, announced its plan to exit the Ford Bridgend plant in South Wales in 2020. Ford of Britain~~ ceased production at the Bridgend plant in the United Kingdom and the facility was closed in September ~~2020.~~2020

•Ford India Private Limited ceased vehicle manufacturing in Sanand in fourth quarter 2021 and plans to cease engine and vehicle manufacturing in Chennai by mid-2022

~~India.~~• ~~In the third quarter of 2019,~~ Ford committed to a plan to sell specific net assets in our India Automotive operations. On December 31, 2020, Ford and Mahindra & Mahindra Limited mutually determined that we will not complete the joint venture.

~~Item 1. Financial Statements (Continued)~~

~~FORD MOTOR COMPANY AND SUBSIDIARIES~~

~~NOTES TO THE FINANCIAL STATEMENTS~~

~~NOTE 16.EMPLOYEE SEPARATION ACTIONS AND EXIT AND DISPOSAL ACTIVITIES(Continued)~~

~~Other Global Redesign Actions.~~ ~~In 2018, we announced our plan to end production at the Ford Aquitaine Industries plant in Bordeaux, France. We~~Espana S.L. ceased production and the facility was closed in July 2019. In March 2019, we announced our plan to phase-out the production of the C-Max at the Saarlouis Body and Assembly Plant in Germany. We ceased production of the C-Max in June 2019. In March 2021, we announced our plan to phase-out the production of the Mondeo at the Valencia ~~Plant~~plant in ~~Spain.~~ Spain in March 2022

In addition, we are continuing to reduce our global workforce and take other restructuring actions.

The following table summarizes the ~~redesign-related~~ activities for the periods ended March 31, which are recorded in Other liabilities and deferred revenue (in millions):


		First Quarter			First Quarter
			2020			2021			2021		2022
Beginning balance	Beginning balance		$	734		$	1,732	Beginning balance	$	1,732	$	950
Changes in accruals (a)	Changes in accruals (a)		68			193		Changes in accruals (a)	193		66
Payments	Payments		(172)			(291)		Payments	(291)		(205)
Foreign currency translation	Foreign currency translation		(29)			(135)		Foreign currency translation	(135)		18
Ending balance	Ending balance		$	601		$	1,499	Ending balance	$	1,499	$	829

__________

(a)Excludes pension costs of ~~$24~~$38 million and ~~$38~~$7 million in the first quarter of ~~2020~~2021 and ~~2021,~~2022, respectively.

We ~~also~~ recorded ~~$14~~$302 million and ~~$302~~$23 million in the first quarter of ~~2020~~2021 and ~~2021,~~2022, respectively, for accelerated depreciation and other non-cash items. In addition, we recognized a pre-tax net gain on sale of assets of $32 million in the first quarter of 2022.

We estimate that we will incur total charges in ~~2021~~2022 that range between ~~$2.2~~$1.0 billion and ~~$2.7~~$1.5 billion related to the actions above, primarily attributable to employee separations ~~accelerated depreciation,~~ and dealer and supplier settlements. We continue to review our global businesses and may take additional restructuring actions in markets where a path to sustained profitability is not feasible when considering the capital allocation required for those markets.

~~Other Actions~~Ford Credit

~~United Automobile, Aerospace~~Accumulated foreign currency translation losses included in Accumulated other comprehensive income/(loss) at March 31, 2022 of $259 million are associated with Ford Credit’s investments in Brazil and ~~Agricultural Implement Workers~~Argentina, that it no longer plans to operate. We expect to reclassify these losses to income upon substantially complete liquidation of ~~America (“UAW”) Voluntary Separation Packages.~~ ~~As agreed in the collective bargaining agreement ratified in November 2019, during~~Ford Credit’s investments, which may occur over multiple reporting periods. In the first quarter of ~~2020,~~2022, we ~~offered voluntary separation packages~~recognized a $119 million loss on the liquidation of two investments in Brazil. Although the timing for the completion of the remaining actions is uncertain, we expect the majority of losses to ~~our UAW hourly workforce who were eligible for normal~~be recognized in 2024 or ~~early retirement, and recorded associated costs of $201 million in~~ later.

~~Cost of sales~~

~~. All separations occurred during 2020.~~

2422

Item 1. Financial Statements (Continued)

FORD MOTOR COMPANY AND SUBSIDIARIES

NOTES TO THE FINANCIAL STATEMENTS

NOTE 17. ~~HELD-FOR-SALE OPERATIONS~~ACQUISITIONS AND ~~CHANGES IN INVESTMENTS IN AFFILIATES~~DIVESTITURES

Company Excluding Ford Credit

Ford ~~Lio Ho Motor Co., Ltd.~~Romania S.A. (“~~FLH”~~Ford Romania”). In the first quarter of ~~2021,~~2022, we ~~concluded the terms of~~entered into an agreement to sell our wholly-owned Ford Romania subsidiary to Ford Otosan, a ~~sale of our controlling interest in FLH, a consolidated~~ joint venture ~~with Taiwan investors, and its wholly owned subsidiary FLH Marketing & Service Limited (“FMSL”). FLH and FMSL import,~~in which Ford has a 41% ownership share. This transaction will result in the deconsolidation of Ford Romania. Following the sale, the plant in Craiova, Romania will continue to manufacture ~~and sell~~ Ford-branded vehicles for Ford and Ford Otosan. We expect to complete the sale in ~~Taiwan.~~ mid-2022.

We have reported the assets and liabilities of ~~these~~the Ford Romania operations as held for sale and ceased depreciation and amortization of those assets.

The assets and liabilities ~~of our Ford Taiwan operations~~ classified as held for sale for the period ended March 31, were as follows (in millions):


	March 31, ~~2021~~2022
Assets
~~Cash and cash equivalents~~	$	16
Trade and other receivables, net	12$	392
Inventories	~~141~~201
Other assets, current	2116
Net property	~~124~~433
Other assets, non-current	212
Total Company excluding Ford Credit assets of held-for-sale operations	~~316~~1,054
Less: Intercompany asset balances	~~(1)~~(357)
Total assets of held-for-sale operations (a)	$	~~315~~697

Liabilities
Payables	$	~~124~~538
Other liabilities and deferred revenue, current	4917
Company excluding Ford Credit debt payable within one year	~~114~~—
Other liabilities and deferred revenue, non-current	354
Total Company excluding Ford Credit liabilities of held-for-sale operations	~~322~~559
Less: Intercompany liability balances	~~(31)~~(40)
Total liabilities of held-for-sale operations (a)	$	~~291~~519

__________

(a)As of March 31, ~~2021,~~2022, intercompany items and transactions have been eliminated on the consolidated balance sheets. Upon closing, the buyer will assume the intercompany assets and liabilities. Accordingly, we have presented those balances in the table for informational purposes.

Held-for-sale assets are measured at the lower of carrying amount ~~and~~or fair value less cost to sell. We ~~determined~~estimated the fair value using a market approach ~~estimated~~ based on the negotiated value of the assets, and determined the assets held for sale were 0tnot impaired.

Skinny Labs Inc., dba Spin (“Spin”). In the first quarter of 2022, we entered into an agreement to sell Spin, our wholly-owned micro-mobility provider. Accordingly, we have reported the $116 million of assets, including $76 million of cash, and $28 million of liabilities of this operation as held for sale for the period ended March 31, 2022. We determined the assets held for sale were not impaired.

On April 1, 2022, we completed the sale of Spin to TIER Mobility SE, a German-based micro-mobility provider, which will result in the deconsolidation of our Spin subsidiary in the second quarter of 2022. In exchange for our shares of Spin, we received preferred equity in TIER Mobility SE, which we will reflect in our consolidated balance sheets in Other assets in the second quarter of 2022. We expect the fair value of the preferred equity to approximate the carrying value of Spin at the time of the transaction.

Item 1. Financial Statements (Continued)

FORD MOTOR COMPANY AND SUBSIDIARIES

NOTES TO THE FINANCIAL STATEMENTS

NOTE 17. ACQUISITIONS AND DIVESTITURES (Continued)

Electriphi, Inc. (“Electriphi”). On June 18, 2021, we acquired Electriphi, a California-based provider of charging management and fleet monitoring software for electric vehicles. Assets acquired primarily include goodwill, reported in Other assets, and software, reported in Net property. The acquisition did not have a material impact on our financial statements.

Ford Lio Ho Motor Co., Ltd. (“FLH”). On April 1, 2021, we completed the sale of our controlling financial interest in FLH and its wholly owned subsidiary ~~FMSL,~~FLH Marketing & Service Limited, which ~~will result~~resulted in deconsolidation of our Ford Taiwan subsidiary in the second quarter of 2021. FLH will continue to import, manufacture, and sell Ford-branded vehicles ~~for~~through at least a ~~five-year period.~~2025. We ~~expect to recognize~~recognized a pre-tax gain of ~~about $150~~$161 million, which ~~will be~~was reported in Other income/(loss), net in the second quarter of 2021.

Getrag Ford Transmissions GmbH (“GFT”). Prior to March 2021, Ford and Magna International Inc. (“Magna”) equally owned and operated the GFT joint venture for the purpose of developing, manufacturing, and selling transmissions. We accounted for our investment in GFT as an equity method investment. During the first quarter of 2021 and prior to our acquisition, GFT recorded restructuring charges, of which our share was $40 million. These charges are included in Equity in net income/(loss) of affiliated companies.

~~Item 1. Financial Statements (Continued)~~

~~FORD MOTOR COMPANY AND SUBSIDIARIES~~

~~NOTES TO THE FINANCIAL STATEMENTS~~

~~NOTE 17. HELD-FOR-SALE OPERATIONS AND CHANGES IN INVESTMENTS IN AFFILIATES~~ ~~(Continued)~~

On March 1, 2021, we acquired Magna’s shares in athe restructured ~~GFT for $254~~GFT. The purchase price, which was subject to post-closing revisions, was $275 million. The restructured GFT includes the Halewood, UK and Cologne, Germany transmission plants, but excludes the Bordeaux, France transmission plant and China interests acquired by Magna. We concluded with Magna that these businesses would be better served under separate ownership. The Sanand, India transmission plant will continue under joint Ford/Magna ownership. As a result of the transaction, we consolidated the restructured GFT, remeasured our prior investment in GFT at its ~~$254~~$275 million fair value, and recognized ~~a gain of $155 million~~ in Other income/(loss), ~~net~~ne.t a pre-tax gain of $178 million during 2021 and post-closing revisions resulting in a pre-tax gain of $2 million during the first quarter of 2022. We estimated the fair value of GFT in negotiations with Magna based on the income approach. The significant assumptions used in the valuation included GFT’s cash flows that reflect the approved business plan, discounted at a rate typically used for a company like GFT. ~~See Note 11 for information about goodwill recognized as part of this transaction.~~

~~Ford Credit~~

~~In the first quarter of 2020, Ford Credit completed the sale of its wholly-owned subsidiary Forso Nordic AB, recognizing a pre-tax loss of $4 million, reported in~~ ~~Other income/(loss), net, and cash proceeds of $1.3 billion.~~

2624

Item 1. Financial Statements (Continued)

FORD MOTOR COMPANY AND SUBSIDIARIES

NOTES TO THE FINANCIAL STATEMENTS

NOTE 18. ACCUMULATED OTHER COMPREHENSIVE INCOME/(LOSS)

The changes in the balances for each component of accumulated other comprehensive income/(loss) attributable to Ford Motor Company for the periods ended March 31 were as follows (in millions):


		First Quarter			First Quarter
			2020			2021			2021		2022
Foreign currency translation	Foreign currency translation							Foreign currency translation
Beginning balance	Beginning balance		$	(4,626)		$	(5,526)	Beginning balance	$	(5,526)	$	(5,487)
Gains/(Losses) on foreign currency translation	Gains/(Losses) on foreign currency translation		(1,406)			394		Gains/(Losses) on foreign currency translation	394		(71)
Less: Tax/(Tax benefit)			27			97
Less: Tax/(Tax benefit) (a)								Less: Tax/(Tax benefit) (a)	97		(96)
Net gains/(losses) on foreign currency translation	Net gains/(losses) on foreign currency translation		(1,433)			297		Net gains/(losses) on foreign currency translation	297		25
(Gains)/Losses reclassified from AOCI to net income ~~(a)~~(b)	(Gains)/Losses reclassified from AOCI to net income ~~(a)~~(b)		(20)			(8)		(Gains)/Losses reclassified from AOCI to net income ~~(a)~~(b)	(8)		121
Other comprehensive income/(loss), net of tax	Other comprehensive income/(loss), net of tax		(1,453)			289		Other comprehensive income/(loss), net of tax	289		146
Ending balance	Ending balance		$	(6,079)		$	(5,237)	Ending balance	$	(5,237)	$	(5,341)

Marketable securities	Marketable securities							Marketable securities
Beginning balance	Beginning balance		$	71		$	156	Beginning balance	$	156	$	(19)
Gains/(Losses) on available for sale securities	Gains/(Losses) on available for sale securities		19			(76)		Gains/(Losses) on available for sale securities	(76)		(330)
Less: Tax/(Tax benefit)	Less: Tax/(Tax benefit)		5			(19)		Less: Tax/(Tax benefit)	(19)		(77)
Net gains/(losses) on available for sale securities	Net gains/(losses) on available for sale securities		14			(57)		Net gains/(losses) on available for sale securities	(57)		(253)
(Gains)/Losses reclassified from AOCI to net income	(Gains)/Losses reclassified from AOCI to net income		0			(11)		(Gains)/Losses reclassified from AOCI to net income	(11)		—
Less: Tax/(Tax benefit)	Less: Tax/(Tax benefit)		0			(3)		Less: Tax/(Tax benefit)	(3)		—
Net (gains)/losses reclassified from AOCI to net income	Net (gains)/losses reclassified from AOCI to net income		0			(8)		Net (gains)/losses reclassified from AOCI to net income	(8)		—
Other comprehensive income/(loss), net of tax	Other comprehensive income/(loss), net of tax		14			(65)		Other comprehensive income/(loss), net of tax	(65)		(253)
Ending balance	Ending balance		$	85		$	91	Ending balance	$	91	$	(272)

Derivative instruments	Derivative instruments							Derivative instruments
Beginning balance	Beginning balance		$	(488)		$	(266)	Beginning balance	$	(266)	$	(193)
Gains/(Losses) on derivative instruments	Gains/(Losses) on derivative instruments		796			(381)		Gains/(Losses) on derivative instruments	(381)		156
Less: Tax/(Tax benefit)	Less: Tax/(Tax benefit)		173			(74)		Less: Tax/(Tax benefit)	(74)		37
Net gains/(losses) on derivative instruments	Net gains/(losses) on derivative instruments		623			(307)		Net gains/(losses) on derivative instruments	(307)		119
(Gains)/Losses reclassified from AOCI to net income	(Gains)/Losses reclassified from AOCI to net income		84			7		(Gains)/Losses reclassified from AOCI to net income	7		32
Less: Tax/(Tax benefit)	Less: Tax/(Tax benefit)		15			1		Less: Tax/(Tax benefit)	1		7
Net (gains)/losses reclassified from AOCI to net income ~~(b)~~(c)	Net (gains)/losses reclassified from AOCI to net income ~~(b)~~(c)		69			6		Net (gains)/losses reclassified from AOCI to net income ~~(b)~~(c)	6		25
Other comprehensive income/(loss), net of tax	Other comprehensive income/(loss), net of tax		692			(301)		Other comprehensive income/(loss), net of tax	(301)		144
Ending balance	Ending balance		$	204		$	(567)	Ending balance	$	(567)	$	(49)

Pension and other postretirement benefits	Pension and other postretirement benefits							Pension and other postretirement benefits
Beginning balance	Beginning balance		$	(2,685)		$	(2,658)	Beginning balance	$	(2,658)	$	(2,640)
Amortization and recognition of prior service costs/(credits)	Amortization and recognition of prior service costs/(credits)		4			3		Amortization and recognition of prior service costs/(credits)	3		6
Less: Tax/(Tax benefit)	Less: Tax/(Tax benefit)		1			1		Less: Tax/(Tax benefit)	1		1
Net prior service costs/(credits) reclassified from AOCI to net income	Net prior service costs/(credits) reclassified from AOCI to net income		3			2		Net prior service costs/(credits) reclassified from AOCI to net income	2		5
Translation impact on non-U.S. plans	Translation impact on non-U.S. plans		11			(1)		Translation impact on non-U.S. plans	(1)		3
Other comprehensive income/(loss), net of tax	Other comprehensive income/(loss), net of tax		14			1		Other comprehensive income/(loss), net of tax	1		8
Ending balance	Ending balance		$	(2,671)		$	(2,657)	Ending balance	$	(2,657)	$	(2,632)

Total AOCI ending balance at March 31	Total AOCI ending balance at March 31		$	(8,461)		$	(8,370)	Total AOCI ending balance at March 31	$	(8,370)	$	(8,294)

__________

(a)We do not recognize deferred taxes for a majority of the foreign currency translation gains and losses because we do not anticipate reversal in the foreseeable future. However, we have made elections to tax certain non-U.S. operations simultaneously in U.S. tax returns, and have recorded deferred taxes for temporary differences that will reverse, independent of repatriation plans, in U.S. tax returns. Taxes or tax benefits resulting from foreign currency translation of the temporary differences are recorded in Other comprehensive income/(loss), net of tax.

(b)Reclassified to Other income/(loss), net.

~~(b)~~(c)Reclassified to Cost of sales. During the next twelve months, we expect to reclassify existing net ~~losses~~gains on cash flow hedges of ~~$366~~$11 million (see Note 15).

Item 1. Financial Statements (Continued)

FORD MOTOR COMPANY AND SUBSIDIARIES

NOTES TO THE FINANCIAL STATEMENTS

NOTE 19. VARIABLE INTEREST ENTITIES

Certain of our affiliates are variable interest entities in which we are not the primary beneficiary. Our maximum exposure to any potential losses associated with these affiliates is limited to our investments and loans and was $2.8 billion and $3 billion at ~~both~~ December 31, ~~2020~~2021 and March 31, ~~2021.~~2022, respectively.

NOTE 20. COMMITMENTS AND CONTINGENCIES

Commitments and contingencies primarily consist of guarantees and indemnifications, litigation and claims, and warranty and field service actions.

Guarantees and Indemnifications

Financial Guarantees. Financial guarantees and indemnifications are recorded at fair value at their inception. Subsequent to initial recognition, the guarantee liability is adjusted at each reporting period to reflect the current estimate of expected payments resulting from possible default events over the remaining life of the guarantee. The maximum potential payments for financial guarantees were ~~$346~~$357 million and ~~$351~~$358 million at December 31, ~~2020~~2021 and March 31, ~~2021,~~2022, respectively. The carrying value of recorded liabilities related to financial guarantees was ~~$46~~$36 million and ~~$29~~$35 million at December 31, ~~2020~~2021 and March 31, ~~2021,~~2022, respectively.

Our financial guarantees consist of debt and lease obligations of certain joint ventures, as well as certain financial obligations of outside third parties, including suppliers, to support our business and economic growth. Expiration dates vary through 2033, and guarantees will terminate on payment and/or cancellation of the underlying obligation. A payment by us would be triggered by failure of the joint venture or other third party to fulfill its obligation covered by the guarantee. In some circumstances, we are entitled to recover from a third party amounts paid by us under the guarantee.

Non-Financial Guarantees. Non-financial guarantees and indemnifications are recorded at fair value at their inception. We regularly review our performance risk under these arrangements, and in the event it becomes probable we will be required to perform under a guarantee or indemnity, the amount of probable payment is recorded. The maximum potential payments for non-financial guarantees were ~~$245~~$453 million and ~~$394~~$295 million at December 31, ~~2020~~2021 and March 31, ~~2021,~~2022, respectively. The carrying value of recorded liabilities related to non-financial guarantees was ~~$48~~$38 million and ~~$86~~$16 million at December 31, ~~2020~~2021 and March 31, ~~2021,~~2022, respectively.

Included in the ~~$394~~$295 million of maximum potential payments at March 31, ~~2021~~2022 are guarantees for the resale value of vehicles sold in certain arrangements to daily rental companies. The maximum potential payment of ~~$388~~$288 million as of March 31, ~~2021~~2022 represents the total proceeds we guarantee the rental company will receive on resale. Reflecting our present estimate of proceeds the rental companies will receive on resale from third parties, we have recorded ~~$85~~$16 million as our best estimate of the amount we will have to pay under the guarantee.

In the ordinary course of business, we execute contracts involving indemnifications standard in the industry and indemnifications specific to a transaction, such as the sale of a business. These indemnifications might include and are not limited to claims relating to any of the following: environmental, tax, and shareholder matters; intellectual property rights; power generation contracts; governmental regulations and employment-related matters; dealer, supplier, and other commercial contractual relationships; and financial matters, such as securitizations. Performance under these indemnities generally would be triggered by a breach of contract claim brought by a counterparty, including a joint venture or alliance partner, or a third-party claim. While some of these indemnifications are limited in nature, many of them do not limit potential payment. Therefore, we are unable to estimate a maximum amount of future payments that could result from claims made under these unlimited indemnities.

2826

Item 1. Financial Statements (Continued)

FORD MOTOR COMPANY AND SUBSIDIARIES

NOTES TO THE FINANCIAL STATEMENTS

NOTE 20. COMMITMENTS AND CONTINGENCIES (Continued)

Litigation and Claims

Various legal actions, proceedings, and claims (generally, “matters”) are pending or may be instituted or asserted against us. These include, but are not limited to, matters arising out of alleged defects in our products; product warranties; governmental regulations relating to safety, emissions, and fuel economy or other matters; government incentives; tax ~~matters;~~matters, including trade and customs; alleged illegal acts resulting in fines or penalties; financial services; employment-related matters; dealer, supplier, and other contractual relationships; intellectual property rights; environmental matters; shareholder or investor matters; and financial reporting matters. Certain of the pending legal actions are, or purport to be, class actions. Some of the matters involve or may involve claims for compensatory, punitive, or antitrust or other treble damages in very large amounts, or demands for field service actions, environmental remediation programs, sanctions, loss of government incentives, assessments, or other relief, which, if granted, would require very large expenditures.

The extent of our financial exposure to these matters is difficult to estimate. Many matters do not specify a dollar amount for damages, and many others specify only a jurisdictional minimum. To the extent an amount is asserted, our historical experience suggests that in most instances the amount asserted is not a reliable indicator of the ultimate outcome.

We accrue for matters when losses are deemed probable and reasonably estimable. In evaluating matters for accrual and disclosure purposes, we take into consideration factors such as our historical experience with matters of a similar nature, the specific facts and circumstances asserted, the likelihood that we will prevail, and the severity of any potential loss. We reevaluate and update our accruals as matters progress over time.

For the majority of matters, which generally arise out of alleged defects in our products, we establish an accrual based on our extensive historical experience with similar matters. We do not believe there is a reasonably possible outcome materially in excess of our accrual for these matters.

For the remaining matters, where our historical experience with similar matters is of more limited value (i.e., “non-pattern matters”), we evaluate the matters primarily based on the individual facts and circumstances. For non-pattern matters, we evaluate whether there is a reasonable possibility of a material loss in excess of any accrual that can be estimated. Our estimate of reasonably possible loss in excess of our accruals for all material matters currently reflects indirect tax, customs, and ~~customs~~regulatory matters, for which we estimate the aggregate risk to be a range of up to about $~~400 million.~~2.1 billion.

As noted, the litigation process is subject to many uncertainties, and the outcome of individual matters is not predictable with assurance. Our assessments are based on our knowledge and experience, but the ultimate outcome of any matter could require payment substantially in excess of the amount that we have accrued and/or disclosed.

2927

Item 1. Financial Statements (Continued)

FORD MOTOR COMPANY AND SUBSIDIARIES

NOTES TO THE FINANCIAL STATEMENTS

NOTE 20. COMMITMENTS AND CONTINGENCIES (Continued)

Warranty and Field Service Actions

We accrue the estimated cost of both base warranty coverages and field service actions at the time of sale. We establish our estimate of base warranty obligations using a patterned estimation model, using historical information regarding the nature, frequency, and average cost of claims for each vehicle line by model year. We establish our estimates of field service action obligations using a patterned estimation model, using historical information regarding the nature, frequency, severity, and average cost of claims for each model year. In addition, from time to time, we issue extended warranties at our expense, the estimated cost of which is accrued at the time of issuance. Warranty and field service action obligations are reported in Other liabilities and deferred revenue. We reevaluate the adequacy of our accruals on a regular basis.

We recognize the benefit from a recovery of the costs associated with our warranty and field service actions when specifics of the recovery have been agreed with our supplier and the amount of recovery is virtually certain. Recoveries are reported in Trade and other receivables, net and Other assets.

The estimate of our future warranty and field service action costs, net of estimated supplier recoveries, for the periods ended March 31 was as follows (in millions):


		First Quarter					First Quarter
		2020		2021			2021		2022
Beginning balance	Beginning balance	$	5,702	$	8,172	Beginning balance	$	8,172	$	8,451
Payments made during the period	Payments made during the period	(1,075)		(1,086)		Payments made during the period	(1,086)		(984)
Changes in accrual related to warranties issued during the period	Changes in accrual related to warranties issued during the period	805		1,000		Changes in accrual related to warranties issued during the period	1,000		793
Changes in accrual related to pre-existing warranties	Changes in accrual related to pre-existing warranties	521		(141)		Changes in accrual related to pre-existing warranties	(141)		21
Foreign currency translation and other	Foreign currency translation and other	(164)		(40)		Foreign currency translation and other	(40)		38
Ending balance	Ending balance	$	5,789	$	7,905	Ending balance	$	7,905	$	8,319

Changes to our estimated costs are reported as changes in accrual related to pre-existing warranties in the table above. Our estimate of reasonably possible costs in excess of our accruals for material field service actions and customer satisfaction actions is a range of up to about ~~$1 billion~~$700 million in the aggregate.

3028

Item 1. Financial Statements (Continued)

FORD MOTOR COMPANY AND SUBSIDIARIES

NOTES TO THE FINANCIAL STATEMENTS

NOTE 21. SEGMENT INFORMATION

We report segment information consistent with the way our chief operating decision maker (“CODM”) evaluates the operating results and performance of the Company. Accordingly, we analyze the results of our business through the following segments: Automotive, Mobility, and Ford Credit.

Effective ~~January 1,~~with fourth quarter 2021 ~~consistent with how our CODM assesses performance of the segments~~reporting, special items include gains and ~~makes decisions about resource allocations, we changed the measurement of our segments as follows: (i) costs and benefits related to enterprise connectivity activities included~~losses on investments in the Mobility segment are now reported in the Automotive segment; (ii) certain corporate governance expenses that benefit the global enterprise reported in the Automotive segment are now reported as part of Corporate Other; and (iii) cash and other centrally managed corporate assets reported in the Automotive segment were realigned to Corporate Other.

~~In addition, we realigned tax-related assets within our segments to reflect our adoption of ASU 2019-12 as of January 1, 2021 (see Note 2).~~

equity securities. Prior period amounts were adjusted retrospectively to reflect ~~these changes.~~the change.

Below is a description of our reportable segments and other activities.

Automotive Segment

The Automotive segment primarily includes the sale of Ford and Lincoln vehicles, service parts, and accessories worldwide, together with the associated costs to develop, manufacture, distribute, and service the vehicles, parts, and accessories. This segment includes revenues and costs related to our electrification vehicle programs and enterprise connectivity. The segment includes the following regional business units: North America, South America, Europe, China (including Taiwan), and the International Markets Group.

Mobility Segment

The Mobility segment primarily includes development costs for Ford’s autonomous vehicles and related businesses, Ford’s equity ownership in Argo AI (a developer of autonomous driving systems), and other mobility businesses and ~~investments (including Spin, a micro-mobility service provider).~~investments.

Ford Credit Segment

The Ford Credit segment is comprised of the Ford Credit business on a consolidated basis, which is primarily vehicle-related financing and leasing activities.

Corporate Other

Corporate Other primarily includes corporate governance expenses, interest income (excluding interest earned on our extended service contract portfolio that is included in our Automotive segment) and gains and losses from our cash, cash equivalents, and marketable securities (excluding gains and ~~other~~losses on investments in equity securities), and foreign exchange derivatives gains and losses associated with intercompany lending. Corporate governance expenses are primarily administrative, delivering benefit on behalf of the global enterprise, ~~and~~that are not allocated to ~~specific Automotive business units or~~ operating segments. These include expenses related to setting and directing global policy, providing oversight and stewardship, and promoting the Company’s interests. Corporate Other assets include: cash, cash equivalents, and marketable securities; tax related assets; other investments; and other assets managed centrally.

Interest on Debt

Interest on Debt is presented as a separate reconciling item and consists of interest expense on ~~Automotive and Other debt.~~Company debt excluding Ford Credit. The underlying liability is reported in the Automotive segment and in Corporate Other.

~~Item 1. Financial Statements (Continued)~~

~~FORD MOTOR COMPANY AND SUBSIDIARIES~~

~~NOTES TO THE FINANCIAL STATEMENTS~~

~~NOTE 21. SEGMENT INFORMATION~~ ~~(Continued)~~

Special Items

Special Items are presented as a separate reconciling item. They consist of (i) pension and OPEB remeasurement gains and losses, (ii) gains and losses on investments in equity securities, (iii) significant personnel expenses, dealer-related costs, and facility-related charges stemming from our efforts to match production capacity and cost structure to market demand and changing model mix, and ~~(iii)~~(iv) other items that we do not necessarily consider to be indicative of earnings from ongoing operating activities. Our management ordinarily excludes these items from its review of the results of the operating segments for purposes of measuring segment profitability and allocating resources. We also report these special items separately to help investors track amounts related to these activities and to allow investors analyzing our results to identify certain infrequent significant items that they may wish to exclude when considering the trend of ongoing operating results.

Item 1. Financial Statements (Continued)

FORD MOTOR COMPANY AND SUBSIDIARIES

NOTES TO THE FINANCIAL STATEMENTS

NOTE 21. SEGMENT INFORMATION (Continued)

Key financial information for the periods ended or at March 31 was as follows (in millions):


		Automotive		Mobility		Ford Credit		Corporate Other			Interest on Debt		Special Items			Adjustments			Total			Automotive		Mobility		Ford Credit		Corporate Other		Interest on Debt		Special Items			Adjustments			Total
First Quarter 2020
First Quarter 2021																					First Quarter 2021
Revenues	Revenues	$	31,342	$	11	$	2,967	$	0		$	0	$	0		$	0		$	34,320	Revenues	$	33,554	$	11	$	2,663	$	—	$	—	$	—		$	—		$	36,228
Income/(loss) before income taxes		(154)		(285)		30		(223)			(227)		(287)		(a)	0			(1,146)
Income/(Loss) before income taxes																					Income/(Loss) before income taxes	3,397		(207)		962		(240)		(473)		503		(a)	—			3,942
Equity in net income/(loss) of affiliated companies	Equity in net income/(loss) of affiliated companies	(47)		0		6		0			0		0			0			(41)		Equity in net income/(loss) of affiliated companies	172		(60)		5		1		—		(39)		(a)	—			79
Total assets	Total assets	62,818		378		156,451		47,308			0		0			(2,805)		(b)	264,150		Total assets	65,633		3,612		146,349		46,492		—		—			(1,267)		(b)	260,819

First Quarter 2021
First Quarter 2022																					First Quarter 2022
Revenues	Revenues	$	33,554	$	11	$	2,663	$	0		$	0	$	0		$	0		$	36,228	Revenues	$	32,111	$	84	$	2,281	$	—	$	—	$	—		$	—		$	34,476
Income/(loss) before income taxes		3,403		(197)		962		648		(c)	(473)		(401)		(a)	0			3,942
Income/(Loss) before income taxes																					Income/(Loss) before income taxes	1,891		(242)		928		(251)		(308)		(5,866)		(c)	—			(3,848)
Equity in net income/(loss) of affiliated companies	Equity in net income/(loss) of affiliated companies	174		(59)		5		1			0		(42)		(a)	0			79		Equity in net income/(loss) of affiliated companies	139		(75)		6		1		—		(104)		(d)	—			(33)
Total assets	Total assets	65,633		3,612		146,349		46,492			0		0			(1,267)		(b)	260,819		Total assets	72,437		3,501		132,582		45,130		—		—			(664)		(b)	252,986

__________

(a)Primarily reflects gains/(losses) on investments in equity securities (including a $902 million unrealized gain on our Rivian equity investment) and Global Redesign actions.

(b)Includes eliminations of intersegment transactions occurring in the ordinary course of business and deferred tax netting.

(c)~~Includes~~Primarily reflects gains/(losses) on investments in equity securities (including a $5.4 billion unrealized loss on our Rivian equity investment).

(d)Primarily reflects the ~~unrealized gain~~full impairment of ~~$902 million related to~~our Ford Sollers Netherlands B.V. (the parent company of our joint venture in Russia) equity method investment, resulting from the ~~Rivian observable event (see Note 10).~~ongoing regulatory and economic uncertainty in Russia.

3230

ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

~~RECENT DEVELOPMENTS~~KEY TRENDS AND ECONOMIC FACTORS AFFECTING FORD AND THE AUTOMOTIVE INDUSTRY

The following supplements the key trends and economic factors discussed on pages 34 and 35 of our 2021 Form 10‑K:

COVID-19 and Supplier Disruptions. The ~~automotive industry continues~~impact of COVID-19, including changes in consumer behavior, pandemic fears and market downturns, and restrictions on business and individual activities, has created significant volatility in the global economy. Recent outbreaks in certain regions, including China where lock-downs due to COVID-19 have been imposed in more than 40 cities, continue to cause intermittent COVID-19-related disruptions in our supply chain and local manufacturing operations. We also continue to face ~~a significant shortage of semiconductors, which has presented challenges and production~~supplier disruptions ~~globally, including at~~due to the semiconductor shortage. Further, actions taken by Russia in Ukraine could impact our ~~assembly plants. Our initial outlook was for semiconductor supply chains to remain constrained through the second quarter of 2021, and we would have an opportunity to begin recovering lost volumes~~suppliers, particularly our lower tier suppliers, as well as our operations in the second half of 2021. However, the industry faced another setback on March 19, 2021, when Renesas Electronics Corporation, a key supplier of semiconductors for the automotive industry, experienced a significant fire at its Naka Factory. Renesas estimates that it will return to full capacity at its Naka Factory in July. Based on the overall recovery rate we are seeing for the industry, we now believe the automotive semiconductor shortage may not be fully resolved until 2022.Europe. For additional information ~~regarding~~on the ~~semiconductor shortage,~~impact of supplier disruptions, see the Outlook section on page 5654.

Commodities. Prices for commodities remain volatile, and recently we have experienced price increases for base metals (e.g., steel and aluminum), precious metals (e.g., palladium), and raw materials that are used in batteries for electric vehicles (e.g., lithium, cobalt, and nickel for batteries). Global demand and differences in output across sectors due to the COVID-19 pandemic have generated divergence in price movements across different commodities. The net impact on us overall has been higher material costs. To help ensure supply of raw materials for critical components (e.g., batteries), we, like others in the industry, plan to enter into multi-year sourcing agreements. For additional information on commodity costs, see the Outlook section on page 54.

Inflation. Despite recent increases, interest rates, notably mature market government bond yields, remain low by historical standards. At the same time, inflation has accelerated and government deficits and debt remain at high levels in many major markets. In the United States, inflation rose 8.5% annually in March 2022 to a 40-year high as Russia’s invasion of Ukraine drove up energy costs as well as other costs, such as freight premiums. We are seeing a near-term impact on our business due to inflationary pressure. The eventual implications of higher government deficits and debt, tighter monetary policy, and potentially higher long-term interest rates may drive a higher cost of capital during our plan period.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

RESULTS OF OPERATIONS

In the first quarter of ~~2021,~~2022, the net ~~income~~loss attributable to Ford Motor Company was ~~$3,262~~$3,110 million, and Company adjusted EBIT was ~~$4,816~~$2,326 million.

Net income/(loss) includes certain items (“special items”) that are excluded from Company adjusted EBIT. These items are discussed in more detail in Note 21 of the Notes to the Financial Statements. We report special items separately to allow investors analyzing our results to identify certain ~~infrequent significant~~ items that they may wish to exclude when considering the trend of ongoing operating results. Our pre-tax and tax special items were as follows (in millions):


		First Quarter				First Quarter
		2020		2021				2021		2022
Global Redesign	Global Redesign						Global Redesign
Europe excl. Russia		$	(105)	$	(94)
Europe							Europe	$	(94)	$	(22)
India	India	(3)		—			India	—		(28)
South America	South America	(17)		(322)			South America	(322)		(27)
Russia		20		3
China		—		(1)

Separations and Other (not included above)	Separations and Other (not included above)	(1)		(2)			Separations and Other (not included above)	—		19
Subtotal Global Redesign	Subtotal Global Redesign	$	(106)	$	(416)		Subtotal Global Redesign	$	(416)	$	(58)
Other Items	Other Items						Other Items
North America hourly buyouts / Other		$	(203)	$	(7)
Mark-to-market gain/(loss) on Rivian investment							Mark-to-market gain/(loss) on Rivian investment	$	902	$	(5,449)
Ford Credit – Brazil restructuring (see Note 16)							Ford Credit – Brazil restructuring (see Note 16)	—		(119)
Russia suspension of operations/asset write-off							Russia suspension of operations/asset write-off	—		(138)
Patent matters related to prior calendar years							Patent matters related to prior calendar years	—		(135)
Other							Other	(5)		33
Subtotal Other Items	Subtotal Other Items	$	(203)	$	(7)		Subtotal Other Items	$	897	$	(5,808)
Pension and OPEB Gain/(Loss)	Pension and OPEB Gain/(Loss)						Pension and OPEB Gain/(Loss)
Pension and OPEB remeasurement	Pension and OPEB remeasurement	$	22	$	61		Pension and OPEB remeasurement	$	61	$	—
Pension settlements and curtailments	Pension settlements and curtailments	—		(39)			Pension settlements and curtailments	(39)		—
Subtotal Pension and OPEB Gain/(Loss)	Subtotal Pension and OPEB Gain/(Loss)	$	22	$	22		Subtotal Pension and OPEB Gain/(Loss)	$	22	$	—
Total EBIT Special Items	Total EBIT Special Items	$	(287)	$	(401)		Total EBIT Special Items	$	503	$	(5,866)

Cash effect of Global Redesign (incl. separations)	Cash effect of Global Redesign (incl. separations)	$	(172)	$	(345)		Cash effect of Global Redesign (incl. separations)	$	(345)	$	(148)

Provision for/(Benefit from) tax special items (a)	Provision for/(Benefit from) tax special items (a)	$	787	$	(99)		Provision for/(Benefit from) tax special items (a)	$	58	$	(1,192)

__________

(a)Includes related tax effect on special items and tax special items.

We recorded ~~$401 million~~$5.9 billion of pre-tax special item charges in the first quarter of ~~2021,~~2022, driven primarily ~~reflecting Global Redesign actions in South America and Europe.~~by a mark-to-market loss on our Rivian investment.

In Note 21 of the Notes to the Financial Statements, special items are reflected as a separate reconciling item, as opposed to being allocated among the Automotive, Mobility, and Ford Credit segments. This reflects the fact that management excludes these items from its review of operating segment results for purposes of measuring segment profitability and allocating resources.

3432

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

COMPANY KEY METRICS

The table below shows our first quarter ~~2021~~2022 key metrics for the Company, compared to a year ago.


		First Quarter									First Quarter
		2020			2021			H / (L)					2021			2022			H / (L)
GAAP Financial Measures	GAAP Financial Measures											GAAP Financial Measures
Cash Flows from Operating Activities ($B)	Cash Flows from Operating Activities ($B)	$	(0.5)		$	4.5		$	5.0			Cash Flows from Operating Activities ($B)	$	4.5		$	(1.1)		$	(5.6)
Revenue ($M)	Revenue ($M)	34,320			36,228			6		%		Revenue ($M)	36,228			34,476			(5)		%
Net Income/(Loss) ($M)	Net Income/(Loss) ($M)	(1,993)			3,262			5,255				Net Income/(Loss) ($M)	3,262			(3,110)			$	(6,372)
Net Income/(Loss) Margin (%)	Net Income/(Loss) Margin (%)	(5.8)		%	9.0		%	14.8 ppts				Net Income/(Loss) Margin (%)	9.0		%	(9.0)		%	(18.0) ppts
EPS (Diluted)	EPS (Diluted)	$	(0.50)		$	0.81		$	1.31			EPS (Diluted)	$	0.81		$	(0.78)		$	(1.59)

Non-GAAP Financial Measures (a)	Non-GAAP Financial Measures (a)											Non-GAAP Financial Measures (a)
Company Adj. Free Cash Flow ($B)	Company Adj. Free Cash Flow ($B)	$	(2.2)		$	(0.4)		$	1.8			Company Adj. Free Cash Flow ($B)	$	(0.4)		$	(0.6)		$	(0.2)
Company Adj. EBIT ($M)	Company Adj. EBIT ($M)	(632)			4,816			5,448				Company Adj. EBIT ($M)	3,912			2,326			(1,586)
Company Adj. EBIT Margin (%)	Company Adj. EBIT Margin (%)	(1.8)		%	13.3		%	15.1 ppts				Company Adj. EBIT Margin (%)	10.8		%	6.7		%	(4.1) ppts
Adjusted EPS (Diluted)	Adjusted EPS (Diluted)	$	(0.23)		$	0.89		$	1.12			Adjusted EPS (Diluted)	$	0.70		$	0.38		$	(0.32)
Adjusted ROIC (Trailing Four Quarters)	Adjusted ROIC (Trailing Four Quarters)	2.5		%	8.2		%	5.7 ppts				Adjusted ROIC (Trailing Four Quarters)	6.6		%	7.8		%	1.2 ppts

__________

(a)See Non-GAAP Financial Measure Reconciliations section for reconciliation to GAAP.

In the first quarter of ~~2021,~~2022, our diluted earnings per share of Common and Class B Stock was ~~$0.81~~a loss of $0.78 and our diluted adjusted earnings per share was ~~$0.89.~~$0.38.

Net income/(loss) margin was negative 9.0% in the first quarter of ~~2021, up 14.8~~2022, down 18.0 percentage points from a year ago. Company adjusted EBIT margin was ~~13.3%~~6.7% in the first quarter of ~~2021, up 15.1~~2022, down 4.1 percentage points from a year ago.

The year-over-year ~~increases~~decrease of ~~$5,255 million~~$6.4 billion in net income/(loss) ~~and $5,448 million in Company adjusted EBIT~~ in the first quarter of ~~2021 were~~2022 includes the effect of special items, including a mark-to-market loss on our Rivian investment, as well as lower Automotive EBIT. The year-over-year decrease of $1.6 billion in Company adjusted EBIT was driven by ~~improvements in~~lower Automotive ~~EBIT, Ford Credit EBT, and Corporate Other, which includes a $902 million non-cash gain from our investment in Rivian.~~EBIT.

The table below shows our first quarter ~~2021~~2022 net income/(loss) attributable to Ford and Company adjusted EBIT by segment.


		First Quarter						First Quarter
		2020		2021		H / (L)				2021		2022		H / (L)
Automotive	Automotive	$	(154)	$	3,403	$	3,557		Automotive	$	3,397	$	1,891	$	(1,506)
Mobility	Mobility	(285)		(197)		88			Mobility	(207)		(242)		(35)
Ford Credit	Ford Credit	30		962		932			Ford Credit	962		928		(34)
Corporate Other	Corporate Other	(223)		648		871			Corporate Other	(240)		(251)		(11)
Company Adjusted EBIT (a)	Company Adjusted EBIT (a)	(632)		4,816		5,448			Company Adjusted EBIT (a)	3,912		2,326		(1,586)
Interest on Debt	Interest on Debt	(227)		(473)		246			Interest on Debt	(473)		(308)		(165)
Special Items	Special Items	(287)		(401)		114			Special Items	503		(5,866)		6,369
Taxes / Noncontrolling Interests	Taxes / Noncontrolling Interests	(847)		(680)		(167)			Taxes / Noncontrolling Interests	(680)		738		(1,418)
Net Income/(Loss)	Net Income/(Loss)	$	(1,993)	$	3,262	$	5,255		Net Income/(Loss)	$	3,262	$	(3,110)	$	(6,372)

__________

(a)See Non-GAAP Financial Measure Reconciliations section for reconciliation to GAAP.

3533

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

Automotive Segment

The table below shows our first quarter ~~2021~~2022 Automotive segment EBIT by business unit (in millions).


		First Quarter						First Quarter
		2020		2021		H / (L)				2021		2022		H / (L)
North America	North America	$	373	$	2,949	$	2,576		North America	$	2,943	$	1,591	$	(1,352)
South America	South America	(112)		(73)		39			South America	(73)		50		123
Europe	Europe	(149)		341		490			Europe	341		207		(134)
China (including Taiwan)	China (including Taiwan)	(241)		(15)		226			China (including Taiwan)	(15)		(53)		(38)
International Markets Group	International Markets Group	(25)		201		226			International Markets Group	201		96		(105)
Automotive Segment	Automotive Segment	$	(154)	$	3,403	$	3,557		Automotive Segment	$	3,397	$	1,891	$	(1,506)

The tables below and on the following pages provide first quarter ~~2021~~2022 key metrics and the change in first quarter ~~2021~~2022 EBIT compared with first quarter ~~2020~~2021 by causal factor for our Automotive segment and its regional business units: North America, South America, Europe, China (including Taiwan), and the International Markets Group. For a description of these causal factors, see Definitions and Information Regarding Automotive Causal Factors.


		First Quarter								First Quarter
Key Metrics	Key Metrics	2020			2021			H / (L)			Key Metrics	2021			2022			H / (L)
Market Share (%)	Market Share (%)	6.0		%	5.3		%	(0.6) ppts			Market Share (%)	5.3		%	4.8		%	(0.6) ppts
Wholesale Units (000)	Wholesale Units (000)	1,126			1,062			(64)			Wholesale Units (000)	1,062			966			(96)
Revenue ($M)	Revenue ($M)	$	31,342		$	33,554		$	2,212		Revenue ($M)	$	33,554		$	32,111		$	(1,443)
EBIT ($M)	EBIT ($M)	(154)			3,403			3,557			EBIT ($M)	3,397			1,891			(1,506)
EBIT Margin (%)	EBIT Margin (%)	(0.5)		%	10.1		%	10.6 ppts			EBIT Margin (%)	10.1		%	5.9		%	(4.2) ppts


Change in EBIT by Causal Factor (in millions)
First Quarter ~~2020~~2021 EBIT	$	~~(154)~~3,397
Volume / Mix	~~(778)~~(1,096)
Net Pricing	~~2,954~~1,693
Cost	~~806~~ (1,868)
Exchange	~~205~~ (25)
Other	~~370~~ (210)
First Quarter ~~2021~~2022 EBIT	$	~~3,403~~1,891

In the first quarter of ~~2021,~~2022, wholesales ~~declined 6%~~decreased 9% from a year ago, primarily reflecting the impact of ~~semiconductor~~ supply constraints ~~in North America~~on production, including semiconductors. First quarter 2022 revenue decreased 4%, driven by lower wholesales, weaker currencies, and ~~Europe and the shift to a new business model in South America,~~unfavorable mix, partially offset by improvement in China and IMG. The global semiconductor shortage eliminated about 17% of our planned first quarter 2021 production, or about 200,000 units. First quarter 2021 revenue increased 7%, primarily reflecting higher net ~~pricing, favorable mix, and stronger currencies, partially offset by lower volume.~~pricing.

Our first quarter ~~2021~~2022 Automotive segment EBIT was ~~$3.4~~$1.9 billion, ~~an improvement~~a decrease of ~~$3.6~~$1.5 billion from a year ago, and our first quarter ~~2021~~2022 Automotive EBIT margin was ~~10.1%~~5.9%. The ~~higher~~lower EBIT was driven by inflationary increases on commodity and freight costs, higher warranty expense, unfavorable mix due to supplier constraints on full size pick-up trucks and large SUVs in North America, and lower wholesales. Higher net pricing (reflecting the strength of our product portfolio and lower incentives in response to reduced dealer stock levels), lower warranty expense, structural cost reductions in areas such as manufacturing and advertising, and higher profits from our Ford Customer Service Division business and our joint ventures, partially offset by lower volumes. We expect some of these improvements, such as lower manufacturing cost and the robust pricing environment, to moderate as the industry returns to full production and dealer stocks rebound.was a partial offset.

3634

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

North America


		First Quarter								First Quarter
Key Metrics	Key Metrics	2020			2021			H / (L)			Key Metrics	2021			2022			H / (L)
Market Share (%)	Market Share (%)	13.6		%	12.5		%	(1.1) ppts			Market Share (%)	12.5		%	12.0		%	(0.5) ppts
Wholesale Units (000)	Wholesale Units (000)	619			533			(85)			Wholesale Units (000)	533			514			(20)
Revenue ($M)	Revenue ($M)	$	21,811		$	22,993		$	1,182		Revenue ($M)	$	22,993		$	22,318		$	(675)
EBIT ($M)	EBIT ($M)	373			2,949			2,576			EBIT ($M)	2,943			1,591			(1,352)
EBIT Margin (%)	EBIT Margin (%)	1.7		%	12.8		%	11.1 ppts			EBIT Margin (%)	12.8		%	7.1		%	(5.7) ppts


Change in EBIT by Causal Factor (in millions)
First Quarter ~~2020~~2021 EBIT	$	~~373~~2,943
Volume / Mix	~~(550)~~(883)
Net Pricing	~~2,550~~1,098
Cost	~~418~~ (1,356)
Exchange	~~102~~ (16)
Other	56 (195)
First Quarter ~~2021~~2022 EBIT	$	~~2,949~~1,591

In North America, first quarter ~~2021~~2022 wholesales ~~declined 14%~~decreased 4% from a year ago, ~~driven by~~primarily reflecting the impact of ~~semiconductor~~ supply ~~constraints.~~constraints on production, including semiconductors. First quarter ~~2021~~2022 revenue ~~increased 5%~~decreased 3%, ~~primarily reflecting robust customer demand for the new product portfolio,~~driven by lower wholesales and unfavorable mix, partially offset by higher ~~industrywide~~ net ~~pricing on lower dealer inventories from the semiconductor supply shortage, and favorable mix.~~pricing.

North America’s first quarter ~~2021~~2022 EBIT ~~improved $2.6~~decreased $1.4 billion from a year ago with an EBIT margin of ~~12.8%~~7.1%. The lower EBIT ~~improvement~~ was driven by inflationary increases on commodity and freight costs, higher warranty expense, unfavorable mix (due to supplier constraints on full size pick-up trucks and large SUVs), and lower wholesales. Higher net pricing ~~favorable mix, lower warranty expense, and improved structural costs.~~was a partial offset.

South America


		First Quarter								First Quarter
Key Metrics	Key Metrics	2020			2021			H / (L)			Key Metrics	2021			2022			H / (L)
Market Share (%)	Market Share (%)	6.9		%	3.6		%	(3.3) ppts			Market Share (%)	3.6		%	2.2		%	(1.4) ppts
Wholesale Units (000)	Wholesale Units (000)	59			18			(42)			Wholesale Units (000)	18			15			(2)
Revenue ($M)	Revenue ($M)	$	728		$	436		$	(292)		Revenue ($M)	$	436		$	579		$	143
EBIT ($M)	EBIT ($M)	(112)			(73)			39			EBIT ($M)	(73)			50			123
EBIT Margin (%)	EBIT Margin (%)	(15.4)		%	(16.7)		%	(1.3) ppts			EBIT Margin (%)	(16.7)		%	8.7		%	25.4 ppts


Change in EBIT by Causal Factor (in millions)
First Quarter ~~2020~~2021 EBIT	$	~~(112)~~(73)
Volume / Mix	~~(73)~~(3)
Net Pricing	73180
Cost	13 (63)
Exchange	20 (18)
Other	627
First Quarter ~~2021~~2022 EBIT	$	~~(73)~~50

In South America, first quarter ~~2021~~2022 wholesales ~~declined 70%~~decreased 14% from a year ago, ~~driven by~~primarily reflecting the impact of ~~shifting to a new business model focused~~supply constraints on ~~key portfolio strengths, mainly Ranger pickup, Transit van, and key imports.~~production, including semiconductors. First quarter ~~2021~~2022 revenue ~~decreased 40%~~increased 33%, ~~primarily reflecting~~driven by higher net pricing and favorable mix, partially offset by lower ~~volume~~wholesales and weaker currencies.

South America’s first quarter ~~2021~~2022 EBIT ~~loss~~ improved ~~$39~~$123 million from a year ago with an EBIT margin of ~~negative 16.7%~~8.7%. The EBIT improvement was driven by higher net pricing and structural cost reductions, ~~pricing to~~partially offset ~~inflation,~~by higher material costs, inflationary increases on commodity and freight costs, and weaker currencies. ~~This was South America’s sixth consecutive quarter of year-over-year EBIT improvement.~~

3735

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

Europe


		First Quarter								First Quarter
Key Metrics	Key Metrics	2020			2021			H / (L)			Key Metrics	2021			2022			H / (L)
Market Share (%)	Market Share (%)	6.9		%	7.2		%	0.3 ppts			Market Share (%)	7.2		%	6.6		%	(0.5) ppts
Wholesale Units (000) (a)	Wholesale Units (000) (a)	288			278			(10)			Wholesale Units (000) (a)	278			254			(24)
Revenue ($M)	Revenue ($M)	$	6,247		$	7,050		$	803		Revenue ($M)	$	7,050		$	6,910		$	(140)
EBIT ($M)	EBIT ($M)	(149)			341			490			EBIT ($M)	341			207			(134)
EBIT Margin (%)	EBIT Margin (%)	(2.4)		%	4.8		%	7.2 ppts			EBIT Margin (%)	4.8		%	3.0		%	(1.8) ppts

__________

(a)Includes Ford brand vehicles produced and sold by our unconsolidated affiliate in Turkey (about ~~11,000 units in Q1 2020 and~~ 17,000 units in Q1 ~~2021)~~2021 and 13,000 units in Q1 2022). Revenue does not include these sales.


Change in EBIT by Causal Factor (in millions)
First Quarter ~~2020~~2021 EBIT	$	~~(149)~~341
Volume / Mix	~~(151)~~(59)
Net Pricing	~~247~~345
Cost	~~300~~ (456)
Exchange	~~(4)~~28
Other	988
First Quarter ~~2021~~2022 EBIT	$	~~341~~207

In Europe, first quarter ~~2021~~2022 wholesales ~~declined 4%~~decreased 9% from a year ago, ~~driven by~~primarily reflecting the impact of ~~semiconductor~~ supply constraints on production, including semiconductors. First quarter 2022 revenue decreased 2%, driven by weaker currencies and lower wholesales, partially offset by ~~stronger commercial vehicle sales. First quarter 2021 revenue increased 13% year over year, primarily reflecting stronger currencies, favorable mix, and~~ higher net pricing ~~partially offset by lower volume.~~and favorable mix.

Europe’s first quarter ~~2021~~2022 EBIT ~~increased $490~~decreased $134 million from a year ~~over year~~ago with an EBIT margin of ~~4.8%~~3.0%. The ~~higher~~lower EBIT was driven by ~~cost reductions~~inflationary increases on commodity costs, higher structural costs, and ~~higher~~lower wholesales. Higher net pricing ~~partially offset by lower volume.~~and favorable mix were partial offsets.

3836

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

China (Including Taiwan)


		First Quarter								First Quarter
Key Metrics	Key Metrics	2020			2021			H / (L)			Key Metrics	2021			2022			H / (L)
Market Share (%)	Market Share (%)	2.2		%	2.3		%	0.1 ppts			Market Share (%)	2.3		%	2.2		%	(0.1) ppts
Wholesale Units (000) (a)	Wholesale Units (000) (a)	81			150			69			Wholesale Units (000) (a)	150			128			(23)
Revenue ($M)	Revenue ($M)	$	593		$	825		$	232		Revenue ($M)	$	825		$	561		$	(264)
EBIT ($M)	EBIT ($M)	(241)			(15)			226			EBIT ($M)	(15)			(53)			(38)
EBIT Margin (%)	EBIT Margin (%)	(40.6)		%	(1.8)		%	38.8 ppts			EBIT Margin (%)	(1.8)		%	(9.4)		%	(7.6) ppts

China Unconsolidated Affiliates	China Unconsolidated Affiliates										China Unconsolidated Affiliates
Wholesales (000)(b)	Wholesales (000)(b)	72			140			68			Wholesales (000)(b)	140			125			(15)
Ford Equity Income/(Loss) ($M)	Ford Equity Income/(Loss) ($M)	$	(91)		$	49		$	140		Ford Equity Income/(Loss) ($M)	$	49		$	40		$	(9)

__________

(a)Includes vehicles produced and sold by our unconsolidated affiliates. Revenue does not include these sales.

(b)Includes Ford and Lincoln brand and JMC brand vehicles produced and sold in ~~China~~China. First quarter 2022 also includes Ford brand vehicles produced in Taiwan by ~~our unconsolidated affiliates. Revenue does not include these sales.~~Lio Ho Group.


Change in EBIT by Causal Factor (in millions)
First Quarter ~~2020~~2021 EBIT	$	~~(241)~~(15)
Volume / Mix	14 (81)
Net Pricing	308
Cost	~~(7)~~20
Exchange	32
Other (Including Joint Ventures)	~~186~~13
First Quarter ~~2021~~2022 EBIT	$	~~(15)~~(53)

In China, first quarter ~~2021~~2022 wholesales ~~increased 85%~~decreased 15% from a year ago, driven by ~~the non-recurrence of 2020 COVID-related shutdowns, localization of Lincoln,~~weaker industry, a plant changeover, and ~~the strength of commercial vehicles, which now represent 48% of our sales in China.~~supply constraints on production, including semiconductors. First quarter ~~2021~~2022 revenue ~~increased 39% year over year, primarily reflecting~~at our consolidated operations decreased 32%, driven by lower wholesales, partially offset by higher ~~component sales to our joint ventures in China~~net pricing and favorable mix.

China’s first quarter ~~2021~~2022 EBIT loss ~~improved $226~~increased $38 million from a year ago with an EBIT margin of negative ~~1.8%~~9.4%. The higher EBIT ~~improvement was driven~~loss reflects lower volume, partially offset by higher ~~profits at~~royalties from our joint ventures, lower total costs, higher net pricing, and favorable mix. ~~This was China’s fourth consecutive quarter of year-over-year EBIT improvement.~~

3937

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

International Markets Group


		First Quarter								First Quarter
Key Metrics	Key Metrics	2020			2021			H / (L)			Key Metrics	2021			2022			H / (L)
Market Share (%)	Market Share (%)	1.5		%	1.7		%	0.2 ppts			Market Share (%)	1.7		%	1.2		%	(0.5) ppts
Wholesale Units (000) (a)	Wholesale Units (000) (a)	78			82			4			Wholesale Units (000) (a)	82			55			(27)
Revenue ($M)	Revenue ($M)	$	1,962		$	2,250		$	288		Revenue ($M)	$	2,250		$	1,743		$	(507)
EBIT ($M)	EBIT ($M)	(25)			201			226			EBIT ($M)	201			96			(105)
EBIT Margin (%)	EBIT Margin (%)	(1.3)		%	8.9		%	10.2 ppts			EBIT Margin (%)	8.9		%	5.5		%	(3.4) ppts

__________

(a)Includes Ford brand vehicles produced and sold by our unconsolidated affiliate in Russia (about 3,000 units in both Q1 ~~2020~~2021 and Q1 ~~2021)~~2022). Revenue does not include these sales.


Change in EBIT by Causal Factor (in millions)
First Quarter ~~2020~~2021 EBIT	$	~~(25)~~201
Volume / Mix	~~(19)~~(71)
Net Pricing	5463
Cost	83 (14)
Exchange	84 (22)
Other	24 (61)
First Quarter ~~2021~~2022 EBIT	$	~~201~~96

In our International Markets Group, first quarter ~~2021~~2022 wholesales ~~increased 5%~~decreased 33% from a year ago, primarily reflecting our India restructuring and the impact of supply constraints on production, including semiconductors. First quarter 2022 revenue decreased 23%, driven by ~~higher industry volumes~~lower wholesales and ~~improvement in market share. First quarter 2021 revenue increased 15% year over year, primarily reflecting stronger~~weaker currencies, ~~increased volume,~~partially offset by higher net ~~pricing, and favorable mix.~~pricing.

Our International Markets Group’s first quarter ~~2021~~2022 EBIT was ~~$226~~$105 million ~~higher~~lower than a year ago with an EBIT margin of ~~8.9%~~5.5%. The ~~record quarterly~~lower EBIT was driven by ~~favorable exchange, cost reductions,~~lower wholesales, inflationary increases on commodity costs, lower joint venture profits due to the suspension of operations in Russia, and ~~higher~~weaker currencies. Higher net ~~pricing.~~pricing and lower warranty expense were partial offsets.

4038

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

Definitions and Information Regarding Automotive Causal Factors

In general, we measure year-over-year change in Automotive segment EBIT using the causal factors listed below, with net pricing and cost variances calculated at present-period volume and mix and exchange:

•Market Factors (exclude the impact of unconsolidated affiliate wholesale units):

◦Volume and Mix – primarily measures EBIT variance from changes in wholesale unit volumes (at prior-year average contribution margin per unit) driven by changes in industry volume, market share, and dealer stocks, as well as the EBIT variance resulting from changes in product mix, including mix among vehicle lines and mix of trim levels and options within a vehicle line

◦Net Pricing – primarily measures EBIT variance driven by changes in wholesale unit prices to dealers and marketing incentive programs such as rebate programs, low-rate financing offers, special lease offers, and stock adjustments on dealer inventory

•Cost:

◦Contribution Costs – primarily measures EBIT variance driven by per-unit changes in cost categories that typically vary with volume, such as material costs (including commodity and component costs), warranty expense, and freight and duty costs

◦Structural Costs – primarily measures EBIT variance driven by absolute change in cost categories that typically do not have a directly proportionate relationship to production volume. Structural costs include the following cost categories:

▪Manufacturing, Including Volume-Related – consists primarily of costs for hourly and salaried manufacturing personnel, plant overhead (such as utilities and taxes), and new product launch expense. These costs could be affected by volume for operating pattern actions such as overtime, line-speed, and shift schedules

▪Engineering and Connectivity – consists primarily of costs for vehicle and software engineering personnel, prototype materials, testing, and outside engineering and software services

▪Spending-Related – consists primarily of depreciation and amortization of our manufacturing and engineering assets, but also includes asset retirements and operating leases

▪Advertising and Sales Promotions – includes costs for advertising, marketing programs, brand promotions, customer mailings and promotional events, and auto shows

▪Administrative, Information Technology, and Selling – includes primarily costs for salaried personnel and purchased services related to our staff activities, information technology, and selling functions ~~as well as associated information technology costs~~

▪Pension and OPEB – consists primarily of past service pension costs and other postretirement employee benefit costs

•Exchange – primarily measures EBIT variance driven by one or more of the following: (i) transactions denominated in currencies other than the functional currencies of the relevant entities, (ii) effects of converting functional currency income to U.S. dollars, (iii) effects of remeasuring monetary assets and liabilities of the relevant entities in currencies other than their functional currency, or (iv) results of our foreign currency hedging

•Other – includes a variety of items, such as parts and services earnings, royalties, government incentives, and compensation-related changes

In addition, definitions and calculations used in this report include:

•Wholesales and Revenue – wholesale unit volumes include all Ford and Lincoln badged units (whether produced by Ford or by an unconsolidated affiliate) that are sold to dealerships, units manufactured by Ford that are sold to other manufacturers, units distributed by Ford for other manufacturers, and local brand units produced by our China joint venture, Jiangling Motors Corporation, Ltd. (“JMC”), that are sold to ~~dealerships.~~dealerships, and from the second quarter of 2021, Ford badged vehicles produced in Taiwan by Lio Ho Group. Vehicles sold to daily rental car companies that are subject to a guaranteed repurchase option (i.e., rental repurchase), as well as other sales of finished vehicles for which the recognition of revenue is deferred (e.g., consignments), also are included in wholesale unit volumes. Revenue from certain vehicles in wholesale unit volumes (specifically, Ford badged vehicles produced and distributed by our unconsolidated affiliates, as well as JMC brand vehicles) are not included in our revenue

•Industry Volume and Market Share – based, in part, on estimated vehicle registrations; includes medium and heavy duty trucks

•SAAR – seasonally adjusted annual rate

4139

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

Mobility Segment

Effective January 1, 2021, we realigned the costs and benefits related to enterprise connectivity activities previously included in the Mobility segment to the Automotive segment. Accordingly, beginning in 2021, theThe Mobility segment primarily includes development costs for Ford’s autonomous vehicles and related businesses, Ford’s equity ownership in Argo AI (a developer of autonomous driving systems), and other mobility businesses and ~~investments (including Spin, a micro-mobility service provider).~~investments.

In our Mobility segment, our first quarter ~~2021~~2022 EBIT loss was ~~$197~~$242 million, ~~an $88~~a $35 million ~~improvement from~~higher loss than a year ago. The loss reflects our strategic investments as we continued to expand our capabilities in autonomous vehicles and support our mobility ~~businesses.~~initiatives.

4240

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

Ford Credit Segment

Ford Credit files periodic reports with the SEC that contain additional information regarding Ford Credit. The reports are available through Ford Credit’s website located at www.fordcredit.com/investor-center and can also be found on the SEC’s website located at www.sec.gov. The foregoing information regarding Ford Credit’s website and its content is for convenience only and not deemed to be incorporated by reference into this Report nor filed with the SEC.

The tables below provide first quarter ~~2021~~2022 key metrics and the change in first quarter ~~2021~~2022 EBT compared with first quarter ~~2020~~2021 by causal factor for the Ford Credit segment. For a description of these causal factors, see Definitions and Information Regarding Ford Credit Causal Factors.


		First Quarter									First Quarter
GAAP Financial Measures		2020			2021			H / (L)
Net Receivables ($B)		$	138		$	127		(8)		%
Key Metrics												Key Metrics	2021			2022			H / (L)
Total Net Receivables ($B)												Total Net Receivables ($B)	$	127		$	117		(8)		%
Loss-to-Receivables (bps) (a)	Loss-to-Receivables (bps) (a)	62			22			(40)				Loss-to-Receivables (bps) (a)	22			8			(14)
Auction Values (b)	Auction Values (b)	$	19,235		$	21,925		14		%		Auction Values (b)	$	22,955		$	30,300		32		%
EBT ($M)	EBT ($M)	$	30		$	962		$	932			EBT ($M)	962			928			$	(34)
ROE (%) ~~(c)~~	ROE (%) ~~(c)~~	—		%	22		%	22 ppts				ROE (%) ~~(c)~~	22		%	22		%	— ppts

Other Balance Sheet Metrics	Other Balance Sheet Metrics											Other Balance Sheet Metrics
Debt ($B)	Debt ($B)	$	137		$	127		(7)		%		Debt ($B)	$	127		$	116		(9)		%
Net Liquidity ($B)	Net Liquidity ($B)	28			34			20		%		Net Liquidity ($B)	34			28			(16)		%
Financial Statement Leverage (to 1) (c)		8.9			8.3			(0.6)
Financial Statement Leverage (to 1)												Financial Statement Leverage (to 1)	8.3			9.5			1.2

__________

(a)U.S. retail financing only.

(b)U.S. 36-month off-lease auction values at Q1 ~~2021~~2022 mix.

~~(c)~~Prior period amounts have been updated as a result of the adoption of ASU 2019-12, Simplifying the Accounting for Income Taxes. For additional information, see Note 2 of the Notes to the Financial Statements.

First Quarter
Non-GAAP Financial Measures 2020 2021 H / (L)
Managed Receivables ($B) (a) $ 146 $ 135 (8) %
Managed Leverage (to 1) (b) (c) 8.0 7.3 (0.7)

~~__________~~

~~(a)See~~ ~~Non-GAAP Financial Measure Reconciliations~~ ~~section for reconciliation to GAAP.~~

~~(b)See~~ ~~Liquidity and Capital Resources - Ford Credit Segment~~ ~~section for reconciliation to GAAP.~~

~~(c)~~Prior period amount has been updated as a result of the adoption of ASU 2019-12, Simplifying the Accounting for Income Taxes. For additional information, see Note 2 of the Notes to the Financial Statements.


Change in EBT by Causal Factor (in millions)
First Quarter ~~2020~~2021 EBT	$	30962
Volume / Mix	~~(48)~~(78)
Financing Margin	~~(3)~~(101)
Credit Loss	~~625~~24
Lease Residual	~~448~~ (5)
Exchange	1711
Other	~~(107)~~115
First Quarter ~~2021~~2022 EBT	$	~~962~~928

Ford Credit’s total net receivables were $10 billion lower than a year ago, primarily reflecting lower volume due to supply constraints. The loss-to-receivables (“LTR”) ratio remained at a low level in the first quarter of ~~2021,~~2022, at ~~0.22%, which was 40~~eight basis points, 14 basis points lower than a year ago. U.S. auction values in the first quarter of ~~2021~~2022 were ~~14%~~32% higher than a year ~~ago. Full year 2021 auction values are now forecasted to be higher than 2020, consistent with third party estimates.~~ago, reflecting continued strong demand for used vehicles.

Ford Credit’s first quarter ~~2021~~2022 EBT of ~~$962~~$928 million was ~~$932~~$34 million ~~higher~~lower than a year ago, ~~primarily~~ reflecting ~~the non-recurrence of the first quarter 2020 increase to the credit loss reserve~~unfavorable net financing margin and lower volume due to ~~COVID-19 as well as favorable auction performance~~supply constraints on ~~off-lease vehicles as a result of lower dealer stocks due to the semiconductor shortage. Unfavorable performance in~~new vehicle production, partially offset by positive market valuation adjustments to derivatives due to ~~rising~~higher interest rates, ~~was a partial offset.~~which is included in Other.

4341

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

Definitions and Information Regarding Ford Credit Causal Factors

In general, we measure year-over-year changes in Ford Credit’s EBT using the causal factors listed below:

•Volume and Mix:

◦Volume primarily measures changes in net financing margin driven by changes in average ~~managed~~net receivables excluding the allowance for credit losses at prior period financing margin yield (defined below in financing margin) at prior period exchange rates. Volume changes are primarily driven by the volume of new and used vehicles sold and leased, the extent to which Ford Credit purchases retail financing and operating lease contracts, the extent to which Ford Credit provides wholesale financing, the sales price of the vehicles financed, the level of dealer inventories, Ford-sponsored special financing programs available exclusively through Ford Credit, and the availability of cost-effective funding

◦Mix primarily measures changes in net financing margin driven by period-over-period changes in the composition of Ford Credit’s average ~~managed~~net receivables excluding the allowance for credit losses by product within each region

•Financing Margin:

◦Financing margin variance is the period-to-period change in financing margin yield multiplied by the present period average ~~managed~~net receivables excluding the allowance for credit losses at prior period exchange rates. This calculation is performed at the product and country level and then aggregated. Financing margin yield equals revenue, less interest expense and scheduled depreciation for the period, divided by average ~~managed~~net receivables excluding the allowance for credit losses for the same period

◦Financing margin changes are driven by changes in revenue and interest expense. Changes in revenue are primarily driven by the level of market interest rates, cost assumptions in pricing, mix of business, and competitive environment. Changes in interest expense are primarily driven by the level of market interest rates, borrowing spreads, and asset-liability management

•Credit Loss:

◦Credit loss is the change in the provision for credit losses at prior period exchange rates. For analysis purposes, management splits the provision for credit losses into net charge-offs and the change in the allowance for credit losses

◦Net charge-off changes are primarily driven by the number of repossessions, severity per repossession, and recoveries. Changes in the allowance for credit losses are primarily driven by changes in historical trends in credit losses and recoveries, changes in the composition and size of Ford Credit’s present portfolio, changes in trends in historical used vehicle values, and changes in forward looking macroeconomic conditions. For additional information, refer to the “Critical Accounting Estimates - Allowance for Credit Losses” section of Item 7 of Part II of our ~~2020~~2021 Form 10-K Report

•Lease Residual:

◦Lease residual measures changes to residual performance at prior period exchange rates. For analysis purposes, management splits residual performance primarily into residual gains and losses, and the change in accumulated supplemental depreciation

◦Residual gain and loss changes are primarily driven by the number of vehicles returned to Ford Credit and sold, and the difference between the auction value and the depreciated value (which includes both base and accumulated supplemental depreciation) of the vehicles sold. Changes in accumulated supplemental depreciation are primarily driven by changes in Ford Credit’s estimate of the expected auction value at the end of the lease term and changes in Ford Credit’s estimate of the number of vehicles that will be returned to it and sold. Accumulated depreciation reflects early termination losses on operating leases due to customer default events. For additional information, refer to the “Critical Accounting Estimates - Accumulated Depreciation on Vehicles Subject to Operating Leases” section of Item 7 of Part II of our ~~2020~~2021 Form 10-K Report

•Exchange:

◦Reflects changes in EBT driven by the effects of converting functional currency income to U.S. dollars

•Other:

◦Primarily includes operating expenses, other revenue, insurance expenses, and other income/(loss) at prior period exchange rates

◦Changes in operating expenses are primarily driven by salaried personnel costs, facilities costs, and costs associated with the origination and servicing of customer contracts

◦In general, other income/(loss) changes are primarily driven by changes in earnings related to market valuation adjustments to derivatives (primarily related to movements in interest rates) and other miscellaneous items

4442

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

In addition, the following definitions and calculations apply to Ford Credit when used in this report:

•Cash (as shown in the Funding Structure ~~Liquidity,~~ and ~~Leverage~~Liquidity tables) – Cash, cash equivalents, and marketable securities, excluding amounts related to insurance activities

•Debt (as shown in the Key Metrics and Leverage tables) – Debt on Ford Credit’s balance sheets. Includes debt issued in securitizations and payable only out of collections on the underlying securitized assets and related enhancements. Ford Credit holds the right to receive the excess cash flows not needed to pay the debt issued by, and other obligations of, the securitization entities that are parties to those securitization transactions

•Earnings Before Taxes ~~(EBT~~(“EBT”) – Reflects Ford Credit’s income before income taxes

•Loss-to-Receivables (“LTR”) Ratio – LTR ratio is calculated using net charge-offs divided by average finance receivables, excluding unearned interest supplements and the allowance for credit losses

•Return on Equity ~~(ROE~~(“ROE”) (as shown in the Key Metrics table) – Reflects return on equity calculated by annualizing net income for the period and dividing by monthly average equity for the period

•Securitization and Restricted Cash (as shown in the Liquidity table) – Securitization cash is held for the benefit of the securitization investors (for example, a reserve fund). Restricted cash is primarily includes cash held to meet certain local governmental and regulatory reserve requirements and cash held under the terms of certain contractual agreements

•Securitizations (as shown in the Public Term Funding Plan table) – Public securitization transactions, Rule 144A offerings sponsored by Ford Credit, and widely distributed offerings by Ford Credit Canada

•Term Asset-Backed Securities (as shown in the Funding Structure table) – Obligations issued in securitization transactions that are payable only out of collections on the underlying securitized assets and related enhancements

•Total Net Receivables (as shown in the Key Metrics ~~and Ford Credit Net Receivables Reconciliation to Managed Receivables tables)~~table) – Includes finance receivables (retail financing and wholesale) sold for legal purposes and net investment in operating leases included in securitization transactions that do not satisfy the requirements for accounting sale treatment. These receivables and operating leases are reported on Ford Credit’s balance sheets and are available only for payment of the debt issued by, and other obligations of, the securitization entities that are parties to those securitization transactions; they are not available to pay the other obligations of Ford Credit or the claims of Ford Credit’s other creditors

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

Corporate Other

Corporate Other primarily includes corporate governance expenses, interest income (excluding interest earned on our extended service contract portfolio that is included in our Automotive segment) and gains and losses from our cash, cash equivalents, and marketable securities (excluding gains and ~~other~~losses on investments in equity securities), and foreign exchange derivatives gains and losses associated with intercompany lending. Corporate governance expenses are primarily administrative, delivering benefit on behalf of the global enterprise, ~~and~~that are not allocated to ~~specific Automotive business units or~~ operating segments. These include expenses related to setting and directing global policy, providing oversight and stewardship, and promoting the Company’s interests. In the first quarter of ~~2021,~~2022, Corporate Other had a ~~$648~~$251 million ~~profit,~~loss, compared with a ~~$223~~$240 million loss a year ago. ~~The improvement is more than explained by a $902 million gain on our investment in Rivian.~~

Interest on Debt

Interest on Debt, which consists of interest expense on Company debt excluding Ford Credit, was ~~$473~~$308 million in the first quarter of ~~2021, $246~~2022, $165 million ~~higher~~lower than a year ago, primarily ~~reflecting higher~~explained by U.S. debt ~~interest expense.~~restructuring actions undertaken in the fourth quarter of 2021.

Taxes

Our Provision for/(Benefit from) income taxes for the first quarter ~~2021~~2022 was ~~$680~~a $729 million benefit, resulting in an effective tax rate of ~~17.3%~~18.9%.

Our first quarter ~~2021~~2022 adjusted effective tax rate, which excludes special items, was ~~17.9%~~22.9%.

We regularly review our organizational structure and income tax elections for affiliates in non-U.S. and U.S. tax jurisdictions, which may result in changes in affiliates that are included in or excluded from our U.S. tax return. Any future changes to our structure, as well as any changes in income tax laws in the countries that we operate, could cause increases or decreases to our deferred tax balances and related valuation allowances.

4644

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

LIQUIDITY AND CAPITAL RESOURCES

At March 31, ~~2021,~~2022, total balance sheet cash, cash equivalents, marketable securities, and restricted cash (including Ford ~~Credit)~~Credit and entities held for sale) was ~~$46.3~~$41.5 billion.

We consider our key balance sheet metrics to be: (i) Company cash, which includes cash equivalents, marketable securities, and restricted cash (including cash held for sale), excluding Ford Credit’s cash, cash equivalents, marketable securities, and restricted cash; and (ii) Company liquidity, which includes Company cash, less restricted cash, and total available committed credit lines, excluding Ford Credit’s total available committed credit lines.

Company excluding Ford Credit


		December 31, 2020		March 31, 2021			December 31, 2021		March 31, 2022
Balance Sheets ($B)	Balance Sheets ($B)					Balance Sheets ($B)
Company Cash	Company Cash	$	30.8	$	31.3	Company Cash	$	36.5	$	28.8
Liquidity	Liquidity	46.9		47.2		Liquidity	52.4		44.6
Debt	Debt	(24.0)		(25.9)		Debt	(20.4)		(20.1)
Cash Net of Debt	Cash Net of Debt	6.8		5.5		Cash Net of Debt	16.1		8.7

Pension Funded Status ($B) (a)	Pension Funded Status ($B) (a)					Pension Funded Status ($B) (a)
Funded Plans	Funded Plans	$	0.3	$	0.9	Funded Plans	$	5.8	$	6.0
Unfunded Plans	Unfunded Plans	(7.0)		(6.6)		Unfunded Plans	(6.1)		(5.8)
Total Global Pension	Total Global Pension	$	(6.7)	$	(5.7)	Total Global Pension	$	(0.3)	$	0.2

Total Funded Status OPEB	Total Funded Status OPEB	$	(6.6)	$	(6.5)	Total Funded Status OPEB	$	(6.0)	$	(6.0)

__________

(a)Balances at March 31, ~~2021~~2022 reflect net ~~underfunded~~funded status at December 31, ~~2020,~~2021, updated for service and interest cost, expected return on assets, ~~curtailment and settlement gains and associated interim remeasurement (where applicable),~~ separation expense, actual benefit payments, and cash contributions. ~~For plans without interim remeasurement, the~~The discount rate and rate of expected return assumptions are unchanged from year-end ~~2020.~~2021.

Liquidity. One of our key priorities is to maintain a strong balance sheet, while at the same time having resources available to invest in and grow our business. At March 31, ~~2021,~~2022, we had Company cash of ~~$31.3~~$28.8 billion ~~with~~and liquidity of $44.6 billion (both of which include our Rivian marketable securities). Excluding the Rivian marketable securities, Company cash and liquidity at March 31, 2022 were $23.6 billion and $39.4 billion, respectively. As marketable securities increase or decrease in value, Company cash and liquidity will likewise increase or decrease. At March 31, 2022, about ~~88%~~91% of Company cash was held by consolidated entities domiciled in the United ~~States, and Company liquidity of $47.2 billion.~~ States.

To be prepared for an economic downturn, we target an ongoing Company cash balance at or above $20 billion plus significant additional liquidity above our Company cash target. We expect to have periods when we will be above or below this amount due to: (i) future cash flow expectations, such as for investments in future opportunities, capital investments, debt maturities, pension contributions, or restructuring requirements, (ii) short-term timing differences, and (iii) changes in the global economic environment.

Our Company cash investments (excluding the Rivian marketable securities) primarily include U.S. Department of Treasury obligations, federal agency securities, bank time deposits with investment-grade institutions, investment-grade corporate securities, investment-grade commercial paper, and debt obligations of a select group of non-U.S. governments, non-U.S. governmental agencies, and supranational institutions. The average maturity of these investments is approximately one year and adjusted based on market conditions and liquidity needs. We monitor our Company cash levels and average maturity on a daily basis.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

Material Cash Requirements. Our material cash requirements include: (1) capital expenditures (for additional information, see the “Changes in Company Cash” section below) and other payments for engineering, software, product development, and implementation of our plans for battery electric vehicles; (2) the purchase of raw materials and components to support the manufacturing and sale of vehicles (including electric vehicles), parts, and accessories (for additional information, see the Aggregate Contractual Obligations table and the accompanying description of our “Purchase obligations” in the “Liquidity and Capital Resources - Company Excluding Ford Credit” section in Item 7 of our 2021 Form 10-K Report); (3) marketing incentive payments to dealers; (4) payments for warranty and field service actions (for additional information, see Note 20 of the Notes to the Financial Statements herein); (5) debt repayments (for additional information, see the Aggregate Contractual Obligations table in the “Liquidity and Capital Resources - Company Excluding Ford Credit” section in Item 7 and Note 19 of the Notes the Financial Statements in our 2021 Form 10-K Report); (6) discretionary and mandatory payments to our global pension plans (for additional information, see the Aggregate Contractual Obligations table in the “Liquidity and Capital Resources - Company Excluding Ford Credit” section in Item 7 of our 2021 Form 10-K Report, the “Changes in Company Cash” section below, and Note 13 of the Notes to the Financial Statements herein); (7) employee wages, benefits, and incentives; (8) operating lease payments (for additional information, see the Aggregate Contractual Obligations table in the “Liquidity and Capital Resources - Company Excluding Ford Credit” section in Item 7 and Note 18 of the Notes the Financial Statements in our 2021 Form 10-K Report); (9) cash effects related to the global redesign of our business (for additional information, see the “Changes in Company Cash” section below); and (10) strategic acquisitions and investments to grow our business, including electrification. In addition, subject to approval by our Board of Directors, shareholder distributions in the form of dividend payments and/or a share repurchase program may require the expenditure of a material amount of cash. Moreover, we may be subject to additional material cash requirements that are contingent upon the occurrence of certain events, e.g., legal contingencies, uncertain tax positions, and other matters.

We plan to utilize our liquidity (as described above) and our cash flows from business operations to fund our material cash requirements.

Changes in Company Cash.In managing our business, we classify changes in Company cash into operating and non-operating items. Operating items include: Company adjusted EBIT excluding Ford Credit EBT, capital spending, depreciation and tooling amortization, changes in working capital, Ford Credit distributions, interest on debt, cash taxes, and all other and timing ~~differences.~~differences (including timing differences between accrual-based EBIT and associated cash flows). Non-operating items include: ~~Global Redesign~~global redesign (including separation payments), changes in Company debt excluding Ford Credit, contributions to funded pension plans, shareholder distributions, and other items (including gains and losses on investments in equity securities, acquisitions and divestitures, and other transactions with Ford Credit).

~~Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)~~

With respect to “Changes in working capital,” in general we carry relatively low Automotive segment trade receivables compared with our trade payables because the majority of our Automotive wholesales are financed (primarily by Ford Credit) immediately upon the sale of vehicles to dealers, which generally occurs shortly after being produced. In contrast, our Automotive trade payables are based primarily on industry-standard production supplier payment terms of ~~generally~~ about 45 days. As a result, our cash flow ~~tends to improve as~~deteriorates if wholesale volumes ~~increase, but can deteriorate when~~(and the corresponding revenue) decrease while trade payables continue to become due. Conversely, our cash flow improves if wholesale volumes ~~sharply decrease.~~(and the corresponding revenue) increase while new trade payables are generally not due for about 45 days. For example, the suspension of production at most of our assembly plants and lower industry volumes due to COVID-19 in early 2020 resulted in an initial deterioration of our cash flow, while the subsequent resumption of manufacturing operations and return to pre-COVID-19 production levels at most of our assembly plants resulted in a subsequent improvement of our cash flow. Even in normal economic conditions, however, these working capital balances generally are subject to seasonal changes that can impact cash flow. For example, we typically experience cash flow timing differences associated with inventories and payables due to our annual summer and December shutdown periods when production, and therefore inventories and wholesale volumes, are usually at their lowest levels, while payables continue to come due and be paid. The net impact of this typically results in cash outflows from changes in our working capital balances during these shutdown periods.

~~A financial institution offers~~Our inventory includes vehicles completed but awaiting installation of components, including semiconductors. As a result of the shortage, our inventory is higher than in periods prior to the supply shortage.

In response to, or in anticipation of, supplier disruptions, we may stockpile certain components or raw materials to help prevent disruption in our production of vehicles. Such actions could have a short-term adverse impact on our cash and increase our inventory.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

Financial institutions participate in a supply chain finance (“SCF”) program that enables our suppliers, at their sole discretion, to sell their Ford receivables (i.e., our payment obligations to the suppliers) to the financial ~~institution~~institutions on a non-recourse basis in order to be paid earlier than our payment terms provide. Our suppliers’ voluntary inclusion of invoices in the SCF program has no bearing on our payment terms, the amounts we pay, or our liquidity. We have no economic interest in a supplier’s decision to participate in the SCF program, and we have no direct financial relationship with the SCF financial ~~institution.~~institutions. Moreover, we do not provide any guarantees in connection with the SCF program. As of March 31, ~~2021,~~2022, the outstanding amount of Ford receivables that suppliers elected to sell to the SCF financial ~~institution~~institutions was ~~$43~~$144 million. ~~The reduction in the balance at the end of the first quarter reflects the transition to a new SCF financial institution.~~ The amount settled through the SCF program during the first quarter of ~~2021~~2022 was ~~$341~~$306 million.

Changes in Company cash excluding Ford Credit are summarized below (in billions):


		First Quarter				First Quarter
		2020		2021				2021		2022
Company Excluding Ford Credit	Company Excluding Ford Credit						Company Excluding Ford Credit
Company Adjusted EBIT excluding Ford Credit (a)	Company Adjusted EBIT excluding Ford Credit (a)	$	(0.7)	$	3.9		Company Adjusted EBIT excluding Ford Credit (a)	$	2.9	$	1.4

Capital spending	Capital spending	$	(1.8)	$	(1.4)		Capital spending	$	(1.4)	$	(1.3)
Depreciation and tooling amortization	Depreciation and tooling amortization	1.4		1.2			Depreciation and tooling amortization	1.2		1.3
Net spending	Net spending	$	(0.4)	$	(0.1)		Net spending	$	(0.1)	$	(0.1)

Receivables	Receivables	$	0.5	$	(0.6)		Receivables	$	(0.6)	$	—
Inventory	Inventory	(1.1)		(2.2)			Inventory	(2.2)		(2.7)
Trade Payables	Trade Payables	(0.5)		1.6			Trade Payables	1.6		1.5
Changes in working capital	Changes in working capital	$	(1.2)	$	(1.2)		Changes in working capital	$	(1.2)	$	(1.2)

Ford Credit distributions	Ford Credit distributions	$	0.3	$	1.0		Ford Credit distributions	$	1.0	$	1.0
Interest on debt and cash taxes	Interest on debt and cash taxes	(0.4)		(0.4)			Interest on debt and cash taxes	(0.4)		(0.3)
All other and timing differences	All other and timing differences	0.2		(3.5)			All other and timing differences	(2.6)		(1.3)
Company adjusted free cash flow (a)	Company adjusted free cash flow (a)	$	(2.2)	$	(0.4)		Company adjusted free cash flow (a)	$	(0.4)	$	(0.6)

Global Redesign (including separations)	Global Redesign (including separations)	$	(0.2)	$	(0.3)		Global Redesign (including separations)	$	(0.3)	$	(0.1)
Changes in debt	Changes in debt	15.1		1.9			Changes in debt	1.9		(0.3)
Funded pension contributions	Funded pension contributions	(0.2)		(0.2)			Funded pension contributions	(0.2)		(0.2)
Shareholder distributions	Shareholder distributions	(0.6)		—			Shareholder distributions	—		(0.4)
All other (including acquisitions and divestitures)		0.1		(0.4)
All other (b)							All other (b)	(0.4)		(6.2)
Change in cash	Change in cash	$	12.0	$	0.5		Change in cash	$	0.5	$	(7.8)

__________

(a)See Non-GAAP Financial Measure Reconciliations section for reconciliation to GAAP.

(b)2022 includes the $5.4 billion mark-to-market loss on our Rivian investment.

Note: Numbers may not sum due to rounding.

Our first quarter 2022 Net cash provided by/(used in) operating activities was negative $1.1 billion, a decrease of $5.6 billion from a year ago (see page 59 for additional information). The year-over-year decrease was driven primarily by lower Ford Credit operating cash flow. Company adjusted free cash flow was negative $0.6 billion, $0.2 billion lower than a year ago, driven by lower adjusted EBIT, partially offset by less adverse timing differences.

Capital spending was $1.3 billion in the first quarter of 2022, $0.1 billion lower than a year ago. We now expect full year 2022 capital spending to be about $7.0 billion.

First quarter 2022 working capital impact was $1.2 billion negative, driven by higher inventory. All other and timing differences were negative $1.3 billion, reflecting assorted differences including differences between accrual-based EBIT and the associated cash flows (e.g., pension and OPEB income or expense; compensation payments; marketing incentive and warranty payments to dealers). We expect the working capital and timing differences to normalize when supply is restored, dealer stocks rebound, and incentives potentially increase.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

~~Our first quarter 2021~~ ~~Net cash provided by/(used in) operating activities~~ was positive $4.5 billion, an increase of $5.0 billion from a year ago. The year-over-year increase is more than explained by higher net income. Our Company adjusted free cash flow was negative $0.4 billion, which was $1.8 billion higher than a year ago, driven by higher adjusted EBIT and Ford Credit distributions and lower capital spending, partially offset by adverse timing differences.

~~Capital spending was $1.4 billion in the first quarter of 2021, $0.4 billion lower than a year ago. We continue to expect full year 2021 capital spending to be between $6.0 billion and $6.5 billion.~~

First quarter 2021 working capital was $1.2 billion negative, driven by higher inventory due to the semiconductor supply constraints; all other and timing differences were $3.5 billion negative, reflecting assorted differences including differences between accrual-based EBIT and the associated cash flows (e.g., marketing incentive and warranty payments to dealers; pension and OPEB income or expense) and the $902 million non-cash gain from our investment in Rivian. We expect the working capital and timing differences to normalize as the semiconductor supply is restored, dealer stocks rebound, and incentives return to more normal levels. This process will take several quarters and will most likely extend into 2022.

In the first quarter of ~~2021,~~2022, we contributed ~~$229~~$174 million to our global funded pension plans. We ~~continue to~~now expect to contribute between ~~$600~~$700 million and $800 million to our global funded pension plans in ~~2021.~~2022.

~~There~~Shareholder distributions were ~~no shareholder distributions~~$408 million in the first quarter of ~~2021.~~2022, all of which was attributable to our regular

quarterly dividend.

We previously announced our plan for the global redesign of our business, pursuant to which we are working to turn around automotive operations, compete like a challenger, and capitalize on our strengths by allocating more capital, more resources, and more talent to our strongest ~~business~~businesses and vehicle franchises. Beginning with the actions we took in 2018, we expect our global redesign to have a potential cash effect of about ~~$7 billion.~~$6 billion through 2023. The cash effect related to our global redesign activities was $2$3.7 billion through March 31, ~~2021 and is expected to be about $5 billion through December 31, 2021.~~2022.

Available Credit Lines. Total Company committed credit lines, excluding Ford Credit, at March 31, ~~2021~~2022 were ~~$18.3~~$18.2 billion, consisting of $13.5 billion of our corporate credit facility, $2$2.0 billion of our supplemental revolving credit facility, $1.5 billion of our delayed draw term loan facility, and ~~$1.4~~$1.3 billion of local credit facilities. At March 31, ~~2021,~~2022, the utilized portion of the corporate credit facility was ~~$27~~$25 million, representing amounts utilized for letters of credit, and no portion of the supplemental revolving credit facility was utilized. The $1.5 billion delayed draw term loan facility was drawn in full in 2019 and remains outstanding. In addition, ~~$878~~$848 million of committed Company credit lines, excluding Ford Credit, was utilized under local credit facilities for our affiliates as of March 31, ~~2021.~~2022.

Lenders under our corporate credit facility have ~~$0.4~~$3.4 billion of commitments maturing on ~~April 30, 2022, $3 billion of commitments maturing on July 27, 2023,~~September 29, 2024 and $10.1 billion of commitments maturing on ~~April 30, 2024.~~September 29, 2026. Lenders under our supplemental revolving credit facility have ~~$0.2~~$2.0 billion of commitments maturing on ~~April 30, 2022~~September 29, 2024.

The corporate and ~~$1.8 billion of commitments maturing on July 27, 2023.~~supplemental credit agreements include certain sustainability-linked targets, pursuant to which the applicable margin and facility fees may be adjusted if Ford achieves, or fails to achieve, the specified targets related to global manufacturing facility greenhouse gas emissions, renewable electricity consumption, and Ford Europe CO2 tailpipe emissions.

The corporate credit facility is unsecured and free of material adverse change conditions to borrowing, restrictive financial covenants (for example, interest or fixed-charge coverage ratio, debt-to-equity ratio, and minimum net worth requirements), and credit rating triggers that could limit our ability to obtain funding or trigger early repayment. The corporate credit facility contains a liquidity covenant that requires us to maintain a minimum of $4 billion in aggregate of domestic cash, cash equivalents, and loaned and marketable securities and/or availability under the facility. Further, the terms of the corporate and supplemental revolving credit facilities prohibit share repurchases (with limited exceptions) while any portion of either facility is outstanding and the payment of dividends on our Common or Class B Stock while more than 50% of the aggregate amount of commitments under the two facilities is utilized. The terms and conditions of the delayed draw term loan (other than the ~~restrictions on share repurchases and dividends)~~sustainability-linked provisions) and the supplemental revolving credit facility are consistent with our corporate credit facility.

~~Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)~~

Each of the corporate credit facility, supplemental revolving credit facility, delayed draw term loan, and our Loan Arrangement and Reimbursement Agreement with the U.S. Department of Energy (the “DOE”) include a covenant that requires us to provide guarantees from certain of our subsidiaries in the event that our senior, unsecured, long-term debt does not maintain at least two investment grade ratings from Fitch, Moody’s, and S&P. The following subsidiaries have provided unsecured guarantees to the lenders under the credit facilities and to the DOE: Ford Component Sales, LLC; Ford European Holdings LLC; Ford Global Technologies, LLC; Ford Holdings LLC (the parent company of Ford Credit); Ford International Capital LLC; Ford Mexico Holdings LLC; Ford Motor Service Company; Ford Next LLC; Ford Smart Mobility LLC; and Ford Trading Company, LLC.

Debt. As shown in Note 14 of the Notes to the Financial Statements, at March 31, ~~2021,~~2022, Company debt excluding Ford Credit was ~~$25.9~~$20.1 billion. This balance is ~~$1.9~~$0.3 billion ~~higher~~lower than at December 31, ~~2020,~~2021, primarily ~~reflecting our convertible notes issuance in March 2021.~~

~~In March 2021, we issued $2.3 billion principal amount of 0% Convertible Senior Notes~~ due ~~March 15, 2026. These notes are convertible, under certain circumstances, into Ford Common Stock at a conversion price of approximately $17.49 per share. Upon conversion, we will pay cash up~~ to the aggregate principal amount of the notes to be converted and cash, shares of Ford Common Stock, or a combination of cash and shares of Ford Common Stock, at our election, for the remainder of our obligation in excess, if any, of the aggregate principal amount of the notes being converted.scheduled maturities.

Leverage. We manage Company debt (excluding Ford Credit) levels with a leverage framework that targets investment grade credit ratings through a normal business ~~cycle; however, during these uncertain times, we have increased our debt balance and prioritized actions that preserve or improve our cash balance.~~cycle. The leverage framework includes a ratio of total ~~company~~Company debt (excluding Ford Credit), underfunded pension liabilities, operating leases, and other adjustments, divided by Company adjusted EBIT (excluding Ford Credit EBT), and further adjusted to exclude depreciation and tooling amortization (excluding Ford Credit).

Ford Credit’s leverage is calculated as a separate business as described in the Liquidity and Capital Resources - Ford Credit Segment section of Item 2. Ford Credit is self-funding and its debt, which is used to fund its operations, is separate from our Company debt excluding Ford Credit.

5048

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

Ford Credit Segment

Ford Credit ended the first quarter of ~~2021~~2022 with ~~$33.7~~$28.4 billion of liquidity. During the quarter, Ford Credit completed $5 billion of public term funding.

Key elements of Ford Credit’s funding strategy include:

•Maintain strong ~~liquidity; continue to renew and expand committed ABS capacity~~liquidity

•Prudently access public markets

•Continue growth of retail deposits in Europe

•Flexibility to increase ABS mix as needed; preserving assets and committed capacity

•Target ~~managed~~financial statement leverage of 8:9:1 to 9:10:1

•Maintain self-liquidating balance sheet

Ford Credit’s liquidity profile continues to be diverse, robust, and focused on maintaining liquidity levels that meet its business and funding requirements. Ford Credit regularly stress tests its balance sheet and liquidity to ensure that it can continue to meet its financial obligations through economic cycles.

The following table shows funding for Ford Credit’s ~~managed~~net receivables (in billions):

March 31,
2020 December 31,
2020 March 31,
2021
Term unsecured debt $ 75.4 $ 76.6 $ 69.4
Term asset-backed securities 55.7 54.6 50.2
Ford Interest Advantage / Deposits 5.7 6.5 7.2
Other (a) 5.4 5.7 7.2
Equity (a) 15.5 15.6 15.3
Adjustments for cash (11.3) (18.5) (14.1)
Total Managed Receivables (b) $ 146.4 $ 140.5 $ 135.2
Securitized Funding as Percent of Managed Receivables 38.1 % 38.8 % 37.1 %

~~__________~~

~~(a)~~Prior period amounts have been updated as a result of the adoption of ASU 2019-12, Simplifying the Accounting for Income Taxes. For additional information, see Note 2 of the Notes to the Financial Statements.

~~(b)See~~ ~~Non-GAAP Financial Measure Reconciliations~~ ~~section for reconciliation to GAAP.~~


	March 31, 2021			December 31, 2021			March 31, 2022
Funding Structure
Term unsecured debt	$	66.1		$	59.4		$	55.1
Term asset-backed securities	50.2			45.4			47.1
Ford Interest Advantage / Retail Deposits	10.5			12.9			13.3
Other	(0.9)			(0.2)			1.7
Equity	15.3			12.4			12.1
Adjustments for cash	(14.1)			(12.4)			(11.9)
Total Net Receivables	$	127.1		$	117.5		$	117.4

Securitized Funding as Percent of Total Debt	39.6		%	38.5		%	40.8		%

~~Managed~~Net receivables were ~~$135.2~~$117.4 billion at March 31, ~~2021,~~2022 and were funded primarily with term unsecured debt and term asset-backed securities. Securitized funding as a percent of ~~managed receivables~~total debt was ~~37.1%~~40.8% at the end of the first quarter of ~~2021. The calendarization of the funding plan will result in quarterly fluctuations of the securitized funding percentage.~~2022.

Public Term Funding Plan. The following table shows Ford Credit’s issuances for full year ~~2019~~2020 and ~~2020,~~2021, planned issuances for full year ~~2021,~~2022, and its global public term funding issuances through April ~~27, 2021,~~26, 2022, excluding short-term funding programs (in billions):


		2019 Actual		2020 Actual		2021 Forecast	Through April 27			2020 Actual		2021 Actual		2022 Forecast	Through April 26
Unsecured	Unsecured	$	17	$	14	$ 5 - 9	$	1	Unsecured	$	14	$	5	$ 8 - 11	$	4
Securitizations (a)	Securitizations (a)	14		13		7 - 10	5		Securitizations (a)	13		9		6 - 9	3
Total public	Total public	$	31	$	27	$ 12 - 19	$	6	Total public	$	27	$	14	$ 14 - 20	$	7

__________

(a)See Definitions and Information Regarding Ford Credit Causal Factors section.

For ~~2021,~~2022, Ford Credit ~~now~~ projects full year public term funding in the range of ~~$12~~$14 billion to ~~$19~~$20 billion. Through April ~~27, 2021,~~26, 2022, Ford Credit has completed $6$7 billion of public term issuances.

5149

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

Liquidity. The following table shows Ford Credit’s liquidity sources and utilization (in billions):


		March 31, 2020		December 31, 2020		March 31, 2021			March 31, 2021		December 31, 2021		March 31, 2022
Liquidity Sources (a)	Liquidity Sources (a)							Liquidity Sources (a)
Cash	Cash	$	11.3	$	18.5	$	14.1	Cash	$	14.1	$	12.4	$	11.9
Committed asset-backed facilities	Committed asset-backed facilities	35.9		38.1		38.2		Committed asset-backed facilities	38.2		37.1		36.1
Other unsecured credit facilities	Other unsecured credit facilities	2.8		2.5		2.5		Other unsecured credit facilities	2.5		2.7		2.8
Total liquidity sources	Total liquidity sources	$	50.0	$	59.1	$	54.8	Total liquidity sources	$	54.8	$	52.2	$	50.8

Utilization of Liquidity (a)	Utilization of Liquidity (a)							Utilization of Liquidity (a)
Securitization and restricted cash	Securitization and restricted cash	$	(3.1)	$	(3.9)	$	(5.4)	Securitization and restricted cash	$	(5.4)	$	(3.9)	$	(3.0)
Committed asset-backed facilities	Committed asset-backed facilities	(18.6)		(16.7)		(11.9)		Committed asset-backed facilities	(11.9)		(12.5)		(17.0)
Other unsecured credit facilities	Other unsecured credit facilities	(0.5)		(0.5)		(0.6)		Other unsecured credit facilities	(0.6)		(1.0)		(0.4)
Total utilization of liquidity	Total utilization of liquidity	$	(22.2)	$	(21.1)	$	(17.9)	Total utilization of liquidity	$	(17.9)	$	(17.4)	$	(20.4)

Gross liquidity	Gross liquidity	$	27.8	$	38.0	$	36.9	Gross liquidity	$	36.9	$	34.8	$	30.4
Asset-backed capacity in excess of eligible receivables and other adjustments	Asset-backed capacity in excess of eligible receivables and other adjustments	0.3		(2.6)		(3.2)		Asset-backed capacity in excess of eligible receivables and other adjustments	(3.2)		(2.8)		(2.0)
Net liquidity available for use	Net liquidity available for use	$	28.1	$	35.4	$	33.7	Net liquidity available for use	$	33.7	$	32.0	$	28.4

__________

(a)See Definitions and Information Regarding Ford Credit Causal Factors section.

Ford Credit’s net liquidity available for use will fluctuate quarterly based on factors including near-term debt maturities, receivable growth and decline, and timing of funding transactions. At March 31, ~~2021,~~2022, Ford Credit’s net liquidity available for use was ~~$33.7~~$28.4 billion, ~~$1.7~~$3.6 billion lower than year-end ~~2020.~~2021. Ford Credit’s sources of liquidity include cash, committed ~~asset-backed~~asset-back facilities, and unsecured ~~credit~~ facilities. At March 31, ~~2021,~~2022, Ford Credit’s liquidity sources ~~including cash~~ totaled ~~$54.8~~$50.8 billion, down ~~$4.3~~$1.4 billion from year-end ~~2020.~~2021.

Material Cash Requirements. Ford Credit’s material cash requirements include: (1) the purchase of retail financing and operating lease contracts from dealers and providing wholesale financing for dealers to finance new and used vehicles; and (2) debt repayments (for additional information on debt, see the “Balance Sheet Liquidity Profile” section below and the Aggregate Contractual Obligations table in the Liquidity and Capital Resources - Company Excluding Ford Credit” section in Item 7 and Note 19 of the Notes to the Financial Statements in our 2021 Form 10-K Report). In addition, subject to approval by Ford Credit’s Board of Directors, shareholder distributions may require the expenditure of a material amount of cash. Moreover, Ford Credit may be subject to additional material cash requirements that are contingent upon the occurrence of certain events, e.g., legal contingencies, uncertain tax positions, and other matters.

Ford Credit plans to utilize its liquidity (as described above) and its cash flows from business operations to fund its material cash requirements.

Balance Sheet Liquidity Profile. Ford Credit defines its balance sheet liquidity profile as the cumulative maturities, including the impact of expected prepayments and allowance for credit losses, of its finance receivables, investment in operating leases, and cash, less the cumulative debt maturities over upcoming annual periods. Ford Credit’s balance sheet is inherently liquid because of the short-term nature of its finance receivables, investment in operating leases, and cash. Ford Credit ensures its cumulative debt maturities have a longer tenor than its cumulative asset maturities. This positive maturity profile is intended to provide Ford Credit with additional liquidity after all of its assets have been funded and is in addition to its liquidity available to protect for stress ~~test.~~scenarios.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

The following table shows Ford Credit’s cumulative maturities for assets and total debt for the periods presented and unsecured long-term debt maturities in the individual periods presented (in billions):


		April - December 2021		2022		2023		2024 and Beyond			April - December 2022		2023		2024		2025 and Beyond
Balance Sheet Liquidity Profile	Balance Sheet Liquidity Profile									Balance Sheet Liquidity Profile
Assets (a)	Assets (a)	$	64	$	95	$	120	$	147	Assets (a)	$	56	$	85	$	108	$	134
Total debt (b)	Total debt (b)	46		74		92		126		Total debt (b)	43		69		86		116
Memo: Unsecured long-term debt maturities	Memo: Unsecured long-term debt maturities	10		14		11		30		Memo: Unsecured long-term debt maturities	8		11		11		26

__________

(a)Includes gross finance receivables less the allowance for credit losses (including certain finance receivables that are reclassified in consolidation to Trade and other receivables, net), investment in operating leases net of accumulated depreciation, cash and cash equivalents, and marketable securities (excluding amounts related to insurance activities). Amounts shown include the impact of expected prepayments.

(b)Excludes unamortized debt (discount)/premium, unamortized issuance costs, and fair value adjustments.

Maturities of investment in operating leases consist primarily of the portion of rental payments attributable to depreciation over the remaining life of the lease and the expected residual value at lease termination. Maturities of finance receivables and investment in operating leases in the table above include expected prepayments for Ford Credit’s retail installment sale contracts and investment in operating leases. The table above also reflects adjustments to debt maturities to match the asset-backed debt maturities with the underlying asset maturities.

~~Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)~~

All wholesale securitization transactions and wholesale receivables are shown maturing in the next 12 months, even if the maturities extend beyond first quarter ~~2022.~~2023. The retail securitization transactions under certain committed asset-backed facilities are assumed to amortize immediately rather than amortizing after the expiration of the commitment period. As of March 31, ~~2021,~~2022, Ford Credit had ~~$147~~$134 billion of assets, ~~$76~~$72 billion of which were unencumbered.

Funding and Liquidity Risks.Ford Credit’s funding plan is subject to risks and uncertainties, many of which are beyond its control, including disruption in the capital markets, that could impact both unsecured debt and asset-backed securities issuance and the effects of regulatory changes on the financial markets. Refer to the “Liquidity - Ford Credit Segment - Funding and Liquidity Risks” section of Item 7 of Part II of our ~~2020~~2021 Form 10-K Report for more information.

Leverage. Ford Credit uses leverage, or the debt-to-equity ratio, to make various business decisions, including evaluating and establishing pricing for finance receivable and operating lease financing, and assessing its capital structure.

The table below shows the calculation of Ford Credit’s financial statement leverage ~~and managed leverage~~ (in billions):

March 31,
2020 December 31,
2020 March 31,
2021
Leverage Calculation
Debt $ 136.8 $ 137.7 $ 126.8
Adjustments for cash (11.3) (18.5) (14.1)
Adjustments for derivative accounting (a) (1.6) (1.5) (0.8)
Total adjusted debt $ 123.9 $ 117.7 $ 111.9
Equity (b) (c) $ 15.5 $ 15.6 $ 15.3
Adjustments for derivative accounting (a) — 0.1 —
Total adjusted equity (c) $ 15.4 $ 15.7 $ 15.3
Financial statement leverage (to 1) (GAAP) (c) 8.9 8.8 8.3
Managed leverage (to 1) (Non-GAAP) (c) 8.0 7.5 7.3


	March 31, 2021		December 31, 2021		March 31, 2022
Leverage Calculation
Debt	$	126.8	$	117.7	$	115.5
Equity (a)	15.3		12.4		12.1
Financial statement leverage (to 1)	8.3		9.5		9.5

__________

(a)Related primarily to market valuation adjustments to derivatives due to movements in interest rates. Adjustments to debt are related to designated fair value hedges and adjustments to equity are related to retained earnings.

~~(b)~~Total shareholder’s interest reported on Ford Credit’s balance sheets.

~~Note: Numbers may not sum due to rounding.~~

Ford Credit plans its ~~managed~~ leverage by considering market conditions and the risk characteristics of its business. At March 31, ~~2021,~~2022, Ford Credit’s financial statement leverage was ~~8.3:1, and its managed leverage was 7.3:~~9.5:1. Ford Credit targets ~~managed~~financial statement leverage in the range of 8:9:1 to ~~9:1~~10:1.

Total Company

Pension Plans - Funded Balances. As of March 31, 2022, our total Company pension overfunded status reported on our consolidated balance sheets was $0.2 billion and ~~expects its managed leverage to~~reflects the net funded status at December 31, 2021, updated for: service and interest cost; expected return ~~to its target range later in~~on assets; separation expense; actual benefit payments; and cash contributions. The discount rate and rate of expected return assumptions are unchanged from year-end 2021.

5351

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

~~Total Company~~

~~Pension Plans - Underfunded Balances.~~ As of March 31, 2021, our total Company pension underfunded status reported on our consolidated balance sheets was $5.7 billion and reflects the net underfunded status at December 31, 2020, updated for: service and interest cost; expected return on assets; curtailments, settlements, and associated interim remeasurement (where applicable); separation expense; actual benefit payments; and cash contributions. For plans without interim remeasurement, the discount rate and rate of expected return assumptions are unchanged from year-end 2020.

Return on Invested Capital (“ROIC”). We analyze total Company performance using an adjusted ROIC financial metric based on an after-tax, rolling four quarter average. The following table contains the calculation of our ROIC for the periods shown (in billions):


		Four Quarters Ending							Four Quarters Ending
		March 31, 2020			March 31, 2021				March 31, 2021			March 31, 2022
Adjusted Net Operating Profit After Cash Tax
Adjusted Net Operating Profit/(Loss) After Cash Tax								Adjusted Net Operating Profit/(Loss) After Cash Tax
Net income/(loss) attributable to Ford	Net income/(loss) attributable to Ford	$	(3.1)		$	4.0		Net income/(loss) attributable to Ford	$	4.0		$	11.6
Add: Noncontrolling interest	Add: Noncontrolling interest	—			—			Add: Noncontrolling interest	—			—
Less: Income tax	Less: Income tax	0.3			—			Less: Income tax	—			1.5
Add: Cash tax	Add: Cash tax	(0.6)			(0.4)			Add: Cash tax	(0.4)			(0.6)
Less: Interest on debt	Less: Interest on debt	(1.0)			(1.9)			Less: Interest on debt	(1.9)			(1.6)
Less: Total pension/OPEB income/(cost)	Less: Total pension/OPEB income/(cost)	(2.5)			(0.9)			Less: Total pension/OPEB income/(cost)	(0.9)			4.8
Add: Pension/OPEB service costs	Add: Pension/OPEB service costs	(1.0)			(1.1)			Add: Pension/OPEB service costs	(1.1)			(1.1)
Net operating profit/(loss) after cash tax	Net operating profit/(loss) after cash tax	$	(1.6)		$	5.2		Net operating profit/(loss) after cash tax	$	5.2		$	5.2
Less: Special items (excl. pension/OPEB) pre-tax	Less: Special items (excl. pension/OPEB) pre-tax	(3.2)			(0.7)			Less: Special items (excl. pension/OPEB) pre-tax	0.5			(0.4)
Adjusted net operating profit after cash tax		$	1.6		$	6.0
Adjusted net operating profit/(loss) after cash tax								Adjusted net operating profit/(loss) after cash tax	$	4.8		$	5.6

Invested Capital	Invested Capital							Invested Capital
Equity	Equity	$	29.7		$	34.0		Equity	$	34.0		$	45.1
Redeemable noncontrolling interest		—			—
Debt (excl. Ford Credit)	Debt (excl. Ford Credit)	30.5			25.9			Debt (excl. Ford Credit)	25.9			20.1
Net pension and OPEB liability	Net pension and OPEB liability	12.2			12.2			Net pension and OPEB liability	12.2			5.8
Invested capital (end of period)	Invested capital (end of period)	$	72.4		$	72.1		Invested capital (end of period)	$	72.1		$	70.9
Average invested capital	Average invested capital	$	63.7		$	72.9		Average invested capital	$	72.9		$	72.7

ROIC (a)	ROIC (a)	(2.5)		%	7.2		%	ROIC (a)	7.2		%	7.2		%
Adjusted ROIC (Non-GAAP) (b)	Adjusted ROIC (Non-GAAP) (b)	2.5		%	8.2		%	Adjusted ROIC (Non-GAAP) (b)	6.6		%	7.8		%

__________

(a)Calculated as the sum of net operating ~~profit~~profit/(loss) after cash tax from the last four quarters, divided by the average invested capital over the last four quarters.

(b)Calculated as the sum of adjusted net operating ~~profit~~profit/(loss) after cash tax from the last four quarters, divided by the average invested capital over the last four quarters.

Note: Numbers may not sum due to rounding.

5452

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

CREDIT RATINGS

Our short-term and long-term debt is rated by four credit rating agencies designated as nationally recognized statistical rating organizations (“NRSROs”) by the U.S. Securities and Exchange Commission: DBRS, Fitch, Moody’s, and S&P.

In several markets, locally recognized rating agencies also rate us. A credit rating reflects an assessment by the rating agency of the credit risk associated with a corporate entity or particular securities issued by that entity. Rating agencies’ ratings of us are based on information provided by us and other sources. Credit ratings are not recommendations to buy, sell, or hold securities and are subject to revision or withdrawal at any time by the assigning rating agency. Each rating agency may have different criteria for evaluating company risk and, therefore, ratings should be evaluated independently for each rating agency.

~~The following~~There have been no rating actions ~~were~~ taken by these NRSROs since the filing of our ~~2020~~2021 Form 10-K ~~Report:~~

•~~On March 29, 2021, Moody’s affirmed the credit ratings for Ford and Ford Credit at Ba2 and revised the outlook to stable, from negative.~~Report.

The following table summarizes certain of the credit ratings and outlook presently assigned by these four NRSROs:

NRSRO RATINGS

Ford

Ford Credit

NRSROs

Issuer
Default /
Corporate /
Issuer Rating

Long-Term Senior Unsecured

Outlook / Trend

Long-Term Senior Unsecured

Short-Term
Unsecured

Outlook / Trend

Minimum Long-Term Investment Grade Rating

DBRS

BB (high)

~~Negative~~Stable

BB (high)

R-4

~~Negative~~Stable

BBB (low)

Fitch

BB+

~~Negative~~Stable

BB+

~~Negative~~Stable

BBB-

Moody’s

N/A

Ba2

Stable

Ba2

Stable

Baa3

S&P

BB+

~~Negative~~Positive

BB+

~~Negative~~Positive

BBB-

5553

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

OUTLOOK

We provided ~~2021~~2022 Company guidance in our earnings release furnished on Form 8-K dated April ~~28, 2021. The guidance is based on our expectations as of April 28, 2021 and assumes no material change in the current economic environment, including foreign exchange and tariffs.~~27, 2022. Our actual results could differ materially from our guidance due to risks, uncertainties, and other factors, including those set forth in “Risk Factors” in Item 1A of our ~~2020~~2021 Form 10-K Report and as updated by our subsequent filings with the SEC.


						~~2021~~2022 Guidance
Total Company
Adjusted EBIT (a)						$~~5.5~~11.5 - ~~$6.5~~$12.5 billion
Adjusted Free Cash Flow (a)						$~~0.5~~5.5 - ~~$1.5~~$6.5 billion
Capital spending						~~$6.0 - $6.5~~About $7.0 billion
Pension contributions						$~~0.6~~0.7 - $0.8 billion
Global Redesign EBIT charges (b)						$~~2.2~~1.0 - ~~$2.7~~$1.5 billion
Global Redesign cash effects (b)						$~~3.0~~1.0 - ~~$3.5~~$1.5 billion

Ford Credit
EBT						~~Improved compared to 2020~~
~~Ford Credit auction values (c)~~						~~Higher~~Strong but lower than 2021

__________

(a)When we provide guidance for ~~Adjusted~~adjusted EBIT and adjusted free cash flow, we do not provide guidance for ~~net income/(loss),~~ the most comparable GAAP ~~measure,~~measures because, as described in more detail below in “Non-GAAP Measures That Supplement GAAP Measures,” ~~it includes~~they include items that are difficult to predict with reasonable ~~certainty prior to year-end, including pension and OPEB remeasurement gains and losses.~~certainty.

(b)We continue to review our global businesses and may take additional restructuring actions in markets where a path to sustained profitability is not feasible when considering the capital allocation required for those markets. Such actions may result in global redesign EBIT charges and cash effects in ~~2021~~2022 that are incremental to those set forth in the table.

~~(c)On average compared with full year 2020 at constant mix.~~

~~In February 2021, we estimated that there was the potential~~A strong demand and pricing environment for ~~an adverse impact~~existing and new vehicles support maintaining our full-year 2022 outlook of ~~10%~~$11.5 billion to ~~20% on our volume~~$12.5 billion in adjusted EBIT. Adjusted free cash flow for the first half of 2021 due to the growing semiconductor shortage. Further, we believed that the risk had the potential to reduce our original full-year guidance, which was to deliver adjusted EBIT of $8 billion to $9 billion, by $1 billion to $2.5 billion, net of recoveries and some production make-up in the second half of the year. Including the impact of the fire at Renesas, we now expect to lose about 50% of our planned production in the second quarter of 2021, an increase from the 17% loss in the first quarter of 2021. The second quarteryear is expected to be ~~the trough for our performance this year. For the second half of 2021, we expect to lose about 10% of our planned production.~~

In total, we believe the shortage for the year will result in a loss of about 1.1 million wholesale units, which translates to a headwind to adjusted EBIT of about $2.5 billion, net of recovery actions. The expected volume loss for the year has more than doubled, but we have worked to contain the adjusted EBIT impact to the high-end of the range we outlined in February. Including the effect of the semiconductor shortage, we now expect full-year adjusted EBIT to be in a range of $5.5 billion to $6.5 billion.

~~We also now expect full-year adjusted free cash flow of $500 million to $1.5 billion, which reflects a $3 billion adverse impact from semiconductors. The impact~~Underlying assumptions for our 2022 guidance include:

•Improved semiconductor availability during the second half of the ~~semiconductor shortage~~year

•Full-year vehicle wholesale volumes increasing 10% to 15% from 2021

•Continued strong pricing, though with a dynamic relationship between prices and vehicle volumes

•Commodity costs up about $4 billion year over year, along with inflationary effects on ~~adjusted free cash flow~~a range of other expenses

•EBT from Ford Credit that remains strong, but is ~~$500 million worse~~lower than in 2021

•Ongoing investment in the ~~impact~~Ford+ plan for growth and value creation

Our outlook also assumes that disruptions in the supply chain and local vehicle manufacturing operations resulting from renewed COVID-19-related health concerns and lockdowns in China do not further deteriorate.

Separately, to date, the tragic conflict in Ukraine has had limited direct effect on ~~adjusted EBIT due to timing differences and working capital impacts that we expect to recover once~~ our ~~rate of production is fully restored, dealer stocks align with demand, and incentives normalize. In~~supply chain. However, the ~~second quarter of 2021, adjusted free cash flow is expected to be significantly negative, but we expect our cash balance and liquidity to remain healthy throughout 2021.~~situation in Eastern Europe could exacerbate broader supply issues over time.

5654

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

Cautionary Note on Forward-Looking Statements

Statements included or incorporated by reference herein may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on expectations, forecasts, and assumptions by our management and involve a number of risks, uncertainties, and other factors that could cause actual results to differ materially from those stated, including, without limitation:

•Ford and Ford Credit’s financial condition and results of operations have been and may continue to be adversely affected by public health issues, including epidemics or pandemics such as COVID-19;

•Ford is highly dependent on its suppliers to deliver components in accordance with Ford’s production schedule, and a shortage of key components, such as semiconductors, or raw materials can disrupt Ford’s production of vehicles;

•Ford’s long-term competitiveness depends on the successful execution of ~~its Plan;~~Ford+;

•Ford’s vehicles could be affected by defects that result in delays in new model launches, recall campaigns, or increased warranty costs;

•Ford may not realize the anticipated benefits of existing or pending strategic alliances, joint ventures, acquisitions, divestitures, or new business strategies;

•Operational systems, security systems, vehicles, and ~~vehicles~~services could be affected by cyber incidents, ransomware attacks, and other disruptions;

•Ford’s production, as well as Ford’s suppliers’ production, could be disrupted by labor issues, natural or man-made disasters, financial distress, production difficulties, capacity limitations, or other factors;

•Ford’s ability to maintain a competitive cost structure could be affected by labor or other constraints;

•Ford’s ability to attract and retain talented, diverse, and highly skilled employees is critical to its success and competitiveness;

•Ford’s new and existing products, digital and physical services, and mobility services are subject to market acceptance and face significant competition from existing and new entrants in the automotive, mobility, and ~~mobility~~digital services industries;

•Ford’s near-term results are dependent on sales of larger, more profitable vehicles, particularly in the United States;

•With a global footprint, Ford’s results could be adversely affected by economic, geopolitical, protectionist trade policies, or other events, including tariffs;

•Industry sales volume in any of Ford’s key markets can be volatile and could decline if there is a financial crisis, recession, or significant geopolitical event;

•Ford may face increased price competition or a reduction in demand for its products resulting from industry excess capacity, currency fluctuations, competitive actions, or other factors;

•~~Fluctuations~~Inflationary pressure and fluctuations in commodity prices, foreign currency exchange rates, interest rates, and market value of Ford or Ford Credit’s investments, including marketable securities, can have a significant effect on results;

•Ford and Ford Credit’s access to debt, securitization, or derivative markets around the world at competitive rates or in sufficient amounts could be affected by credit rating downgrades, market volatility, market disruption, regulatory requirements, or other factors;

•Ford’s receipt of government incentives could be subject to reduction, termination, or clawback;

•Ford Credit could experience higher-than-expected credit losses, lower-than-anticipated residual values, or higher-than-expected return volumes for leased vehicles;

•Economic and demographic experience for pension and other postretirement benefit plans (e.g., discount rates or investment returns) could be worse than Ford has assumed;

•Pension and other postretirement liabilities could adversely affect Ford’s liquidity and financial condition;

•Ford and Ford Credit could experience unusual or significant litigation, governmental investigations, or adverse publicity arising out of alleged defects in products, services, perceived environmental impacts, or otherwise;

•Ford may need to substantially modify its product plans to comply with safety, emissions, fuel economy, autonomous vehicle, and other regulations;

•Ford and Ford Credit could be affected by the continued development of more stringent privacy, data use, and data protection laws and regulations as well as consumers’ heightened expectations to safeguard their personal information; and

•Ford Credit could be subject to new or increased credit regulations, consumer protection regulations, or other regulations.

We cannot be certain that any expectation, forecast, or assumption made in preparing forward-looking statements will prove accurate, or that any projection will be realized. It is to be expected that there may be differences between projected and actual results. Our forward-looking statements speak only as of the date of their initial issuance, and we do not undertake any obligation to update or revise publicly any forward-looking statement, whether as a result of new information, future events, or otherwise. For additional discussion, see “Item 1A. Risk Factors” in our ~~2020~~2021 Form 10-K Report, as updated by our subsequent Quarterly Reports on Form 10-Q and Current Reports on Form 8-K.

5755

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

NON-GAAP FINANCIAL MEASURES THAT SUPPLEMENT GAAP MEASURES

We use both generally accepted accounting principles (“GAAP”) and non-GAAP financial measures for operational and financial decision making, and to assess Company and segment business performance. The non-GAAP measures listed below are intended to be considered by users as supplemental information to their equivalent GAAP measures, to aid investors in better understanding our financial results. We believe that these non-GAAP measures provide useful perspective on underlying ~~business~~operating results and trends, and a means to ~~assess~~compare our period-over-period results. These non-GAAP measures should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. These non-GAAP measures may not be the same as similarly titled measures used by other companies due to possible differences in method and in items or events being adjusted.

•Company Adjusted EBIT (Most Comparable GAAP Measure: Net Income/(Loss) Attributable to Ford) – Earnings before interest and taxes (EBIT) excludes interest on debt (excl. Ford Credit Debt), taxes, and pre-tax special items. This non-GAAP measure is useful to management and investors because it ~~allows users to evaluate our~~focuses on underlying operating results ~~aligned with industry reporting.~~and trends, and improves comparability of our period-over-period results. Our management ordinarily excludes special items from its review of the results of the operating segments for purposes of measuring segment profitability and allocating resources. Our categories of pre-tax special items and the applicable significance guideline for each item (which may consist of a group of items related to a single event or action) are as follows:


Pre-Tax Special Item						Significance Guideline
∘ Pension and OPEB remeasurement gains and losses						∘ No minimum

∘ Gains and losses on investments in equity securities						∘ No minimum

∘ Personnel expenses, dealer-related costs, and facility-related charges stemming from our efforts to match production capacity and cost structure to market demand and changing model mix						∘ Generally $100 million or more

∘ Other items that we do not necessarily consider to be indicative of earnings from ongoing operating activities						∘ $500 million or more for individual field service actions; generally $100 million or more for other items

When we provide guidance for adjusted EBIT, we do not provide guidance on a net income basis because the GAAP measure will include potentially significant special items that have not yet occurred and are difficult to predict with reasonable certainty, ~~prior to year-end,~~ including gains and losses on pension and OPEB ~~remeasurement gains~~remeasurements and ~~losses.~~on investments in equity securities.

•Company Adjusted EBIT Margin (Most Comparable GAAP Measure: Company Net Income/(Loss) Margin) – Company Adjusted EBIT margin is Company adjusted EBIT divided by Company revenue. This non-GAAP measure is useful to management and investors because it allows users to evaluate our operating results aligned with industry reporting.

•Adjusted Earnings/(Loss) Per Share (Most Comparable GAAP Measure: Earnings/(Loss) Per Share) – Measure of Company’s diluted net earnings/(loss) per share adjusted for impact of pre-tax special items (described above), tax special items, and restructuring impacts in noncontrolling interests. The measure provides investors with useful information to evaluate performance of our business excluding items not indicative of ~~the underlying run rate of our business.~~earnings from ongoing operating activities. When we provide guidance for adjusted earnings/(loss) per share, we do not provide guidance on an earnings/(loss) per share basis because the GAAP measure will include potentially significant special items that have not yet occurred and are difficult to predict with reasonable certainty prior to year-end, including pension and OPEB remeasurement gains and losses.

•Adjusted Effective Tax Rate (Most Comparable GAAP Measure: Effective Tax Rate) – Measure of Company’s tax rate excluding pre-tax special items (described above) and tax special items. The measure provides an ongoing effective rate which investors find useful for historical comparisons and for forecasting. When we provide guidance for adjusted effective tax rate, we do not provide guidance on an effective tax rate basis because the GAAP measure will include potentially significant special items that have not yet occurred and are difficult to predict with reasonable certainty prior to year-end, including pension and OPEB remeasurement gains and losses.

5856

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

•Company Adjusted Free Cash Flow (Most Comparable GAAP Measure: Net Cash Provided By/(Used In) Operating Activities) – Measure of Company’s operating cash flow excluding Ford Credit’s operating cash flows. The measure contains elements management considers operating activities, including ~~Automotive and Mobility~~Company excluding Ford Credit capital spending, Ford Credit distributions to its parent, and settlement of derivatives. The measure excludes cash outflows for funded pension contributions, global redesign (including separations), and other items that are considered operating cash flows under U.S. GAAP. This measure is useful to management and investors because it is consistent with management’s assessment of the Company’s operating cash flow performance. When we provide guidance for Company adjusted free cash flow, we do not provide guidance for net cash provided by/(used in) operating activities because the GAAP measure will include items that are difficult to quantify or predict with reasonable certainty, including cash flows related to the Company's exposures to foreign currency exchange rates and certain commodity prices (separate from any related hedges), Ford Credit's operating cash flows, and cash flows related to special items, including separation payments, each of which individually or in the aggregate could have a significant impact to our net cash provided by/(used in) our operating activities.

•Adjusted ROIC – Calculated as the sum of adjusted net operating profit after cash tax from the last four quarters, divided by the average invested capital over the last four quarters. Adjusted Return on Invested Capital (“Adjusted ROIC”) provides management and investors with useful information to evaluate the Company’s after-cash tax operating return on its invested capital for the period presented. Adjusted net operating profit after cash tax measures operating results less special items, interest on debt (excl. Ford Credit Debt), and certain pension/OPEB costs. Average invested capital is the sum of average balance sheet equity, debt (excl. Ford Credit Debt), and net pension/OPEB liability.

•~~Ford Credit Managed Receivables (Most Comparable GAAP Measure: Net Finance Receivables plus Net Investment in Operating Leases)~~ – Measure of Ford Credit’s total net receivables and held-for-sale receivables, excluding unearned interest supplements and residual support, allowance for credit losses, and other (primarily accumulated supplemental depreciation). The measure is useful to management and investors as it closely approximates the customer’s outstanding balance on the receivables, which is the basis for earning revenue.

•~~Ford Credit Managed Leverage (Most Comparable GAAP Measure: Financial Statement Leverage)~~ – Ford Credit’s debt-to-equity ratio adjusted (i) to exclude cash, cash equivalents, and marketable securities (other than amounts related to insurance activities), and (ii) for derivative accounting. The measure is useful to investors because it reflects the way Ford Credit manages its business. Cash, cash equivalents, and marketable securities are deducted because they generally correspond to excess debt beyond the amount required to support operations and on-balance sheet securitization transactions. Derivative accounting adjustments are made to asset, debt, and equity positions to reflect the impact of interest rate instruments used with Ford Credit’s term-debt issuances and securitization transactions. Ford Credit generally repays its debt obligations as they mature, so the interim effects of changes in market interest rates are excluded in the calculation of managed leverage.

5957

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

Non-GAAP Financial Measure Reconciliations

The following tables show our Non-GAAP financial measure reconciliations. ~~The GAAP reconciliation for Ford Credit Managed Leverage can be found in the Ford Credit Segment section of “Liquidity and Capital Resources.”~~

Net Income/(Loss) Reconciliation to Adjusted EBIT ($M)


		First Quarter						First Quarter
		2020			2021					2021					2022
Net income/(loss) attributable to Ford (GAAP)	Net income/(loss) attributable to Ford (GAAP)	$	(1,993)		$	3,262				$	3,262				$	(3,110)
Income/(Loss) attributable to noncontrolling interests	Income/(Loss) attributable to noncontrolling interests	—			—				Income/(Loss) attributable to noncontrolling interests			—					(9)
Net income/(loss)	Net income/(loss)	$	(1,993)		$	3,262			Net income/(loss)			$	3,262				$	(3,119)
Less: (Provision for)/Benefit from income taxes	Less: (Provision for)/Benefit from income taxes	(847)			(680)				Less: (Provision for)/Benefit from income taxes			(680)					729
Income/(Loss) before income taxes	Income/(Loss) before income taxes	$	(1,146)		$	3,942			Income/(Loss) before income taxes			$	3,942				$	(3,848)
Less: Special items pre-tax	Less: Special items pre-tax	(287)			(401)				Less: Special items pre-tax			503					(5,866)
Income/(Loss) before special items pre-tax	Income/(Loss) before special items pre-tax	$	(859)		$	4,343			Income/(Loss) before special items pre-tax			$	3,439				$	2,018
Less: Interest on debt	Less: Interest on debt	(227)			(473)				Less: Interest on debt			(473)					(308)
Adjusted EBIT (Non-GAAP)	Adjusted EBIT (Non-GAAP)	$	(632)		$	4,816			Adjusted EBIT (Non-GAAP)			$	3,912				$	2,326

Memo:	Memo:								Memo:
Revenue ($B)	Revenue ($B)	$	34.3		$	36.2			Revenue ($B)			$	36.2				$	34.5
Net income/(loss) margin (%)		(5.8)		%	9.0		%
Adjusted EBIT margin (%)		(1.8)		%	13.3		%
Net income/(loss) margin (GAAP) (%)									Net income/(loss) margin (GAAP) (%)			9.0		%			(9.0)		%
Adjusted EBIT margin (Non-GAAP) (%)									Adjusted EBIT margin (Non-GAAP) (%)			10.8		%			6.7		%

Earnings per Share Reconciliation to Adjusted Earnings per Share


		First Quarter				First Quarter
		2020		2021				2021			2022
Diluted After-Tax Results ($M)	Diluted After-Tax Results ($M)
Diluted after-tax results (GAAP)	Diluted after-tax results (GAAP)	$	(1,993)	$	3,262		Diluted after-tax results (GAAP)		$	3,262		$	(3,110)
Less: Impact of pre-tax and tax special items	Less: Impact of pre-tax and tax special items	(1,074)		(302)			Less: Impact of pre-tax and tax special items		445			(4,674)
Adjusted net income/(loss) – diluted (Non-GAAP)	Adjusted net income/(loss) – diluted (Non-GAAP)	$	(919)	$	3,564		Adjusted net income/(loss) – diluted (Non-GAAP)		$	2,817		$	1,564

Basic and Diluted Shares (M)	Basic and Diluted Shares (M)						Basic and Diluted Shares (M)
Basic shares (average shares outstanding)	Basic shares (average shares outstanding)	3,963		3,980			Basic shares (average shares outstanding)		3,980			4,008
Net dilutive options, unvested restricted stock units and restricted stock (a)		—		36
Net dilutive options, unvested restricted stock units, unvested restricted stock shares, and convertible debt							Net dilutive options, unvested restricted stock units, unvested restricted stock shares, and convertible debt		36			56
Diluted shares	Diluted shares	3,963		4,016			Diluted shares		4,016			4,064

Earnings/(Loss) per share – diluted (GAAP)(a)	Earnings/(Loss) per share – diluted (GAAP)(a)	$	(0.50)	$	0.81		Earnings/(Loss) per share – diluted (GAAP)(a)		$	0.81		$	(0.78)
Less: Net impact of adjustments	Less: Net impact of adjustments	(0.27)		(0.08)			Less: Net impact of adjustments		0.11			(1.16)
Adjusted earnings/(loss) per share – diluted (Non-GAAP)	Adjusted earnings/(loss) per share – diluted (Non-GAAP)	$	(0.23)	$	0.89		Adjusted earnings/(loss) per share – diluted (Non-GAAP)		$	0.70		$	0.38

_________

(a)~~In Q1 2020, there were 30~~The first quarter of 2022 calculation excludes 56 million shares ~~excluded from the calculation~~ of ~~diluted earnings/(loss) per share,~~net dilutive options, unvested restricted stock units, unvested restricted stock shares, and convertible debt due to their anti-dilutive effect.

6058

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

Effective Tax Rate Reconciliation to Adjusted Effective Tax Rate

First Quarter
2020 2021 Memo:
FY 2020
Pre-Tax Results ($M)
Income/(Loss) before income taxes (GAAP) $ (1,146) $ 3,942 $ (1,116)
Less: Impact of special items (287) (401) (2,246)
Adjusted earnings before taxes (Non-GAAP) $ (859) $ 4,343 $ 1,130
Taxes ($M)
(Provision for)/Benefit from income taxes (GAAP) $ (847) $ (680) $ (160)
Less: Impact of special items (a) (787) 99 (670)
Adjusted (provision for) / benefit from income taxes (Non-GAAP) $ (60) $ (779) $ 510
Tax Rate (%)
Effective tax rate (GAAP) (73.9) % 17.3 % (14.3) %
Adjusted effective tax rate (Non-GAAP) (7.0) % 17.9 % (45.1) %

~~__________~~

~~(a)Full Year 2020 includes $(1.3) billion related to the establishment of valuation allowances against primarily U.S. tax credits.~~


	First Quarter
	2021			2022			Memo: FY 2021
Pre-Tax Results ($M)
Income/(Loss) before income taxes (GAAP)	$	3,942		$	(3,848)		$	17,780
Less: Impact of special items	503			(5,866)			9,583
Adjusted earnings before taxes (Non-GAAP)	$	3,439		$	2,018		$	8,197

Taxes ($M)
(Provision for)/Benefit from income taxes (GAAP)	$	(680)		$	729		$	130
Less: Impact of special items	(58)			1,192			1,924
Adjusted (provision for)/benefit from income taxes (Non-GAAP)	$	(622)		$	(463)		$	(1,794)

Tax Rate (%)
Effective tax rate (GAAP)	17.3		%	18.9		%	(0.7)		%
Adjusted effective tax rate (Non-GAAP)	18.1		%	22.9		%	21.9		%

Net Cash Provided by/(Used in) Operating Activities Reconciliation to Company Adjusted Free Cash Flow ($M)

First Quarter
2020 2021
Net cash provided by / (used in) operating activities (GAAP) $ (473) $ 4,492
Less: Items not included in Company Adjusted Free Cash Flows
Ford Credit operating cash flows (a) $ 201 $ 4,998
Funded pension contributions (175) (229)
Global Redesign (including separations) (172) (345)
Ford Credit tax payments / (refunds) under tax sharing agreement (a) 407 4
Other, net (15) 77
Add: Items included in Company Adjusted Free Cash Flows
Automotive and Mobility capital spending $ (1,770) $ (1,358)
Ford Credit distributions (a) 343 1,000
Settlement of derivatives (28) (25)
Company adjusted free cash flow (Non-GAAP) (a) $ (2,174) $ (396)

~~__________~~


	First Quarter
	2021		2022
Net cash provided by/(used in) operating activities (GAAP)	$	4,492	$	(1,084)

Less: Items not included in Company Adjusted Free Cash Flows
Ford Credit operating cash flows	$	4,998	$	(419)
Funded pension contributions	(229)		(174)
Global Redesign (including separations)	(345)		(148)
Ford Credit tax payments/(refunds) under tax sharing agreement	4		—
Other, net	64		(48)

Add: Items included in Company Adjusted Free Cash Flows
Company excluding Ford Credit capital spending	$	(1,358)	$	(1,349)
Ford Credit distributions	1,000		1,000
Settlement of derivatives	(25)		64
Company adjusted free cash flow (Non-GAAP)	$	(383)	$	(580)

~~Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)~~

~~Ford Credit Net Receivables Reconciliation to Managed Receivables ($B)~~

March 31,
2020 December 31,
2020 March 31,
2021
Ford Credit finance receivables, net (GAAP) (a) $ 106.0 $ 97.7 $ 93.2
Net investment in operating leases (GAAP) (a) 27.0 26.6 26.6
Consolidating adjustments (b) 4.8 7.4 7.3
Total net receivables $ 137.8 $ 131.7 $ 127.1
Ford Credit unearned interest supplements and residual support $ 6.3 6.5 $ 6.0
Allowance for credit losses 1.2 1.3 1.2
Other, primarily accumulated supplemental depreciation 1.1 1.0 0.9
Total managed receivables (Non-GAAP) $ 146.4 $ 140.5 $ 135.2

~~__________~~

~~(a)~~Includes finance receivables (retail and wholesale) sold for legal purposes and net investment in operating leases included in securitization transactions that do not satisfy the requirements for accounting sale treatment. These receivables and operating leases are reported on Ford Credit’s balance sheets and are available only for payment of the debt issued by, and other obligations of, the securitization entities that are parties to those securitization transactions; they are not available to pay the other obligations of Ford Credit or the claims of Ford Credit’s other creditors.

~~(b)Primarily includes Automotive segment receivables purchased by Ford Credit which are classified to~~ ~~Trade and other receivables~~ ~~on our consolidated balance sheets. Also includes eliminations of intersegment transactions.~~

6259

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

SUPPLEMENTAL INFORMATION

The tables below provide supplemental consolidating financial information, other financial information, and U.S. sales by type. Company excluding Ford Credit includes our Automotive and Mobility reportable segments, Corporate Other, Interest on Debt, and Special Items. Eliminations, where presented, primarily represent eliminations of intersegment transactions and deferred tax netting.

Selected Cash Flow Information. The following tables provide supplemental cash flow information (in millions):


		For the period ended March 31, 2021									For the period ended March 31, 2022
		First Quarter									First Quarter
Cash flows from operating activities	Cash flows from operating activities	Company excluding Ford Credit		Ford Credit		Eliminations		Consolidated		Cash flows from operating activities	Company excluding Ford Credit		Ford Credit		Eliminations		Consolidated
Net income	Net income	$	2,417	$	845	$	—	$	3,262	Net income	$	(3,962)	$	843	$	—	$	(3,119)
Depreciation and tooling amortization	Depreciation and tooling amortization	1,525		578		—		2,103		Depreciation and tooling amortization	1,332		525		—		1,857
Other amortization	Other amortization	32		(393)		—		(361)		Other amortization	33		(343)		—		(310)
Provision for credit and insurance losses		(1)		(35)		—		(36)
Provision for/(Benefit from) credit and insurance losses										Provision for/(Benefit from) credit and insurance losses	5		(71)		—		(66)
Pension and OPEB expense/(income)	Pension and OPEB expense/(income)	(318)		—		—		(318)		Pension and OPEB expense/(income)	(213)		—		—		(213)
Equity investment dividends received in excess of (earnings)/losses		73		(5)		—		68
Equity method investment dividends received in excess of (earnings)/losses and impairments										Equity method investment dividends received in excess of (earnings)/losses and impairments	205		(6)		—		199
Foreign currency adjustments	Foreign currency adjustments	301		49		—		350		Foreign currency adjustments	(57)		89		—		32
Net unrealized (gain)/loss on Other Investments		(914)		—		—		(914)
Net realized and unrealized (gains)/losses on cash equivalents, marketable securities, and other investments										Net realized and unrealized (gains)/losses on cash equivalents, marketable securities, and other investments	5,415		39		—		5,454
Net (gain)/loss on changes in investments in affiliates	Net (gain)/loss on changes in investments in affiliates	(165)		(1)		—		(166)		Net (gain)/loss on changes in investments in affiliates	123		2		—		125
Stock compensation	Stock compensation	39		2		—		41		Stock compensation	64		3		—		67
Provision for deferred income taxes	Provision for deferred income taxes	414		13		—		427		Provision for deferred income taxes	(1,090)		37		—		(1,053)
Decrease/(Increase) in finance receivables (wholesale and other)	Decrease/(Increase) in finance receivables (wholesale and other)	—		2,699		—		2,699		Decrease/(Increase) in finance receivables (wholesale and other)	—		(2,192)		—		(2,192)
Decrease/(Increase) in intersegment receivables/payables	Decrease/(Increase) in intersegment receivables/payables	(772)		772		—		—		Decrease/(Increase) in intersegment receivables/payables	(570)		570		—		—
Decrease/(Increase) in accounts receivable and other assets	Decrease/(Increase) in accounts receivable and other assets	(624)		36		—		(588)		Decrease/(Increase) in accounts receivable and other assets	(876)		(80)		—		(956)
Decrease/(Increase) in inventory	Decrease/(Increase) in inventory	(2,176)		—		—		(2,176)		Decrease/(Increase) in inventory	(2,755)		—		—		(2,755)
Increase/(Decrease) in accounts payable and accrued and other liabilities	Increase/(Decrease) in accounts payable and accrued and other liabilities	397		(204)		—		193		Increase/(Decrease) in accounts payable and accrued and other liabilities	1,828		(114)		—		1,714
Other	Other	(125)		33		—		(92)		Other	310		(178)		—		132
Interest supplements and residual value support to Ford Credit	Interest supplements and residual value support to Ford Credit	(609)		609		—		—		Interest supplements and residual value support to Ford Credit	(457)		457		—		—
Net cash provided by/(used in) operating activities	Net cash provided by/(used in) operating activities	$	(506)	$	4,998	$	—	$	4,492	Net cash provided by/(used in) operating activities	$	(665)	$	(419)	$	—	$	(1,084)


Cash flows from investing activities	Cash flows from investing activities	Company excluding Ford Credit		Ford Credit		Eliminations		Consolidated		Cash flows from investing activities	Company excluding Ford Credit		Ford Credit		Eliminations		Consolidated
Capital spending	Capital spending	$	(1,358)	$	(10)	$	—	$	(1,368)	Capital spending	$	(1,358)	$	(12)	$	—	$	(1,370)
Acquisitions of finance receivables and operating leases	Acquisitions of finance receivables and operating leases	—		(11,695)		—		(11,695)		Acquisitions of finance receivables and operating leases	—		(10,278)		—		(10,278)
Collections of finance receivables and operating leases	Collections of finance receivables and operating leases	—		12,482		—		12,482		Collections of finance receivables and operating leases	—		11,988		—		11,988
Proceeds from sale of business		7		—		—		7

Purchases of marketable and other investments	Purchases of marketable and other investments	(7,879)		(3,701)		—		(11,580)		Purchases of marketable and other investments	(3,410)		(909)		—		(4,319)
Sales and maturities of marketable securities and other investments	Sales and maturities of marketable securities and other investments	7,088		4,598		—		11,686		Sales and maturities of marketable securities and other investments	6,108		1,007		—		7,115
Settlements of derivatives	Settlements of derivatives	(25)		56		—		31		Settlements of derivatives	64		148		—		212
Other	Other	(54)		—		—		(54)		Other	(35)		2		—		(33)
Investing activity (to)/from other segments	Investing activity (to)/from other segments	1,000		—		(1,000)		—		Investing activity (to)/from other segments	1,031		(30)		(1,001)		—
Net cash provided by/(used in) investing activities	Net cash provided by/(used in) investing activities	$	(1,221)	$	1,730	$	(1,000)	$	(491)	Net cash provided by/(used in) investing activities	$	2,400	$	1,916	$	(1,001)	$	3,315


Cash flows from financing activities	Cash flows from financing activities	Company excluding Ford Credit		Ford Credit		Eliminations		Consolidated		Cash flows from financing activities	Company excluding Ford Credit		Ford Credit		Eliminations		Consolidated
Cash payments for dividends and dividend equivalents	Cash payments for dividends and dividend equivalents	$	(3)	$	—	$	—	$	(3)	Cash payments for dividends and dividend equivalents	$	(405)	$	—	$	—	$	(405)
Purchases of common stock	Purchases of common stock	—		—		—		—		Purchases of common stock	—		—		—		—
Net changes in short-term debt	Net changes in short-term debt	(295)		568		—		273		Net changes in short-term debt	(6)		(608)		—		(614)
Proceeds from issuance of long-term debt	Proceeds from issuance of long-term debt	2,300		4,631		—		6,931		Proceeds from issuance of long-term debt	—		12,489		—		12,489
Principal payments on long-term debt		(78)		(14,814)		—		(14,892)
Payments of long-term debt										Payments of long-term debt	(270)		(12,705)		—		(12,975)
Other	Other	(91)		(11)		—		(102)		Other	(124)		(32)		—		(156)
Financing activity to/(from) other segments	Financing activity to/(from) other segments	—		(1,000)		1,000		—		Financing activity to/(from) other segments	(1)		(1,000)		1,001		—
Net cash provided by/(used in) financing activities	Net cash provided by/(used in) financing activities	$	1,833	$	(10,626)	$	1,000	$	(7,793)	Net cash provided by/(used in) financing activities	$	(806)	$	(1,856)	$	1,001	$	(1,661)

Effect of exchange rate changes on cash, cash equivalents, and restricted cash	Effect of exchange rate changes on cash, cash equivalents, and restricted cash	$	(26)	$	(67)	$	—	$	(93)	Effect of exchange rate changes on cash, cash equivalents, and restricted cash	$	10	$	(34)	$	—	$	(24)

6360

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

Selected Income Statement Information. The following table provides supplemental income statement information (in millions):


		For the period ended March 31, 2021							For the period ended March 31, 2022
		First Quarter							First Quarter
		Company excluding Ford Credit		Ford Credit		Consolidated			Company excluding Ford Credit		Ford Credit		Consolidated
Revenues	Revenues	$	33,565	$	2,663	$	36,228	Revenues	$	32,195	$	2,281	$	34,476
Total costs and expenses	Total costs and expenses	32,140		1,624		33,764		Total costs and expenses	31,776		1,357		33,133
Operating income/(loss)	Operating income/(loss)	1,425		1,039		2,464		Operating income/(loss)	419		924		1,343
Interest expense on Company debt excluding Ford Credit	Interest expense on Company debt excluding Ford Credit	473		—		473		Interest expense on Company debt excluding Ford Credit	308		—		308
Other income/(loss), net	Other income/(loss), net	1,954		(82)		1,872		Other income/(loss), net	(4,848)		(2)		(4,850)
Equity in net income/(loss) of affiliated companies	Equity in net income/(loss) of affiliated companies	74		5		79		Equity in net income/(loss) of affiliated companies	(39)		6		(33)
Income/(Loss) before income taxes	Income/(Loss) before income taxes	2,980		962		3,942		Income/(Loss) before income taxes	(4,776)		928		(3,848)
Provision for/(Benefit from) income taxes	Provision for/(Benefit from) income taxes	563		117		680		Provision for/(Benefit from) income taxes	(814)		85		(729)
Net income/(loss)	Net income/(loss)	2,417		845		3,262		Net income/(loss)	(3,962)		843		(3,119)
Less: Income/(Loss) attributable to noncontrolling interests	Less: Income/(Loss) attributable to noncontrolling interests	—		—		—		Less: Income/(Loss) attributable to noncontrolling interests	(9)		—		(9)
Net income/(loss) attributable to Ford Motor Company	Net income/(loss) attributable to Ford Motor Company	$	2,417	$	845	$	3,262	Net income/(loss) attributable to Ford Motor Company	$	(3,953)	$	843	$	(3,110)

6461

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

Selected Balance Sheet Information. The following tables provide supplemental balance sheet information (in millions):


		March 31, 2021									March 31, 2022
Assets	Assets	Company excluding Ford Credit		Ford Credit		Eliminations		Consolidated		Assets	Company excluding Ford Credit		Ford Credit		Eliminations		Consolidated
Cash and cash equivalents	Cash and cash equivalents	$	10,957	$	10,869	$	—	$	21,826	Cash and cash equivalents	$	10,434	$	10,579	$	—	$	21,013
Marketable securities	Marketable securities	20,333		3,948		—		24,281		Marketable securities	18,179		2,036		—		20,215
Ford Credit finance receivables, net	Ford Credit finance receivables, net	—		40,664		—		40,664		Ford Credit finance receivables, net	—		32,775		—		32,775
Trade and other receivables, net	Trade and other receivables, net	3,973		6,475		—		10,448		Trade and other receivables, net	3,559		9,472		—		13,031
Inventories	Inventories	12,742		—		—		12,742		Inventories	14,647		—		—		14,647
Assets held for sale	Assets held for sale	321		14		—		335		Assets held for sale	825		1		—		826
Other assets	Other assets	2,303		1,333		—		3,636		Other assets	2,905		730		—		3,635
Receivable from other segments	Receivable from other segments	158		1,075		(1,233)		—		Receivable from other segments	5		641		(646)		—
Total current assets	Total current assets	50,787		64,378		(1,233)		113,932		Total current assets	50,554		56,234		(646)		106,142

Ford Credit finance receivables, net	Ford Credit finance receivables, net	—		52,570		—		52,570		Ford Credit finance receivables, net	—		50,000		—		50,000
Net investment in operating leases	Net investment in operating leases	1,251		26,560		—		27,811		Net investment in operating leases	1,183		24,363		—		25,546
Net property	Net property	36,141		220		—		36,361		Net property	36,400		225		—		36,625
Equity in net assets of affiliated companies	Equity in net assets of affiliated companies	4,564		130		—		4,694		Equity in net assets of affiliated companies	4,177		129		—		4,306
Deferred income taxes	Deferred income taxes	11,937		166		—		12,103		Deferred income taxes	14,774		207		10		14,991
Other assets	Other assets	11,057		2,291		—		13,348		Other assets	13,980		1,396		—		15,376
Receivable from other segments	Receivable from other segments	—		34		(34)		—		Receivable from other segments	—		28		(28)		—
Total assets	Total assets	$	115,737	$	146,349	$	(1,267)	$	260,819	Total assets	$	121,068	$	132,582	$	(664)	$	252,986


Liabilities	Liabilities	Company excluding Ford Credit		Ford Credit		Eliminations		Consolidated		Liabilities	Company excluding Ford Credit		Ford Credit		Eliminations		Consolidated
Payables	Payables	$	22,365	$	1,127	$	—	$	23,492	Payables	$	22,251	$	1,005	$	—	$	23,256
Other liabilities and deferred revenue	Other liabilities and deferred revenue	19,661		1,334		—		20,995		Other liabilities and deferred revenue	17,018		1,245		—		18,263
Debt payable within one year	Debt payable within one year	1,061		48,410		—		49,471		Debt payable within one year	2,927		45,359		—		48,286
Liabilities held for sale	Liabilities held for sale	291		—		—		291		Liabilities held for sale	547		—		—		547
Payable to other segments	Payable to other segments	1,233		—		(1,233)		—		Payable to other segments	646		—		(646)		—
Total current liabilities	Total current liabilities	44,611		50,871		(1,233)		94,249		Total current liabilities	43,389		47,609		(646)		90,352

Other liabilities and deferred revenue	Other liabilities and deferred revenue	27,445		1,262		—		28,707		Other liabilities and deferred revenue	26,560		1,941		—		28,501
Long-term debt	Long-term debt	24,819		78,382		—		103,201		Long-term debt	17,158		70,157		—		87,315
Deferred income taxes	Deferred income taxes	164		524		—		688		Deferred income taxes	984		740		10		1,734
Payable to other segments	Payable to other segments	34		—		(34)		—		Payable to other segments	28		—		(28)		—
Total liabilities	Total liabilities	$	97,073	$	131,039	$	(1,267)	$	226,845	Total liabilities	$	88,119	$	120,447	$	(664)	$	207,902

6562

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

Selected Other Information.

Equity. At March 31, ~~2021,~~2022, total equity attributable to Ford was ~~$33.8~~$45 billion, ~~an increase~~a decrease of ~~$3.1~~$3.5 billion compared with December 31, ~~2020.~~2021. The detail for this change is shown below (in billions):


	Increase/ (Decrease)
Net income/(loss)	$	~~3.3~~ (3.1)
~~Common stock issued~~Shareholder distributions	~~(0.1)~~
~~Other comprehensive income~~	~~(0.1)~~(0.4)
Total	$	~~3.1~~ (3.5)

U.S. Sales by Type. The following table shows first quarter ~~2021~~2022 U.S. sales volume and U.S. wholesales segregated by truck, SUV, and car sales. U.S. sales volume reflects transactions with (i) retail and fleet customers (as reported by dealers), (ii) governments, and (iii) Ford management. U.S. wholesales reflect sales to dealers.


		U.S. Sales	U.S. Wholesales		U.S. Sales	U.S. Wholesales
Trucks	Trucks	277,233	257,240	Trucks	212,312	211,193
SUVs	SUVs	216,899	186,032	SUVs	205,798	238,784
Cars	Cars	27,202	16,135	Cars	14,022	9,088
Total Vehicles	Total Vehicles	521,334	459,407	Total Vehicles	432,132	459,065

ACCOUNTING STANDARDS ISSUED BUT NOT YET ADOPTED

The Financial Accounting Standards Board (“FASB”) has issued the following Accounting Standards ~~Update~~Updates (“ASU”) ~~which is not expected to have a material impact to our financial statements or financial statement disclosures. For additional information, see Note 2 of the Notes to the Financial Statements.~~.


ASU		Effective Date (a)
2018-12	Targeted Improvements to the Accounting for Long Duration Contracts	January 1, 2023
2022-01	Derivatives and Hedging (Topic 815): Fair Value Hedging – Portfolio Layer Method	January 1, 2023
2022-02	Financial Instruments – Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures	January 1, 2023

__________

(a)Early adoption for each of the ~~standard~~standards is permitted.

ASUs 2018-12 and 2022-01 were assessed and are not expected to have a material impact on our consolidated financial statements and disclosures. We are presently assessing the impact of ASU 2022-02. For additional information, see Note 2 of the Notes to the Financial Statements.

ITEM 3. Quantitative and Qualitative Disclosures About Market Risk.

Automotive Segment

Foreign Currency Risk. The net fair value of foreign exchange forward contracts (including adjustments for credit risk) as of March 31, ~~2021,~~2022, was a liability of ~~$706~~$462 million, compared with a liability of ~~$487~~$253 million as of December 31, ~~2020.~~2021. The potential ~~decrease~~change in the fair value from a 10% ~~adverse~~ change in the underlying exchange rates, in U.S. dollar terms, would have been ~~$2.4~~$2.3 billion at March 31, ~~2021,~~2022, compared with ~~$2.5~~$2.2 billion at December 31, ~~2020.~~2021.

Commodity Price Risk. The net fair value of commodity forward contracts (including adjustments for credit risk) as of March 31, ~~2021,~~2022, was an asset of ~~$195~~$526 million, compared with an asset of ~~$105~~$220 million at December 31, ~~2020.~~2021. The potential ~~decrease~~change in the fair value from a 10% ~~adverse~~ change in the underlying commodity prices would have been ~~$164~~$224 million at March 31, ~~2021,~~2022, compared with ~~$141~~$215 million at December 31, ~~2020.~~2021.

Ford Credit Segment

Interest Rate Risk. To provide a quantitative measure of the sensitivity of its pre-tax cash flow to changes in interest rates, Ford Credit uses interest rate scenarios that assume a hypothetical, instantaneous increase or decrease of one percentage point in all interest rates across all maturities (a “parallel shift”), as well as a base case that assumes that all interest rates remain constant at existing levels. The differences in pre-tax cash flow between these scenarios and the base case over a 12-month period represent an estimate of the sensitivity of Ford Credit’s pre-tax cash flow. Under this model, Ford Credit estimates that at March 31, ~~2021,~~2022, all else constant, such an increase in interest rates would ~~increase~~decrease its pre-tax cash flow by $1$27 million over the next 12 months, compared with a decrease of $3$76 million at December 31, ~~2020~~2021. In reality, interest rate changes are rarely instantaneous or parallel and rates could move more or less than the one percentage point assumed in Ford Credit’s analysis. As a result, the actual impact to pre-tax cash flow could be higher or lower than the results detailed above.

~~Transition from LIBOR to Alternative Reference Rates~~

We and our affiliates, including Ford Credit, have been working to transition from the London Interbank Offered Rate (“LIBOR”) to alternative reference rates. We have developed a total company inventory of affected financial instruments and contracts, have been working to transition legacy contracts linked to LIBOR to alternative reference rates, and intend to rely exclusively on alternative reference rates for new contracts after 2021.

ITEM 4. Controls and Procedures.

Evaluation of Disclosure Controls and Procedures. James D. Farley, Jr., our Chief Executive Officer (“CEO”), and John T. Lawler, our Chief Financial Officer (“CFO”), have performed an evaluation of the Company’s disclosure controls and procedures, as that term is defined in Rule 13a-15(e) of the Securities Exchange Act of 1934, as amended (“Exchange Act”), as of March 31, ~~2021,~~2022, and each has concluded that such disclosure controls and procedures are effective to ensure that information required to be disclosed in our periodic reports filed under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified by SEC rules and forms, and that such information is accumulated and communicated to the CEO and CFO to allow timely decisions regarding required disclosures.

Changes in Internal Control Over Financial Reporting. There were no changes in internal control over financial reporting during the quarter ended March 31, ~~2021~~2022 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II. OTHER INFORMATION

ITEM 1. Legal Proceedings.

ENVIRONMENTAL MATTERS

We have no legal proceedings arising under any federal, state, or local provisions that have been enacted or adopted regulating the discharge of materials into the environment or primarily for the purpose of protecting the environment, in which (i) a governmental authority is a party, and (ii) we believe there is the possibility of monetary sanctions (exclusive of interest and costs) in excess of $1 million.

OTHER MATTERS

Brazilian Tax Matters (as previously reported on page 2830 of our ~~2020~~2021 Form 10-K Report). One Brazilian state (São Paulo) and the Brazilian federal tax authority currently have outstanding substantial tax assessments against Ford Motor Company Brasil Ltda. (“Ford Brazil”) related to state and federal tax incentives Ford Brazil received for its operations in the Brazilian state of Bahia. The ~~state assessments are~~São Paulo assessment is part of a broader conflict among various states in Brazil. The federal legislature enacted laws designed to encourage the states to end that conflict, and in 2017 the states reached an agreement on a framework for resolution. Ford Brazil continues to pursue a resolution under the framework and expects the amount of any remaining assessments by the states to be resolved under that framework. The federal assessments are outside the scope of the legislation.

All of the outstanding assessments have been appealed to the relevant administrative court of each jurisdiction. In the State of Minas Gerais, one case that had been pending at the administrative level was dismissed on April 1, 2020, and on July 13, 2020, the other two cases that were on appeal to the judicial court were dismissed. Our appeals with the State of São Paulo and the federal tax authority remain at the administrative level. To proceed with an appeal within the judicial court system, an appellant may be required to post collateral. To date, we have not been required to post any collateral. If we are required to post collateral, which could be in excess of $1 billion, we expect it to be in the form of fixed assets, surety bonds, and/or letters of credit, but we may be required to post cash collateral. Although the ultimate resolution of these matters may take many years, we consider our overall risk of loss to be remote.

ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds.

~~On March 19, 2021,~~In the first quarter of 2022, we repurchased shares of Ford ~~issued $2.3 billion~~Common Stock from our employees related to certain exercises of stock options in aggregate principal amount of 0% Convertible Senior Notes due 2026 in a private placement to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended. The notes are unsecured, senior obligations of Ford.accordance with our various compensation plans.

The principal initial purchasers of the notes were Citigroup Global Markets Inc., Deutsche Bank Securities Inc., Goldman Sachs & Co. LLC, J.P. Morgan Securities LLC, BofA Securities, Inc., Barclays Capital Inc., BNP Paribas Securities Corp., Mizuho Securities USA LLC, Morgan Stanley & Co. LLC, RBC Capital Markets, LLC, Commerz Markets LLC, Credit Agricole Securities (USA) Inc., Credit Suisse Securities (USA) LLC, Lloyds Securities Inc., SG Americas Securities, LLC, and SMBC Nikko Securities America, Inc.

The notes will not bear regular interest, and the principal amount of the notes will not accrete. The notes will mature on March 15, 2026, unless earlier repurchased, redeemed, or converted. Ford may not redeem the notes prior to March 20, 2024. On or after March 20, 2024, Ford may redeem for cash all or any portion of the notes, at its option, if the last reported sale price of Ford’s Common Stock has been at least 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on and including the trading day preceding the date on which Ford provides notice of redemption at a redemption price equal to 100% of the principal amount of the notes to be redeemed, plus accrued and unpaid special interest, if any, to, but excluding, the redemption date.

The initial conversion rate for the notes is 57.1886 shares of Ford’s Common Stock per $1,000 principal amount of notes (which is equivalent to an initial conversion price of approximately $17.49 per share). Prior to December 15, 2025, the notes will be convertible at the option of the noteholders only upon the satisfaction of specified conditions and during certain periods as set forth in the indenture for the notes, and as described in more detail in Note 14 of the Notes to the Financial Statements. Thereafter, the notes will be convertible at the option of the noteholders at any time regardless of these conditions. Conversions of the notes will be settled in cash up to the aggregate principal amount of the notes to be converted and cash, shares of Ford’s Common Stock, or a combination thereof, at Ford’s election, for the remainder, if any, of Ford’s conversion obligation in excess of the aggregate principal amount of the notes being converted.

Ford intends to use the net proceeds of $2,266,725,000 after deducting the initial purchasers’ discount and expenses from the offering of the notes for general corporate purposes, including the potential repayment of debt.


Period	Total Number of Shares Purchased	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly-Announced Plans or Programs	Maximum Number (or Approximate Dollar Value) of Shares that May Yet Be Purchased Under the Plans or Programs
January 1, 2022 through January 31, 2022	784,211	$	23.74	—	—
February 1, 2022 through February 28, 2022	299,166	17.34		—	—
March 1, 2022 through March 31, 2022	589,521	17.34		—	—
Total / Average	1,672,898	$	20.34	—	—

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ITEM 6. Exhibits.

Designation

Description

Method of Filing

Exhibit 10.1

Annual Incentive Compensation Plan Metrics for ~~2021.~~2022.

Filed with this Report.

Exhibit 10.2

Performance-Based Restricted Stock Unit Metrics for ~~2021.~~2022.

Filed with this Report.

Exhibit 10.3

~~Agreement between Ford Motor Company~~Benefit Equalization Plan, as amended and ~~Jon M. Huntsman, Jr. dated April 12, 2021.~~restated effective as of January 1, 2022.

Filed with this Report.

Exhibit 10.4

Defined Benefit Supplemental Executive Retirement Plan, as amended and restated effective as of January 1, 2022.

Filed with this Report.

Exhibit 10.5

Defined Contribution Supplemental Executive Retirement Plan, as amended and restated effective as of January 1, 2022.

Filed with this Report.

Exhibit 31.1

Rule 15d-14(a) Certification of CEO.

Filed with this Report.

Exhibit 31.2

Rule 15d-14(a) Certification of CFO.

Filed with this Report.

Exhibit 32.1

Section 1350 Certification of CEO.

Furnished with this Report.

Exhibit 32.2

Section 1350 Certification of CFO.

Furnished with this Report.

Exhibit 101.INS

Interactive Data Files pursuant to Rule 405 of Regulation S-T formatted in Inline Extensible Business Reporting Language (“Inline XBRL”).

(a)

Exhibit 101.SCH

XBRL Taxonomy Extension Schema Document.

(a)

Exhibit 101.CAL

XBRL Taxonomy Extension Calculation Linkbase Document.

(a)

Exhibit 101.LAB

XBRL Taxonomy Extension Label Linkbase Document.

(a)

Exhibit 101.PRE

XBRL Taxonomy Extension Presentation Linkbase Document.

(a)

Exhibit 101.DEF

XBRL Taxonomy Extension Definition Linkbase Document.

(a)

Exhibit 104

Cover Page Interactive Data File (formatted in Inline XBRL and contained in Exhibit 101).

(a)

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(a)Submitted electronically with this Report in accordance with the provisions of Regulation S-T.

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

FORD MOTOR COMPANY


By:			/s/ Cathy O’Callaghan
			Cathy O’Callaghan, Controller
			(principal accounting officer)

Date:			April ~~28, 2021~~27, 2022

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	First Quarter
Non-GAAP Financial Measures	2020		2021		H / (L)
Managed Receivables ($B) (a)	$	146	$	135	(8)	%
Managed Leverage (to 1) (b) (c)	8.0		7.3		(0.7)