Playing to Win Ford Europe March 22, 2019 Todays Participants - - PowerPoint PPT Presentation

Playing to Win Ford Europe

March 22, 2019

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Today’s Participants

Lynn Tyson: Executive Director, Investor Relations Stuart Rowley: Chief Operating Officer, Ford North America Hans Schep: General Manager, Commercial Vehicles, Ford Europe Sarah-Jayne Williams: Director, Smart Mobility, Europe Will Periam: Chief Financial Officer, Ford Europe

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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 th at could cause actual results to differ materially from those stated, including, without limitation:

• Ford’s long-term competitiveness depends on the successful execution of fitness actions;
• Industry sales volume, particularly in the United States, Europe, or China, can be volatile and could decline if there is a financial crisis, recession, or significant geopolitical event;
• Ford’s new and existing products and mobility services are subject to market acceptance;
• Ford’s results are dependent on sales of larger, more profitable vehicles, particularly in the United States;
• Ford may face increased price competition resulting from industry excess capacity, currency fluctuations, or other factors;
• Fluctuations in commodity prices, foreign currency exchange rates, and interest rates can have a significant effect on results;
• With a global footprint, Ford’s results could be adversely affected by economic, geopolitical, protectionist trade policies, or other events, including Brexit;
• Ford’s production, as well as Ford’s suppliers’ production, could be disrupted by labor disputes, natural or man-made disasters, financial distress, production difficulties, or other factors;
• Ford’s ability to maintain a competitive cost structure could be affected by labor or other constraints;
• Pension and other postretirement liabilities could adversely affect Ford’s liquidity and financial condition;
• 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;
• Ford’s vehicles could be affected by defects that result in delays in new model launches, recall campaigns, or increased warranty costs;
• Ford may need to substantially modify its product plans to comply with safety, emissions, fuel economy, and other regulationsthat may change in the future;
• Ford could experience unusual or significant litigation, governmental investigations, or adverse publicity arising out of alleged defects in products, perceived environmental impacts, or otherwise;
• Ford’s receipt of government incentives could be subject to reduction, termination, or clawback;
• Operational systems, security systems, and vehicles could be affected by cyber incidents;
• 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 Credit could experience higher-than-expected credit losses, lower-than-anticipated residual values, or higher-than-expected return volumes for leased vehicles;
• Ford Credit could face increased competition from banks, financial institutions, or other third parties seeking to increase their share of financing Ford vehicles; and
• Ford Credit could be subject to new or increased credit regulations, consumer or data 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 Annual Report on Form 10-K for the year ended December 31, 2018, as updated by subsequent Quarterly Reports on Form 10-Q and Current Reports on Form 8-K.

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Today’s Participants

Lynn Tyson: Executive Director, Investor Relations Stuart Rowley: Chief Operating Officer, Ford North America Hans Schep: General Manager, Commercial Vehicles, Ford Europe Sarah-Jayne Williams: Director, Smart Mobility, Europe Will Periam: Chief Financial Officer, Ford Europe

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Improving Ford’s Competitive Position And Profitability In Europe

• Ford of Europe has embarked
• n a program to fundamentally

redesign our business and reset near term performance

• Program was officially

launched on January 10, 2019. Negotiations with Social Partners are progressing well

• Future Operating Model will

focus on three distinct business groups – Commercial Vehicles, Passenger Vehicles and Imports

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• Future Operating Model will

focus on high-performing business supported by strong competitive position and profit / return pillars – Commercial Vehicles, Utilities and select Imports

• Presently represents less

than 50% of Europe’s total volume and revenue

• Low-performing business

principally Passenger cars and Multi Activity Vehicles

New Operating Model Will Focus Capital On High-Margin, High-Growth Businesses

Low Performing High Performing >200% of Europe’s EBIT

10% 20% 20% 60% 40% (20)% 80% (10)% (20)%

H I G H L Y D I L U T I V E

ROIC (%) EBIT Margin

+

• +

Circle size = 2017 +/- EBIT (Bils)

H I G H L Y A C C R E T I V E

• Expense For

Future Growth Profitable

Note: References to EBIT and EBIT Margin include regional Ford Credit EBT

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Today’s Participants

Lynn Tyson: Executive Director, Investor Relations Stuart Rowley: Chief Operating Officer, Ford North America Hans Schep: General Manager, Commercial Vehicles, Ford Europe Sarah-Jayne Williams: Director, Smart Mobility, Europe Will Periam: Chief Financial Officer, Ford Europe

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• Commercial Vehicle

customers are represented by seven core roles, centered around moving goods, moving people and performing tasks

• Growing use case

differentiation leads to increased requirement for product tailoring

Diversity Of Commercial Vehicle Customer Types

• Parcel Delivery
• Furniture M over
• Daily Rental
• Finished Goods
• Carpet Fitting
• Rubbish

Clearance

• Equipment

Carrying

• Bulk

M aterials

• Catering
• Retail

Agents

• M inibus
• Taxi
• Crew Bus
• Shuttle
• Family Use
• Luxury Bus
• DCiV
• Film Crew Van
• Double CC
• Handyman Van
• Building Trades
• Equipment Repairs
• Drain Clearance
• Windscreen Repair
• Road M aintenance
• Police Van
• M obile Kitchen
• Surveillance Van
• Car Transporter
• Ambulance
• Campers
• Fire Rescue
• Tippers
• Ice Cream Van
• Snow Gritter
• Cherry Picker

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2012 2013 2014 2015 2016 2017 2018

• Commercial Vehicle industry

has grown by 47% in the last 6 years

• Largest growth has been in

the Medium Commercial Vehicle 1T and 2T, and Pickup segments

• Ford segment share has

grown in each of these segments

• Ford is leading in 1T Van and

Pickup segments

Strong CV Industry Growth

Transit / Tourneo Courier Transit / Tourneo Connect Fiesta Van Transit / Tourneo Custom Transit Ranger

12% 20% 14% 29%

1.9M 1.9M 2.0M 2.2M 2.5M 2.7M 2.8M Ford Segment Share

Pickups Medium Commercial Vehicle – 2T Medium Commercial Vehicle – 1T Integrated Style Van Heavy Commercial Vehicle

EU20 Industry Volume

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• Our product and distribution

led strategy improved our market position from seventh in 2012 to market leadership in 2015

• 2018 represented our sixth

consecutive year of market share growth and our fourth as the number one brand

• We plan to extend our

leadership position through a continued focus on Commercial Vehicles and implementation of a comprehensive CV strategy

Ford Strengthening Leadership Position

NEW PRODUCT DRIVES SHARE IMPROVEMENT COMMERCIAL VEHICLE STRATEGY IMPLEMENTATION

#7 #6 #3 #1 #1 #1 #1

EU20 Market Share (Pct.)

8.5% 10.0% 11.4% 12.6% 13.2% 13.5% 14.1%

2012 2014 2016 2013 2018 2015 2017

Share Rank:

11

Ford Otosan

• Manufacturing / engineering

Conversion Partnerships VW Alliance 1 Tonne

Commercial Vehicle Strategy Continuing Profitable Growth

Ford Transit Centre Network Fleet services

• Financing / leasing / insurance
• Acquisition / re-marketing
• Admin and compliance
• Rental

Transit 24

• 100% uptime
• E-check
• Extended opening hours
• Priority service
• Roadside assistance

Connected services

• Ford telematics
• Ford data services
• FordPass
• Mobility services

2 Tonne Pickup B-Integrated Style Van C-Integrated Style Van Car Derived Van 950 Transit Centres in Europe

PRODUCTS DISTRIBUTION PARTNERSHIPS / ALLIANCES SERVICES

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Today’s Participants

Lynn Tyson: Executive Director, Investor Relations Stuart Rowley: Chief Operating Officer, Ford North America Hans Schep: General Manager, Commercial Vehicles, Ford Europe Sarah-Jayne Williams: Director, Smart Mobility, Europe Will Periam: Chief Financial Officer, Ford Europe

SECRET

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Our Mobility Solutions

Smart Vehicles For A Smart World

… …

Integrated Services

Smart Vehicles Smart World

Mobility Orchestration

PAR K I N G S O L U T IO NS F O R D PAS S F O R D C O M M ERC IAL S O L U T I O N S

THE TRANSPORTATION MOBILITY CLOUD™

C I T Y D AT A S O L U T I O N S

A u t o n o m o u s T e c h n o l o g y

L AS T M I L E D E L I VE RY U R B AN E L E C T RI C VAN

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• Urbanisation is creating

significant challenges for European cities

• Air quality is the number one

issue followed by congestion

• City Mayors are introducing

new legislation and policies that impact our Commercial Vehicle customers who

• perate in urban areas

EU City Transport Strategies Tackle Air Quality Challenge

Media Headlines Capture Citizen Sentiment Examples of City Transport Plans

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• Urban Electric Van pilot

demonstrates an innovative solution that connects city needs with our commercial customers’ needs

• Project also highlights the
• pportunity to create

integrated mobility solutions by combining product and service

Commercial Mobility Solutions: The Urban Electrified Van (UEV)

Pilots in Four Cities

WHAT:

Providing our commercial customers with an UEV that gives range assurance and not range anxiety

HOW:

Transit Custom PHEV with UEV Services Ecosystem including geofencing innovations. Working with Transport for London and supported by U.K. government-funded Advanced Propulsion Centre

WHY:

Enable compliant, clean and efficient commercial vehicles that can

• perate in low emissions zones in urban environments

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• Increased online orders

impacts air quality and congestion challenges

• Cities, delivery companies and

consumers benefit from a faster, cleaner more efficient solution for the last mile

• Ford Mobility is piloting a last

mile delivery solution in London using multi-modal software to optimise deliveries

Commercial Mobility Solutions: Last Mile Delivery

Last Mile Delivery Pilot

Large U.K. Internet Retailer

WHAT:

Providing our commercial customers with an urban last mile solution with the seamless connection of traditional van fleets with more appropriate, specialist last mile vehicles

HOW:

Multi-modal software platform and last mile courier

WHY:

Enable faster, cleaner and more efficient deliveries in urban areas

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• Ford Mobility has launched

connected services for our Commercial Vehicle drivers designed to simplify their driving experience

• In 2Q, Ford Mobility will

launch the Ford Telematics tool and vehicle data services targeted to simplify fleet

• wnership and management

Commercial Mobility Solutions: Connected Services For Fleet Managers And Drivers

Connected Services: Fleet Manager Connected Services: Commercial Vehicle Driver

WHAT:

Connected experiences for owners, drivers and fleet managers both in and outside of the vehicles

HOW:

Built in, brought in and beamed in connected services

WHY:

To help our customers drive business productivity to make their businesses’ thrive

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• Combining vehicle data from

160 Light Commercial Vehicles with city data with insight and smart algorithms

• Potential to support cities with

transportation planning and fleet managers to improve safety

City Data Solutions

15,000+ days of vehicle

• peration

500 million+ data records 1 million+ kilometers driven 10+ years of data collection 6+ years of engine-on time WHAT:

Analysis of smart vehicle data to assess road safety, fleet operations re-timing, EV charging infrastructure and road traffic metrics

HOW:

Connected 160 Light Commercial Vehicles running across London, collected data, combined with city data sets, developed algorithms to create insights and predictive models

WHY:

To support transportation planning and provide fleet insights about driving patterns