Ford Motor Company (F)

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Ford Motor Company (F)

December 2012 U.S. Sales Conference Call

January 3, 2013 10:00 AM ET

Executives

Erich Merkle – U.S. Sales Analyst

Ken Czubay – VP, U.S. Marketing, Sales and Service

Ellen Hughes-Cromwick – Chief Economist

Analysts

John Murphy – Bank of America Merrill Lynch

Brian Johnson – Barclays

Pat Archambault – Goldman Sachs

Adam Jonas – Morgan Stanley

Karl Henkel – The Detroit News

Alisa Priddle – Detroit Free Press

Mike Ramsey – Wall Street Journal

Jim Henry – Automotive News

Presentation

Operator

Good day, ladies and gentlemen. Welcome to the Ford Monthly Sales Call. My name is Cheverly and I’ll be your operator for today. At this time, all participants are in listen-only mode. Later, we will conduct the question-and-answer session. (Operator Instructions)

I would now like to turn the conference over to your host for today, Mr. Erich Merkle, U.S. Sales Analyst. Please proceed, sir.

Erich Merkle

Thank you, Cheverly. Good morning and Happy New Year everyone. Welcome to Ford’s December 2012 Sales Call. We expect that December SAAR including medium and heavy trucks finish the month in the high 15 million vehicle range. Based on our calculations this would translate into about a 1.4 million to 1.42 million vehicle sales month, this again includes medium and heavy trucks and it provides an approximate 10% to 12% lift in vehicle sales compared to December of last year. Industry retail sales again represented a strong part of the overall mix at about 83% of the industry. We estimate that retail SAAR came in, in the low 13 million vehicle range in December.

For the full year 2012, we estimate a finish of 14.8 million vehicles, in line with our guidance and equating to a 14% increase over 2012 volumes. Retail sales likely finished the year at 11.8 million vehicles, representing a 15% increase over last year. Much of the retail strength came at the back half of the year with July to December retail SAAR of 12.4 million vehicles.

We have a few industry-wide observations on segmentation for the month. We saw small cars pulled back in December to approximately 21% of the overall industry. Even so, this segment continues to operate at elevated levels as they closed out the year, representing approximately 22% of the industry compared to 19% in 2011.

We saw this in Ford’s small car sales as well, which were up 29% last year, almost 10 points more than the industry overall. Full-sized pickups regained their strength in December, as the segment moved past 13% of industry making it the best month for the segment all year. For the year, the segment finished at just under 11.5% of industry, which is relatively consistent with what we saw in 2010 and 2011.

Now here for more insight on what has been happening in Ford dealer showrooms and across the nation is Ken Czubay. Ken?

Ken Czubay

Thank you, Erich, and let me add my Happy New Year to everyone, also.

Sales of the Ford brand totaled 2,168,015 vehicles for the year. For the second year in a row, the Ford brand topped the 2 million vehicle mark. It’s the only brand to do so since 2007. Ford Motor Company sold 2,250,165 vehicles for the year. In December, Ford Motor Company sold 214,222 vehicles, making it our best December sales month since 2006. Retail sales last month totaled 154,256 vehicles, which made it our best December retail month since 2006, also. What a year for Ford passenger car sales.

Ford’s sales of small cars including Focus, Fiesta and C-MAX Hybrids, provided a 29% up-tick for the year, almost 10 percentage points more than the segment that Erich just referenced and giving us our best small car sales year since 2001, over a decade. Focus sales increased 40% last year and contributed to one-third of our U.S. sales growth in 2012, more than any other vehicle.

Focus retail sales were up 83% in California, I referenced this often, because it’s America’s largest small car market. The strength of Focus extended well beyond the U.S. Focus now ranks as the world’s best-selling vehicle nameplate through September of 2012, based on new vehicle registration data provided by R. L. Polk. Not only was Focus the best-selling global vehicle, but Fiesta has been the best-selling global sub-compact car again based on global Polk new vehicle registration data; proved positive that our global One Ford Plan is working.

We are looking forward to continuing our passenger car sales momentum into 2013 with the addition of our all-new C-MAX and Fusion lineups.

On the utility front, Explorer closed the year out with its best sales numbers since 2006, totaling 158,344 vehicles, up 17% compared to last year. This is on top of 124% increase last year over the prior-year.

Escape had its best sales year ever in 2012 with 261,008 vehicles sold, beating 2011’s record by 3%. These two vehicles again helped make Ford America’s number one selling brand at utilities for the second year in a row.

On the pickup truck side, we saw really strong F-Series results as we close the year. December F-Series sales totaled 68,787, making it our best December F-Series sales month since 2006 and our 17th consecutive month over year-over-year sales gains, showing that we are incredibly consistent with our management of F-Series pickup lineups. 2012 provided F-Series with 36 straight years of pickup truck leadership and 31 years as America’s best-selling vehicle.

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