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COMPANY PROFILE

Ford Motor Company

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Ford Motor Company TABLE OF CONTENTS

Ford Motor Company © MarketLine

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TABLE OF CONTENTS

Company Overview ........................................................................................................ 3 Key Facts ......................................................................................................................... 3 Business Description ..................................................................................................... 4 History ............................................................................................................................. 6 Key Employees ............................................................................................................. 13 Key Employee Biographies .........................................................................................16 Major Products & Services ..........................................................................................22 Revenue Analysis ......................................................................................................... 24 SWOT Analysis ............................................................................................................. 26 Top Competitors ........................................................................................................... 33 Company View .............................................................................................................. 34 Locations And Subsidiaries ........................................................................................38

Ford Motor Company Company Overview

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Company Overview

COMPANY OVERVIEW

Ford Motor Company (Ford or 'the company') is one of the largest automotive manufacturers in the world. The company manufactures and distributes automobiles across six continents. It also provides financial services through Ford Motor Credit. The company's key automotive vehicle brands include Ford and Lincoln. Ford primarily operates in North America, Europe, Asia Pacific, South America, and the Middle East and Africa. It is headquartered in Dearborn, Michigan, and employed approximately 199,000 people as on December 31, 2015.

The company recorded revenues of $149,558 million during the financial year ended December 2015 (FY2015), an increase of 3.8% over FY2014. The operating profit of the company was $10,518 million in FY2015, as compared to an operating profit of $3,336 million in FY2014. The net profit of the company was $7,373 million in FY2015, as compared to a net profit of $1,231 million in FY2014.

Note: Operating profit is arrived after adjusting revenue for costs and expenses.

Key Facts

KEY FACTS

Head Office Ford Motor Company One American Road Dearborn Michigan 48126 USA

Phone 1 313 322 3000 Fax Web Address http://www.ford.com Revenue / turnover (USD Mn) 149,558.0 Financial Year End December Employees 199,000 New York Stock Exchange Ticker F

Ford Motor Company Business Description

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Business Description

BUSINESS DESCRIPTION

Ford Motor Company (Ford or 'the company'), one of the oldest car manufacturers in the world, designs, builds and sells cars, utilities vehicles and trucks. The company's core and affiliated automotive brands include Ford and Lincoln. Ford, through its subsidiaries, also provides vehicle financing services. It operates 67 plants globally spread across North America, Europe, South America, Asia Pacific, and the Middle East and Africa.

The company's operating activity consists of two operating sectors: automotive and financial services.

Within the automotive business, the company is engaged in the design, development, manufacture, sale, and service of cars, trucks, and service parts. Ford produces a range of vehicles including cars for the small, medium, large and luxury segments; trucks; buses/vans (including minivans); full-size pickups; sport utility vehicles (SUV); and vehicles for the medium/heavy segments. In FY2015, the company sold approximately 6,635,000 vehicles (wholesale) throughout the world.

The company's automotive business is organized into four operating segments: North America, Europe, Asia Pacific, South America, and the Middle East and Africa.

The North America segment primarily includes the sale of Ford and Lincoln brand vehicles, service parts, and accessories in North America (the US, Canada, and Mexico), together with the associated costs to develop, manufacture , distribute, and service these vehicles, parts, and accessories. During FY2015, this segment sold 3,073,000 vehicles.

The Europe and Asia Pacific segments include primarily the sale of Ford brand vehicles, service parts, and accessories in Europe (including Turkey and Russia) and in Asia Pacific, respectively. During FY2015, Europe and Asia Pacific sold 1,530,000 and 1,464,000 vehicles, respectively.

The South America, and the Middle East and Africa segments primarily include the sale of Ford and Lincoln brand vehicles, service parts, and accessories in the South America region, and the Middle East and Africa respectively. During FY2015, South America, and the Middle East and Africa segments sold 381,000 vehicles and 187,000 vehicles respectively in the same period.

Ford Motor Company Business Description

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All of the company's vehicles, parts, and accessories are marketed through distributors and dealers majority of which are independently owned. During FY2015, the company operated approximately 11,971 dealerships across the world, including 10,727 Ford dealerships and 360 Lincoln dealerships. In addition the company operated 884 Ford and Lincoln combined dealerships.

In addition to the retail sale, Ford also sell cars and trucks to its dealerships for sale to fleet customers, including commercial fleet customers, daily rental car companies, and governments. The company also sells parts and accessories, primarily to dealerships and to authorized parts distributors. The company also provides a wide range of aftersales vehicle services and products, including maintenance and repairs, vehicle accessories and parts, and extended service contracts. In North America, Ford market these products and services under several brands, including Ford Service, Quick Lane Tire & Auto Center, Ford and Lincoln Accessories, Ford and Lincoln Extended Service Plans, Ford Parts, and Motorcraft.

The financial services sector includes two operating segments: Ford Credit and other financial services. Ford Credit provides vehicle-related financing, and leasing. Other financial services include a variety of businesses, including holding companies, and real estate-related activities.

Ford Motor Company History

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History

HISTORY

Ford Motor Company (Ford or 'the company') was established in 1903 by Henry Ford and 11 other associates. In the same year, the company made its first shipment. In 1908, Ford launched its model 'T'. The company began producing trucks and tractors, in 1917. In 1925, Ford acquired the Lincoln Motor Company, branching out into luxury cars.

In 1956, the company went public. Also during 1950s, Ford produced one of its most successful cars, the Thunderbird. The global expansion of Ford continued during 1960s when the company established Ford Europe in 1967. Throughout the 1970s and 1980s, Ford continued to expand in Europe and Asia. In 1987, Ford formed Park Ridge in order to acquire the Hertz car rental business.

Ford experienced further growth in the 1990s. In 1990, Ford acquired Jaguar. The company increased its stake in Hertz to 100% in 1994. The company acquired the repair chain Kwik-Fit in 1999 and later Volvo's passenger vehicle business. Ford spun off its Visteon automotive components business unit during 2000. Ford also acquired Land Rover from BMW in the same year. In late 2002, the company concluded the sale of Collision Team of America (CTA) and Kwik-Fit.

The company expanded its presence in China during 2002 and 2003. The Changan Ford (a joint venture operation with Changan Automobile) assembly plant located in Chongqing became operational and production of the Fiesta in China started in mid-2003. The company's Ford Services Thailand became operational later in 2003.

Ford sold Cosworth, its motor sport technology engineering company, and Jaguar Racing, its Formula One team, in 2004. In the same year, the company recalled 600,000 vehicles of its Escape and Mazda Tribute SUVs. Subsequently, the company launched the 2005 F-Series Super Duty and also introduced the Ford Expedition King Ranch.

During 2005, the company made several acquisitions. This included the reacquisition of Visteon's 23 North American facilities in order to protect its supply of components. Ford also acquired a minority interest in the Beanstalk Group, a majority owned subsidiary that licensed trademarks and subsequently sold 100% interest in the Beanstalk Group. Further in 2005, Ford sold its subsidiary Hertz, to a private equity group. In the same year, the company sold its interests in Mahindra & Mahindra and Vastera. Subsequently, the company exchanged its 8.3 million shares in Ballard Power Systems for an equity interest in NuCellSys, an equal joint venture with DaimlerChrysler.

In 2006, Ford became the first automotive manufacturer to commence the production of hydrogen fueled V-10 engines. Subsequently, Valeo Management Services signed a memorandum of understanding with Ford to acquire its climate control business, including its plant in Plymouth Township, Michigan.

In 2007, Ford sold Automobile Protection (APCO) to Trident IV, a private equity fund managed by Stone Point Capital. In the same year, Ford sold its sports car business, Aston Martin, to a consortium comprised of David Richards, John Sinders, Investment Dar and Adeem Investment. Later in the year, Ford signed a long-term agreement with Sony electronics division to offer Sony-branded audio systems in Ford and Mercury vehicles.

Ford Motor Company History

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Further in 2007, Ford's Japanese affiliate Mazda and China's Changan Automotive Group began full production, at a new engine plant in eastern China's Nanjing. Later in the year, Ford and Mazda Motor planned a new Thai car factory with an investment of $500 million.

Ford sold its Jaguar Land Rover operations to Tata Motors in 2008. In the same year, the company acquired 72.4% stake in Romania's state-owned Automobile Craiova assembly plant. Further in 2008, Ford Motor, Automotive Components Holdings and Zeledyne sold the ACH Glass business and its three plants. In addition, Ford's southern African arm secured an export contract to supply the Ranger pickup truck to African markets.

Further in 2008, Western Power Distribution renewed its contract with Ford to supply its light commercial vehicles and small business cars. Later in the same year, Ford started its operations at a new engine assembly plant near Chennai, India. Subsequently, the company sold its St. Louis Assembly Plant property in Hazelwood, Missouri, to Panattoni Development Company. Additionally, it also sold the Atlanta Assembly Plant property in Hapeville, Georgia, to Jacoby Development. Subsequently, Ford, Automotive Components Holdings and Johnson Controls, terminated their memorandum of understanding for sale of the ACH interiors business and ACH's Saline, Michigan.

During 2009, Ford and Navistar International reached an agreement to restructure their ongoing business relationship and settle all existing litigation between the companies. Subsequently, the new Ford Fiesta started its production at the Changan Ford Mazda Automobile (CFMA) manufacturing facility in Nanjing, China. Ford introduced an advanced dual-clutch PowerShift six-speed transmission in North America in 2010 for the small-car segment.

During the same year, American Electric Power (AEP) joined Ford and the Electric Power Research Institute (EPRI) in a project designed to research and develops plug-in hybrid electric vehicles (PHEVs) as part of a complete vehicle, home and grid energy system. Also in 2009, Ford and its utility partners tested the vehicle-to-electric grid communications and control systems, which enable electric vehicles to interface with the grid for optimal recharging. Subsequently, Ford reached an agreement in principle to sell Wixom Assembly Plant to Xtreme Power of Austin, Texas, and Clairvoyant Energy of Santa Barbara, California. Moreover, Ford's joint venture in China CFMA started building a new and highly flexible passenger car plant in Chongqing, China, scheduled for completion in 2012.

In 2010, the company decided to invest an additional $450 million in its electric vehicle plan, paving the way to build a hybrid and plug-in hybrid vehicle in Michigan beginning in 2012. In the same year, Ford decided to invest $155 million at its Cleveland operations to build a new V-6 engine for the 2011 Mustang. Also in 2010, the company introduced its first hybrid car under the Lincoln brand in the US.

Further in 2010, Ford started the production of the all-new 2011 Ford Fiesta at its Cuautitlan Stamping and Assembly Plant (CSAP). Also in 2010, Ford announced a partnership with Coulomb Technologies to provide free in-home ChargePoint Networked Charging Stations for some of the company's first electric vehicle customers under the Ford Blue Oval ChargePoint Program. Further in 2010, Ford introduced Curve Control, a crash-avoidance technology.

During the same year, the company completed the sale of Volvo Car and related assets to the Zhejiang

Ford Motor Company History

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Geely Holding Group. In the same year, Ford partnered with Austin Energy and CenterPoint Energy to develop consumer outreach and education programs on electric vehicles as well as share information on charging needs and requirements. In addition, the company and PSA Peugeot Citroen entered into an agreement to develop and produce next-generation Euro 6-compliant engines.

Also in 2010, Ford Otosan, the Turkish joint venture owned by Ford and Koc Holding, announced an investment of approximately $630 million in its Kocaeli production facility to support future manufacturing initiatives for the Ford Transit. Later in the year, the company sold 7.5% stake in Mazda Motor. Subsequently, Ford decided to invest $600 million in its Louisville Assembly Plant to transform it into a, flexible facility that would build the next-generation Escape for the North America market.

In 2011, Ford introduced Focus Electric, the company's first-ever all-electric passenger car. Subsequently, the company decided to invest $400 million in its Kansas City plant to install a new body shop, new tooling and other upgrades to support new vehicle production. In the same year, Ford and Sollers, a producer of passenger and light commercial vehicles in Russia, signed a memorandum of understanding to establish an equally owned joint venture called Ford Sollers for the production and distribution of Ford vehicles in Russia. Further in 2011, the company signed an agreement with AT&T to wirelessly connect the Ford Focus Electric, Ford's first all-electric passenger car.

Later in 2011, Ford and Automotive Components Holdings (ACH) signed definitive agreements with Inergy Automotive Systems for the sale of the blow-molded fuel tank business located at the ACH plant in Milan, Michigan, US. Subsequently, CFMA signed a memorandum of understanding with the Chongqing Municipal Government to construct a new plant for the production of fuel-efficient 6-speed automatic transmissions in China.

Further in 2011, the company announced a partnership with Nuance Communications to research new voice recognition capabilities for Ford SYNC. Later in the same year, Ford collaborated with Audi, BMW, Daimler, General Motors, Porsche and Volkswagen to support a harmonized single-port fast charging approach for use on electric vehicles in Europe and the US. Towards the end of 2011, Ford and Azure Dynamics jointly introduced the new electrified commercial vehicle product, the Ford Transit Connect Electric Wagon.

In the early 2012, the company unveiled the new Ford Fusion sedan, featuring gasoline, hybrid and plug- in hybrid powertrains. In the same period, Ford, Microsoft, Healthrageous and BlueMetal Architects announced an alliance for in-car health and wellness research. In addition, the company received an order for 500 police interceptor sedans and utility vehicles from the city of Chicago. During the same year, the company announced a $1.3 billion investment in its Hermosillo Stamping and assembly plant to producing Fusion and Lincoln MKZ midsize sedans. Subsequently, Ford announced the construction of a new assembly plant in Hangzhou, China, to increase its production capacity in China to 1.2 million passenger cars annually by 2015.

In the mid of 2012, ACH completed the sale of its automotive lighting business located at its Ohio facilities to Ventra Sandusky, a Flex-N-Gate group affiliate. Ventra Sandusky would continue to supply Ford with automotive lighting components and service parts from the Sandusky and Bellevue facilities. In the same period, ACH completed the sale of its automotive interior trim components business located at its Saline, Michigan plant to Faurecia. Faurecia would continue to supply Ford with interior trim components from the

Ford Motor Company History

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Saline facility as well as other Faurecia facilities.

Further in 2012, Ford launched the all-new Escape, a small utility vehicle with an automatic transmission. In the same year, the company's commercial vehicle investment in China, Jiangling Motors, announced the acquisition of Taiyuan Changan Heavy Truck Company, a heavy truck maker. Moreover, Ford and its joint venture CFMA announced the construction of a third assembly plant in Chongqing, China. The $600 million investment would expand capacity in Chongqing by 250,000 passenger vehicles annually with the flexibility to produce up to seven different models.

Further in 2012, the company planned to introduce Lincoln cars in China in the second half of 2014. Later in 2012, Ford and ACH announced the sale of the last remaining ACH operation - the climate control business currently located at the ACH Sheldon Road Plant in Plymouth Township, Michigan to Detroit Thermal Systems (DTS). DTS is a joint venture between Valeo and V. Johnson Enterprises.

In the late 2012, Ford announced its decision to restructure its European operations. The company plans to close three European facilities and relocate the production of its key products for a more efficient manufacturing footprint. The facility actions include the planned closure of two UK facilities in 2013 - Ford's assembly plant in Southampton, and stamping and tooling operations in Dagenham. Ford also plans to end production at a major assembly plant in Genk, Belgium, by the end of 2014. Under the proposed plan, company aims to introduce 15 global vehicles in Europe within five years.

Towards the end of 2012, Ford demonstrated a prototype carbon fiber bonnet that could help lower fuel consumption. The prototype bonnet weighs around 50% less than the steel version. Additionally, Ford announced a partnership with General Electric, under which the company would purchase 2,000 Ford C- MAX Energi plug-in hybrids for its fleet. In addition, Ford would jointly market GE's alternative fuel infrastructure solutions. Ford plans to promote GE's WattStation charging station and CNG in a Box natural gas fueling station with its commercial customers.

Towards the end of 2012, the company launched the seven-passenger vehicle Transit Connect Wagon. In the same period, Ford planned to invest $773 million on new equipment and capacity expansions across its six manufacturing facilities in southeast Michigan.

During 2013, the company announced a strategic collaboration with Eaton, SunPower and Whirlpool to help consumers optimize energy consumption by integrating home appliance technology with a plug-in vehicle. The Ford-led MyEnergi Lifestyle collaboration is comprised of Eaton, SunPower and Whirlpool. Additional featured companies include semiconductor provider Infineon and Nest Labs. During the same year, to meet rising consumer demand for its 2.0-liter EcoBoost engine, Ford announced its decision to invest around $200 million at its Cleveland engine plant. Ford teamed up with PlugShare, an aggregator of public charge stations, to provide real-time charge station information to drivers of Ford's plug-in hybrid vehicles - C-MAX Energi and Fusion Energi.

In 2013, the company launched new Tourneo Courier and the new EcoSport compact SUV for European market. In the same year, Ford of Germany signed a co-operation agreement with the German Ford dealers association FHD GmbH, and DB Rent for a new car sharing platform - FORD2GO. Ford entered the Myanmar market through an exclusive agreement and partnership with Capital Automotive, a subsidiary of Myanmar-based conglomerate, Capital Diamond Star Group. The company joined the

Ford Motor Company History

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American Institute of Architects (AIA) San Francisco Chapter to discuss common design trends between cars and buildings. Subsequently, Ford Sollers, Ford's joint venture in Russia, started full production of the Ford Explorer. Ford launched four-cylinder 1.5-liter EcoBoost engine.

Also in 2013, Ford announced its intention to cease its Australian manufacturing operations due to the challenging market conditions, including market fragmentation and the high cost of manufacturing. In the same year, the company announced its decision to reduce energy consumption in its 25 plants over 10 years. In addition, Ford introduced its urban sport utility vehicle EcoSport in Indian market. Subsequently, the company opened two new sales and service outlets in Kozhikode and Kottayam, Kerala.

During 2013, the company launched Ford Developer Program in China. In the same year, Ford and China Unicom announced a partnership to provide access to Ford SYNC AppLink to developers on China Unicom's WoStore. Also in 2013, the company opened a new engine plant in Chongqing at its joint venture in China CFMA with an initial capacity of 400,000 units. Ford announced that it is currently developing a highly flexible patented technology to rapidly form sheet metal parts for low-volume production applications.

Further in 2013, Ford introduced the all-new 2014 Transit Connect Taxi for the North American taxi market. Subsequently, the company acquired Livio, a Michigan-based software development startup. Ford launched the 3.5-liter V6 EcoBoost engine to racing in 2014 TUDOR United SportsCar Championship. The company announced plans to launch 17 new or refreshed Ford and Lincoln vehicles in the next 24 months to accelerate growth in the Middle East and Africa. Ford launched the all-new Ford Ka Concept, a sleek, compact hatchback that features bold design, and innovative technologies in Brazil and other key markets around the world. The company launched the all-new Ford Mustang simultaneously in Dearborn, Michigan; New York, Los Angeles; Barcelona, Spain; Sydney, Australia and Shanghai, China. In addition, the company unveiled a Ford Fusion Hybrid automated research vehicle that will be used to make progress on future automated driving and other advanced technologies.

In 2014, Ford planned to invest $80 million in its Kentucky Truck Plant to meet growing demand for Ford F-Series Super Duty trucks. In the same year, Lincoln introduced the new 2015 Navigator. Also, the company launched new 2015 Ford Expedition. Subsequently, Ford of Canada's Oakville Assembly plant was selected to build the all-new Ford Edge global utility vehicle.

Ford announced, in 2014, that the production of its all-new 2016 F-650 and F-750 medium-duty trucks will shift from Mexico to Ohio Assembly Plant starting early 2015. Also, Ford unveiled the all-new Ecosport and new Fiesta at the Bangkok International Motor Show.

In 2014, the company revealed all-new Focus Sedan. Further, OPI and Ford launched the limited-edition nail lacquer collection inspired by the popular Ford Mustang.

During 2014, the state of Oklahoma, its agencies and the city of Dallas ordered a total of 321 Ford F-150 pickups that can run on compressed natural gas. Also, Ford opened its new Ford Technical Support Center in Concord, North Carolina. In addition, Ford Otosan launched vehicle production at the all-new vehicle production facility in Yenikoy, Turkey. Subsequently, Ford launched the advanced steering technology to help make vehicles easier to maneuver. In the mid of 2014, the company opened a new facility in Colombo with a renewed focus on the Sri Lanka market. In the same time, the company

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invested $129 million in Louisville Assembly Plant to support production of the all-new 2015 Lincoln MKC.

Further in 2014, Charter Communications, the fourth-largest cable operator in the US, ordered more than 800 low roof Ford Transit vans to be used by technicians across its 29 state footprint. In 2014, Ford and Tweddle launched a new full-featured interactive smartphone application for owners of the all-new Ford Mustang. In 2014, Ford collaborated with Wind Energy to bring a new and innovative source of clean energy to its dealers.

In January 2015, Ford unveiled the all-new GT, a supercar that serves as a technology showcase for EcoBoost performance, aerodynamics and lightweight carbon fiber construction. During the same month, Ford and DowAksa accelerated their joint research to develop high-volume manufacturing techniques for automotive-grade carbon fiber, aiming to make vehicles lighter for greater fuel efficiency, performance and capability. Subsequently, the company opened a Research and Innovation Center in Palo Alto, growing its innovation and global research team. In the same month, the company launched the 2015 F150 trucks, featuring an aluminum-alloy body and steel frame.

In February 2015, Ford completed the final part of the $2.6 billion investment in its manufacturing operations in Valencia, Spain. During March 2015, Ford introduced Ford Telematics powered by Telogis to help fleets run more efficient operations. In the same month, the company started production of the twin-scroll 2.0-liter and 2.3-liter EcoBoost engines for North America at its Cleveland Engine Plant in Ohio. In the same month, Ford in collaboration with Tonka launched the F-750 Tonka dump truck.

Ford and DowAksa signed a joint development agreement (JDA) to formally advance research on high- volume manufacturing of automotive-grade carbon fiber, in April 2015. In the same month, the company invested $2.5 billion in new engine and transmission plants in the Mexican states of Chihuahua and Guanajuato, respectively. Subsequently, Ford began offering factory-installed strobe warning LED light kit for all models of 2016 F-Series Super Duty trucks.

In May 2015, the company expanded its operations in Morocco with a new regional sales office in Casablanca and a purchasing office in Tangier. In the same month, Ford offered competitors access to its electrified vehicle technology patents to accelerate industry-wide research and development of electrified vehicles.

Ford planned to collaborate with Carbon3D to produce high-quality automotive-grade parts, in June 2015.

In September 2015, Ford and Alcoa collaborated to produce next-generation automotive aluminum alloys that are more formable and design-friendly.

The company teamed up with Michelin to provide custom-engineered tires for Ford performance vehicle lineup, in November 2015. In the same month, United Auto Workers (UAW) union and Ford reached a tentative agreement for the next four years.

In February 2016, Ford collaborated with Pivotal, a cloud-based software technology provider, to build a software platform supporting FordPass that will enable the company to innovate and iterate on new applications and mobility solutions for consumers. In the same month, the company introduced KUGA for Europe and unveiled SYNC 3 connectivity, an in-car technology at Mobile World Congress in Barcelona.

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Ford Motor Company Key Employees

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Key Employees

KEY EMPLOYEES

Name Job Title Board Compensation Mark Fields President and Chief Executive

Officer Executive Board 18576946 USD

William Clay Ford, Jr. Executive Chairman Executive Board 12860840 USD Stephen G. Butler Director Non Executive Board 329385 USD Kimberly A. Casiano Director Non Executive Board 298101 USD Anthony F. Earley, Jr. Director Non Executive Board 308489 USD Edsel B. Ford II Director Non Executive Board 915609 USD James H. Hance, Jr. Director Non Executive Board 282654 USD William W. Helman IV Director Non Executive Board 279241 USD Jon M. Huntsman, Jr. Director Non Executive Board 296967 USD Ellen R. Marram Director Non Executive Board 319738 USD William E. Kennard Director Non Executive Board 276885 USD Gerald L. Shaheen Director Non Executive Board 317667 USD John L. Thornton Director Non Executive Board 277227 USD John C. Lechleiter Director Non Executive Board 286208 USD Robert L. Shanks Executive Vice President and

Chief Financial Officer Senior Management 5557846 USD

Marcy Klevorn Vice President and Chief Information Officer

Senior Management

James D. Farley, Jr. Executive Vice President; and President, Europe, the Middle East and Africa

Senior Management 5804965 USD

Stephen T. Odell Executive Vice President, Global Marketing, Sales and Service

Senior Management

Joseph R. Hinrichs Executive Vice President and President, The Americas

Senior Management 6418180 USD

Raj Nair Executive Vice President, Product Development and Chief Technical Officer

Senior Management

Felicia J. Fields Group Vice President, Human Resources and Corporate Services

Senior Management

Bennie W. Fowler Group Vice President, Quality and New Model Launch

Senior Management

Bradley M. Gayton Group Vice President and General Counsel

Senior Management

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David L. Schoch Group Vice President and General Counsel

Senior Management

Ziad S. Ojakli Group Vice President, Government and Community Relations

Senior Management

Raymond F. Day Group Vice President, Communications

Senior Management

Hau Thai-Tang Group Vice President, Global Purchasing

Senior Management

Bernard B. Silverstone Group Vice President; and Chairman and Chief Executive Officer, Ford Motor Credit

Senior Management

John T. Lawler Group Vice President and Controller

Senior Management

Stephen E. Biegun Vice President, International Governmental Affairs

Senior Management

Kimberly Pittel Vice President, Sustainability, Environment and Safety Engineering

Senior Management

Roelant de Waard Vice President, Marketing, Sales and Service, Ford of Europe

Senior Management

Kumar Galhotra Group Vice President, and President, Lincoln

Senior Management

Gary Johnson Vice President, North America Manufacturing

Senior Management

Ken Washington Vice President, Research and Advanced Engineering

Senior Management

Stuart Rowley Vice President, Strategy Senior Management Neil M. Schloss Vice President and Treasurer Senior Management Frederiek Toney Vice President, Global Ford

Customer Service Division Senior Management

Elena A. Ford Vice President, Global Dealer and Consumer Experience

Senior Management

Mark Laneve Vice President, US Marketing, Sales and Service

Senior Management

Joseph Bakaj Vice President, Product Development, Ford of Europe

Senior Management

Robert Fascetti Vice President, Powertrain Engineering

Senior Management

Barb J. Samardzich Vice President, and Chief Operating Officer, Ford of Europe

Senior Management

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Birgit Behrendt Vice President, Global Programs and Purchasing Operations

Senior Management

Burt Jordan Vice President, Global Vehicle and Powertrain Purchasing and Supplier Diversity

Senior Management

Trevor Worthington Vice President, Product Development, Asia Pacific

Senior Management

Moray Callum Vice President, Design Senior Management Bruce Hettle Group Vice President,

Manufacturing and Labor Affairs

Senior Management

Bill Dirksen Vice President, Labor Affairs Senior Management Steven Armstrong Vice President, Ford and

President, Ford South America Senior Management

Jim Holland Vice President, Vehicle Component and Systems Engineering

Senior Management

John Casesa Group Vice President, Global Strategy

Senior Management

Ford Motor Company Key Employee Biographies

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Key Employee Biographies

KEY EMPLOYEE BIOGRAPHIES

Mark Fields

Board:Executive Board Job Title:President and Chief Executive Officer Since:2014 Age:55

Mr. Fields has been the President and Chief Executive Officer at Ford Motor Company (Ford or 'the company') since 2014. He joined the company in 1989, and has most recently served as the Chief Operating Officer from 2012 to 2014. Prior to that, Mr. Fields was the Executive Vice President at the company and the President of the Americas region. From 2000 to 2002, he was the President at Mazda Motor.

William Clay Ford, Jr.

Board:Executive Board Job Title:Executive Chairman Since:2006 Age:58

Mr. Ford has been the Executive Chairman at Ford since 2006. He has also been the Chairman of the Board of Directors at the company since 1999. Mr. Ford held a number of management positions within Ford, including the Vice President of Commercial Truck Vehicle Center in 1994. He was elected as the Chief Executive Officer at Ford from 2001 to 2006. He served as a Director at eBay at 2005 to 2015.

Stephen G. Butler

Board:Non Executive Board Job Title:Director Since:2004 Age:68

Mr. Butler has been a Director at Ford since 2004. He served as the Chairman and Chief Executive Officer at KPMG from 1996 until his retirement in 2002. Mr. Butler held a variety of management positions, both in the US and internationally, during his 33-year career at KPMG. He is currently a Director at ConAgra Foods. Previously, Mr. Butler was a Director at Cooper Industries.

Kimberly A. Casiano

Board:Non Executive Board Job Title:Director

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Since:2003 Age:58

Ms. Casiano has been a Director at Ford since 2003. She is the President at Kimberly Casiano & Associates. Ms. Casiano was the President at Casiano Communications, from 1994 until 2009. She is a member of the Board of Directors at Mutual of America, and Mead Johnson Nutrition.

Anthony F. Earley, Jr.

Board:Non Executive Board Job Title:Director Since:2009 Age:66

Mr. Earley has been a Director at Ford since 2009. He has been the Chairman, Chief Executive Officer, and President at PG&E since 2011. Previously, Mr. Earley served as the Executive Chairman, Chairman, and Chief Executive Officer at DTE Energy. He joined DTE Energy in 1994 as the President and Chief Operating Officer. Prior to that, Mr. Earley served as the President and Chief Operating Officer at Long Island Lighting Company. He is a Director at Nuclear Energy Institute, Edison Electric Institute, and Business Roundtable.

Edsel B. Ford II

Board:Non Executive Board Job Title:Director Since:1988 Age:67

Mr. Ford has been a Director at Ford since 1988. He is a retired Vice President at Ford and former President and Chief Operating Officer at Ford Motor Credit. Mr. Ford presently serves as a Consultant to the company. He also serves as a Director at International Speedway.

James H. Hance, Jr.

Board:Non Executive Board Job Title:Director Since:2010 Age:71

Mr. Hance has been a Director at Ford since 2010. He is the former Chief Financial Officer and former Vice Chairman at Bank of America, where he retired in 2005 after 18 years with the company. Mr. Hance spent 17 years at Price Waterhouse (now PricewaterhouseCoopers) in Philadelphia and Charlotte. He currently serves on the Boards at Acuity Brands, Cousins Properties and Duke Energy. Mr. Hance is an Operating Executive and a Board Member at The Carlyle Group.

William W. Helman IV

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Board:Non Executive Board Job Title:Director Since:2011 Age:57

Mr. Helman has been a Director at Ford since 2011. He serves as a General Partner at Greylock Partners, which he joined in 1984, and has been a Partner since 1997. Mr. Helman was a Director at Zipcar.

Jon M. Huntsman, Jr.

Board:Non Executive Board Job Title:Director Since:2012 Age:56

Mr. Huntsman has been a Director at Ford since 2012. He has also been the Chairman at the Huntsman Cancer Foundation since 2012. Mr. Huntsman was the US Ambassador to China from 2009 until 2011. Prior to that, he was twice elected as the Governor of Utah from 2005 to 2009. Mr. Huntsman currently serves as a Director at Huntsman, Caterpillar, and Chevron.

Ellen R. Marram

Board:Non Executive Board Job Title:Director Since:1988 Age:69

Ms. Marram has been a Director at Ford since 1988. She is the President at the Barnegat Group. From 2000 to 2005, Ms. Marram was the Managing Director at North Castle Partners. Prior to that, from 1997 to 1998, she was the President and Chief Executive Officer at Tropicana Beverage, having served as the Group's President from 1993 to 1997. Ms. Marram was the Senior Vice President at Nabisco Foods and the President and Chief Executive Officer at Nabisco Biscuit from 1988 to 1993. From 1987 to 1988, she was the President at Nabisco Grocery. Ms. Marram also serves as a Director at New York Times and Eli Lilly and Company.

William E. Kennard

Board:Non Executive Board Job Title:Director Since:2015 Age:59

Mr. Kennard has been a Non Executive Director at Ford since 2015. He is the Non Executive Chairman and Co-founder at Velocitas Partners. Mr. Kennard serves on the board at AT&T, MetLife and Duke

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Energy. He served as the US Ambassador to the European Union from 2009 to 2013. From 2001 to 2009, Mr. Kennard was the Managing Director at The Carlyle Group.

Gerald L. Shaheen

Board:Non Executive Board Job Title:Director Since:2007 Age:71

Mr. Shaheen has been a Director at Ford since 2007. He was the Group President at Caterpillar. Mr. Shaheen joined Caterpillar in 1967 and held a variety of management positions. He retired from Caterpillar in 2008. Mr. Shaheen also serves as a Director at AGCO.

John L. Thornton

Board:Non Executive Board Job Title:Director Since:1996 Age:62

Mr. Thornton has been a Director at Ford since 1996. He retired as the President and Co-Chief Operating Officer at Goldman Sachs in 2003. Mr. Thornton formerly served as the Chairman at Goldman Sachs Asia during 1996–98. He was previously the Co-Chief Executive at Goldman Sachs International. Mr. Thornton currently serves as a Director at China Unicom.

John C. Lechleiter

Board:Non Executive Board Job Title:Director Since:2013 Age:62

Mr. Lechleiter has been a Director at Ford since 2013. He is the Chairman, President, and Chief Executive Officer at Eli Lilly and Company. Mr. Lechleiter was appointed as the President and Chief Executive Officer in 2008 and became the Chairman at Eli Lilly in 2009. He also serves on the Board at Nike.

Robert L. Shanks

Board:Senior Management Job Title:Executive Vice President and Chief Financial Officer Since:2012 Age:63

Mr. Shanks has been the Executive Vice President and Chief Financial Officer at Ford since 2012. In his

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previous role, he served as the company's Vice President and Controller. He joined Ford in 1977 and was elected to the position of Vice President of Operations Support, Finance and Strategy at Ford of Europe and Premier Automotive Group (PAG), in 2004. Prior to that assignment, he served as the Chief Financial Officer at PAG.

Marcy Klevorn

Board:Senior Management Job Title:Vice President and Chief Information Officer Since:2015 Age:57

Ms. Klevorn has been the Vice President and Chief Information Officer at Ford since 2015. Previously, she served as a Director in the Office of the Chief Information Officer since 2013. Ms. Klevron spent her entire career in IT at Ford, serving in a variety of positions in the Americas, Ford of Europe and Ford Credit. She began her career at the company in 1983 in Telecommunications Services and worked at various positions within Ford IT and Ford Credit through 2003. From 2006 to 2011, Ms. Klevron led Ford's IT Infrastructure organization. Ms. Klevron served as the IT Director at Ford of Europe from 2011 to 2013.

James D. Farley, Jr.

Board:Senior Management Job Title:Executive Vice President; and President, Europe, the Middle East and Africa Since:2015 Age:53

Mr. Farley has been the Executive Vice President; and President, Europe, the Middle East and Africa at Ford since 2015. Previously, he served as the Executive Vice President of Global Marketing at the company. Mr. Farley joined Ford in 2007, from Toyota where he was the Group Vice President and General Manager of Lexus. He joined Toyota in 1990 in the strategic planning department and served in several product and marketing positions in the US and Europe.

Stephen T. Odell

Board:Senior Management Job Title:Executive Vice President, Global Marketing, Sales and Service Since:2015 Age:60

Mr. Odell has been the Executive Vice President of Global Marketing, Sales and Service at Ford since 2015. Previously, he led the company's Europe operations and most recently served as the Executive Vice President and President of Europe, Middle East and Africa at the company. He served as the Group Vice President, Chairman, and Chief Executive Officer at Ford of Europe since 2010. Mr. Odell joined Ford in 1980.

Joseph R. Hinrichs

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Board:Senior Management Job Title:Executive Vice President and President, The Americas Since:2012 Age:49

Mr. Hinrichs has been the Executive Vice President and President, the Americas at Ford since 2012. Prior to this role, he served as the Group Vice President and President of Asia Pacific and Africa since 2009. From 2006 to 2007, Mr. Hinrichs was the Vice President of North America Manufacturing. He joined the company in 2000 as a Plant Manager of the Van Dyke Transmission Plant from Ryan Enterprises Group, where he was a Partner and Senior Vice President. Early in his career, Mr. Hinrichs spent 10 years at General Motors in various positions in engineering and manufacturing, including as a Plant Manager.

Raj Nair

Board:Senior Management Job Title:Executive Vice President, Product Development and Chief Technical Officer Since:2012 Age:51

Mr. Nair has been the Executive Vice President of Product Development and Chief Technical Officer at Ford since 2015. Previously, he served as the company's Vice President of Engineering for Global Product Development. Prior to this role, Mr. Nair served for three years as the Vice President of Operations at Ford's Asia Pacific and Africa region. He joined Ford in 1987 as a Body and Assembly Operations launch Engineer.

Ford Motor Company Major Products & Services

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Major Products & Services

MAJOR PRODUCTS & SERVICES

The company's key products, services, and brands include the following:

Automotive:

Sedan cars

Hatchbacks

Trucks

Buses

Vans

Utility vehicles

Vehicle accessories

After sales vehicle parts and products

Services:

Vehicle maintenance

Vehicle repair services

Financial services:

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Retail financing

Wholesale financing

Third-party claim management services

Vehicle insurance services

Brands:

Ford

Lincoln

Ford Motor Company Revenue Analysis

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Revenue Analysis

REVENUE ANALYSIS

Overview

Ford Motor Company (Ford or 'the company') recorded revenues of $149,558 million during FY2015, an increase of 3.8% over FY2014. In FY2015, the US, the company's largest geographic market, accounted for 62.3% of the total revenues.

Ford's operating activity consists of two sectors, automotive and financial services, which are further divided into six reportable segments. The automotive sector includes five segments: North America (61.4% of the total revenues in FY2015), Europe (18.8%), Asia Pacific (7.2%), South America (3.9%), and Middle East & Africa (2.7%). The financial services segment contributed 6% of total revenues during FY2015.

Revenue by segment

In FY2015, the North America segment recorded revenues of $91,870 million, an increase of 11.5% over FY2014.

The Europe segment recorded revenues of $28,170 million in FY2015, a decrease of 4.4% as compared to FY2014.

The Asia Pacific segment recorded revenues of $10,755 million in FY2015, an increase of 0.1% over FY2014.

The South America segment recorded revenues of $5,766 million in FY2015, a decrease of 34.5% as compared to FY2014.

The Middle East & Africa segment recorded revenues of $4,005 million in FY2015, a decrease of 9.1% as

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compared to FY2014.

The financial services segment recorded revenues of $8,992 million in FY2015, an increase of 8.4% over FY2014.

Revenue by geography

The US, Ford's largest geographic market, accounted for 62.3% of the total revenues in FY2015. Revenues from the US reached $93,142 million in FY2015, an increase of 12.7% over FY2014.

The UK accounted for 7.7% of the total revenues in FY2015. Revenues from the UK reached $11,451 million in FY2015, a decrease of 2.5% as compared to FY2014.

Canada accounted for 6% of the total revenues in FY2015. Revenues from Canada reached $8,978 million in FY2015, a decrease of 4.6% as compared to FY2014.

Germany accounted for 4.6% of the total revenues in FY2015. Revenues from Germany reached $6,950 million in FY2015, a decrease of 7.2% as compared to FY2014.

Other regions accounted for 19.4% of the total revenues in FY2015. Revenues from other regions reached $29,037 million in FY2015, a decrease of 11.4% as compared to FY2014.

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SWOT Analysis

SWOT ANALYSIS

Ford Motor Company (Ford or 'the company') is one of the largest automotive manufacturers in the world. The company manufactures and distributes automobiles across six continents. It also provides financial services through Ford Motor Credit. The company's global platform consolidation efforts coupled with strong focus on affordable mobility blueprint has provided significant cost savings, thus delivering sustainable growth prospects. However, intense competition presents a significant risk to Ford's ability to enhance its revenue per vehicle and maintain its market share during difficult economic times.

Strength

Strong market share in several regions could enhance brand value Robust portfolio of automotive products provides competitive advantage Significant research and development capabilities help launch new vehicles

Weakness

Frequent product recalls could affect brand image

Opportunity

Growing global automotive industry could provide immense opportunities to boost financial performance Focus on hybrid electric and fuel cell vehicle market Establishment of new plants to expand business prospects

Threat

Intense competition and pricing pressure could impact market share Stringent environmental regulations affect business performance Fluctuations in foreign currency could impact profitability

Strength

Strong market share in several regions could enhance brand value

Ford is one of the leading automotive manufacturers in the world. The company has a strong market presence across the globe, with a global market share of 7.2% in FY2015. Ford primarily operates in North America, Europe, Asia Pacific, South America, and the Middle East and Africa. The company had a market share of 14.7% in the US automotive market in 2015. Ford stood in the second position in the US in terms of vehicles sold during the year. Also, the company occupied a market share of 14.4% in the Canadian automotive market. Ford was Canada's leading automaker in terms of volumes sold in 2015. Ford maintained an overall strong position in the North American automotive market. In addition, the company has robust market share of 7.7% in Europe, with 14.3% and 12.6%, in the UK and Turkey, respectively.

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In the South American market, Ford has been consistently maintaining a strong market share of more than 9% in Brazil since 2013. The company has also been able to expand its market share in Argentina from 12.6% in 2013 to 14.8% in 2015. In the Asia-Pacific region, Ford occupied a market share of 4.5% in China in 2015. Thus, Ford's strong market share in several regions could enhance brand value leading to greater demand and higher profitability.

Robust portfolio of automotive products provides competitive advantage

Ford is engaged in designing, manufacturing and selling cars, utilities vehicles and trucks. Through its automotive business, the company produces a range of vehicles, including cars for the small, medium, large and premium segments; trucks; buses/vans (including minivans); full-size pickups; sport utility vehicles (SUV); and vehicles for the medium/heavy segments. Ford produces vehicles under the Ford and Lincoln brands. In FY2015, the company sold approximately 6,635,000 vehicles (wholesale) throughout the world.

The company also provides a wide range of after-sale vehicle services and products, including maintenance and repairs, vehicle accessories and parts, and extended service contracts. Thus, robust portfolio of automotive products helps the company to meet the evolving needs of its customers which in turn provides significant competitive advantage.

Significant research and development capabilities help launch new vehicles

Ford has strong engineering, research and development (R&D) capability. The R&D efforts are directed at improving the performance (including fuel efficiency), safety, customer satisfaction, and developing new products. The company operates engineering, research, and development centers worldwide and maintains extensive engineering and R&D centers in Dearborn, Michigan; Dunton, the UK; and Aachen and Merkenich, Germany. Ford recorded $6.7 billion of engineering, R&D costs in both FY2015 and FY2014. Also, the company currently has approximately 38,500 active patents and pending patent applications globally, with an average age for patents in its active patent portfolio at five and a half years. Ford also opened a new Research and Innovation Center in Palo Alto in 2015. The new center would accelerate the development of technologies and experiments in connectivity, mobility, autonomous vehicles, customer experience and big data.

Ford was an early industry leader in developing diesel engine after-treatment systems. The company owns more than 100 patents for these advancements. Over the years, the company has increased focus on technologies to enhance fuel efficiency like EcoBoost, direct injection of gasoline or diesel fuel, six- speed transmissions, and hybrid and plug-in hybrid powertrains. Ford has been working extensively on three main areas to enhance its product quality namely light-weighting, cabin technology, and powertrain. Ford has been involved in extensive research to make its vehicles lighter in order to strike a balance between cost and reparability. Moreover, the company's R&D is engaged in designing automotive cockpits with better features and advanced technologies for driver assistance. Also, the company seeks to build more efficient gasoline engines to achieve higher efficiency and lighter weight.

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Due to the strong R&D efforts, the company was able to develop and launch a number of new vehicles. For instance, in March 2015, Ford in collaboration with Tonka launched the F-750 Tonka dump truck. Also, during January 2015, the company launched the 2015 F150 trucks, having an aluminum-alloy body and steel frame. Moreover, in the same month, the company unveiled the all-new GT, a supercar that serves as a technology showcase for top EcoBoost performance, aerodynamics and lightweight carbon fiber construction. Furthermore, in 2014, Ford revealed the all-new Focus Sedan.

Thus, strong R&D capabilities support and enhance Ford's existing product offerings as well as enable it to launch new vehicles in the market place.

Weakness

Frequent product recalls could affect brand image

In the recent past, string of product recalls have hit Ford's quality image. Ford has recalled some of its most popular models due to manufacturing and design problems. For instance, in May 2016, Ford issued a recall of approximately 271,000 2013–2014 Ford F-150 vehicles to replace brake master cylinders. In April 2016, Ford recalled approximately 202,000 2011–2012 Ford F-150, and 2012 Ford Expedition, Ford Mustang and Lincoln Navigator vehicles for a potential issue with the output speed sensor on the vehicle’s transmission lead frame.

Further in May 2015, the company expanded its safety recalls on vehicles that have certain Takata airbag inflators after Takata declared that those inflators are defective, bringing the total number of Ford vehicles recalled for Takata airbag inflators to 1,509,535 vehicles until May 2015. In the same month, Ford issued safety recall for 422,814 vehicles, including certain 2011–2013 Ford Taurus and Flex vehicles, Lincoln MKS and MKT vehicles, for certain 2011–2012 Ford Fusion and Lincoln MKZ vehicles, and for certain 2011 Mercury Milan vehicles in North America for a potential intermittent electrical connection in the steering gear that might result in the loss of electric power steering assist while driving.

Hence, frequent product recalls could negatively impact the consumer's confidence on Ford which in turn may affect the brand name and reduce trust on the company's products.

Opportunity

Growing global automotive industry could provide immense opportunities to boost financial performance

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The global automotive manufacturing industry has produced relatively stable and consistent levels of growth overall in recent years. The industry is expected to continue to follow a similar pattern through to the end of the forecast period in 2019. According to MarketLine, the global automotive manufacturing industry generated total revenues of $1,252.6 billion in 2015, an increase of 3.1% over the previous year. Furthermore, the industry is expected to grow at a compound annual growth rate (CAGR) of 6% for the 2015–19 period to reach a value of approximately $1,577.1 billion in 2019. In addition, the industry production volume is expected to rise to 189 billion units by the end of 2019, representing a CAGR of 5% for the 2015–19 period.

Ford, one of the oldest car manufacturers in the world, designs, builds and sells cars, utilities vehicles and trucks. The company's core and affiliated automotive brands include Ford and Lincoln. Within the automotive business, the company is engaged in the design, development, manufacture, sale and service of cars, trucks and service parts. Ford produces a range of vehicles, including cars for the small, medium, large and luxury segments; trucks; buses/vans (including minivans); full-size pickups; sport utility vehicles (SUV); and vehicles for the medium/heavy segments. Thus, the growing global automotive industry provides incremental growth opportunities for Ford to enhance its financial performance.

Focus on hybrid electric and fuel cell vehicle market

The company has been focusing on developing cars running on hybrid electric and fuel cell technologies. The demand for hybrid electric and fuel cell vehicles (FCVs) is primarily driven by the growing global concerns about carbon emissions coupled with highly volatile fuel prices. According to industry estimates, the sales of electric vehicle are anticipated to reach approximately 7.5 million units by the end of 2020, growing at a CAGR of 19% for the 2014-20 periods.

Ford is currently increasing its hybrid volume and preparing for hybrid capability across its highest-volume global product platforms. For instance, in FY2014, Ford offered the C-MAX Hybrid and Fusion Hybrid, and the Lincoln MKZ hybrid, in the US. The C-MAX hybrid is one of three electrified vehicle options on its C- platform; the others are the Focus Electric battery electric vehicle (BEV) and the C-MAX Energi plug-in hybrid electric vehicle (PHEV). Also, in 2014, the company introduced a hybrid version of Ford Mondeo in Europe.

Furthermore, the company is also focusing on the FCV market to enhance its revenues in the coming periods. According to industry estimates, fuel cell vehicles will account for 24% of the consumer demand for electric vehicles by 2019. Ford has reprioritized its internal resources to concentrate on core fuel cell research that might help increase the commercialization potential of FCVs, including materials development and basic scientific research to solve cost and durability challenges. For example, in 2013, the company announced a partnership with Daimler and Nissan Motor to accelerate the commercialization of FCV technology by jointly developing a common fuel cell system that will reduce technology costs by maximizing design commonality, leveraging volume and deriving efficiencies through economies of scale. This collaboration could lead to the launch of the world's first affordable, mass- market fuel cell electric vehicles as early as 2017.

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Thus, Ford's strong emphasis on hybrid electric and alternate fuel vehicles coupled with the growing demand from the end markets is expected to enhance its revenues and market share in the coming periods.

Establishment of new plants to expand business prospects

Ford has established several new plants and also expanded the capacity of existing plants in recent times. For instance, in April 2015, the company invested $2.5 billion in new engine and transmission plants in the Mexican states of Chihuahua and Guanajuato, respectively. The investment is part of the company's One Ford plan, which emphasizes global competitiveness. Furthermore, during February 2015, Ford completed the final part of the $2.6 billion investment in its manufacturing operations in Valencia, Spain. With this investment, the vehicle production in Valencia will increase 40% to around 400,000 units. Moreover, the new high-tech bodyshop will raise daily production capacity to 2,000 vehicles. Valencia is one of Spain's top automotive exporters, with 80% of its production exported to 75 countries worldwide, including North America.

The establishment of new plants could enable the company to further drive its profitable growth and enhance its overall revenue base.

Threat

Intense competition and pricing pressure could impact market share

The global automotive industry is highly competitive which pressurizes manufacturers' ability to increase prices. The principal competitive factors include price, quality, available options, style, safety, reliability, fuel economy and functionality. Ford faces strong completion from companies such as Fiat Chrysler Automobiles, General Motors, Honda Motor, Hyundai-Kia Automotive Group, PSA Peugeot Citroen, Renault-Nissan, Suzuki Motor, Toyota Motor, and Volkswagen, among others. In the future, Chinese and Indian manufacturers are expected to enter the US and European markets, further intensifying competition. Over the long term intense competition and apparent excess capacity is expected to continue to put downward pressure on inflation-adjusted prices for similarly-contented vehicles in the US and contribute to a challenging pricing environment for the automotive industry. In Europe, the excess capacity situation is exacerbated by weakening demand along with the lack of reductions in existing capacity, which could result in negative pricing pressure to continue for the foreseeable future.

Thus, these actions might influence Ford's vehicle pricing, which in turn could have a significant negative impact on the company's market share and operating results. It also presents a significant risk to Ford's ability to enhance its revenue per vehicle and maintain its market share during difficult economic times.

Stringent environmental regulations affect business performance

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The automobile industry worldwide is influenced by a broad spectrum of regulations governing the emission levels of exhaust fumes, carbon dioxide/fuel economy guidelines, noise level limitations, recycling-related restrictions and safety standards. These regulations have become increasingly stringent. For instance, in the US, the Federal Clean Air Act imposes stringent limits on the amount of regulated pollutants that lawfully may be emitted by new vehicles and engines produced for sale in the US. In 2014, the Environmental Protection Agency (EPA) finalized new Tier 3 regulations that phase in increasingly stringent motor vehicle emissions standards beginning with the 2017 model year; compliance with these standards could be challenging. Pursuant to the Clean Air Act, California may establish its own unique vehicle emissions control standards; the California standards can also be adopted by other states. The California Air Resources Board has adopted LEV III standards, which took effect with the 2015 model year and impose increasingly stringent tailpipe and evaporative emissions requirements for light and medium duty vehicles. Thirteen states, primarily located in the Northeast and Northwest, have adopted the LEV III standards. Moreover, the California vehicle emissions program also includes requirements for manufacturers to produce and deliver zero-emission vehicles (ZEVs) for sale.

Furthermore, European Union (EU) directives and related legislation limit the amount of regulated pollutants that may be emitted by new motor vehicles and engines sold in the EU. Stringent new Stage V emissions standards took effect for vehicle registrations starting in January 2011; Stage VI requirements applied from September 2014, with a second phase beginning in September 2017. Stage V particulate standards drove the deployment of particulate filters in diesel engines, and Stage VI further tightened the standard for oxides of nitrogen. Also, many countries, in an effort to address air quality concerns, are adopting previous versions of European or United Nations Economic Commission for Europe (UN-ECE) mobile source emission regulations. Some countries have adopted more advanced regulations based on the most recent version of European or US regulations. For example, China adopted emission regulations for large cities based on European Stage V emissions standards. Korea and Taiwan have adopted stringent US-based standards for gasoline vehicles, and European-based standards for diesel vehicles. Brazil, Argentina, and Chile have also introduced more stringent emissions standards.

Thus, any significant change in the regulation structure in any of the countries where Ford operates may have a serious impact on its business operations.

Fluctuations in foreign currency could impact profitability

Ford is an enterprise with global operations. The company operates 67 plants spread across North America, Europe, South America, Asia Pacific, and the Middle East and Africa. During FY2015, the company operated approximately 11,971 dealerships across the world, including 10,727 Ford dealerships and 360 Lincoln dealerships. In addition the company operated 884 Ford and Lincoln combined dealerships.

Foreign currency risks affect Ford's automotive and financial services sector alike. In the automotive

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sector, the company is exposed to foreign exchange risk arising from high proportion of export in sales amount, which is denominated in foreign currencies. Also, Ford Credit, in order to meet funding objectives, borrows in a variety of currencies, principally US dollars, Canadian dollars, Euros, Pound Sterling, and renminbi. Ford Credit faces exposure to currency exchange rates if a mismatch exists between the currency of receivables and the currency of the debt funding those receivables. In addition, the value of the company's equity investment in foreign countries may fluctuate based upon changes in foreign currency exchange rates. Thus, any unfavorable change in other currencies would have an adverse impact on the profitability of the company.

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Top Competitors

TOP COMPETITORS

The following companies are the major competitors of Ford Motor Company

Fiat Chrysler Automobiles N.V. General Motors Company Honda Motor Co., Ltd. Hyundai-Kia Automotive Group Nissan Motor Co., Ltd. PSA Groupe Renault-Nissan B.V. Suzuki Motor Corporation Toyota Motor Corporation Volkswagen AG

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Company View

COMPANY VIEW

An excerpt of ‘Management’s Discussion and Analysis of Financial Condition and Results of Operations’ is given below. The statement is taken from the company’s Annual Report for FY2015.

OVERVIEW

Revenue

Our Automotive sector’s revenue is generated primarily by sales of vehicles, parts, and accessories; we generally treat sales and marketing incentives as a reduction to revenue. Revenue is recorded when all risks and rewards of ownership are transferred to our customers (generally, our dealers and distributors). For the majority of sales, this occurs when products are shipped from our manufacturing facilities. This is not the case, however, with respect to vehicles produced for sale to daily rental car companies that are subject to a guaranteed repurchase option. These vehicles are accounted for as operating leases, with lease revenue and profits recognized over the term of the lease. Proceeds from the sale of vehicles at auction are recognized in revenue at the time of sale.

Most of the vehicles sold by us to our dealers and distributors are financed at wholesale by Ford Credit. Upon Ford Credit originating the wholesale receivable related to a dealer’s purchase of a vehicle, Ford Credit pays cash to the relevant legal entity in our Automotive sector in payment of the dealer’s obligation for the purchase price of the vehicle. The dealer then pays the wholesale finance receivable to Ford Credit when it sells the vehicle to a retail customer.

Our Financial Services sector’s revenue is generated primarily from interest on finance receivables, net of certain deferred origination costs that are included as a reduction of financing revenue, and such revenue is recognized over the term of the receivable using the interest method. Also, revenue from operating leases is recognized on a straight-line basis over the term of the lease. Income is generated to the extent revenues exceed expenses, most of which are interest, depreciation, and operating expenses.

Transactions between our Automotive and Financial Services sectors occur in the ordinary course of business. For example, we offer special retail financing and lease incentives to dealers’ customers who choose to finance or lease our vehicles from Ford Credit. The estimated cost for these incentives is

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recorded as revenue reduction to Automotive sales at the later of the date the related vehicle sales to our dealers are recorded or the date the incentive program is both approved and communicated. In order to compensate Ford Credit for the lower interest or lease rates offered to the retail customer, we pay the discounted value of the incentive directly to Ford Credit when it originates the retail finance or lease contract with the dealer’s customer. Ford Credit recognizes the amount over the life of retail finance contracts as an element of financing revenue and over the life of lease contracts as a reduction to depreciation. See Note 1 of the Notes to the Financial Statements for a more detailed discussion of transactions and payments between our Automotive and Financial Services sectors.

Key Economic Factors and Trends Affecting the Automotive Industry

Currency Exchange Rate Volatility. The U.S. Federal Reserve raised its policy interest rate in December 2015, for the first time since 2006, and the resulting shifts in capital flows have contributed to downward pressure on several emerging market currencies. In some cases that pressure is aggravated by low commodity prices, high inflation, or unstable policy environments. Additionally, the yen and euro have depreciated as a result of monetary policy easing by the Bank of Japan and European Central Bank. The weak yen, in particular, adds significant potential downward pressure on vehicle pricing across many markets globally. In most markets, exchange rates are market-determined, and all are impacted by many different macroeconomic and policy factors, and thus likely to remain volatile. However, in some markets, exchange rates are heavily influenced or controlled by governments.

Excess Capacity. According to IHS Automotive, an automotive research firm, the estimated automotive industry global production capacity for light vehicles of about 119 million units exceeded global production by about 31 million units in 2015. In North America and Europe, two regions where a significant share of industry revenue is earned, excess capacity as a percent of production was an estimated 7% and 22%, respectively, in 2015. In China, the auto industry also witnessed excess capacity at 54% of production in 2015, as manufacturers competed to capitalize on China’s future market potential. According to production capacity data projected by IHS Automotive, global excess capacity conditions could continue for several years at an average of about 33 million units per year during the period from 2016 to 2020.

Pricing Pressure. Excess capacity, coupled with a proliferation of new products being introduced in key segments, will keep pressure on manufacturers’ ability to increase prices. In North America, the industry restructuring of the past few years has allowed manufacturers to better match production with demand, although Japanese and Korean manufacturers also have capacity located outside of the region directed to North America. In the future, Chinese and Indian manufacturers are expected to enter U.S. and European markets, further intensifying competition. Over the long term, intense competition and excess capacity will continue to put downward pressure on inflation-adjusted prices for similarly contented vehicles in the United States and contribute to a challenging pricing environment for the automotive

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industry. In Europe, the excess capacity situation was exacerbated by weakening demand and the lack of reductions in existing capacity, such that negative pricing pressure is expected to continue for the foreseeable future.

Commodity and Energy Price Changes. The price of oil has continued to decline in early 2016, after averaging under $50 per barrel in 2015, as global supply remains strong despite the ongoing price pressures. Other commodity prices also have declined recently, but over the longer term prices are likely to trend higher given expectations for global demand growth.

Vehicle Profitability. Our financial results depend on the profitability of the vehicles we sell, which may vary significantly by vehicle line. In general, larger vehicles tend to command higher prices and be more profitable than smaller vehicles, both across and within vehicle segments. For example, in North America, our larger, more profitable vehicles had an average contribution margin that was about 135% of our total average contribution margin across all vehicles, whereas our smaller vehicles had significantly lower contribution margins. Government regulations aimed at reducing emissions and increasing fuel efficiency may increase the cost of vehicles by more than the perceived benefit to the consumer. Given the backdrop of excess capacity, these regulations could dampen contribution margins. As we execute our One Ford plan, we are working to create best-in-class vehicles on global platforms that contribute higher margins, and offering a more balanced portfolio of vehicles with which we aim to be among the leaders in fuel efficiency in every segment in which we compete.

Increasing Sales of Smaller Vehicles. Like other manufacturers, we are increasing our participation in newly developed and emerging markets, such as Brazil, Russia, India, and China, in which vehicle sales are expected to increase at a faster rate than in most mature markets. The largest segments in these markets are small vehicles (i.e., Sub-B, B, and C segments). To increase our participation in these fast- growing markets, we are significantly increasing our production capacity, directly or through joint ventures. Although we expect positive contribution margins from higher small vehicle sales, one result of increased production of small vehicles may be that, over time, our average per unit margin decreases because small vehicles tend to have lower margins than medium and large vehicles.

Trade Policy. To the extent governments in various regions erect or intensify barriers to imports, or implement currency policy that advantages local exporters selling into the global marketplace, there can be a significant negative impact on manufacturers based in markets that promote free trade. While we believe the long-term trend is toward the growth of free trade, we have noted with concern recent developments in a number of regions. In Asia Pacific, for example, the recent dramatic depreciation of the yen significantly reduces the cost of exports into the United States, Europe, and other global markets by Japanese manufacturers. Over a period of time, the emerging weakness of the yen can contribute to other countries pursuing weak currency policies by intervening in the exchange rate markets. This is

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particularly likely in other Asian countries, such as South Korea. As another example, government actions in South America to incentivize local production and balance trade are driving trade frictions between South American countries and also with Mexico, resulting in business environment instability and new trade barriers. We will continue to monitor and address developing issues around trade policy.

Other Economic Factors. During 2015, mature market government bond yields and inflation were lower than expected, and there is a rising risk of persistent disinflation and, in some markets, even outright deflation. The lower levels of inflation and interest rates were unexpected partially because they have occurred against a backdrop of loose monetary policy and high levels of mature market deficits and debt. The eventual implications of higher government deficits and debt, with potentially higher long-term interest rates, may still drive a higher cost of capital over our planning period. Higher interest rates and/or taxes to address the higher deficits also may impede real growth in gross domestic product and, therefore, vehicle sales over our planning period.

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Locations And Subsidiaries

LOCATIONS AND SUBSIDIARIES

Head Office

Ford Motor Company One American Road Dearborn Michigan 48126 USA Phone:1 313 322 3000 http://www.ford.com

Other Locations and Subsidiaries

Bordeaux Automatic Transmission Plant Blanquefort FRA http://www.ford.fr

Ford - Japan Hiroshima Plant JPN http://www.ford.co.jp

Ford Brazil Camacari Plant Bahia BRA http://www.ford.com.br

Ford India P. Ltd, S.P. Koil Post Chengalpattu Tamil Nadu 603204 IND Phone:91 44 67403333 http://www.india.ford.com/

Ford Motor Co. Ltd. Eagle Way Brentwood Essex CM14 9HE GBR http://www.ford.co.uk/

Ford Motor Company of Canada, Limited Oakville Ontario L6J 5E4 CAN http://www.ford.ca

Ford Motor Credit Company LLC Omaha Nebraska 68154 8000 USA http://credit.ford.com/

Ford Motors de Venezuela Valencia VEN http://www.ford.com.ve/

Ford Thailand Manufacturing (FTM) 500/103 Moo 3 Tambol Tasit Amphur Pluakdaeng Rayong 21140 THA http://www.ford.co.th/

Haiduong Assembly Factory - Ford Vietnam Haiduong Hanoi VNM http://www.ford.com.vn

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