Ford Credit Finance Receivables (Tables)

9 Months Ended

Sep. 30, 2020

Receivables [Abstract]

Schedule of Accounts, Notes, Loans and Financing Receivable

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

	December 31, 2019		September 30, 2020
Consumer
Retail installment contracts, gross	$	68,905	$	73,246
Finance leases, gross	8,566		8,244
Retail financing, gross	77,471		81,490
Unearned interest supplements	(3,589)		(4,091)
Consumer finance receivables	73,882		77,399
Non-Consumer
Dealer financing	33,985		21,421
Non-Consumer finance receivables	33,985		21,421
Total recorded investment	$	107,867	$	98,820
Recorded investment in finance receivables	$	107,867	$	98,820
Allowance for credit losses	(513)		(1,314)
Total finance receivables, net	$	107,354	$	97,506
Current portion	$	53,651	$	41,847
Non-current portion	53,703		55,659
Total finance receivables, net	$	107,354	$	97,506
Net finance receivables subject to fair value (a)	$	99,168	$	89,663
Fair value (b)	99,297		91,068

__________

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

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

Financing Receivable, Past Due

The credit quality analysis of consumer receivables at December 31, 2019 was as follows (in millions):

	Total
Consumer
31 - 60 days past due	$	839
61 - 120 days past due	166
Greater than 120 days past due	35
Total past due	1,040
Current	72,842
Total	$	73,882

The credit quality analysis of consumer receivables at September 30, 2020 was as follows (in millions):

	Amortized Cost Basis by Origination Year
	Prior to 2016		2016		2017		2018		2019		2020		Total
Consumer
31 - 60 days past due	$	45	$	58	$	99	$	141	$	141	$	76	$	560
61 - 120 days past due	7		14		28		45		48		22		164
Greater than 120 days past due	13		7		7		8		7		1		43
Total past due	65		79		134		194		196		99		767
Current	1,141		3,290		8,001		15,444		22,492		26,264		76,632
Total	$	1,206	$	3,369	$	8,135	$	15,638	$	22,688	$	26,363	$	77,399

Financing Receivable Credit Quality Indicators

The credit quality analysis of dealer financing receivables at December 31, 2019 was as follows (in millions):

	Total
Dealer financing
Group I	$	26,281
Group II	5,407
Group III	2,108
Group IV	189
Total (a)	$	33,985

__________

(a)Total past due dealer financing receivables at December 31, 2019 were $62 million.

The credit quality analysis of dealer financing receivables at September 30, 2020 was as follows (in millions):

	Amortized Cost Basis by Origination Year														Wholesale Loans
	Dealer Loans
	Prior to 2016		2016		2017		2018		2019		2020		Total				Total
Group I	$	528	$	130	$	142	$	132	$	73	$	300	$	1,305	$	13,823	$	15,128
Group II	46		21		15		35		4		89		210		4,520		4,730
Group III	9		—		3		17		3		41		73		1,356		1,429
Group IV	2		3		—		—		2		5		12		122		134
Total (a)	$	585	$	154	$	160	$	184	$	82	$	435	$	1,600	$	19,821	$	21,421

__________

(a)Total past due dealer financing receivables at September 30, 2020 were $126 million.

Financing Receivable, Allowance for Credit Loss

An analysis of the allowance for credit losses related to finance receivables for the periods ended September 30 was as follows (in millions):

	Third Quarter 2019 (a)						First Nine Months 2019 (a)
	Consumer		Non-Consumer		Total		Consumer		Non-Consumer		Total
Allowance for credit losses
Beginning balance	$	496	$	17	$	513	$	566	$	23	$	589
Charge-offs	(129)		(1)		(130)		(383)		(18)		(401)
Recoveries	41		—		41		129		8		137
Provision for credit losses	93		—		93		187		2		189
Other (b)	(3)		(1)		(4)		(1)		—		(1)
Ending balance	$	498	$	15	$	513	$	498	$	15	$	513

	Third Quarter 2020						First Nine Months 2020
	Consumer		Non-Consumer		Total		Consumer		Non-Consumer		Total
Allowance for credit losses
Beginning balance	$	1,211	$	74	$	1,285	$	496	$	17	$	513
Adoption of ASU 2016-13 (c)	—		—		—		247		5		252
Charge-offs	(104)		(5)		(109)		(329)		(6)		(335)
Recoveries	41		2		43		117		5		122
Provision for credit losses	95		(9)		86		723		42		765
Other (b)	8		1		9		(3)		—		(3)
Ending balance	$	1,251	$	63	$	1,314	$	1,251	$	63	$	1,314

__________

(a)The comparative information has not been restated and continues to be reported under the accounting standard in effect during 2019.

(b)Primarily represents amounts related to translation adjustments.

(c)Cumulative pre-tax adjustments recorded to retained earnings as of January 1, 2020. See Note 2 for additional information.