Transfers of Receivables

9 Months Ended

Sep. 30, 2011

Transfers and Servicing [Abstract]

TRANSFERS OF RECEIVABLES

TRANSFERS OF RECEIVABLES

We securitize finance receivables and net investments in operating leases through a variety of programs utilizing amortizing, variable funding and revolving structures. We also sell finance receivables in structured financing transactions. Due to the similarities between securitization and structured financing, we refer to structured financings as securitization transactions. Our securitization programs are targeted to many different investors in both public and private transactions in capital markets worldwide.

We engage in securitization transactions to fund operations and to maintain liquidity. Our securitization transactions are recorded as asset-backed debt and the associated assets are not de-recognized and continue to be included in our financial statements.

The finance receivables and net investment in operating leases that have been included in securitization transactions are only available for payment of the debt and other obligations issued or arising in the securitization transactions. They are not available to pay our other obligations or the claims of our other creditors. We do, however, hold the right to the excess cash flows not needed to pay the debt and other obligations issued or arising in each of these securitization transactions. The debt is the obligation of our consolidated securitization entities and not the legal obligation of Ford Credit or our other subsidiaries.

Most of these securitization transactions utilize VIEs. See Note 6 for more information concerning VIEs. The following tables show the assets and liabilities related to our securitization transactions that were included in our financial statements (in billions):

	September 30, 2011
	Cash and Cash Equivalents		Finance Receivables & Net Investment in Operating Leases (a)						Related Debt
			Before Allowance for Credit Losses		Allowance for Credit Losses		After Allowance for Credit Losses
VIE (b)
Retail (c)	$	2.6	$	32.4	$	0.3	$	32.1	$	26.6
Wholesale	0.4		16.2		0.0		16.2		9.6
Finance receivables	3.0		48.6		0.3		48.3		36.2
Net investment in operating leases	0.4		4.7		0.0		4.7		2.8
Total	$	3.4	$	53.3	$	0.3	$	53.0	$	39.0
Non-VIE
Retail (c)	$	0.2	$	2.3	$	0.0	$	2.3	$	2.0
Wholesale	0.0		2.0		0.0		2.0		1.6
Finance receivables	0.2		4.3		0.0		4.3		3.6
Net investment in operating leases	—		—		—		—		—
Total	$	0.2	$	4.3	$	0.0	$	4.3	$	3.6
Total securitization transactions
Retail (c)	$	2.8	$	34.7	$	0.3	$	34.4	$	28.6
Wholesale	0.4		18.2		0.0		18.2		11.2
Finance receivables	3.2		52.9		0.3		52.6		39.8
Net investment in operating leases	0.4		4.7		0.0		4.7		2.8
Total	$	3.6	$	57.6	$	0.3	$	57.3	$	42.6

(a) Unearned interest supplements are excluded from securitization transactions.

(b) Includes assets to be used to settle the liabilities of the consolidated VIEs.

(c) Includes direct financing leases.

FORD MOTOR CREDIT COMPANY LLC AND SUBSIDIARIES

NOTES TO THE FINANCIAL STATEMENTS (Continued)

NOTE 5. TRANSFERS OF RECEIVABLES (Continued)

	December 31, 2010
	Cash and Cash Equivalents		Finance Receivables & Net Investment in Operating Leases (a)						Related Debt
			Before Allowance for Credit Losses		Allowance for Credit Losses		After Allowance for Credit Losses
VIE (b)
Retail (c)	$	2.8	$	33.8	$	0.4	$	33.4	$	27.1
Wholesale	0.4		16.6		0.0		16.6		10.1
Finance receivables	3.2		50.4		0.4		50.0		37.2
Net investment in operating leases	0.8		6.2		0.1		6.1		3.0
Total	$	4.0	$	56.6	$	0.5	$	56.1	$	40.2
Non-VIE
Retail (c)	$	0.1	$	2.0	$	0.0	$	2.0	$	1.7
Wholesale	0.1		2.1		0.0		2.1		1.7
Finance receivables	0.2		4.1		0.0		4.1		3.4
Net investment in operating leases	—		—		—		—		—
Total	$	0.2	$	4.1	$	0.0	$	4.1	$	3.4
Total securitization transactions
Retail (c)	$	2.9	$	35.8	$	0.4	$	35.4	$	28.8
Wholesale	0.5		18.7		0.0		18.7		11.8
Finance receivables	3.4		54.5		0.4		54.1		40.6
Net investment in operating leases	0.8		6.2		0.1		6.1		3.0
Total	$	4.2	$	60.7	$	0.5	$	60.2	$	43.6

(a) Unearned interest supplements are excluded from securitization transactions.

(b) Includes assets to be used to settle the liabilities of the consolidated VIEs.

(c) Includes direct financing leases.

The financial performance related to our securitization transactions for the periods ended September 30 were as follows (in millions):

	Third Quarter					First Nine Months
	2011			2010		2011			2010
VIE
Derivative expense/(income)	$	(46	)	$	90	$	(13	)	$	237
Interest expense	248			297		763			971
Total VIE	$	202		$	387	$	750		$	1,208
Non-VIE
Derivative expense/(income)	$	4		$	5	$	18		$	13
Interest expense	35			49		108			183
Total Non-VIE	$	39		$	54	$	126		$	196
Total securitization transactions
Derivative expense/(income)	$	(42	)	$	95	$	5		$	250
Interest expense	283			346		871			1,154
Total	$	241		$	441	$	876		$	1,404

FORD MOTOR CREDIT COMPANY LLC AND SUBSIDIARIES

NOTES TO THE FINANCIAL STATEMENTS (Continued)

NOTE 5. TRANSFERS OF RECEIVABLES (Continued)

Certain of our securitization entities enter into derivative transactions to mitigate interest rate exposure, primarily resulting from fixed-rate assets securing floating-rate debt and, in certain instances, currency exposure resulting from assets in one currency and debt in another currency. In many instances, the counterparty enters into offsetting derivative transactions with us to mitigate their interest rate risk resulting from derivatives with our securitization entities. Our exposures based on the fair value of derivative instruments related to securitization programs were as follows (in millions):

	September 30, 2011				December 31, 2010
	Derivative Asset		Derivative Liability		Derivative Asset		Derivative Liability
VIE - securitization entities	$	169	$	94	$	26	$	222
Ford Credit related to VIE	81		60		134		37
Other Ford Credit securitization related	12		24		14		23
Total securitization transactions	$	262	$	178	$	174	$	282

See Notes 10 and 11 for information regarding our derivatives.