Net Investments in Operating Leases

9 Months Ended

Sep. 30, 2011

Leases, Operating [Abstract]

NET INVESTMENT IN OPERATING LEASES

NET INVESTMENT IN OPERATING LEASES

Net investment in operating leases consists primarily of lease contracts for new and used vehicles with retail customers, daily rental companies, government entities and fleet customers with terms of 60 months or less.

We receive interest supplements and residual support payments on certain leasing transactions under agreements with Ford and other affiliates. The unamortized balance of unearned interest supplements and residual support payments on operating leases are included in Other liabilities and deferred income on the balance sheet. See Note 7 for further information.

Net investment in operating leases were as follows (in millions):

	September 30, 2011			December 31, 2010
Vehicles, at cost, including initial direct costs	$	12,946		$	14,046
Less:  Accumulated depreciation	(2,491		)	(4,003		)
Net investment in operating leases before allowance for credit losses (a)	10,455			10,043
Less:  Allowance for credit losses	(51		)	(87		)
Net investment in operating leases	$	10,404		$	9,956

(a) At September 30, 2011 and December 31, 2010, includes net investment in operating leases of $4.7 billion and $6.2 billion, respectively, that have been included in securitization transactions but continue to be included in our consolidated financial statements. These net investment in operating leases are available only 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 until the associated debt or other obligations are satisfied. See Note 5 for additional information.