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52 Ford Motor Company | 2013 Annual Report
Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)
2014 Planning Assumptions and Key Metrics
Based on the current economic environment, our planning assumptions and key metrics for 2014 include the
following:
2013 2014
Full Year Full Year
Results Plan Outlook
Planning Assumptions
Industry Volume (a) -- U.S. (Mils.) 15.9 16.0 - 17.0 On Track
-- Europe (Mils.) (b) 13.8 13.5 - 14.5 On Track
-- China (Mils.) 22.2 22.5 - 24.5 On Track
Key Metrics
Automotive (Compared with 2013):
- Revenue (Bils.) $ 139.4 About Equal On Track
- Operating Margin (c) 5.4 % Lower On Track
- Operating-Related Cash Flow (Bils.) (d) $ 6.1 Substantially Lower On Track
Ford Credit (Compared with 2013):
- Pre-Tax Profit (Bils.) $ 1.8 About Equal On Track
Total Company:
- Pre-Tax Profit (Bils.) (d) $ 8.6 $7 - $8 Billion On Track
__________
(a) Includes medium and heavy trucks.
(b) The 20 markets we track (traditional 19 markets plus Romania).
(c) Automotive operating margin is defined as Automotive pre-tax results, excluding Other Automotive, divided by Automotive revenue.
(d) Excludes special items; reconciliation to GAAP for full-year 2013 provided in “Results of Operations” and “Liquidity and Capital Resources” above.
For 2014, we project U.S. industry volume, including medium-heavy trucks, to range from 16 million to 17 million units.
In Europe, we expect a range of 13.5 million to 14.5 million units. In China, we expect volume to range from 22.5 million
to 24.5 million units.
For our financial metrics, which are now aligned to the key drivers of total shareholder return, we expect Automotive
revenue in 2014 to be about the same as 2013, Automotive operating margin to be lower, and Automotive operating-
related cash flow to be positive but substantially lower than 2013, including higher capital spending consistent with our
mid-decade outlook of about $7.5 billion.
Ford Credit’s 2014 pre-tax profit is expected to be about equal to 2013.
We expect our operating effective tax rate to normalize at about 35%, compared with 27% last year.
Our outlook for 2014 is unchanged from the outlook we previously provided, with total Company pre-tax profit,
excluding special items, expected to range from $7 billion to $8 billion.
ONE FORD PLAN
We remain focused on delivering the key aspects of the One Ford plan, which are unchanged:
• Aggressively restructure to operate profitably at the current demand and changing model mix;
• Accelerate development of new products our customers want and value;
• Finance our plan and improve our balance sheet; and
• Work together effectively as one team, leveraging our global assets.