Ford 2010 Annual Report Download - page 172

Notes to the Financial Statements
170 Ford Motor Company | 2010 Annual Report
NOTE 28. SEGMENT INFORMATION (Continued)
Ford South America segment includes primarily the sale of Ford-brand vehicles and related service parts and
accessories in South America.
Ford Europe segment includes primarily the sale of Ford-brand vehicles and related service parts and accessories in
Europe (including all parts of Turkey and Russia).
Ford Asia Pacific Africa segment includes primarily the sale of Ford-brand vehicles and related service parts and
accessories in the Asia Pacific region and South Africa. Revenue from certain vehicles (specifically, Ford brand vehicles
produced and distributed by our unconsolidated affiliates, as well as by our Chinese unconsolidated affiliate Jiangling
Motors Corporation (JMC) brand vehicles) is not included in our revenue.
The Mazda segment, in 2008, included the equity income/(loss) associated with our investment in Mazda (33.4% of
Mazda's profit after tax before the sale of a portion of our investment in November 2008), as well as certain of our Mazda-
related investments. Beginning with the fourth quarter of 2008, our remaining investment in Mazda was reduced and
treated as marketable securities – all mark-to-market adjustments are recorded in Other Automotive. As of
November 2008, our investment in Mazda was reduced to approximately 11%; in November 2010, it was reduced to
approximately 3.5%.
Prior to the sale of the brand, the Volvo segment included primarily the sale of Volvo-brand vehicles and related
service parts throughout the world (including in North America, South America, Europe, Asia Pacific, and Africa), which
were reported as operating results through 2009. In August 2010 we completed the sale of Volvo. Results for Volvo are
reported as special items in 2010 and as segment operating results in 2009 and 2008.
Prior to the sale of the brand, the Jaguar Land Rover segment included primarily the sale of Jaguar Land Rover
vehicles and related service parts throughout the world (including in North America, South America, Europe, Asia Pacific,
and Africa). In June 2008, we completed the sale of Jaguar Land Rover. Results for Jaguar Land Rover were reported as
special items in 2008.
The Other Automotive component of the Automotive sector consists primarily of centrally-managed net interest
expense and related fair market value adjustments.
Transactions among Automotive segments generally are presented on a "where-sold," absolute-cost basis, which
reflects the profit/(loss) on the sale within the segment making the ultimate sale to an external entity. This presentation
generally eliminates the effect of legal entity transfer prices within the Automotive sector for vehicles, components, and
product engineering. Beginning with the first quarter of 2008, until their sale in June 2008 and August 2010, respectively,
income/(loss) before income taxes on vehicle component sales by Jaguar Land Rover or Volvo to each other or to any
other segment and by the Ford-brand segments to either Jaguar Land Rover or Volvo were reflected in the results for the
segment making the vehicle component sale.
Financial Services Sector
The Financial Services sector includes the following segments: 1) Ford Credit, and 2) Other Financial Services. Ford
Credit provides vehicle-related financing, leasing, and insurance. Other Financial Services includes a variety of
businesses including holding companies, real estate, and the financing and leasing of some Volvo vehicles in Europe.
Special Items
In the second quarter of 2010, we changed our presentation of special items. We now show special items as a
separate reconciling item to reconcile segment results to consolidated results of the Company. These special items
include (i) personnel and dealer-related items stemming from our efforts to match production capacity and cost structure
to market demand and changing model mix, and (ii) certain infrequent significant items that we generally do not consider
to be indicative of our ongoing operating activities. Prior to this change, special items were included within the operating
segments and the Other Automotive reconciling item. Our current presentation reflects the fact that management
excludes these items from its review of the results of the operating segments for purposes of measuring segment
profitability and allocating resources. Results for prior periods herein are presented on the same basis.