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Management’s Discussion and Analysis of Financial Condition and Results of Operations
Ford Motor Company | 2010 Annual Report 33
Details of Automotive sector market share for selected markets for 2010 and 2009, along with the level of dealer
stocks as of December 31, 2010 and 2009, are shown below:
Dealer
DealerDealer
Dealer-
---Owned Stocks (a)
Owned Stocks (a)Owned Stocks (a)
Owned Stocks (a)
Market Share
Market ShareMarket Share
Market Share
(in thousands)
(in thousands)(in thousands)
(in thousands)
Market
MarketMarket
Market
2010
20102010
2010
2009
20092009
2009
2010
20102010
2010
Over/(Under)
Over/(Under)Over/(Under)
Over/(Under)
2009
20092009
2009
2010
20102010
2010
2009
20092009
2009
2010
20102010
2010
Over/(Under)
Over/(Under)Over/(Under)
Over/(Under)
2009
20092009
2009
United States (b)............................... 16.4% 15.3% 1.1 pts.
394 382 12
South America (b) (c)........................ 9.8 10.2 (0.4) 52 53 (1)
Europe (b) (d) ................................... 8.4 9.1 (0.7) 213 202 11
Asia Pacific Africa (e)........................ 2.4 2.3 0.1 75 40 35
_________
(a) Dealer-owned stocks represent our estimate of vehicles shipped to our customers (dealers) and not yet sold by the dealers to their retail
customers.
(b) Includes only Ford and, in certain markets (primarily United States), Lincoln and Mercury brands.
(c) South America market share and dealer-owned stocks are based on our six major markets (Argentina, Brazil, Chile, Colombia, Ecuador and
Venezuela); market share represents, in part, estimated vehicle registrations.
(d) Europe market share and dealer-owned stocks are based on the 19 European markets we track.
(e) Asia Pacific Africa market share and dealer-owned stocks are based on our 12 major markets (Australia, China, Japan, India, Indonesia,
Malaysia, New Zealand, Philippines, South Africa, Taiwan, Thailand and Vietnam), including JMC-brand vehicles sold in China by our
unconsolidated affiliates; market share represents, in part, estimated vehicle sales; dealer-owned stocks include units distributed for other
manufacturers.
In the United States, continued consumer awareness of our improvements in quality and fuel efficiency are driving
strong consideration and demand for Ford products, which has enabled us to achieve market share gains and improve
net pricing. In South America, the decrease in market share primarily reflects planned lower production in Venezuela. In
Europe, the decrease in market share reflects our decision to reduce participation selectively in low-margin business, as
well as the end of the favorable effect of government scrappage programs on our small car sales. In Asia Pacific Africa,
the increase in market share primarily reflects share gains in India, as well as China, driven by new model introductions.
Total costs and expenses for our Automotive sector for 2010 and 2009 was $113.5 billion and $107.2 billion,
respectively, a difference of $6.3 billion. An explanation of the change is shown below (in billions):
2010
(Over)/Under
2009
Explanation of Change:
Volume and Mix, and Exchange................................................................................................
................................
$ (11.6)
Material Costs Excluding Commodity Costs (a) ................................................................
................................
1.1
Commodity Costs (a) ................................................................................................................................
................
(1.0)
Structural Costs (a) ................................................................................................................................
...................
(1.2)
Warranty / Other (a) ................................................................................................................................
..................
0.1
Special Items / Other (b) ................................................................................................
................................
6.3
Total................................................................................................................................
................................
$ (6.3)
(a) Our key cost change elements are measured primarily at present-year exchange; in addition, costs that vary directly with volume, such as
material, freight and warranty costs, are measured at present-year volume and mix. Excludes special items/other (primarily changes in
Volvo costs and expenses reflecting the sale of these operations).
(b) Primarily reflects changes in Volvo costs and expenses.
Total Automotive Excluding Special Items. The improvement in results primarily reflects favorable volume and mix
(about $3.4 billion), net pricing (mainly in North America) (about $3.1 billion), changes in currency exchange (about
$900 million), and the non-recurrence of Volvo operating losses from 2009 (about $700 million), offset partially by
unfavorable cost changes (about $1 billion, as described in the table below) and higher net interest expense (about
$400 million). Favorable volume and mix primarily reflects higher industry volumes (about $1.7 billion), market share
improvements in North America (about $1 billion), and the non-recurrence of prior-year stock reductions (about
$900 million), offset partially by lower market share in Europe (about $700 million).