~~Report of Independent Registered Public Accounting Firm~~

~~To the Board of Directors and Shareholder of~~

~~Ford Motor Credit Company LLC:~~

We have reviewed the accompanying consolidated balance sheet of Ford Motor Credit Company LLC and its subsidiaries as of September 30, 2017 and the related consolidated statements of income and comprehensive income for the three-month and nine-month periods ended September 30, 2017 and 2016 and the consolidated statement of shareholder’s interest and condensed consolidated statement of cash flows for the nine-month periods ended September 30, 2017 and 2016. These interim financial statements are the responsibility of the Company’s management.

We conducted our review in accordance with the standards of the Public Company Accounting Oversight Board (United States). A review of interim financial information consists principally of applying analytical procedures and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with the standards of the Public Company Accounting Oversight Board (United States), the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.

Based on our review, we are not aware of any material modifications that should be made to the accompanying consolidated interim financial statements for them to be in conformity with accounting principles generally accepted in the United States of America.

We previously audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheet as of December 31, 2016, and the related consolidated statements of income, comprehensive income, shareholder’s interest, and of cash flows for the year then ended (not presented herein), and in our report dated February 9, 2017, except with respect to our opinion on the consolidated financial statements insofar as it relates to the change in composition of reportable segments discussed in Note 17, as to which the date is April 27, 2017, we expressed an unqualified opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying consolidated balance sheet information as of December 31, 2016, is fairly stated, in all material respects, in relation to the consolidated balance sheet from which it has been derived.

~~/s/ PricewaterhouseCoopers LLP~~

~~PricewaterhouseCoopers LLP~~

~~Detroit, Michigan~~

~~October 26, 2017~~

ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

~~Results of Operations~~Definitions and Information Regarding Causal Factors

~~Overview~~

In general, we measure ~~period-to-period~~year-over-year changes in ~~pre-tax results~~EBT using the causal factors listed below:

~~Volume and Mix~~ ~~– Volume and Mix are primarily reflected within~~ ~~Net financing margin~~ ~~on the income statement.~~


•	Volume and Mix – Volume and Mix are primarily reflected within Net financing margin on the income statement.

◦

Volume primarily measures changes in net financing margin driven by changes in average managed receivables at prior period financing margin yield (defined below in financing margin) at prior period exchange rates. Volume changes are primarily driven by the volume of new and used ~~vehicle sales~~vehicles sold and ~~leases,~~leased, the extent to which we purchase retail installment sale and finance lease contracts (retail financing) and operating lease contracts, the extent to which we provide wholesale financing, the sales price of the vehicles financed, the level of dealer inventories, Ford-sponsored special financing programs available exclusively through us, and the availability of cost-effective ~~funding for the purchase of retail installment sale and lease contracts and to provide wholesale financing.~~funding.


◦	Mix primarily measures changes in net financing margin driven by ~~period over period~~period-over-period changes in the composition of our average managed receivables by product ~~and by country or~~within each region.


~~��~~•	Financing Margin – Financing Margin is reflected within Net financing margin on the income statement.

◦

Financing margin variance is the period-to-period change in financing margin yield multiplied by the present period average managed receivables at prior period exchange rates. This calculation is performed at the product and country level and then aggregated. Financing margin yield equals revenue, less interest expense and scheduled depreciation for the period, divided by average managed receivables for the same period.


◦	Financing margin changes are driven by changes in revenue and interest expense. Changes in revenue are primarily driven by the level of market interest rates, cost assumptions in pricing, mix of business, and competitive environment. Changes in interest expense are primarily driven by the level of market interest rates, borrowing spreads, and asset-liability management.

~~Credit Loss~~ ~~– Credit Loss is reflected within the~~ ~~Provision for credit losses~~ ~~on the income statement.~~


•	Credit Loss – Credit Loss is reflected within the Provision for credit losses on the income statement.


◦	Credit loss is the change in the provision for credit losses at prior period exchange rates. For analysis purposes, management splits the provision for credit losses into net charge-offs and the change in the allowance for credit losses.


◦	Net charge-off changes are primarily driven by the number of repossessions, severity per repossession, and recoveries. Changes in the allowance for credit losses are primarily driven by changes in historical trends in credit losses and recoveries, changes in the composition and size of our present portfolio, changes in trends in historical used vehicle values, and changes in economic conditions.

◦

As of January 1, 2019, we changed our accounting method for reporting early termination losses related to customer defaults on operating leases. Prior to the first quarter of 2019, we presented the early termination loss reserve on operating leases due to customer default events as part of the allowance for credit losses which reduces Net investment in operating leases on the balance sheet. On the income statement, the incurred losses were included in Provision for credit losses. We now consider the effects of operating lease early terminations when determining depreciation estimates, which are included as part of accumulated depreciation within Net investment in operating leases on the balance sheet, and Depreciation on vehicles subject to operating leases on the income statement. We believe this change in accounting method is preferable as the characterization of these changes is better reflected as depreciation. We have reclassified prior period amounts to reflect these changes. For additional information, refer to the “Critical Accounting Estimates –- Allowance for Credit Losses” section of Item 7 of ~~Exhibit 99 to~~Part II of our ~~Current Report on~~2018 Form ~~8-K dated April 27, 2017 (“April 27, 2017 Form 8-K Report”).~~10-K Report.

~~Lease Residual~~ ~~– Lease Residual is reflected within~~ ~~Depreciation on vehicles subject to operating leases~~ ~~on the income statement.~~25

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)


•	Lease Residual – Lease Residual is primarily reflected within Depreciation on vehicles subject to operating leases on the income statement.


◦	Lease residual measures changes to residual performance at prior period exchange rates. For analysis purposes, management splits residual performance primarily into residual gains and losses, and the change in accumulated supplemental depreciation.

◦

Residual gain and loss changes are primarily driven by the number of vehicles returned to us and sold, and the difference between the auction value and the depreciated value (which includes both base and accumulated supplemental depreciation) of the vehicles sold. Changes in accumulated supplemental depreciation are primarily driven by changes in our estimate of the expected auction value at the end of the lease term, and changes in our estimate of the number of vehicles that will be returned to us and sold. With the change in accounting method discussed above, Depreciation on vehicles subject to operating leases now reflects early termination losses on operating leases due to customer default events for all periods presented. For additional information, refer to the “Critical Accounting Estimates” section of Item 7 of ~~Exhibit 99 to~~Part II of our ~~April 27, 2017~~2018 Form ~~8-K~~10-K Report.


•	Exchange – Reflects changes in EBT driven by the effects of converting functional currency income to U.S. dollars.

~~Exchange~~ ~~– Reflects changes in pre-tax results driven by the effects of converting functional currency income to U.S. dollars and is reflected in all lines on the income statement.~~

~~Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)~~

~~Other~~ ~~– Primarily includes~~ ~~Operating expenses~~, ~~Other revenue~~, ~~Insurance expenses,~~ ~~and~~ ~~Other income, net~~ ~~on the income statement at prior period exchange rates.~~


•	Other– Primarily includes Operating expenses, Other revenue, Insurance expenses, and Other income, net on the income statement at prior period exchange rates.


◦	Changes in operating expenses are primarily driven by salaried personnel costs, facilities costs, and costs associated with the origination and servicing of customer contracts.


◦	In general, ~~Other~~other income ~~net~~ changes are primarily driven by changes in earnings related to market valuation adjustments to derivatives (primarily related to movements in interest rates), which are included in ~~Unallocated Other,~~unallocated risk management, and other miscellaneous items.

In addition, the following definitions and calculations apply to the ~~charts~~tables contained in Item 2 of this report:


•	Cash (as shown in the Funding Structure, Liquidity, and Leverage tables) – Cash and cash equivalents and Marketable securities reported on Ford Credit’s balance sheet, excluding amounts related to insurance activities

•

Debt (as shown in the Key Metrics and Leverage tables) – Debt on Ford Credit’s balance sheet. Includes debt issued in securitizations and payable only out of collections on the underlying securitized assets and related enhancements. Ford Credit holds the right to receive the excess cash flows not needed to pay the debt issued by, and other obligations of, the securitization entities that are parties to those securitization transactions


•	Earnings Before Taxes (EBT) – Reflects Income before income taxes as reported on Ford Credit’s income statement


•	Return on Equity (ROE) (as shown in the Key Metrics table) – Reflects return on equity calculated by annualizing net income for the period and dividing by monthly average equity for the period


•	Securitizations (as shown in the Public Term Funding Plan table) – Public securitization transactions, Rule 144A offerings sponsored by Ford Credit, and widely distributed offerings by Ford Credit Canada


•	Securitization Cash (as shown in the Liquidity table) – Cash held for the benefit of the securitization investors (for example, a reserve fund)


•	Term Asset-Backed Securities (as shown in the Funding Structure table) – Obligations issued in securitization transactions that are payable only out of collections on the underlying securitized assets and related enhancements

~~Cash~~ ~~(as shown on the Funding Structure, Liquidity Sources, and Leverage charts) –~~ ~~Cash and cash equivalents~~ ~~and~~ ~~Marketable securities~~ ~~reported on Ford Credit’s balance sheet, excluding amounts related to insurance activities~~26

~~Securitizations~~ ~~(as shown on the Public Term Funding Plan chart) – Public securitization transactions, Rule 144A offerings sponsored by Ford Motor Credit, and widely distributed offerings by Ford Credit Canada~~

~~Term Asset-Backed Securities~~ ~~(as shown on the Funding Structure chart) – Obligations issued in securitization transactions that are payable only out of collections on the underlying securitized assets and related enhancements~~

~~Total Debt~~ ~~(as shown on the Leverage chart) –~~ ~~Debt~~ on Ford Credit’s balance sheet. Includes debt issued in securitizations and payable only out of collections on the underlying securitized assets and related enhancements. Ford Credit holds the right to receive the excess cash flows not needed to pay the debt issued by, and other obligations of, the securitization entities that are parties to those securitization transactions

~~Unallocated Other~~ (as shown on the Pre-Tax Results by Segment chart) – Items excluded in assessing segment performance because they are managed at the corporate level, including market valuation adjustments to derivatives and exchange-rate fluctuations on foreign currency-denominated transactions

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

•

Total Net Receivables (as shown in the Key Metrics and Financial Condition tables) – Includes finance receivables (retail financing and wholesale) sold for legal purposes and net investment in operating leases included in securitization transactions that do not satisfy the requirements for accounting sale treatment. These receivables and operating leases are reported on Ford Credit’s balance sheet and are available only for payment of the debt issued by, and other obligations of, the securitization entities that are parties to those securitization transactions; they are not available to pay the other obligations of Ford Credit or the claims of Ford Credit’s other creditors


•	Unallocated Other (as shown in the Segment Results table) – Items excluded in assessing segment performance because they are managed at the corporate level, including market valuation adjustments to derivatives and exchange-rate fluctuations on foreign currency-denominated transactions

~~Third Quarter 2017 Compared with Third Quarter 2016~~

Key Metrics

~~The following chart shows our key metrics:~~



	Third Quarter									First Nine Months
GAAP Financial Measures	2018			2019			H / (L)			2018			2019			H / (L)
Net Receivables (billions)	$	144		$	140		(3		)%	$	144		$	140		(3		)%
Loss-to-Receivables (bps) (a)	51			51			—			50			48			(2		)
Auction Values (b)	$	19,190		$	18,865		(2		)%	$	18,415		$	18,160		(1		)%
EBT (millions)	$	678		$	736		$	58		$	1,964		$	2,368		$	404
ROE (%)	13		%	15		%	2 ppts			14		%	16		%	2 ppts

Other Balance Sheet Metrics
Debt (billions)										$	138		$	139		1		%
Net Liquidity (billions)										$	29		$	35		22		%
Financial Statement Leverage (to 1)										9.1			9.8			0.7

__________


(a)	U.S. Retail financing only, previously included both retail financing and operating leases


(b)	U.S. 36-month off-lease third quarter auction values at 3Q 2019 mix and YTD amounts at 2019 YTD mix



Non-GAAP Financial Measures	September 30, 2018		September 30, 2019		H / (L)
Managed Receivables (billions) (a)	$	152	$	149	(2	)%
Managed Leverage (to 1) (b)	8.4		8.8		0.4

__________


(a)	See “Financial Condition” section for reconciliation to GAAP


(b)	See “Leverage” section for reconciliation to GAAP

In the third quarter of ~~2017, pre-tax profit of $600~~2019, EBT was $736 million, ~~improved from last year.~~$58 million higher than a year ago. Receivables were ~~higher with growth globally led by retail receivables and the consolidation of $1.3 billion in receivables for the Forso joint venture~~lower than a year ago. Consumer credit metrics were healthy in the ~~Nordic region (“Forso”). For additional information, see Note 1 of our Notes to~~United States, with the ~~Financial Statements.~~

~~FICO scores remain strong, and our origination, servicing and collection practices continue to be disciplined and consistent. Portfolio performance was robust. The~~ loss-to-receivables ratio ~~of 53 basis points~~at 0.51%, which was ~~up 8 basis points and within~~flat compared with a year ago. U.S. auction values were 2% lower than a year ago, slightly better than our expectations.

~~In the third quarter, we distributed $378 million~~ROE was 15%, two percentage points higher compared with a year ago, primarily reflecting higher EBT. Our balance sheet remains strong with managed leverage within our target range of 8:1 to ~~our parent.~~9:1.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

~~On a pre-tax basis, we earned $600 million in the third quarter of 2017, compared~~Third Quarter 2019 Compared with ~~$567 million a year ago.~~ Third Quarter 2018

The following ~~chart~~table shows the factors that contributed to the strong third quarter ~~pre-tax profit:~~EBT (in millions):



Change in EBT by Causal Factor
Third Quarter 2018 EBT	$	678
Volume / Mix	(19		)
Financing Margin	5
Credit Loss	34
Lease Residual	6
Exchange	(8		)
Other	40
Third Quarter 2019 EBT	$	736

~~Ford Credit’s~~Our third quarter ~~pre-tax profit~~2019 EBT was ~~$33~~$736 million, $58 million higher ~~compared to the prior~~than a year ago, led ~~primarily~~ by ~~strong receivables growth~~favorable derivatives market valuation and ~~lease residual performance.~~

~~Unfavorable~~improved operating costs, which are both reflected in other. Favorable credit loss performance primarily reflects ~~an increase~~the non-recurrence of a non-consumer loss recognized in ~~reserves~~the third quarter of 2018. Unfavorable volume and ~~higher actual losses~~mix, which was driven ~~primarily~~ by ~~higher defaults.~~lower receivables, was a partial offset.

~~Other includes unfavorable derivatives market valuation, higher operating costs and a pre-tax loss of $17 million related to the consolidation of the Forso joint venture.~~

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

Segment Results

We have three reportable segments in our consolidated financial statements that align with our management reporting structure and reflect the manner in which our Chief Operating Decision Maker manages our business, including resource allocation and performance assessment. These segments are: the Americas, Europe, and Asia Pacific. Items excluded in assessing segment performance, because they are managed at the corporate level, are reflected in Unallocated Other. Results of operations by segment and Unallocated Other for the ~~period~~periods ended September 30 are shown below (in millions). :



	Third Quarter									First Nine Months
	2018			2019			H / (L)			2018			2019			H / (L)
Results
Americas segment	$	556		$	584		$	28		$	1,619		$	1,836		$	217
Europe segment	89			82			(7		)	303			314			11
Asia Pacific segment	13			15			2			86			64			(22		)
Total segments	$	658		$	681		$	23		$	2,008		$	2,214		$	206
Unallocated other	20			55			35			(44		)	154			198
Earnings before taxes	$	678		$	736		$	58		$	1,964		$	2,368		$	404
(Provision for) / Benefit from income taxes	(160		)	(165		)	(5		)	(266		)	(581		)	(315		)
Net Income	$	518		$	571		$	53		$	1,698		$	1,787		$	89

For additional information, see Note 14 of our Notes to the Financial Statements.

Americas ~~Segment~~segment

The Americas ~~Segment~~segment third quarter ~~pre-tax profit is~~2019 EBT of $584 million was $28 million higher compared with ~~2016,~~third quarter 2018, explained primarily by favorable credit loss performance, driven by the non-recurrence of a non-consumer loss recognized in the third quarter of 2018, and favorable operating lease residual performance, ~~driven~~partially offset by ~~lower supplemental depreciation on the lease portfolio.~~

~~The~~unfavorable volume and mix. Americas ~~Segment pre-tax profit~~segment EBT of ~~$1.3~~$1.8 billion for the first nine months of ~~2017 is $140~~2019 was $217 million higher compared with ~~2016, more than~~a year ago, explained primarily by favorable ~~volume~~operating lease residual and ~~mix.~~credit loss performance, partially offset by unfavorable financing margin.

Europe ~~Segment~~segment

The Europe ~~Segment~~ segment third quarter ~~pre-tax profit is~~2019 EBT of $82 million was $7 million lower compared with ~~2016,~~third quarter 2018, explained primarily by ~~a pre-tax~~unfavorable changes in lease residual value reserves and credit loss ~~of $17 million upon consolidation of our Forso joint venture in the Nordic region,~~performance, partially offset by favorable volume and mix.

~~The~~ Europe ~~Segment pre-tax profit~~segment EBT of ~~$223~~$314 million for the first nine months of ~~2017 is $34~~2019 was $11 million lower compared with 2016, explained primarily by lower financing margin driven by lower yields and a pre-tax loss of $17 million upon consolidation of our Forso joint venture, partially offset by favorable volume and mix.

~~Asia Pacific Segment~~

~~The Asia Pacific Segment third quarter pre-tax profit is~~ higher compared with ~~2016,~~a year ago, explained primarily by favorable volume and mix, partially offset by ~~lower financing margin driven by higher borrowing costs.~~unfavorable exchange.

Asia Pacific segment

The Asia Pacific ~~Segment pre-tax profit~~segment third quarter 2019 EBT of ~~$69~~$15 million was $2 million higher compared with third quarter 2018, explained primarily by favorable credit loss and financing margin performance, partially offset by unfavorable volume and mix. Asia Pacific segment EBT of $64 million for the first nine months of ~~2017 is $23~~2019 was $22 million ~~higher~~lower compared with ~~2016,~~a year ago, explained primarily by ~~favorable~~unfavorable volume and mix, partially offset by ~~lower~~favorable credit loss and financing margin ~~driven by higher borrowing cost.~~performance.

Unallocated Other

Unallocated Other was a $55 million gain for third quarter 2019, a $35 million improvement from third quarter 2018, reflecting favorable performance in market valuation adjustments to derivatives. Unallocated Other was a $154 million gain for the first nine months of 2019, a $198 million improvement compared with a year ago, reflecting favorable performance in market valuation adjustments to derivatives.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

~~Unallocated Other~~

Unallocated Other in the third quarter is lower compared with 2016, reflecting primarily less favorable performance in market valuation adjustments to derivatives. For additional information, see Notes 9 and 14 of our Notes to the Financial Statements.

Unallocated Other pre-tax profit of $100 million for the first nine months of 2017 is $90 million higher compared with 2016, reflecting primarily favorable performance in market valuation adjustments to derivatives.

Financing Shares and Contract Placement Volume

Our focus is on supporting Ford and Lincoln dealers and customers. This includes going to market with Ford and our dealers to support vehicle sales with financing products and marketing programs. Ford’s marketing programs may encourage or require Ford Credit financing and influence the financing choices customers make. As a result, our financing share, volume, and contract characteristics vary from ~~quarter~~period to ~~quarter~~period as Ford’s marketing programs ~~change.~~change.

The following ~~chart~~table shows our ~~United States~~retail financing and ~~Canada retail installment and~~operating lease share of new ~~Ford-~~Ford and ~~Lincoln-brand vehicle retail~~Lincoln brand sales, ~~and~~ wholesale financing share of new ~~Ford-~~Ford and ~~Lincoln-brand~~Lincoln brand vehicles acquired by ~~dealers. Also shown is Americas’ consumer financing~~dealers (in percent), and contract placement volume for new and used ~~vehicles. All data is for the periods ended September 30:~~vehicles (in thousands):



	Third Quarter				First Nine Months
	2018		2019		2018		2019
Share of Ford and Lincoln Sales (a)
United States	59	%	57	%	59	%	52	%
Canada	69		57		73		63
U.K.	36		40		37		39
Germany	47		44		50		47
Total Europe segment	38		37		37		37
China	37		35		34		34

Wholesale Share
United States	76	%	76	%	76	%	76	%
Canada	57		57		59		57
U.K.	100		100		100		100
Germany	94		93		93		93
Total Europe segment	99		98		98		98
China	64		59		61		61

Contract Placement Volume - New and Used (000)
Americas segment	356		318		1,028		821
Europe segment	124		121		419		393
Asia Pacific segment	47		27		139		86
Total	527		466		1,586		1,300

__________


(a)	United States and Canada exclude Fleet sales, other markets include Fleet

In the third quarter of ~~2017, U.S. retail~~2019, Americas segment and ~~lease share and total~~Europe segment contract placement volume were down compared towith a year ago, primarily reflecting lower financing share. In the ~~prior~~third quarter of 2019, Asia Pacific segment contract placement volume was down compared with a year ~~reflecting changes~~ago, more than explained by lower Ford sales in ~~Ford’s marketing programs.~~China.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

Financial Condition

Our receivables, including finance receivables and operating leases, were as follows (in billions):



	September 30, 2018			December 31, 2018			September 30, 2019
Net Receivables
Americas Segment
Consumer financing	$	56.7		$	56.5		$	55.2
Non-Consumer financing	28.9			32.1			29.6
Net investment in operating leases	27.1			27.0			27.0
Total Americas Segment	$	112.7		$	115.6		$	111.8

Europe Segment
Consumer financing	$	15.5		$	15.5		$	15.4
Non-Consumer financing	9.4			9.6			9.0
Net investment in operating leases	0.5			0.4			0.5
Total Europe Segment	$	25.4		$	25.5		$	24.9

Asia Pacific Segment
Consumer financing	$	4.0		$	3.8		$	2.8
Non-Consumer financing	1.5			1.4			0.8
Net investment in operating leases	—			—			—
Total Asia Pacific Segment	$	5.5		$	5.2		$	3.6

Total net receivables	$	143.6		$	146.3		$	140.3

Managed Receivables
Total net receivables (GAAP)	$	143.6		$	146.3		$	140.3
Unearned interest supplements and residual support	6.7			6.8			6.8
Allowance for credit losses	0.6			0.6			0.5
Other, primarily accumulated supplemental depreciation	1.2			1.2			1.1
Total managed receivables (Non-GAAP)	$	152.1		$	154.9		$	148.7

Americas Segment Lease Mix
SUV / CUV	55		%	56		%	57		%
Truck	27			27			30
Car	18			17			13

At September 30, 2018, December 31, 2018, and September 30, 2019, total net receivables includes consumer receivables before allowance for credit losses of $38.8 billion, $40.7 billion, and $37.8 billion, respectively, and non-consumer receivables before allowance for credit losses of $23.3 billion, $25.7 billion, and $24.0 billion, respectively, that have been sold for legal purposes in securitization transactions but continue to be reported in our consolidated financial statements. In addition, at September 30, 2018, December 31, 2018, and September 30, 2019, total net receivables includes net investment in operating leases of $12.4 billion, $16.3 billion, and $12.7 billion, respectively, that have been included in securitization transactions but continue to be reported in our consolidated financial statements. The ~~following chart shows Europe’s retail installment~~receivables and ~~lease share~~net investment in operating leases are available only for payment of ~~new Ford-brand vehicles sold~~the debt issued by, and ~~wholesale financing share~~other obligations of, ~~new Ford-brand vehicles acquired~~the securitization entities that are parties to those securitization transactions; they are not available to pay the other obligations or the claims of Ford Credit’s other creditors. Ford Credit holds the right to receive the excess cash flows not needed to pay the debt issued by, ~~dealers. Also shown is Europe’s consumer financing contract placement volume for new~~ and ~~used vehicles. All data is~~other obligations of, the securitization entities that are parties to those securitization transactions. For additional information on our securitization transactions, refer to the “Securitization Transactions” and “On-Balance Sheet Arrangements” sections of Item 7 of Part II of our 2018 Form 10-K Report and Note 7 of our Notes to the Financial Statements for the ~~periods~~period ended September ~~30:~~30, 2019.

Our operating lease portfolio is managed and was 20% of total net receivables at September 30, 2019. Leasing is an important product, and our leasing strategy balances sales, share, residuals, and long-term profitability. Operating leases in the United States and Canada represent 98% of our total operating lease portfolio.

~~In the third quarter of 2017, Europe Segment financing share and contract volume were similar to the prior year.~~

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

The following chart shows Asia Pacific’s retail installment share of new Ford-brand vehicles sold by dealers and wholesale financing share of new Ford-brand vehicles acquired by dealers. Also shown is Asia Pacific’s consumer financing contract placement volume for new and used vehicles. All data is for the periods ended September 30:

~~In the third quarter of 2017, Asia Pacific Segment total contract volume was up 55% compared with the prior year, reflecting changes in Ford’s marketing programs.~~

~~Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)~~

~~Financial Condition~~

~~Finance Receivables and Operating Leases~~

~~Our receivables, including finance receivables and operating leases, were as follows:~~

Our operating lease portfolio is prudently managed and is about 20% of total net receivables. Leasing is an important product and our leasing strategy balances sales, share, residuals, and long-term profitability. Our operating leases in the U.S. and Canada represent 99% of our total operating lease portfolio.

~~Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)~~

~~The following chart shows our reconciliation for our Non-GAAP financial measure, managed receivables:~~

~~__________~~

At December 31, 2015, September 30, 2016, December 31, 2016, and September 30, 2017, includes consumer receivables before allowance for credit losses of $27.6 billion, $29.9 billion, $32.5 billion, and $35.2 billion, respectively, and non-consumer receivables before allowance for credit losses of $26.1 billion, $23.3 billion, $26.0 billion, and $23.6 billion, respectively, that have been sold for legal purposes in securitization transactions but continue to be reported in our consolidated financial statements. In addition, at December 31, 2015, September 30, 2016, December 31, 2016, and September 30, 2017, includes net investment in operating leases before allowance for credit losses of $13.3 billion, $10.0 billion, $11.8 billion, and $9.9 billion, respectively, that have been included in securitization transactions but continue to be reported in our consolidated financial statements. The receivables and net investment in operating leases are available only for payment of the debt issued by, and other obligations of, the securitization entities that are parties to those securitization transactions; they are not available to pay the other obligations or the claims of Ford Credit’s other creditors. Ford Credit holds the right to receive the excess cash flows not needed to pay the debt issued by, and other obligations of, the securitization entities that are parties to those securitization transactions. For additional information on our securitization transactions, refer to the “Securitization Transactions” and “On-Balance Sheet Arrangements” sections of Item 7 of Exhibit 99 to our April 27, 2017 Form 8-K Report and Note 7 of our Notes to the Financial Statements for the period ended September 30, 2017.

~~Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)~~

Credit Risk

Credit risk is the possibility of loss from a customer’s or dealer’s failure to make payments according to contract terms. Credit losses are a normal part of a ~~financing~~lending business, and credit risk has a significant impact on our business. We ~~actively~~ manage the credit risk of our consumer (retail ~~financing and operating lease)~~financing) and non-consumer (dealer financing) receivables to balance our level of risk and return using our consistent underwriting standards, effective proprietary scoring system (discussed below), and world-class servicing. The allowance for credit losses (also referred to as the credit loss reserve) represents our estimate of the probable credit losses inherent in our finance receivables ~~and operating leases~~ as of the balance sheet date. The allowance for credit losses is estimated using a combination of models and management judgment, and is based on such factors as historical loss performance, portfolio quality, and receivable levels. The adequacy of our allowance for credit losses is assessed quarterly and the assumptions and models used in establishing the allowance are evaluated regularly. A description of our allowance setting process is provided in the “Critical Accounting Estimates - Allowance for Credit Losses” section of Item 7 of ~~Exhibit 99~~Part II to our ~~April 27, 2017~~2018 Form ~~8-K~~10-K Report.

Most of our charge-offs are related to retail ~~finance and operating lease contracts.~~financing. Charge-offs are affected by the number of vehicle repossessions, the unpaid balance outstanding at the time of repossession, the auction price of repossessed vehicles, and other charge-offs. We also incur credit losses on our dealer financing, but default rates for these receivables historically have been substantially lower than those for retail ~~finance and operating lease contracts.~~financing. For additional information on severity, refer to the “Critical Accounting Estimates - Allowance for Credit Losses” section of Item 7 of ~~Exhibit 99~~Part II to our ~~April 27, 2017~~2018 Form ~~8-K~~10-K Report.

In purchasing retail ~~finance and operating lease~~financing contracts, we use a proprietary scoring system that measures credit quality using information in the credit application, proposed contract terms, credit bureau data, and other ~~information we obtain.~~information. After a proprietary risk score is generated, we decide whether to purchase a contract using a decision process based on a judgmental evaluation of the applicant, the credit application, the proposed contract terms, credit bureau information (e.g., FICO score), proprietary risk score, and other information. Our evaluation emphasizes the applicant’s ability to pay and creditworthiness focusing on payment, affordability, applicant credit history, and stability as key considerations. While FICO is a part of our scoring system, our models enable us to more effectively determine the probability that a customer will pay than using credit scores alone. When we originate business, our models project expected losses and we price accordingly. We ensure the business fits our risk appetite. For additional information on the quality of our receivables, see Note 4 of our Notes to the Financial Statements.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

U.S. Origination Metrics

The following table shows U.S. retail financing and operating lease average placement FICO and higher risk portfolio mix metrics. Also shown are extended term mix and U.S. retail financing average placement terms.



	Third Quarter				First Nine Months
	2018		2019		2018		2019
Origination Metrics
Average placement FICO	747		750		745		746
Higher risk portfolio mix	6	%	6	%	6	%	6	%
Greater than or equal to 84 months placement mix	4	%	3	%	4	%	4	%
Average placement term (months)	66		66		65		65

Our third quarter 2019 average placement FICO score remained strong. We support customers across the credit spectrum. Our higher risk business, as classified at contract inception, consistently represents ~~5%-6%~~6% of our portfolio and has been stable for over 10 years.

~~The following charts show quarterly trends for FICO and higher risk mix and retail contract terms:~~

~~The third quarter average placement FICO score remained consistent.~~

Our average retail financing placement term iswas unchanged from ~~the prior~~a year ago, and retail financing contracts of 7384 months and longer continued to be a ~~relatively~~ small part of our business. Ford Credit remains focused on managing the trade cycle –- building customer relationships and loyalty while offering financing products and terms customers want.

Ford ~~Credit’s~~Credit origination and risk management processes deliver robust portfolio performance.

U.S. Retail Financing Credit Losses

The following table shows the primary drivers of credit losses in the U.S. retail financing business, which comprised 62% of our worldwide consumer finance receivables at September 30, 2019.



	Third Quarter						First Nine Months
	2018			2019			2018			2019
Credit Loss Drivers
Over-60-Day delinquencies (excl. bankruptcies)	0.14		%	0.14		%	0.13		%	0.12		%
Reposessions (000)	7			7			21			20
Reposession ratio	1.26		%	1.32		%	1.28		%	1.23		%
Loss severity (000) (a)	$	9.8		$	10.3		$	10.3		$	10.5
Charge-offs (millions)	$	61		$	61		$	178		$	171
LTR ratio (b)	0.51		%	0.51		%	0.50		%	0.48		%

__________


(a)	The expected difference between the amount a customer owes when the finance contract is charged off and the amount received, net of expenses, from selling the repossessed vehicle

(b) Loss-to-Receivables (“LTR”) ratios are charge-offs divided by average finance receivables

Compared with a year ago, third quarter delinquencies were flat, while the repossession rate and severity were slightly higher. Our third quarter 2019 charge-offs and LTR ratio were flat compared with a year ago. Credit loss metrics remained strong, reflecting a healthy business environment and consumer credit conditions.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

Worldwide Credit Losses

The following table shows key metrics related to worldwide credit losses:



	Third Quarter						First Nine Months
	2018			2019			2018			2019
Charge-offs (millions)	$	127		$	89		$	296		$	264
LTR ratio	0.43		%	0.30		%	0.33		%	0.29		%
Credit loss reserve (millions)	$	586		$	513		$	586		$	513
Reserve as percent of EOP Managed Receivables	0.49		%	0.44		%	0.49		%	0.44		%

Our worldwide charge-offs and LTR ratio were both lower than a year ago. The improvement primarily reflects the non-recurrence of a non-consumer loss recognized in the third quarter of 2018. Our credit loss reserve is based on such factors as historical loss performance, portfolio quality, and receivables level. The credit loss reserve and the reserve as a percent of managed receivables were both lower than a year ago.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

~~U.S. Credit Losses~~

~~The following charts show the primary drivers of credit losses in the U.S. retail and lease business, which comprised 70%of our worldwide consumer portfolio at September 30, 2017. Loss-to-Receivables (“LTR”) ratios are charge-offs on an annualized basis divided by average managed receivables.~~

~~Credit losses have been at historically low levels for quite some time. Third quarter 2017 charge-offs and the LTR ratio were higher than the prior year but within our placement expectations.~~

~~Compared to the prior year, delinquencies have shown a slight improvement while the repossession rate is higher. Both are within our expectations.~~

~~Severity has trended favorably during 2017, primarily reflecting an improved auction market.~~

~~Credit quality remains strong, reflecting a strong business environment and healthy consumer credit conditions.~~

~~Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)~~

~~Worldwide Credit Losses~~

The following charts show quarterly trends of charge-offs (credit losses, net of recoveries), LTR ratios, credit loss reserve, and our credit loss reserve as a percentage of end-of-period (“EOP”) managed receivables:

Our worldwide credit loss metrics remain strong. The worldwide LTR ratio in the third quarter of 2017 is higher than the same period in the prior year, reflecting primarily the U.S. retail and lease business as covered above.

Our credit loss reserve is based on such factors as historical loss performance, portfolio quality, and receivable levels. The credit loss reserve was higher at September 30, 2017, compared to September 30, 2016, reflecting credit loss performance trends and growth in receivables.

~~The reserve as a percent of managed receivables was up 4 basis points from the prior year.~~

~~Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)~~

Residual Risk

Leasing is an important product that many customers want and ~~value. Lease~~value, and operating lease customers also are more likely to buy or lease another Ford or Lincoln vehicle. ~~Ford and Ford Credit~~We manage our lease share with an enterprise view to support sales, protect residual values, and manage the trade cycle. ~~Our~~Ford Credit and Ford work together under a leasing strategy that considers share, term, model mix, geography, and other factors.

We are exposed to residual risk on operating leases and similar balloon payment products where the customer may return the financed vehicle to us. Residual risk is the possibility that the amount we obtain from returned vehicles will be less than our estimate of the expected residual value for the vehicle. We estimate the expected residual value by evaluating recent auction values, return volumes for our leased vehicles, ~~industry-wide~~industry wide used vehicle prices, marketing incentive plans, and vehicle quality data. For operating leases, changes in expected residual values impact ~~the~~ depreciation expense, which is recognized on a straight-line basis over the life of the lease.

For additional information on our residual risk on operating leases, refer to the “Critical Accounting Estimates -– Accumulated Depreciation on Vehicles Subject to Operating Leases” section of Item 7 of ~~Exhibit 99 to~~Part II of our ~~April 27, 2017~~2018 Form ~~8-K~~10-K Report.

U.S.~~Ford-~~ Ford and ~~Lincoln-Brand~~Lincoln Brand Operating ~~Lease Experience~~Leases

The following ~~charts show~~table shows share of Ford and Lincoln brand retail financing and operating lease sales, placement volume, and ~~lease share of Ford- and Lincoln-brand retail sales~~residual performance metrics for ~~vehicles in the respective periods. The~~our U.S. operating lease portfolio, ~~accounted for~~which represents 86% of our total net investment in operating leases at September 30, ~~2017.~~2019.



	Third Quarter						First Nine Months
	2018			2019			2018			2019
Lease Share of Retail Sales
Ford Credit	21		%	19		%	22		%	20		%
Industry (a)	29		%	29		%	30		%	30		%

Placement Volume (000)
24-Month	10			11			34			29
36-Month	80			68			213			172
39-Month / Other	5			4			45			46
Total	95			83			292			247

Residual Performance
Return rates	77		%	76		%	78		%	78		%
Return volume (000)	71			70			210			220
Off-lease auction values (b)	$	19,190		$	18,865		$	18,415		$	18,160

__________


(a)	Source: J.D. Power PIN


(b)	36-month off-lease auction values; quarterly amounts at 3Q 2019 mix and YTD amounts at 2019 YTD mix

~~Third quarter 2017 lease placement volume was up compared to the prior year, reflecting Ford’s higher lease mix.~~

~~Industry~~Ford Credit’s U.S. operating lease share of retail sales in the third quarter of ~~2017~~2019 was ~~down~~lower compared ~~to the same period last year. Ford Credit’s lease share was up compared to the prior~~with a year ago and remains below the industry, reflecting the Ford sales mix. Our third quarter 2019 lease placement volume was down compared with a year ago.

Lease return volume and return rate in the third quarter of 2019 were down from a year ago. Our third quarter 2019 36-month off-lease auction values were also down compared with a year ago.

We now expect full-year 2019 off-lease 36-month auction values to be around 2% lower compared with 2018 at constant mix.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

~~The following charts show lease return volumes, return rates, and off-lease auction values at constant third quarter 2017 vehicle mix in the respective periods:~~

Lease return volume in the third quarter of 2017 was up from the prior year, reflecting higher lease placements in recent years and an increased return rate. Our third quarter off-lease auction values were mixed compared to the same period a year ago, but have continued to improve each quarter since the fourth quarter of 2016.

~~We continue to plan for lower auction values but our outlook has improved. We now expect three-year full year 2017 auction values to be down about 3% compared with 2016 at constant mix.~~

~~Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)~~

Credit Ratings

Our short-term and long-term debt is rated by four credit rating agencies designated as nationally recognized statistical rating organizations (“NRSROs”) by the U.S. Securities and Exchange Commission: DBRS, Fitch, Moody’s, and S&P.

~~DBRS Limited (“DBRS”);~~

~~Fitch, Inc. (“Fitch”);~~

~~Moody’s Investors Service, Inc. (“Moody’s”); and~~

~~Standard & Poor’s Ratings Services, a division of McGraw Hill Financial (“S&P”).~~

In several markets, locally recognized rating agencies also rate us. A credit rating reflects an assessment by the rating agency of the credit risk associated with a corporate entity or particular securities issued by that entity. Rating agencies’ ratings of us are based on information provided by us and other sources. Credit ratings assigned to us from all of the NRSROs are closely associated with their opinions on Ford. Credit ratings are not recommendations to buy, sell, or hold securities and are subject to revision or withdrawal at any time by the assigning rating agency. Each rating agency may have different criteria for evaluating company risk and, therefore, ratings should be evaluated independently for each rating agency.

~~There have been no~~The following rating actions were taken by these NRSROs since the filing of our Quarterly Report on Form 10-Q for the quarter ended June 30, ~~2017.~~2019.

On September 9, 2019, Moody’s downgraded the credit rating for Ford Credit to non-investment grade (Ba1 from Baa3) and revised the outlook to stable from negative.

The following ~~chart~~table summarizes certain of the credit ratings and outlook presently assigned by these four NRSROs:

NRSRO RATINGS

Ford Credit

NRSROs

Long-Term Senior Unsecured

Short -Term Unsecured

~~Outlook /~~ Outlook/Trend

Minimum

Long-Term Investment Grade Rating

DBRS

BBB

R-2M

~~Stable~~Negative

BBB (low)

Fitch

BBB

~~Stable~~Negative

BBB-

Moody’s

~~Baa2~~Ba1

~~P-2~~NP

Stable

Baa3

S&P

BBB

A-2

~~Stable~~Negative

BBB-

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

Funding and Liquidity

Our primary funding ~~and liquidity~~ objective is to be well capitalized with a strong ~~investment grade~~ balance sheet and ample liquidity to support our financing activities and growth under a variety of market conditions, including short-term and long-term market disruptions.

Our funding strategy remains focused on diversification, and we plan to continue accessing a variety of markets, channels, and investors.

Our liquidity profile continues to be diverse, robust, and focused on maintaining liquidity levels that meet our business and funding requirements. We annually stress test our balance sheet and liquidity to ensure that we continue to meet our financial obligations through economic cycles.

~~Funding Portfolio~~

The following ~~chart~~table shows ~~the trends in~~ funding for our managed ~~receivables:~~receivables (in billions):



Funding Structure	September 30, 2018			December 31, 2018			September 30, 2019
Term Debt (incl. Bank Borrowings)	$	73		$	70		$	74
Term Asset-Backed Securities	55			60			55
Commercial Paper	4			4			4
Ford Interest Advantage / Deposits	6			6			7
Other	11			10			9
Equity	15			15			14
Adjustments for Cash	(12		)	(10		)	(14		)
Total Managed Receivables (a)	$	152		$	155		$	149

Securitized Funding as a percent of Managed Receivables	36		%	39		%	37		%

__________


(a)	Reconciliation to GAAP provided in the Financial Condition section

Managed receivables of ~~$145~~$149 billion as of September 30, ~~2017,~~2019, were funded primarily with term debt and term asset-backed securities. Securitized funding as a percent of managed receivables was ~~33%~~37%.

We ~~expect the~~target a mix of securitized funding ~~to remain around~~between 35% and 40%. The calendarization of the funding plan will result in quarterly fluctuations of the securitized funding percentage.

Public Term Funding Plan

The following table shows our issuances for full-year 2017 and 2018, planned issuances for full-year 2019, and our global public term funding issuances through October 22, 2019, excluding short-term funding programs (in billions):



	2017 Actual		2018 Actual		2019 Forecast	Through Oct 22
Unsecured - Currency of Issuance (USD Equivalent)
USD	$	10	$	6	$ 9 - 10	$	9
CAD	2		1		1	1
EUR / GBP	3		4		4 - 5	4
Other	1		1		1	1
Total unsecured	$	16	$	13	$ 15 - 17	$	14
Securitizations	15		14		13 - 14	12
Total public	$	32	$	27	$ 28 - 31	$	26

Note: Numbers may not sum due to rounding

Our total unsecured public term funding plan is categorized by currency of issuance. We plan to continue issuing our eurocurrency-denominated (e.g., euro and sterling) public unsecured debt from the United States. For 2019, we now project full-year public term funding in the range of $28 billion to $31 billion.

Through October 22, 2019, we have completed $26 billion of public term issuances.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

~~Public Term Funding Plan~~

The following chart shows our issuances for full year 2015 and 2016, planned issuances for full year 2017, and our global public term funding issuances through October 25, 2017, excluding short-term funding programs:

~~For 2017, our full year forecast for public term funding is in the range of $28 billion to $32 billion. Through October 25, 2017, we have completed about $25 billion of public term issuance.~~

~~The forecast reflects the potential for Ford Credit U.S. to issue euro-denominated debt and on-lend to FCE to provide funding flexibility given the uncertainty around Brexit.~~

~~Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)~~

Liquidity ~~Sources~~

We define gross liquidity as cash, cash equivalents, and marketable securities (excluding amounts related to insurance activities) and committed capacity (which includes our credit and asset-backed facilities and bank lines), less utilization of liquidity. Utilization of liquidity is the amount funded under our liquidity sources and also includes the cash and cash equivalents required to support securitization transactions. ~~Securitization cash is cash held for the benefit of the securitization investors (for example, a reserve fund).~~ Net liquidity available for use is defined as gross liquidity less certain adjustments for asset-backed capacity in excess of eligible receivables and cash related to the Ford Credit Revolving Extended Variable-utilization program (“FordREV”), which can be accessed through future sales of receivables. While not included in available liquidity, these adjustments represent additional funding sources for future originations.

The following ~~chart~~table shows our liquidity sources and ~~utilization:~~utilization (in billions):



	September 30, 2018			December 31, 2018			September 30, 2019
Liquidity Sources
Cash	$	12.1		$	10.2		$	14.3
Committed asset-backed facilities	32.0			35.4			35.2
Other unsecured credit facilities	3.0			3.0			2.6
Ford corporate credit facility allocation	3.0			3.0			3.0
Total liquidity sources	$	50.1		$	51.6		$	55.1

Utilization of Liquidity
Securitization cash	$	(3.0	)	$	(3.0	)	$	(2.9	)
Committed asset-backed facilities	(17.7		)	(20.7		)	(14.4		)
Other unsecured credit facilities	(0.7		)	(0.7		)	(0.5		)
Ford corporate credit facility allocation	—			—			—
Total utilization of liquidity	$	(21.4	)	$	(24.4	)	$	(17.8	)

Gross liquidity	$	28.7		$	27.2		$	37.3
Adjustments	0.3			0.1			(1.9		)
Net liquidity available for use	$	29.0		$	27.3		$	35.4

Our net liquidity available for use will fluctuate quarterly based on factors including near-term debt maturities, receivable growth, and timing of funding transactions. We target liquidity of ~~at least~~about $25 billion.

At September 30, ~~2017, Ford Credit’s~~2019, our net liquidity available for use was ~~$2.9~~$35.4 billion, $8.1 billion higher than at year-end ~~2016 and $1.4 billion higher than at June 30, 2017.~~

~~As of September 30, 2017, our liquidity remained strong at $29.9 billion.~~2018. Our sources of liquidity include cash, committed asset-backed facilities, unsecured credit facilities, and the Ford corporate credit facility allocation. ~~As of~~At September 30, ~~2017,~~2019, our liquidity sources including cash totaled ~~$50.5~~$55.1 billion ~~down $0.4~~, up $3.5 billion from year-end ~~2016.~~2018.

Cash, Cash Equivalents, and Marketable Securities. At September 30, ~~2017,~~2019, our cash, cash equivalents, and marketable securities (excluding amounts related to insurance activities) totaled ~~$11.3~~$14.3 billion, compared with ~~$10.8~~$10.2 billion at year-end ~~2016.~~2018. In the normal course of our funding activities, we may generate more proceeds than are required for our immediate funding needs. These excess amounts are held primarily in highly liquid investments, which provide liquidity for our anticipated and unanticipated cash needs and give us flexibility in the use of our other funding programs. Our cash, cash equivalents, and marketable securities (excluding amounts related to insurance activities) primarily include U.S. Department of Treasury obligations, federal agency securities, bank time deposits with investment-grade institutions, investment-grade commercial paper, ~~rated A-1/P-1 or higher,~~ debt obligations of a select group of non-U.S. governments, non-U.S. governmental agencies, supranational institutions, non-U.S. central banks, and money market funds that carry the highest possible ~~ratings~~. ratings.

~~Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)~~

The average maturity of these investments ranges from approximately three to six months and is adjusted based on market conditions and liquidity needs. We monitor our cash levels and average maturity on a daily basis. Cash, cash equivalents, and marketable securities included amounts to be used only to support our securitization transactions of ~~$2.8~~$3.0 billion and ~~$3.4~~$2.9 billion at December 31, 2018 and September 30, ~~2017~~2019, respectively.

Item 2. Management’s Discussion and ~~December 31, 2016, respectively.~~Analysis of Financial Condition and Results of Operations (Continued)

Committed Capacity. At September 30, ~~2017,~~2019, our committed capacity totaled ~~$39.2~~$40.8 billion, ~~down $0.9~~compared with $41.4 billion ~~from~~at December 31, ~~2016.~~2018. Our committed capacity is primarily comprised of committed ~~asset-backed security (“ABS”)~~ABS facilities from bank-sponsored commercial paper conduits and other financial institutions, unsecured credit facilities with financial institutions, and allocated commitments under the Ford corporate credit facility.

Committed Asset-Backed Facilities. We and our subsidiaries have entered into agreements with a number of bank-sponsored asset-backed commercial paper conduits and other financial institutions. Such counterparties are contractually committed, at our option, to purchase from us eligible retail financing receivables or to purchase or make advances under asset-backed securities backed by retail financing or wholesale finance receivables or operating leases for proceeds of up to ~~$33.4~~$35.2 billion ($~~16.2~~18.0 billion of retail financing, ~~$6.3~~$5.7 billion of wholesale financing, and ~~$10.9~~$11.5 billion of operating leases) at September 30, ~~2017.~~2019. In the United States, we are able to obtain funding within two days of our unutilized capacity in some of our committed asset-backed facilities. These committed facilities have varying maturity dates, with ~~$14.1~~$17.0 billion having maturities within the next twelve months and the remaining balance having maturities through ~~2019.~~2022. We plan capacity renewals to protect our global funding needs, optimize capacity utilization, and maintain sufficient liquidity.

Our ability to obtain funding under these facilities is subject to having a sufficient amount of eligible assets as well as our ability to obtain interest rate hedging arrangements for certain facilities. At September 30, ~~2017, $17.0~~2019, $14.4 billion of these commitments were in use. These programs are free of material adverse change clauses, restrictive financial covenants (for example, debt-to-equity limitations and minimum net worth requirements), and generally, credit rating triggers that could limit our ability to obtain funding. However, the unused portion of these commitments may be terminated if the performance of the underlying assets deteriorates beyond specified levels. Based on our experience and knowledge as servicer of the related assets, we do not expect any of these programs to be terminated due to such events.

FCE Bank plc (“FCE”) has pre-positioned retail receivables with the Bank of England which supports access to the Discount Window Facility. Pre-positioned assets are neither pledged to nor held as collateral by the Bank of England unless the Discount Window Facility is accessed. FCE’s eligibility to access the Discount Window Facility is not reflected in the Liquidity ~~Sources~~ table above.

Unsecured Credit Facilities. At September 30, ~~2017,~~2019, we and our majority-owned subsidiaries had ~~$5.8~~$5.6 billion of contractually committed unsecured credit facilities with financial institutions, including the FCE Credit Agreement, ~~(as defined below)~~the Ford Bank Agreement, and the allocation under Ford’s corporate credit facility. At September 30, ~~2017, $4.8~~2019, $5.1 billion was available for use.

FCE’s ~~£945~~£745 million (equivalent to ~~$1.3 billion~~$917 million at September 30, ~~2017)~~2019) syndicated credit facility (the “FCE Credit Agreement”) ~~matures~~and Ford Bank GmbH’s €240 million (equivalent to $262 million at September 30, 2019) syndicated credit facility (the “Ford Bank Credit Agreement”) both mature in ~~2020.~~2022. At September 30, ~~2017, £545~~2019, all £745 million ~~(equivalent to $730 million) was~~under the FCE Credit Agreement and all €240 million under the Ford Bank Credit Agreement were available for use. ~~The~~

Both the FCE Credit Agreement ~~contains~~and Ford Bank Credit Agreement contain certain covenants, including an obligation for FCE and Ford Bank to maintain ~~its~~their ratio of regulatory capital to risk-weighted assets at no less than the applicable regulatory ~~minimum, and for~~minimum. The FCE Credit Agreement requires the support agreement between FCE and Ford Credit to remain in ~~full force and~~ effect (and enforced by FCE to ensure that its net worth is maintained at no less than $500 million). The Ford Bank Credit Agreement requires our guarantee of Ford Bank’s obligations under the agreement to remain in effect.

Lenders under the Ford corporate credit facility have commitments totaling $13.4 billion, with ~~75%~~25% of the commitments maturing on April 30, 2022 and ~~25%~~75% of the commitments maturing on April 30, ~~2020.~~2024. Ford has allocated $3.0 billion of commitments, including commitments under a Chinese renminbi sub-facility, to us on an irrevocable and exclusive basis to support our ~~growth and~~ liquidity. At September 30, ~~2017,~~2019, all $3.0 billion was available for use.

Funding and Liquidity Risks

Refer to the “Funding and ~~Liquidity”~~Liquidity Risks” section of Item 7 of ~~Exhibit 99 to~~Part II of our ~~April 27, 2017~~2018 Form ~~8-K~~10-K Report for a list of factors that could affect our liquidity and information on our stress testing.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

Leverage

We use leverage, or the debt-to-equity ratio, to make various business decisions, including evaluating and establishing pricing for finance receivable and operating lease financing, and assessing our capital structure. We refer to our shareholder’s interest as equity.

The following ~~chart~~table shows the calculation of our financial statement leverage and managed leverage (in ~~billions, except for ratios)~~billions):



	September 30, 2018			December 31, 2018			September 30, 2019
Leverage Calculation
Debt	$	138.2		$	140.1		$	139.3
Adjustments for cash	(12.1		)	(10.2		)	(14.3		)
Adjustments for derivative accounting	0.6			0.2			(0.8		)
Total adjusted debt	$	126.7		$	130.1		$	124.2

Equity	$	15.2		$	15.0		$	14.2
Adjustments for derivative accounting	(0.1		)	(0.2		)	—
Total adjusted equity	$	15.1		$	14.8		$	14.2

Financial statement leverage (to 1) (GAAP)	9.1			9.4			9.8
Managed leverage (to 1) (Non-GAAP)	8.4			8.8			8.8

We plan our managed leverage by considering ~~prevailing~~ market conditions and the risk characteristics of our business. At September 30, ~~2017,~~2019, our financial statement leverage was ~~9.4:~~9.8:1, and managed leverage was ~~8.7:~~8.8:1. We target managed leverage in the range of 8:1 to 9:1. ~~For information on our planned distributions, refer to the “Outlook” section.~~

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

~~Outlook~~Cautionary Note on Forward-Looking Statements

~~We now expect full year 2017 pre-tax profit to exceed $2.0 billion driven by strong volume and mix and better-than-expected residual values.~~

~~In the third quarter, we distributed $378 million to our parent.~~

~~Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)~~

~~Risk Factors~~

Statements included or incorporated by reference herein may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on expectations, forecasts, and assumptions by our management and involve a number of risks, uncertainties, and other factors that could cause actual results to differ materially from those stated, including without limitation:

~~Decline in industry~~Ford’s long-term competitiveness depends on the successful execution of fitness actions;

Industry sales volume, particularly in the United States, Europe, or China, ~~due to~~can be volatile and could decline if there is a financial crisis, recession, or significant geopolitical ~~events, or other factors;~~ event;

~~Lower-than-anticipated market acceptance of~~ Ford’s new orand existing products orand mobility services ~~or failure~~are subject to ~~achieve expected growth;~~market acceptance;

~~Market shift away from~~Ford’s results are dependent on sales of larger, more profitable vehicles, ~~beyond Ford’s current planning assumption,~~ particularly in the United States;

~~Continued or~~Ford may face increased price competition resulting from industry excess capacity, currency fluctuations, or other factors;

Fluctuations in commodity prices, foreign currency exchange rates, ~~commodity prices,~~ and interest ~~rates;~~rates can have a significant effect on results;

~~Adverse effects resulting from~~With a global footprint, Ford’s results could be adversely affected by economic, geopolitical, protectionist trade policies, or other ~~events;~~events, including Brexit;

~~Work stoppages at Ford or supplier facilities or other limitations on~~Ford’s production, ~~(whether~~ as ~~a result of~~well as Ford’s suppliers’ production, could be disrupted by labor disputes, natural or man-made disasters, ~~tight credit markets or other~~ financial distress, production ~~constraints or~~ difficulties, or other ~~factors);~~factors;

~~Single-source supply of components or materials;~~

~~Labor or other constraints on~~ Ford’s ability to maintain a competitive cost ~~structure;~~structure could be affected by labor or other constraints;

~~Substantial pension~~Pension and other postretirement liabilities ~~impairing~~could adversely affect Ford’s liquidity orand financial condition;

~~Worse-than-assumed economic~~Economic and demographic experience for pension and other postretirement benefit plans (e.g., discount rates or investment returns); could be worse than Ford has assumed;

~~Restriction on use of tax attributes from tax law “ownership change;”~~

~~The discovery of~~Ford’s vehicles could be affected by defects ~~in vehicles resulting~~that result in delays in new model launches, recall campaigns, or increased warranty costs;

~~Increased~~Ford may need to substantially modify its product plans to comply with safety, emissions, fuel economy, orand other regulations ~~resulting~~that may change in ~~higher costs, cash expenditures, and/or sales restrictions;~~the future;

~~Unusual~~Ford could experience unusual or significant litigation, governmental investigations, or adverse publicity arising out of alleged defects in products, perceived environmental impacts, or otherwise;

~~Adverse effects on results from a decrease in or cessation or clawback~~Ford’s receipt of government incentives ~~related~~could be subject to ~~investments;~~reduction, termination, or clawback;

~~Cybersecurity risks to operational~~Operational systems, security systems, ~~or infrastructure owned~~and vehicles could be affected by cyber incidents;

Ford and Ford ~~Credit, or a third-party vendor or supplier;~~

~~Failure of financial institutions~~Credit’s access to ~~fulfill commitments under committed credit and liquidity facilities;~~

~~Inability of Ford Credit to access~~ debt, securitization, or derivative markets around the world at competitive rates or in sufficient amounts ~~due to~~could be affected by credit rating downgrades, market volatility, market disruption, regulatory requirements, or other factors;

~~Higher-than-expected~~Ford Credit could experience higher than expected credit losses, lower-than-anticipated residual values, or higher-than-expected return volumes for operating leased vehicles;

~~Increased~~Ford Credit could face increased competition from banks, financial institutions, or other third parties seeking to increase their share of financing Ford vehicles; and

~~New~~Ford Credit could be subject to new or increased credit regulations, consumer or data protection regulations, or other ~~regulations resulting in higher costs and/or additional financing restrictions.~~regulations.

We cannot be certain that any expectation, forecast, or assumption made in preparing forward-looking statements will prove accurate, or that any projection will be realized. It is to be expected that there may be differences between projected and actual results. Our forward-looking statements speak only as of the date of their initial issuance, and we do not undertake any obligation to update or revise publicly any forward-looking statement, whether as a result of new information, future events, or otherwise. For additional discussion, see “Item 1A. Risk Factors” in our ~~Annual Report on~~2018 Form 10-K ~~for the year ended December 31, 2016 (“2016 Form 10-K Report”),~~Report, as updated by our subsequent Quarterly Reports on Form 10-Q and Current Reports on Form 8-K.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Continued)

Accounting Standards Issued But Not Yet Adopted

The Financial Accounting Standards Board (“FASB”) has issued the following ~~standards,~~Accounting Standards Updates (“ASU”), which are not expected to have a material impact ~~(with the exception of standards 2016-02 and 2016-13)~~ to our financial statements or financial statement ~~disclosures:~~

disclosures. ASU 2016-13 is expected to result in a significant change in practice to Ford Credit. For additional information, see Note 2 of our Notes to the Financial Statements.



~~Standard~~ASU		Effective Date (a)
~~2016-18~~2018-18	~~Statement of Cash Flows - Restricted Cash~~Clarifying the Interaction between Collaborative Arrangements and Revenue from Contracts with Customers	January 1, ~~2018~~2020
~~2016-16~~2018-17	~~Income Taxes - Intra-Entity Transfers of Assets Other Than Inventory~~Targeting Improvements to Related Party Guidance for Variable Interest Entities	January 1, ~~2018~~2020
~~2016-15~~2018-15	~~Statement of Cash Flows - Classification of Certain Cash Receipts and Cash Payments~~Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement that is a Service Contract	January 1, ~~2018~~
~~2016-01~~	~~Financial Instruments - Recognition and Measurement of Financial Assets and Financial Liabilities~~	~~January 1, 2018~~
~~2017-12~~	~~Derivatives and Hedging~~	~~January 1, 2019 (b)~~
~~2017-08~~	~~Nonrefundable Fees and Other Costs - Premium Amortization on Purchased Callable Debt Securities~~	~~January 1, 2019~~
~~2016-02~~	~~Leases~~	~~January 1, 2019 (b)~~2020
2016-13	Credit Losses - Measurement of Credit Losses on Financial Instruments	January 1, 2020 (b)

__________


(a)	Early adoption for each of the standards ~~except standard 2016-01,~~ is permitted.


(b)	~~For additional information, see Note 2 of our Notes~~The FASB has issued the following update to the ~~Financial Statements.~~Credit Losses standard: ASU 2019-05 (Targeted Transition Relief) which we will adopt with the new Credit Losses standard effective January 1, 2020.

~~Other Financial Information~~

The interim financial information included in this Quarterly Report on Form 10-Q for the periods ended September 30, 2017 and 2016 has not been audited by PricewaterhouseCoopers LLP (“PwC”). In reviewing such information, PwC has applied limited procedures in accordance with professional standards for reviews of interim financial information. Readers should restrict reliance on PwC’s reports on such information accordingly. PwC is not subject to the liability provisions of Section 11 of the Securities Act of 1933 for its reports on interim financial information, because such reports do not constitute “reports” or “parts” of registration statements prepared or certified by PwC within the meaning of Sections 7 and 11 of the Securities Act of 1933.

ITEM 3. Quantitative and Qualitative Disclosures About Market Risk.

In our ~~2016~~2018 Form 10-K Report, we discuss in greater detail our market risk, counterparty risk, credit risk, residual risk, liquidity risk, and operating risk.

To provide a quantitative measure of the sensitivity of our pre-tax cash flow to changes in interest rates, we use interest rate scenarios that assume a hypothetical, instantaneous increase or decrease of one percentage point in all interest rates across all maturities (a “parallel shift”), as well as a base case that assumes that all interest rates remain constant at existing levels. The differences in pre-tax cash flow between these scenarios and the base case over a twelve-month period represent an estimate of the sensitivity of our pre-tax cash flow. Under this model, we estimate that at September 30, ~~2017,~~2019, all else constant, such an increase in interest rates would ~~decrease~~increase our pre-tax cash flow by $2 million over the next 12 months, compared with an increase of ~~$21~~$51 million at December 31, ~~2016.~~2018. In reality, interest rate changes are rarely instantaneous or parallel and rates could move more or less than the one percentage point assumed in our analysis. As a result, the actual impact to pre-tax cash flow could be higher or lower than the results detailed above.

ITEM 4. Controls and Procedures.

Evaluation of Disclosure Controls and Procedures. ~~N. Joy Falotico,~~David W. McClelland, our Chairman of the Board and Chief Executive Officer (“CEO”), and ~~Marion B. Harris,~~Brian E. Schaaf, our Chief Financial Officer (“CFO”) and Treasurer, have performed an evaluation of the Company’s disclosure controls and procedures, as that term is defined in Rule 13a-15(e) of the Securities Exchange Act of 1934, as amended (“Exchange Act”), as of September 30, ~~2017~~2019, and each has concluded that such disclosure controls and procedures are effective to ensure that information required to be disclosed in our periodic reports filed under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified by SEC rules and forms, and that such information is accumulated and communicated to the CEO and CFO to allow timely decisions regarding required disclosures.

Changes in Internal Control Over Financial Reporting. There were no changes in internal control over financial reporting during the quarter ended September 30, ~~2017~~2019 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II. OTHER INFORMATION

ITEM 1A. Risk Factors.

The risk factor “Ford Credit’s access to debt, securitization, or derivative markets around the world at competitive rates or in sufficient amounts could be affected by credit rating downgrades, market volatility, market disruption, regulatory requirements, or other factors” included in Item 1A of our 2018 Form 10-K Report is revised as follows:

Ford and Ford Credit’s access to debt, securitization, or derivative markets around the world at competitive rates or in sufficient amounts could be affected by credit rating downgrades, market volatility, market disruption, regulatory requirements, or other factors. Ford and Ford Credit’s ability to obtain unsecured funding at a reasonable cost is dependent on their credit ratings or their perceived creditworthiness. Further, Ford Credit’s ability to obtain securitized funding under its committed asset-backed liquidity programs and certain other asset-backed securitization transactions is subject to having a sufficient amount of assets eligible for these programs, as well as Ford Credit’s ability to obtain appropriate credit ratings and, for certain committed programs, derivatives to manage the interest rate risk. Over time, and particularly in the event of credit rating downgrades, market volatility, market disruption, or other factors, Ford Credit may reduce the amount of receivables it purchases or originates because of funding constraints. The potential phase out of LIBOR is one such risk that could cause market volatility or disruption. In July 2017 the chief executive of the United Kingdom Financial Conduct Authority (the “FCA”), which regulates LIBOR, announced that the FCA intends to stop compelling banks to submit rates for the calculation of LIBOR after 2021. It is unknown whether any banks will continue to voluntarily submit rates for the calculation of LIBOR after 2021 or whether LIBOR will continue to be published by its administrator based on these submissions or on any other basis. It is not possible to predict the effect of these changes, other reforms, or the establishment of alternative reference rates, but the potential phase out of LIBOR could adversely affect Ford Credit’s access to the capital markets and cost of funding. In addition, Ford Credit may be limited in the amount of receivables it purchases or originates in certain countries or regions if the local capital markets, particularly in developing countries, do not exist or are not adequately developed. Similarly, Ford Credit may reduce the amount of receivables it purchases or originates if there is a significant decline in the demand for the types of securities it offers or Ford Credit is unable to obtain derivatives to manage the interest rate risk associated with its securitization transactions. A significant reduction in the amount of receivables Ford Credit purchases or originates would significantly reduce its ongoing profits and could adversely affect its ability to support the sale of Ford vehicles.

ITEM 5. Other Information.

None.

ITEM 6. Exhibits.



Designation	Description	Method of Filing

~~Exhibit 12~~	~~Calculation of Ratio of Earnings to Fixed Charges.~~	~~Filed with this Report.~~

~~Exhibit 15~~	~~Letter of PricewaterhouseCoopers LLP, dated October 26, 2017, relating to financial information.~~	~~Filed with this Report.~~

Exhibit 31.1	Rule 15d-14(a) Certification of CEO.	Filed with this Report.

Exhibit 31.2	Rule 15d-14(a) Certification of CFO.	Filed with this Report.

Exhibit 32.1	Section 1350 Certification of CEO.	Furnished with this Report.

Exhibit 32.2	Section 1350 Certification of CFO.	Furnished with this Report.

~~Exhibit 99~~	~~Items 2 - 4 of Part I and Item 1 of Part II of Ford Motor Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2017.~~	~~Incorporated herein by reference to Ford Motor Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2017. File No. 1-3950.~~

Exhibit 101.INS	~~XBRL Instance Document.~~Interactive Data Files pursuant to Rule 405 of Regulation S-T formatted in Inline Extensible Business Reporting Language (“Inline XBRL”).	*

Exhibit 101.SCH	XBRL Taxonomy Extension Schema Document.	*

Exhibit 101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document.	*

Exhibit 101.LAB	XBRL Taxonomy Extension Label Linkbase Document.	*

Exhibit 101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document.	*

Exhibit 101.DEF	XBRL Taxonomy Extension Definition Linkbase Document.	*
Exhibit 104	Cover Page Interactive Data File (formatted in Inline XBRL and contained in Exhibit 101).	*

__________


*	Submitted electronically with this Report in accordance with the provisions of Regulation S-T.

Instruments defining the rights of holders of certain issues of long-term debt of Ford Credit have not been filed as exhibits to this Report because the authorized principal amount of any one of such issues does not exceed 10% of the total assets of Ford Credit. Ford Credit will furnish a copy of each such instrument to the SEC upon request.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, Ford Motor Credit Company LLC has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.

FORD MOTOR CREDIT COMPANY LLC



By:	/s/ ~~Marion B. Harris~~Brian E. Schaaf
	~~Marion B. Harris~~Brian E. Schaaf
	Chief Financial Officer and Treasurer

Date:	October ~~26, 2017~~23, 2019



£☐	Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
	For the transition period from ____________________ to ____________________
	~~Commission file number 1-6368~~



Delaware		38-1612444
(State of organization)		(I.R.S. employer identification no.)

One American Road
Dearborn,	Michigan	48126
(Address of principal executive offices)		(Zip ~~code)~~Code)



Title of each class	Trading Symbol(s)	Name of each exchange on which registered
3.588% Notes due June 2, 2020	F/20S	New York Stock Exchange
0.623% Notes due June 28, 2023*	F/23E	New York Stock Exchange
1.355% Notes due February 7, 2025*	F/25I	New York Stock Exchange
4.125% Notes due on June 20, 2024	F/24O	New York Stock Exchange
3.021% Notes due March 6, 2024	F/24M	New York Stock Exchange
4.535% Notes due March 6, 2025*	F/25K	New York Stock Exchange
3.350% Notes due Nine Months or More from the Date of Issue due August 20, 2026	F/26N	New York Stock Exchange
1.514% Notes due February 17, 2023	F/23G	New York Stock Exchange
2.386% Notes due February 17, 2026	F/26AB	New York Stock Exchange
Floating Rate Notes due December 12, 2019*	F/19A	New York Stock Exchange
Floating Rate Notes due December 16, 2019*	F/19C	New York Stock Exchange
Floating Rate Notes due May 14, 2021*	F/21C	New York Stock Exchange
Floating Rate Notes due December 1, 2021*	F/21AQ	New York Stock Exchange
Floating Rate Notes due December 7, 2022*	F/22T	New York Stock Exchange
Floating Rate Notes due November 15, 2023*	F/23D	New York Stock Exchange
Floating Rate Notes due December 1, 2024*	F/24L	New York Stock Exchange
*Issued under Euro Medium Term Notes due Nine Months or More from The Date of Issue Program



~~Large accelerated filer~~ o	~~Accelerated filer~~ o	~~Non-accelerated filer~~ þ	~~Smaller reporting company~~ o
~~Emerging growth company~~ o



Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
☐	Yes	☑	No



R☑	Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
	~~For the quarterly period ended September 30, 2017~~




	Table of Contents	Page

	Part I. Financial Information
Item 1	Financial Statements	1
	Consolidated Income Statement	1
	Consolidated Statement of Comprehensive Income	1
	Consolidated Balance Sheet	2
	Consolidated Statement of Shareholder’s Interest	3
	Condensed Consolidated Statement of Cash Flows	4
	Notes to the Financial Statements	5
	~~Report of Independent Registered Public Accounting Firm~~	25
Item 2	Management’s Discussion and Analysis of Financial Condition and Results of Operations	2625
	~~Results of Operations~~Definitions and Information Regarding Causal Factors	2625
	Key Metrics	27
	Financing Shares and Contract Placement Volume	30
	Financial Condition	31
	~~Financial Condition~~Credit Risk	3432
	Residual Risk	35
	Credit ~~Risk~~Ratings	36
	~~Residual Risk~~Funding and Liquidity	37
	Leverage	40
	~~Credit Ratings~~Cautionary Note on Forward-Looking Statements	41
	Accounting Standards Issued But Not Yet Adopted	42
	~~Funding and Liquidity~~	43
	~~Leverage~~	47
	~~Outlook~~	48
	~~Risk Factors~~	49
	~~Accounting Standards Issued But Not Yet Adopted~~	50
	~~Other Financial Information~~	50
Item 3	Quantitative and Qualitative Disclosures About Market Risk	5042
Item 4	Controls and Procedures	5142
	Part II. Other Information
Item 51A	~~Other Information~~Risk Factors	5243
Item 65	~~Exhibits~~Other Information	5243
Item 6	Exhibits	43
	Signature	5344


	For the periods ended September 30,												For the periods ended September 30,
	2016			2017			2016			2017			2018			2019			2018			2019
	Third Quarter						First Nine Months						Third Quarter						First Nine Months
	(unaudited)												(unaudited)
Financing revenue
Operating leases	$	1,409		$	1,394		$	4,115		$	4,141		$	1,463		$	1,480		$	4,321		$	4,429
Retail financing	780			891			2,273			2,518			983			987			2,890			2,958
Dealer financing	450			462			1,333			1,389			519			534			1,624			1,738
Other	10			17			29			51
Other financing													20			23			62			73
Total financing revenue	2,649			2,764			7,750			8,099			2,985			3,024			8,897			9,198
Depreciation on vehicles subject to operating leases	(1,085		)	(989		)	(3,174		)	(3,090		)	(936		)	(894		)	(2,975		)	(2,712		)
Interest expense	(697		)	(810		)	(2,030		)	(2,308		)	(989		)	(1,081		)	(2,898		)	(3,316		)
Net financing margin	867			965			2,546			2,701			1,060			1,049			3,024			3,170
Other revenue
Insurance premiums earned	38			38			118			120			39			43			123			136
Fee based revenue and other	—			61			—			177			57			60			180			175
Total financing margin and other revenue	905			1,064			2,664			2,998			1,156			1,152			3,327			3,481
Expenses
Operating expenses	287			324			891			930			368			350			1,070			1,064
Provision for credit losses (Note 6)	138			169			403			420			127			93			290			189
Insurance expenses	22			28			113			121			19			33			77			103
Total expenses	447			521			1,407			1,471			514			476			1,437			1,356

Other income, net (Note 13)	109			57			224			173			36			60			74			243

Income before income taxes	567			600			1,481			1,700			678			736			1,964			2,368
Provision for income taxes	181			186			441			507
Provision for / (Benefit from) income taxes													160			165			266			581
Net income	$	386		$	414		$	1,040		$	1,193		$	518		$	571		$	1,698		$	1,787


	December 31, 2016			September 30, 2017			December 31, 2018			September 30, 2019
	(unaudited)						(unaudited)
ASSETS
Cash and cash equivalents (Note 3)	$	8,077		$	8,835		$	9,607		$	11,579
Marketable securities (Note 3)	3,280			3,101			1,308			3,454
Finance receivables, net (Note 4)	102,981			110,597
Finance receivables, net
Retail installment contracts, dealer financing, and other financing							110,388			104,302
Finance leases							8,426			8,469
Total finance receivables, net (Note 4)							118,814			112,771
Net investment in operating leases (Note 5)	27,209			26,931			27,449			27,530
Notes and accounts receivable from affiliated companies	811			957			905			794
Derivative financial instruments (Note 9)	909			982			670			1,295
Other assets (Note 10)	2,822			3,075			3,456			3,460
Total assets	$	146,089		$	154,478		$	162,209		$	160,883

LIABILITIES
Accounts payable
Customer deposits, dealer reserves, and other	$	1,065		$	1,236		$	1,097		$	1,081
Affiliated companies	336			705			426			549
Total accounts payable	1,401			1,941			1,523			1,630
Debt (Note 11)	126,492			132,380			140,146			139,274
Deferred income taxes	3,230			3,633			2,595			2,712
Derivative financial instruments (Note 9)	166			420			663			637
Other liabilities and deferred income (Note 10)	1,997			2,020
Other liabilities and deferred revenue (Note 10)							2,307			2,475
Total liabilities	133,286			140,394			147,234			146,728

SHAREHOLDER’S INTEREST
Shareholder’s interest	5,227			5,227			5,227			5,227
Accumulated other comprehensive income/(loss) (Note 12)	(890		)	(405		)
Accumulated other comprehensive income / (loss) (Note 12)							(829		)	(1,011		)
Retained earnings	8,466			9,262			10,577			9,939
Total shareholder’s interest attributable to Ford Motor Credit Company	12,803			14,084
Shareholder’s interest attributable to noncontrolling interests	—			—
Total shareholder’s interest	12,803			14,084			14,975			14,155
Total liabilities and shareholder’s interest	$	146,089		$	154,478		$	162,209		$	160,883



	Shareholder’s Interest Attributable to Ford Motor Credit Company
	Shareholder’s Interest		Accumulated Other Comprehensive Income/(Loss) (Note 12)			Retained Earnings			Total			Shareholder’s Interest Attributable to Non-Controlling Interests			Total Shareholder’s Interest
Balance at December 31, 2015	$	5,227	$	(607	)	$	7,093		$	11,713		$	1		$	11,714
Net income	—		—			1,040			1,040			—			1,040
Other comprehensive income/(loss), net of tax	—		(41		)	—			(41		)	—			(41		)
Distributions declared	—		—			—			—			(1		)	(1		)
Balance at September 30, 2016	$	5,227	$	(648	)	$	8,133		$	12,712		$	—		$	12,712

Balance at December 31, 2016	$	5,227	$	(890	)	$	8,466		$	12,803		$	—		$	12,803
Net income	—		—			1,193			1,193			—			1,193
Other comprehensive income/(loss), net of tax	—		485			—			485			—			485
Adoption of accounting standard (Note 2)	—		—			9			9			—			9
Distributions declared	—		—			(406		)	(406		)	—			(406		)
Balance at September 30, 2017	$	5,227	$	(405	)	$	9,262		$	14,084		$	—		$	14,084



Footnote		Page
Note 1	Presentation	6
Note 2	Accounting Policies	6
Note 3	Cash, Cash Equivalents, and Marketable Securities	87
Note 4	Finance Receivables	98
Note 5	Net Investment in Operating Leases	12
Note 6	Allowance for Credit Losses	1314
Note 7	Transfers of Receivables	15
Note 8	Variable Interest Entities	1617
Note 9	Derivative Financial Instruments and Hedging Activities	17
Note 10	Other Assets and Other Liabilities and Deferred ~~Income~~Revenue	19
Note 11	Debt	20
Note 12	Accumulated Other Comprehensive ~~Income/~~Income / (Loss)	20
Note 13	Other Income, Net	21
Note 14	Segment Information	21
Note 15	Commitments and Contingencies	23



~~Standard~~ASU		Effective Date
~~2017-05~~2018-16	~~Gains and Losses from~~Inclusion of the ~~Derecognition of Nonfinancial Assets - Clarifying the Scope of Asset Derecognition Guidance~~Secured Overnight Financing Rate (SOFR) Overnight Index Swap (OIS) Rate as a Benchmark Interest Rate for Hedge Accounting Purposes	January 1, ~~2017~~2019
~~2017-04~~2018-08	~~Goodwill~~Clarifying the Scope and ~~Other - Simplifying~~ the ~~Test~~Accounting Guidance for ~~Goodwill Impairment~~Contributions Received and Contributions Made	January 1, ~~2017~~
~~2017-03~~	~~Accounting Changes and Error Corrections and Investments - Equity Method and Joint Ventures~~	~~January 1, 2017~~
~~2017-01~~	~~Business Combinations - Clarifying the Definition of a Business~~	~~January 1, 2017~~
~~2016-17~~	~~Consolidation - Interests Held through Related Parties That Are Under Common Control~~	~~January 1, 2017~~
~~2016-09~~	~~Stock Compensation - Improvements to Employee Share-Based Payment Accounting~~	~~January 1, 2017~~
~~2016-07~~	~~Equity Method and Joint Ventures - Simplifying the Transition to the Equity Method of Accounting~~	~~January 1, 2017~~
~~2016-06~~	~~Derivatives and Hedging - Contingent Put and Call Options in Debt Instruments~~	~~January 1, 2017~~
~~2016-05~~	~~Derivatives and Hedging - Effect of Derivative Contract Novations on Existing Hedge Accounting Relationships~~	~~January 1, 2017~~
~~2016-04~~	~~Extinguishments of Liabilities - Recognition of Breakage for Certain Prepaid Stored-Value Products~~	~~January 1, 2017~~
~~2017-09~~	~~Stock Compensation - Scope of Modification Accounting~~	~~April 1, 2017~~2019



	Fair Value Level	December 31, 2018		September 30, 2019
Cash and cash equivalents
U.S. government	1	$	139	$	447
U.S. government and agencies	2	25		571
Non-U.S. government and agencies	2	114		1,405
Corporate debt	2	884		872
Total marketable securities classified as cash equivalents		1,162		3,295
Cash, time deposits and money market funds		8,445		8,284
Total cash and cash equivalents		$	9,607	$	11,579

Marketable securities
U.S. government	1	$	289	$	710
U.S. government and agencies	2	65		340
Non-U.S. government and agencies	2	610		1,927
Corporate debt	2	198		193
Other marketable securities	2	146		284
Total marketable securities		$	1,308	$	3,454


(a)	Restricted cash primarily includes cash held to meet certain local governmental and regulatory reserve requirements and cash held under the terms of certain contractual agreements. Restricted cash does not include required minimum balances or cash securing debt issued through securitization transactions.


(b)	The fair value of finance receivables is categorized within Level 3 of the fair value hierarchy.


•	Group III – marginal to weak financial metrics; and



	December 31, 2018		September 30, 2019
Dealer financing
Group I	$	33,656	$	30,786
Group II	5,635		4,733
Group III	1,576		2,012
Group IV	129		91
Total recorded investment	$	40,996	$	37,622



	September 30, 2019
Within one year	$	2,032
After one year and within two years	1,980
After two years and within three years	1,534
After three years and within four years	709
After four years and within five years	114
After five years	2
Total future cash payments	6,371
Less: Present value discount	(316		)
Finance lease receivables	$	6,055



	December 31, 2018		September 30, 2019
Consumer
31-60 days past due	$	859	$	741
61-90 days past due	123		110
91-120 days past due	39		39
Greater than 120 days past due	39		38
Total past due	1,060		928
Current	75,179		72,970
Consumer finance receivables	76,239		73,898

Non-Consumer
Total past due	76		70
Current	43,088		39,316
Non-Consumer finance receivables	43,164		39,386
Total recorded investment	$	119,403	$	113,284


•	Special Mention – 61 to 120 days past due and in intensified collection status; and


•	Substandard – greater than 120 days past due and for which the uncollectible portion of the receivables has already been charged off, as measured using the fair value of collateral less costs to sell.


•	Group IV – poor financial metrics, including dealers classified as uncollectible.



	2019		2020		2021		2022		2023		Total
Minimum rentals on operating leases	$	4,708	$	2,929	$	1,083	$	83	$	6	$	8,809



	Within 1 year		After 1 year and within 2 years		After 2 years and within 3 years		After 3 years and within 4 years		After 4 years and within 5 years		Total
Operating lease payments	$	4,703	$	2,917	$	1,014	$	72	$	5	$	8,711


	Third Quarter 2016
	Finance Receivables									Net Investment in Operating Leases				Total Allowance			Third Quarter 2018									First Nine Months 2018
	Consumer			Non-Consumer			Total						Consumer					Non-Consumer			Total			Consumer			Non-Consumer			Total
Allowance for credit losses
Beginning balance	$	432		$	17		$	449		$	63			$	512		$	573		$	14		$	587		$	582		$	15		$	597
Charge-offs	(108		)	(5		)	(113		)	(44		)		(157		)	(128		)	(43		)	(171		)	(382		)	(46		)	(428		)
Recoveries	29			1			30			20				50			40			4			44			126			6			132
Provision for credit losses	112			1			113			25				138			73			52			125			237			52			289
Other (a)	(1		)	—			(1		)	(1		)		(2		)
Ending balance	$	464		$	14		$	478		$	63			$	541

	First Nine Months 2016
	Finance Receivables									Net Investment in Operating Leases				Total Allowance
	Consumer			Non-Consumer			Total
Allowance for credit losses
Beginning balance	$	357		$	16		$	373		$	49			$	422
Charge-offs	(304		)	(7		)	(311		)	(125		)		(436		)
Recoveries	89			4			93			60				153
Provision for credit losses	323			1			324			79				403
Other (a)	(1		)	—			(1		)	—				(1		)
Other																	1			—			1			(4		)	—			(4		)
Ending balance	$	464		$	14		$	478		$	63			$	541		$	559		$	27		$	586		$	559		$	27		$	586

Analysis of ending balance of allowance for credit losses
Collective impairment allowance	$	445		$	12		$	457		$	63			$	520											$	538		$	14		$	552
Specific impairment allowance	19			2			21			—				21												21			13			34
Ending balance	464			14			478			63				$	541											$	559		$	27		$	586

Analysis of ending balance of finance receivables and net investment in operating leases
Analysis of ending balance of finance receivables
Collectively evaluated for impairment	64,743			36,120			100,863			27,024																$	76,448		$	39,638		$	116,086
Specifically evaluated for impairment	366			140			506			—																379			165			544
Recorded investment	65,109			36,260			101,369			27,024																76,827			39,803			116,630

Ending balance, net of allowance for credit losses	$	64,645		$	36,246		$	100,891		$	26,961															$	76,268		$	39,776		$	116,044


~~(a)~~	~~Primarily represents amounts related to translation adjustments.~~



	Third Quarter 2019									First Nine Months 2019
	Consumer			Non-Consumer			Total			Consumer			Non-Consumer			Total
Allowance for credit losses
Beginning balance	$	496		$	17		$	513		$	566		$	23		$	589
Charge-offs	(129		)	(1		)	(130		)	(383		)	(18		)	(401		)
Recoveries	41			—			41			129			8			137
Provision for credit losses	93			—			93			187			2			189
Other	(3		)	(1		)	(4		)	(1		)	—			(1		)
Ending balance	$	498		$	15		$	513		$	498		$	15		$	513

Analysis of ending balance of allowance for credit losses
Collective impairment allowance										$	479		$	13		$	492
Specific impairment allowance										19			2			21
Ending balance										498			15			513

Analysis of ending balance of finance receivables
Collectively evaluated for impairment										$	73,564		$	39,295		$	112,859
Specifically evaluated for impairment										334			91			425
Recorded investment										73,898			39,386			113,284

Ending balance, net of allowance for credit losses										$	73,400		$	39,371		$	112,771



	Third Quarter 2017
	Finance Receivables									Net Investment in Operating Leases			Total Allowance
	Consumer			Non-Consumer			Total			Net Investment in Operating Leases			Total Allowance
Allowance for credit losses
Beginning balance	$	507		$	15		$	522		$	66		$	588
Charge-offs	(132		)	—			(132		)	(51		)	(183		)
Recoveries	36			4			40			25			65
Provision for credit losses	146			(6		)	140			29			169
Other (a)	5			—			5			—			5
Ending balance	$	562		$	13		$	575		$	69		$	644

	First Nine Months 2017
	Finance Receivables									Net Investment in Operating Leases			Total Allowance
	Consumer			Non-Consumer			Total			Net Investment in Operating Leases			Total Allowance
Allowance for credit losses
Beginning balance	$	469		$	15		$	484		$	64		$	548
Charge-offs	(366		)	(3		)	(369		)	(155		)	(524		)
Recoveries	105			8			113			73			186
Provision for credit losses	341			(7		)	334			86			420
Other (a)	13			—			13			1			14
Ending balance	$	562		$	13		$	575		$	69		$	644

Analysis of ending balance of allowance for credit losses
Collective impairment allowance	$	541		$	13		$	554		$	69		$	623
Specific impairment allowance	21			—			21			—			21
Ending balance	562			13			575			69			$	644

Analysis of ending balance of finance receivables and net investment in operating leases
Collectively evaluated for impairment	72,069			38,564			110,633			27,000
Specifically evaluated for impairment	387			152			539			—
Recorded investment	72,456			38,716			111,172			27,000

Ending balance, net of allowance for credit losses	$	71,894		$	38,703		$	110,597		$	26,931


	December 31, 2016										December 31, 2018
	Cash and Cash Equivalents		Finance Receivables and Net Investment in Operating Leases (a)						Related Debt (c)		Cash and Cash Equivalents		Finance Receivables and Net Investment in Operating Leases (a)						Related Debt (c)
	Cash and Cash Equivalents		Before Allowance for Credit Losses		Allowance for Credit Losses		After Allowance for Credit Losses		Related Debt (c)		Cash and Cash Equivalents		Before Allowance for Credit Losses		Allowance for Credit Losses		After Allowance for Credit Losses		Related Debt (c)
VIE (b)
Retail financing	$	1.5	$	25.9	$	0.2	$	25.7	$	22.7	$	1.9	$	34.0	$	0.2	$	33.8	$	29.2
Wholesale financing	1.0		25.2		—		25.2		13.6		0.3		24.9		—		24.9		13.9
Finance receivables	2.5		51.1		0.2		50.9		36.3		2.2		58.9		0.2		58.7		43.1
Net investment in operating leases	0.5		11.8		—		11.8		7.4		0.5		16.3		—		16.3		10.2
Total VIE	$	3.0	$	62.9	$	0.2	$	62.7	$	43.7	$	2.7	$	75.2	$	0.2	$	75.0	$	53.3

Non-VIE
Retail financing	$	0.4	$	6.6	$	—	$	6.6	$	6.1	$	0.3	$	6.7	$	—	$	6.7	$	5.9
Wholesale financing	—		0.8		—		0.8		0.6		—		0.8		—		0.8		0.6
Finance receivables	0.4		7.4		—		7.4		6.7		0.3		7.5		—		7.5		6.5
Net investment in operating leases	—		—		—		—		—		—		—		—		—		—
Total Non-VIE	$	0.4	$	7.4	$	—	$	7.4	$	6.7	$	0.3	$	7.5	$	—	$	7.5	$	6.5

Total securitization transactions
Retail financing	$	1.9	$	32.5	$	0.2	$	32.3	$	28.8	$	2.2	$	40.7	$	0.2	$	40.5	$	35.1
Wholesale financing	1.0		26.0		—		26.0		14.2		0.3		25.7		—		25.7		14.5
Finance receivables	2.9		58.5		0.2		58.3		43.0		2.5		66.4		0.2		66.2		49.6
Net investment in operating leases	0.5		11.8		—		11.8		7.4		0.5		16.3		—		16.3		10.2
Total securitization transactions	$	3.4	$	70.3	$	0.2	$	70.1	$	50.4	$	3.0	$	82.7	$	0.2	$	82.5	$	59.8


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


	September 30, 2017										September 30, 2019
	Cash and Cash Equivalents		Finance Receivables and Net Investment in Operating Leases (a)						Related Debt (c)		Cash and Cash Equivalents		Finance Receivables and Net Investment in Operating Leases (a)						Related Debt (c)
	Cash and Cash Equivalents		Before Allowance for Credit Losses		Allowance for Credit Losses		After Allowance for Credit Losses		Related Debt (c)		Cash and Cash Equivalents		Before Allowance for Credit Losses		Allowance for Credit Losses		After Allowance for Credit Losses		Related Debt (c)
VIE (b)
Retail financing	$	1.7	$	29.9	$	0.2	$	29.7	$	25.7	$	1.8	$	33.3	$	0.2	$	33.1	$	28.8
Wholesale financing	0.3		23.1		—		23.1		11.3		0.3		23.4		—		23.4		14.2
Finance receivables	2.0		53.0		0.2		52.8		37.0		2.1		56.7		0.2		56.5		43.0
Net investment in operating leases	0.5		9.9		—		9.9		6.3		0.6		12.7		—		12.7		8.0
Total VIE	$	2.5	$	62.9	$	0.2	$	62.7	$	43.3	$	2.7	$	69.4	$	0.2	$	69.2	$	51.0

Non-VIE
Retail financing	$	0.3	$	5.3	$	—	$	5.3	$	4.7	$	0.2	$	4.5	$	—	$	4.5	$	4.0
Wholesale financing	—		0.5		—		0.5		0.5		—		0.6		—		0.6		0.5
Finance receivables	0.3		5.8		—		5.8		5.2		0.2		5.1		—		5.1		4.5
Net investment in operating leases	—		—		—		—		—		—		—		—		—		—
Total Non-VIE	$	0.3	$	5.8	$	—	$	5.8	$	5.2	$	0.2	$	5.1	$	—	$	5.1	$	4.5

Total securitization transactions
Retail financing	$	2.0	$	35.2	$	0.2	$	35.0	$	30.4	$	2.0	$	37.8	$	0.2	$	37.6	$	32.8
Wholesale financing	0.3		23.6		—		23.6		11.8		0.3		24.0		—		24.0		14.7
Finance receivables	2.3		58.8		0.2		58.6		42.2		2.3		61.8		0.2		61.6		47.5
Net investment in operating leases	0.5		9.9		—		9.9		6.3		0.6		12.7		—		12.7		8.0
Total securitization transactions	$	2.8	$	68.7	$	0.2	$	68.5	$	48.5	$	2.9	$	74.5	$	0.2	$	74.3	$	55.5


(c)	Includes unamortized discount and debt issuance ~~costs.~~cost.


(a)	~~Includes forward contracts between Ford Credit~~At December 31, 2018 and ~~an affiliated company.~~September 30, 2019, we held collateral of $19 million and $24 million, respectively, and we posted collateral of $59 million and $100 million, respectively.


(b)	At December 31, ~~2016~~2018 and September 30, ~~2017, we held collateral of $15 million and $11 million, respectively, and we posted collateral of $12 million and $31 million, respectively.~~


~~(c)~~	~~At December 31, 2016 and September 30, 2017,~~2019, the fair value of assets and liabilities available for counterparty netting was ~~$113~~$233 million and ~~$226~~$282 million, respectively. All derivatives are categorized within Level 2 of the fair value hierarchy.


(a)	Accumulated depreciation was $~~347~~367 million and ~~$359~~$383 million at December 31, ~~2016~~2018 and September 30, ~~2017,~~2019, respectively.


~~(b)~~	Restricted cash primarily includes cash held to meet certain local governmental and regulatory reserve requirements and cash held under the terms of certain contractual agreements. Restricted cash does not include required minimum balances or cash securing debt issued through securitization transactions.