What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2022-10-27 compared with 2022-07-28 · 251 added, 177 removed, 458 unchanged (48% of the section changed)

2 unchanged sentences

NOTES TO THE FINANCIAL STATEMENTS

EMPLOYEE SEPARATION ACTIONS AND EXIT AND DISPOSAL ACTIVITIES (Continued)

Accumulated foreign currency translation losses included in Accumulated other comprehensive income/(loss) at September 30, 2022 of $ 223 million are associated with Ford Credit’s investments in Brazil and Argentina that have ceased operations.

We expect to reclassify these losses to income upon substantially complete liquidation of Ford Credit’s investments, which may occur over multiple reporting periods.

In the first nine months of 2022, we reclassified losses of $ 155 million to Other income/(loss), net , upon the liquidation of three investments in Brazil.

Although the timing for the completion of the remaining actions is uncertain, we expect the majority of losses to be recognized in 2024 or later.

ACQUISITIONS AND DIVESTITURES

Company Excluding Ford Credit

Ford Romania S.R.L.

(“Ford Romania”).

On July 1, 2022, we completed the sale of Ford Romania, our wholly-owned Romanian manufacturing subsidiary, to Ford Otosan, a joint venture in which Ford has a 41 % ownership share.

The transaction resulted in deconsolidation of our Ford Romania subsidiary in the third quarter of 2022.

The fair value of consideration received, consisting of cash and a note receivable, approximated the carrying value of Ford Romania at the time of sale.

The Ford Romania plant in Craiova, Romania will continue to manufacture Ford-branded vehicles for Ford and Ford Otosan.

Ford’s portion of the output is expected to be significant;

as a result, there were about $ 100 million of assets, such as embedded leases, and related liabilities that continue to be reported as part of our financial statements.

Sanand, India (“Sanand”) Plants.

In the third quarter of 2022, we entered into an agreement to sell our Sanand vehicle assembly and powertrain plants to Tata Passenger Electric Mobility Limited (“Tata”), a subsidiary of Tata Motors Limited.

The sale transaction will include the land, buildings, and other fixed assets (excluding the powertrain machinery and equipment) for the plants.

Accordingly, we have reported $ 89 million of fixed assets for this operation as held for sale for the period ended September 30, 2022.

We recognized, in Cost of sales , pre-tax impairment charges of $ 32 million in the third quarter of 2022 to adjust the carrying value of the held-for-sale assets to fair value less costs to sell.

We determined fair value using the market approach, estimated based on the negotiated value of the assets.

After the sale to Tata, Ford will continue to operate the powertrain facility by leasing back the associated land and building.

Skinny Labs Inc., dba Spin (“Spin”).

On April 1, 2022, we completed the sale of Spin, our wholly-owned micro-mobility provider, to TIER Mobility SE, a German-based micro-mobility provider, which resulted in the deconsolidation of our Spin subsidiary in the second quarter of 2022.

In exchange for our shares of Spin, we received preferred equity in TIER Mobility SE, which is reflected in our consolidated balance sheets in Other assets as of the second quarter of 2022.

The fair value of the preferred equity approximated the carrying value of Spin at the time of the transaction.

Electriphi, Inc.

(“Electriphi”).

On June 18, 2021, we acquired Electriphi, a California-based provider of charging management and fleet monitoring software for electric vehicles.

Assets acquired primarily include goodwill, reported in Other assets , and software, reported in Net property .

The acquisition did not have a material impact on our financial statements.

Ford Lio Ho Motor Co., Ltd.

On April 1, 2021, we completed the sale of our controlling financial interest in FLH and its wholly owned subsidiary FLH Marketing & Service Limited, which resulted in deconsolidation of our Ford Taiwan subsidiary in the second quarter of 2021.

FLH will continue to import, manufacture, and sell Ford-branded vehicles through at least 2025.

We recognized a pre-tax gain of $ 161 million, which was reported in Other income/(loss), net in the second quarter of 2021.

Financial Statements (Continued)

FORD MOTOR COMPANY AND SUBSIDIARIES

NOTES TO THE FINANCIAL STATEMENTS

ACQUISITIONS AND DIVESTITURES (Continued)

Getrag Ford Transmissions GmbH (“GFT”).

Prior to March 2021, Ford and Magna International Inc.

(“Magna”) equally owned and operated the GFT joint venture for the purpose of developing, manufacturing, and selling transmissions.

We accounted for our investment in GFT as an equity method investment.

During the first quarter of 2021 and prior to our acquisition, GFT recorded restructuring charges, of which our share was $ 40 million.

These charges are included in Equity in net income/(loss) of affiliated companies .

On March 1, 2021, we acquired Magna’s shares in the restructured GFT.

The purchase price, which was subject to post-closing revisions, was $ 275 million.

The restructured GFT includes the Halewood, UK and Cologne, Germany transmission plants, but excludes the Bordeaux, France transmission plant and China interests acquired by Magna.

We concluded with Magna that these businesses would be better served under separate ownership.

The Sanand, India transmission plant continues under joint Ford/Magna ownership.

As a result of the transaction, we consolidated the restructured GFT, remeasured our prior investment in GFT at its $ 275 million fair value, and recognized in Other income/(loss), ne t a pre-tax gain of $ 178 million during 2021 and post-closing revisions resulting in a pre-tax gain of $ 2 million during the first quarter of 2022.

We estimated the fair value of GFT in negotiations with Magna based on the income approach.

The significant assumptions used in the valuation included GFT’s cash flows that reflect the approved business plan, discounted at a rate typically used for a company like GFT.

Financial Statements (Continued)

FORD MOTOR COMPANY AND SUBSIDIARIES

NOTES TO THE FINANCIAL STATEMENTS

ACCUMULATED OTHER COMPREHENSIVE INCOME/(LOSS)

The changes in the balances for each component of accumulated other comprehensive income/(loss) attributable to Ford Motor Company for the periods ended September 30 were as follows (in millions):

Third Quarter First Nine Months

2021 2022 2021 2022

Foreign currency translation

Beginning balance $ ( 5,249 ) $ ( 6,355 ) $ ( 5,526 ) $ ( 5,487 )

Gains/(Losses) on foreign currency translation ( 236 ) ( 996 ) 112 ( 2,063 )

Tax/(Tax benefit) (a) 66 36 133 5

Net gains/(losses) on foreign currency translation ( 302 ) ( 1,032 ) ( 21 ) ( 2,068 )

(Gains)/Losses reclassified from AOCI to net income (b) — 80 ( 4 ) 248

Other comprehensive income/(loss), net of tax (c) ( 302 ) ( 952 ) ( 25 ) ( 1,820 )

Ending balance $ ( 5,551 ) $ ( 7,307 ) $ ( 5,551 ) $ ( 7,307 )

Marketable securities

Beginning balance $ 81 $ ( 355 ) $ 156 $ ( 19 )

Gains/(Losses) on available for sale securities ( 26 ) ( 199 ) ( 112 ) ( 647 )

Tax/(Tax benefit) ( 6 ) ( 47 ) ( 28 ) ( 153 )

Net gains/(losses) on available for sale securities ( 20 ) ( 152 ) ( 84 ) ( 494 )

(Gains)/Losses reclassified from AOCI to net income ( 3 ) 5 ( 18 ) 13

Tax/(Tax benefit) — 1 ( 4 ) 3

Net (gains)/losses reclassified from AOCI to net income

( 3 ) 4 ( 14 ) 10

Other comprehensive income/(loss), net of tax ( 23 ) ( 148 ) ( 98 ) ( 484 )

Ending balance $ 58 $ ( 503 ) $ 58 $ ( 503 )

Derivative instruments

Beginning balance $ ( 455 ) $ ( 143 ) $ ( 266 ) $ ( 193 )

Gains/(Losses) on derivative instruments 339 445 ( 52 ) 475

Tax/(Tax benefit) 85 105 8 112

Net gains/(losses) on derivative instruments 254 340 ( 60 ) 363

(Gains)/Losses reclassified from AOCI to net income 111 35 271 73

Tax/(Tax benefit) 22 8 57 19

Net (gains)/losses reclassified from AOCI to net income (d) 89 27 214 54

Other comprehensive income/(loss), net of tax 343 367 154 417

Ending balance $ ( 112 ) $ 224 $ ( 112 ) $ 224

Pension and other postretirement benefits

Beginning balance $ ( 2,645 ) $ ( 2,620 ) $ ( 2,658 ) $ ( 2,640 )

Amortization and recognition of prior service costs/(credits)

Tax/(Tax benefit) 4 1 8 4

Net prior service costs/(credits) reclassified from AOCI to net income

Translation impact on non-U.S.

Other comprehensive income/(loss), net of tax 5 13 18 33

Ending balance $ ( 2,640 ) $ ( 2,607 ) $ ( 2,640 ) $ ( 2,607 )

Total AOCI ending balance at September 30 $ ( 8,245 ) $ ( 10,193 ) $ ( 8,245 ) $ ( 10,193 )

(a) We do not recognize deferred taxes for a majority of the foreign currency translation gains and losses because we do not anticipate reversal in the foreseeable future.

However, we have made elections to tax certain non-U.S.

operations simultaneously in U.S.

tax returns, and have recorded deferred taxes for temporary differences that will reverse, independent of repatriation plans, in U.S.

Taxes or tax benefits resulting from foreign currency translation of the temporary differences are recorded in Other comprehensive income/(loss), net of tax .

(b) Reclassified to Other income/(loss), net.

(c) Excludes a $ 3 million gain and a $ 1 million loss related to noncontrolling interests in the third quarter and first nine months of 2022, respectively.

(d) Reclassified to Cost of sales .

During the next twelve months, we expect to reclassify existing net gains on cash flow hedges of $ 225 million (see Note 16).

Financial Statements (Continued)

FORD MOTOR COMPANY AND SUBSIDIARIES

NOTES TO THE FINANCIAL STATEMENTS

VARIABLE INTEREST ENTITIES

Certain of our affiliates are variable interest entities in which we are not the primary beneficiary.

Our maximum exposure to any potential losses associated with these affiliates is limited to our investments and loans and was $ 2.8 billion and $ 2.9 billion at December 31, 2021 and June 30, 2022, respectively.

Our maximum exposure to any potential losses associated with these affiliates is limited to our investments and loans and was $ 2.8 billion and $ 510 million at December 31, 2021 and September 30, 2022, respectively.

On July 13, 2022, Ford, SK On Co., Ltd., and SK Battery America, Inc.

(a wholly owned subsidiary of SK On) completed the creation of BlueOval SK, LLC, a 50/ 50 joint venture that will build and operate electric vehicle battery plants in Tennessee and Kentucky to supply batteries to Ford and Ford affiliates.

We expect BlueOval SK to be a variable interest entity of which we are not the primary beneficiary, and that we will use the equity method of accounting for our investment.

Ford has agreed to contribute up to $ 6.6 billion in capital to BlueOval SK over a five-year period ending in 2026, subject to any adjustments agreed to by the parties.

BlueOval SK is a variable interest entity of which we are not the primary beneficiary, and we use the equity method of accounting for our investment.

As of September 30, 2022, Ford has contributed to BlueOval SK $ 312 million of its agreed capital contribution of up to $ 6.6 billion through 2026, subject to any adjustments agreed to by the parties.

The decrease in maximum exposure from December 31, 2021 is primarily explained by Argo AI (see Note 10), partially offset by the investment in BlueOval SK.

Financial Statements (Continued)

FORD MOTOR COMPANY AND SUBSIDIARIES

NOTES TO THE FINANCIAL STATEMENTS

COMMITMENTS AND CONTINGENCIES

4 unchanged sentences

Subsequent to initial recognition, the guarantee liability is adjusted at each reporting period to reflect the current estimate of expected payments resulting from possible default events over the remaining life of the guarantee.

The maximum potential payments for financial guarantees were $ 357 million and $ 242 million at December 31, 2021 and June 30, 2022, respectively.

The carrying value of recorded liabilities related to financial guarantees was $ 36 million and $ 18 million at December 31, 2021 and June 30, 2022, respectively.

The maximum potential payments for financial guarantees were $ 357 million and $ 395 million at December 31, 2021 and September 30, 2022, respectively.

The carrying value of recorded liabilities related to financial guarantees was $ 36 million and $ 15 million at December 31, 2021 and September 30, 2022, respectively.

Our financial guarantees consist of debt and lease obligations of certain joint ventures, as well as certain financial obligations of outside third parties, including suppliers, to support our business and economic growth.

5 unchanged sentences

We regularly review our performance risk under these arrangements, and in the event it becomes probable we will be required to perform under a guarantee or indemnity, the amount of probable payment is recorded.

The maximum potential payments for non-financial guarantees were $ 453 million and $ 278 million at December 31, 2021 and June 30, 2022, respectively.

The carrying value of recorded liabilities related to non-financial guarantees was $ 38 million and de minimis at December 31, 2021 and June 30, 2022, respectively.

Included in the $ 278 million of maximum potential payments at June 30, 2022 are guarantees for the resale value of vehicles sold in certain arrangements to daily rental companies.

The maximum potential payment of $ 271 million as of June 30, 2022 represents the total proceeds we guarantee the rental company will receive on resale.

Reflecting our present estimate of proceeds the rental companies will receive on resale from third parties, we have recorded a de minimis amount as our best estimate of the amount we will have to pay under the guarantee.

The maximum potential payments for non-financial guarantees were $ 453 million and $ 273 million at December 31, 2021 and September 30, 2022, respectively.

The carrying value of recorded liabilities related to non-financial guarantees was $ 38 million and $ 0 at December 31, 2021 and September 30, 2022, respectively.

Included in the $ 273 million of maximum potential payments at September 30, 2022 are guarantees for the resale value of vehicles sold in certain arrangements to daily rental companies.

The maximum potential payment of $ 267 million as of September 30, 2022 represents the total proceeds we guarantee the rental company will receive on resale.

Reflecting our present estimate of proceeds the rental companies will receive on resale from third parties, we do not expect we will have to pay under the guarantee.

In the ordinary course of business, we execute contracts involving indemnifications standard in the industry and indemnifications specific to a transaction, such as the sale of a business.

56 unchanged sentences

Recoveries are reported in Trade and other receivables, net and Other assets.

The estimate of our future warranty and field service action costs, net of estimated supplier recoveries, for the periods ended June 30 was as follows (in millions):

The estimate of our future warranty and field service action costs, net of estimated supplier recoveries, for the periods ended September 30 was as follows (in millions):

First Nine Months

Beginning balance $ 8,172 $ 8,451

23 unchanged sentences

The Mobility segment primarily includes development costs for Ford’s autonomous vehicles and related businesses, Ford’s equity ownership in Argo AI (a developer of autonomous driving systems), and other mobility businesses and investments.

For additional information about our investment in Argo AI, see Note 10.

Ford Credit Segment

21 unchanged sentences

SEGMENT INFORMATION (Continued)

Key financial information for the periods ended or at June 30 was as follows (in millions):

Key financial information for the periods ended or at September 30 was as follows (in millions):

Automotive Mobility Ford Credit Corporate

1 unchanged sentence

on Debt Special Items Adjustments Total

Second Quarter 2021

Third Quarter 2021

Revenues $ 33,211 $ 38 $ 2,434 $ — $ — $ — $ — $ 35,683

2 unchanged sentences

Total assets 68,291 3,471 135,385 46,695 — — ( 1,165 ) (b) 252,677

Second Quarter 2022

Third Quarter 2022

Revenues $ 37,194 $ 11 $ 2,187 $ — $ — $ — $ — $ 39,392

Income/(Loss) before income taxes 1,698 ( 244 ) 599 ( 250 ) ( 321 ) ( 2,607 ) (c) — ( 1,125 )

Equity in net income/(loss) of affiliated companies 157 ( 83 ) 4 — — ( 20 ) — 58

Equity in net income/(loss) of affiliated companies 185 ( 87 ) 8 — — ( 2,732 ) (e) — ( 2,626 )

Total assets 71,983 415 127,088 48,432 — — ( 999 ) (b) 246,919

2 unchanged sentences

on Debt Special Items Adjustments Total

First Half 2021

First Nine Months 2021

Revenues $ 90,893 $ 70 $ 7,700 $ — $ — $ — $ — $ 98,663

1 unchanged sentence

Equity in net income/(loss) of affiliated companies 434 ( 191 ) 23 1 — ( 7 ) — 260

First Half 2022

First Nine Months 2022

Revenues $ 107,214 $ 120 $ 6,724 $ — $ — $ — $ — $ 114,058

3 unchanged sentences

(b) Includes eliminations of intersegment transactions occurring in the ordinary course of business and deferred tax netting.

(d) Primarily reflects the gain on our Rivian investment, Global Redesign actions, and mark-to-market adjustments for our global pension and OPEB plans.

(e) Primarily reflects the full impairment of our Ford Sollers Netherlands B.V.

(the parent company of our joint venture in Russia) equity method investment, resulting from the ongoing regulatory and economic uncertainty in Russia.

(c) Primarily reflects gains/(losses) on our Rivian investment and the impairment of our Argo AI equity method investment.

(d) Primarily reflects gains on our Rivian investment, Global Redesign actions, and mark-to-market adjustments for our global pension and OPEB plans.

(e) Primarily reflects the impairment of our Argo AI equity method investment.

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

KEY TRENDS AND ECONOMIC FACTORS AFFECTING FORD AND THE AUTOMOTIVE INDUSTRY

The following supplements the key trends and economic factors discussed on pages 34 and 35 of our 2021 Form 10‑K and page 31 of our Quarterly Report on Form 10-Q for the quarter ended March 31, 2022:

COVID-19 and Supplier Disruptions.

The impact of COVID-19, including changes in consumer behavior, pandemic fears and market downturns, and restrictions on business and individual activities, has created significant volatility in the global economy.

Recent outbreaks in certain regions continue to cause intermittent COVID-19-related disruptions in our supply chain and local manufacturing operations.

We also continue to face supplier disruptions due to the semiconductor shortage.

Outbreaks in certain regions continue to cause intermittent COVID-19-related disruptions in our supply chain and local manufacturing operations.

We also continue to face supplier disruptions due to labor shortages and other production issues, in addition to the continuing semiconductor shortage.

Our inconsistent production schedule has been disruptive to our suppliers’ operations, which, in turn, has led to a limited availability of certain parts and delivery delays.

Further, actions taken by Russia in Ukraine have impacted and could further impact our suppliers, particularly our lower tier suppliers, as well as our operations in Europe.

1 unchanged sentence

Commodity and Energy Prices.

Prices for commodities remain volatile, and recently we have experienced price increases for base metals (e.g., steel and aluminum), precious metals (e.g., palladium), and raw materials that are used in batteries for electric vehicles (e.g., lithium, cobalt, and nickel for batteries).

Global demand and differences in output across sectors due to the COVID-19 pandemic have generated divergence in price movements across different commodities.

The net impact on us overall has been higher material costs.

Prices for commodities remain volatile but spot prices have recently diverged somewhat, as anticipated weakening in global industrial activity mitigates price increases for base metals such as steel and aluminum, while precious metals (e.g., palladium), and raw materials that are used in batteries for electric vehicles (e.g., lithium, cobalt, and nickel for batteries) remain at historically elevated price levels.

The net impact on us and our suppliers has been higher material costs overall.

To help ensure supply of raw materials for critical components (e.g., batteries), we, like others in the industry, have entered into multi-year sourcing agreements and may enter into additional agreements.

2 unchanged sentences

For additional information on commodity costs, see the Outlook section on page 59 .

We are seeing a near-term impact on our business due to inflationary pressure, and inflation has continued to accelerate in the wake of Russia’s invasion of Ukraine, driving up energy prices, freight premiums, and other operating costs.

Inflation in the United States rose by 9.1% on an annual basis in June, and U.K.

inflation rose 9.4% over the same period, both representing 40-year highs.

Surging energy prices drove the inflation rate for the euro zone 8.6% higher on an annual basis in June.

Interest rates, notably mature market government bond yields, remain low by historical standards but are rising as central banks around the world tighten monetary policy in response to inflation pressures, while government deficits and debt remain at high levels in many major markets.

The eventual implications of higher government deficits and debt, tighter monetary policy, and potentially higher long-term interest rates may drive a higher cost of capital during our plan period.

Inflation and Interest Rates.

We continue to see near-term impacts on our business due to inflation, including ongoing global price pressures in the wake of Russia’s invasion of Ukraine, driving up energy prices, freight premiums, and other operating costs.

Inflation in the United States peaked at a year-over-year rate of 9.1% in June, before moderating to a still-elevated 8.2% in September as gasoline prices eased.

In Europe, energy price pressures and inflation have remained on an upward path, with September U.K.

inflation rebounding to 10.1% and Euro Area inflation at 9.9%, both on a year-over-year basis.

Interest rates have increased quickly and substantially as central banks in developed countries raise interest rates in an effort to subdue inflation, while government deficits and debt remain at high levels in many global markets.

The eventual implications of higher government deficits and debt, tighter monetary policy, and potentially higher long-term interest rates may drive a higher cost of capital for the business.

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

RESULTS OF OPERATIONS

In the second quarter of 2022, the net income attributable to Ford Motor Company was $667 million, and Company adjusted EBIT was $3,722 million.

In the third quarter of 2022, the net loss attributable to Ford Motor Company was $827 million, and Company adjusted EBIT was $1,803 million.

Net income/(loss) includes certain items (“special items”) that are excluded from Company adjusted EBIT.

2 unchanged sentences

Our pre-tax and tax special items were as follows (in millions):

Second Quarter First Half

Third Quarter First Nine Months

2021 2022 2021 2022

4 unchanged sentences

China (including Taiwan) (5) (17) 152 (37)

Separations and Other (not included above) (4) (31) (3) (12)

North America (29) (180) (39) (210)

Other — 2 7 20

Subtotal Global Redesign $ (702) $ (391) $ (1,262) $ (564)

1 unchanged sentence

$ — $ 646 $ 902 $ (7,250)

Debt extinguishment premium — (135) — (135)

Argo impairment (see Note 10) — (2,708) — (2,708)

Ford Credit – Brazil restructuring (see Note 17) — — — (155)

11 unchanged sentences

Provision for/(Benefit from) tax special items (b) $ (460) $ (544) $ (318) $ (2,273)

(a) As of June 30, 2022, we held 76.7 million Rivian common shares valued at $25.74 per share.

(a) As of September 30, 2022, we held 24.8 million Rivian common shares valued at $32.91 per share.

(b) Includes related tax effect on special items and tax special items.

We recorded $2.6 billion of pre-tax special item charges in the second quarter of 2022, driven primarily by a loss on our Rivian investment.

We recorded $2.6 billion of pre-tax special item charges in the third quarter of 2022, driven by an impairment on our Argo investment.

For additional information on the impairment on our Argo investment, see Note 10 of the Notes to the Financial Statements.

In Note 22 of the Notes to the Financial Statements, special items are reflected as a separate reconciling item, as opposed to being allocated among the Automotive, Mobility, and Ford Credit segments.

2 unchanged sentences

COMPANY KEY METRICS

The table below shows our second quarter and first half 2022 key metrics for the Company, compared to a year ago.

Second Quarter First Half

The table below shows our third quarter and first nine months 2022 key metrics for the Company, compared to a year ago.

Third Quarter First Nine Months

2021 2022 H / (L) 2021 2022 H / (L)

12 unchanged sentences

(a) See Non-GAAP Financial Measure Reconciliations section for reconciliation to GAAP.

In the second quarter of 2022, our diluted earnings per share of Common and Class B Stock was $0.16 and our diluted adjusted earnings per share was $0.68.

Net income/(loss) margin was 1.7% in the second quarter of 2022, down 0.4 percentage points from a year ago.

Company adjusted EBIT margin was 9.3% in the second quarter of 2022, up 5.4 percentage points from a year ago.

The year-over-year increase of $106 million in net income/(loss) in the second quarter of 2022 was driven by higher Automotive EBIT, partially offset by a loss on our Rivian investment, which is included in special items, and lower Ford Credit EBT.

The year-over-year increase of $2.7 billion in Company adjusted EBIT was driven by higher Automotive EBIT, partially offset by lower Ford Credit EBT.

The table below shows our second quarter and first half 2022 net income/(loss) attributable to Ford and Company adjusted EBIT by segment.

Second Quarter First Half

In the third quarter of 2022, our diluted earnings per share of Common and Class B Stock was a loss of $0.21 and our diluted adjusted earnings per share was $0.30.

Net income/(loss) margin was negative 2.1% in the third quarter of 2022, down 7.2 percentage points from a year ago.

Company adjusted EBIT margin was 4.6% in the third quarter of 2022, down 3.8 percentage points from a year ago.

The year-over-year decrease of $2.7 billion in net income/(loss) in the third quarter of 2022 was driven by an impairment on our Argo investment, which is included in special items, and lower Automotive EBIT and Ford Credit EBT.

The year-over-year decrease of $1.2 billion in Company adjusted EBIT was driven by lower Automotive EBIT and lower Ford Credit EBT.

The table below shows our third quarter and first nine months 2022 net income/(loss) attributable to Ford and Company adjusted EBIT by segment.

Third Quarter First Nine Months

2021 2022 H / (L) 2021 2022 H / (L)

11 unchanged sentences

Automotive Segment

The table below shows our second quarter and first half 2022 Automotive segment EBIT by business unit (in millions).

Second Quarter First Half

The table below shows our third quarter and first nine months 2022 Automotive segment EBIT by business unit (in millions).

Third Quarter First Nine Months

2021 2022 H / (L) 2021 2022 H / (L)

5 unchanged sentences

Automotive Segment $ 2,456 $ 1,698 $ (758) $ 5,756 $ 6,911 $ 1,155

The tables below and on the following pages provide second quarter and first half 2022 key metrics and the change in second quarter 2022 EBIT compared with second quarter 2021 by causal factor for our Automotive segment and its regional business units:

The tables below and on the following pages provide third quarter and first nine months 2022 key metrics and the change in third quarter 2022 EBIT compared with third quarter 2021 by causal factor for our Automotive segment and its regional business units:

North America, South America, Europe, China (including Taiwan), and the International Markets Group.

For a description of these causal factors, see Definitions and Information Regarding Automotive Causal Factors.

Second Quarter First Half

Third Quarter First Nine Months

Key Metrics 2021 2022 H / (L) 2021 2022 H / (L)

5 unchanged sentences

Change in EBIT by Causal Factor (in millions)

Second Quarter 2021 EBIT $ (97)

Third Quarter 2021 EBIT $ 2,456

Volume / Mix (277)

Net Pricing 3,398

Second Quarter 2022 EBIT $ 3,322

In the second quarter of 2022, wholesales increased 35% from a year ago, primarily reflecting reduced supply constraints (including semiconductors) on production and the ramp-up of Bronco and Maverick production.

Second quarter 2022 revenue increased 57%, driven by higher wholesales, net pricing, and parts and accessories sales, as well as favorable mix, offset partially by weaker currencies.

Our second quarter 2022 Automotive segment EBIT was $3.3 billion, an increase of $3.4 billion from a year ago, and our second quarter 2022 Automotive EBIT margin was 8.8%.

The higher EBIT was driven by higher wholesales and higher net pricing, offset partially by inflationary increases on commodity, material, and freight costs, and higher volume-related manufacturing and investment-related costs.

Exchange (127)

Third Quarter 2022 EBIT $ 1,698

In the third quarter of 2022, wholesales increased 7% from a year ago, driven by reduced supply constraints (including semiconductors) on production and electric vehicle scaling.

Third quarter 2022 revenue increased 12%, driven by higher net pricing and wholesales, offset partially by weaker currencies.

Our third quarter 2022 Automotive segment EBIT was $1.7 billion, a decrease of $758 million from a year ago, and our third quarter 2022 Automotive EBIT margin was 4.6%.

The lower EBIT was driven by inflationary increases on commodity, material, and freight costs, unfavorable mix, and weaker currencies, offset partially by higher net pricing and higher wholesales.

Our results include inflation-related supplier payments of $1.3 billion, primarily in North America, which were about $1 billion higher than originally expected, as indicated in our Current Report on Form 8-K dated September 19, 2022.

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

North America

Second Quarter First Half

Third Quarter First Nine Months

Key Metrics 2021 2022 H / (L) 2021 2022 H / (L)

5 unchanged sentences

Change in EBIT by Causal Factor (in millions)

Second Quarter 2021 EBIT $ 192

Third Quarter 2021 EBIT $ 2,420

Volume / Mix (672)

Net Pricing 2,061

Second Quarter 2022 EBIT $ 3,269

In North America, second quarter 2022 wholesales increased 89% from a year ago, primarily reflecting reduced supply constraints (including semiconductors) on production.

Second quarter 2022 revenue increased 94%, driven by higher wholesales and net pricing, favorable mix, and higher parts and accessories sales.

North America’s second quarter 2022 EBIT was $3.3 billion, an increase of $3.1 billion from a year ago, with an EBIT margin of 11.3%.

The higher EBIT was driven by higher wholesales, higher net pricing, and favorable mix, offset partially by inflationary increases on commodity, material, and freight costs and higher volume-related manufacturing and investment-related costs.

Third Quarter 2022 EBIT $ 1,309

In North America, third quarter 2022 wholesales increased 4% from a year ago.

Third quarter 2022 revenue increased 10%, driven by higher net pricing and wholesales, offset partially by unfavorable mix.

North America’s third quarter 2022 EBIT was $1.3 billion, a decrease of $1.1 billion from a year ago, with an EBIT margin of 5.0%.

The lower EBIT was driven by inflationary increases on commodity, material, and freight costs and unfavorable mix, offset partially by higher net pricing.

Our results include inflation-related supplier payments of $1.2 billion, which were about $1 billion higher than originally expected, as indicated in our Current Report on Form 8-K dated September 19, 2022.

South America

Second Quarter First Half

Third Quarter First Nine Months

Key Metrics 2021 2022 H / (L) 2021 2022 H / (L)

5 unchanged sentences

Change in EBIT by Causal Factor (in millions)

Second Quarter 2021 EBIT $ (86)

Third Quarter 2021 EBIT $ 2

Volume / Mix (16)

Net Pricing 302

Second Quarter 2022 EBIT $ 104

In South America, second quarter 2022 wholesales increased 3% from a year ago.

Second quarter 2022 revenue increased 29%, driven by higher net pricing, offset partially by weaker currencies.

South America’s second quarter 2022 EBIT was $104 million, an improvement of $190 million from a year ago, with an EBIT margin of 14.8%.

The EBIT improvement was driven by higher net pricing, lower warranty expense, and structural cost reductions, offset partially by inflationary increases on commodity and material costs.

Exchange (14)

Third Quarter 2022 EBIT $ 149

In South America, third quarter 2022 wholesales increased 17% from a year ago.

Third quarter 2022 revenue increased 41%, driven by higher net pricing, offset partially by weaker currencies.

South America’s third quarter 2022 EBIT was $149 million, an improvement of $147 million from a year ago, with an EBIT margin of 16.9%.

The EBIT improvement was driven by higher net pricing, offset partially by inflationary increases on commodity, material, and freight costs.

The strong results in South America reflect our restructuring efforts and pricing and were further aided by currencies, including a balance sheet revaluation, the effect of which is not expected to be sustained.

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

Second Quarter First Half

Third Quarter First Nine Months

Key Metrics 2021 2022 H / (L) 2021 2022 H / (L)

7 unchanged sentences

Change in EBIT by Causal Factor (in millions)

Second Quarter 2021 EBIT $ (284)

Third Quarter 2021 EBIT $ (52)

Volume / Mix 306

1 unchanged sentence

Exchange (139)

Second Quarter 2022 EBIT $ 10

In Europe, second quarter 2022 wholesales increased 22% from a year ago, primarily reflecting reduced supply constraints (including semiconductors) on production.

Second quarter 2022 revenue increased 3%, driven by higher wholesales and net pricing, offset partially by weaker currencies and unfavorable mix.

Europe’s second quarter 2022 EBIT was $10 million, an improvement of $294 million from a year ago, with an EBIT margin of 0.2%.

The higher EBIT was driven by higher net pricing and higher wholesales, offset partially by unfavorable mix driven by semiconductor-related supply constraints, inflationary increases on commodity and material costs, and weaker currencies.

Third Quarter 2022 EBIT $ 204

In Europe, third quarter 2022 wholesales increased 25% from a year ago, primarily reflecting reduced supply constraints (including semiconductors) on production.

Third quarter 2022 revenue increased 11%, driven by higher wholesales and net pricing, offset partially by weaker currencies.

Europe’s third quarter 2022 EBIT was $204 million, an improvement of $256 million from a year ago, with an EBIT margin of 3.0%.

The higher EBIT was driven by higher net pricing and wholesales, offset partially by inflationary increases on commodity, material, and freight costs and weaker currencies.

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

China (Including Taiwan)

Second Quarter First Half

Third Quarter First Nine Months

Key Metrics 2021 2022 H / (L) 2021 2022 H / (L)

11 unchanged sentences

Change in EBIT by Causal Factor (in millions)

Second Quarter 2021 EBIT $ (123)

Third Quarter 2021 EBIT $ (39)

Volume / Mix (63)

Net Pricing 8

Exchange (33)

Other (Including Joint Ventures) (41)

Second Quarter 2022 EBIT $ (121)

In China, second quarter 2022 wholesales decreased 24% from a year ago, driven by COVID-related lockdowns and restrictions.

Second quarter 2022 revenue at our consolidated operations decreased 20%, primarily driven by lower component sales to our joint ventures in China.

China’s second quarter 2022 EBIT loss was $121 million, about flat versus a year ago, with an EBIT margin of negative 27.6%.

Higher profits at our joint ventures and lower costs were offset partially by lower wholesales.

Third Quarter 2022 EBIT $ (193)

In China, third quarter 2022 wholesales decreased 16% from a year ago, driven by lower commercial vehicle and compact segment sales.

Third quarter 2022 revenue at our consolidated operations decreased 27%, primarily driven by lower component sales to our joint ventures in China.

China’s third quarter 2022 EBIT loss was $193 million, a $154 million higher loss than a year ago, with an EBIT margin of negative 44.7%.

The EBIT decrease was driven by lower volume, weaker currencies, higher marketing expenses on new products, and lower profits at our joint ventures.

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

International Markets Group

Second Quarter First Half

Third Quarter First Nine Months

Key Metrics 2021 2022 H / (L) 2021 2022 H / (L)

7 unchanged sentences

Change in EBIT by Causal Factor (in millions)

Second Quarter 2021 EBIT $ 204

Third Quarter 2021 EBIT $ 125

Volume / Mix 167

1 unchanged sentence

Exchange (38)

Second Quarter 2022 EBIT $ 60

In our International Markets Group, second quarter 2022 wholesales decreased 32% from a year ago, primarily reflecting lower wholesales in India and Russia and plant changeover for the new Ranger pickup.

Second quarter 2022 revenue decreased 21%, driven by lower wholesales and weaker currencies, offset partially by higher net pricing.

Our International Markets Group’s second quarter 2022 EBIT was $60 million, a decrease of $144 million from a year ago, with an EBIT margin of 3.1%.

The lower EBIT was driven by lower wholesales, inflationary increases on commodity and material costs, and weaker currencies, offset partially by higher net pricing.

Third Quarter 2022 EBIT $ 229

In our International Markets Group, third quarter 2022 wholesales increased 30% from a year ago, primarily reflecting the positive impact of the next generation Ranger and Everest launches.

Third quarter 2022 revenue increased 47%, driven by higher wholesales and net pricing and favorable mix, offset partially by weaker currencies.

Our International Markets Group’s third quarter 2022 EBIT was $229 million, an increase of $104 million from a year ago, with an EBIT margin of 8.2%.

The EBIT increase was driven by higher net pricing and wholesales, offset partially by higher material cost for our new products, inflationary increases on commodity, material, and freight costs, and weaker currencies.

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

29 unchanged sentences

In our Mobility segment, our second quarter 2022 EBIT loss was $221 million, an $11 million higher loss than a year ago.

The loss reflects our strategic investments as we continued to expand our capabilities in autonomous vehicles and support our mobility initiatives.

In our Mobility segment, our third quarter 2022 EBIT loss was $244 million, a $27 million improvement from a year ago.

The loss reflects our strategic investments in our autonomous vehicle capabilities and support of our mobility initiatives.

Although Argo AI has made progress on developing highly automated driving technology (L4), to achieve commercially viable scale, Argo AI’s technology requires significant additional capital investment and time.

In the third quarter of 2022, we made the strategic decision to shift our capital spending from L4 technology being developed by Argo AI to advanced L2/L3 systems, which we believe will ultimately be essential to achieve profitable commercialization of L4 autonomy at scale in the future.

Additionally, because of the significant additional capital and time required to achieve commercialization of L4, as well as other macroeconomic factors, Argo AI has been unable to attract new investors.

After performing external outreach in the third quarter to assess market interest in acquiring either Argo AI or its technology components and conducting internal reviews to evaluate opportunities to leverage Argo AI’s technology, Ford determined that Argo AI no longer has value as a going concern.

As a result, we reassessed the carrying value of our investment in Argo AI as of September 30, 2022, and in October, Ford and VW initiated the process of exiting the joint development of L4 technology through Argo AI.

Accordingly, in the third quarter of 2022, we recorded as a special item a $2.7 billion pre-tax impairment on our Argo AI investment, and on October 26, 2022, we announced that Argo AI plans to wind down operations.

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

3 unchanged sentences

The foregoing information regarding Ford Credit’s website and its content is for convenience only and not deemed to be incorporated by reference into this Report nor filed with the SEC.

The tables below provide second quarter and first half 2022 key metrics and the change in second quarter 2022 EBT compared with second quarter 2021 by causal factor for the Ford Credit segment.

The tables below provide third quarter and year-to-date 2022 key metrics and the change in third quarter 2022 EBT compared with third quarter 2021 by causal factor for the Ford Credit segment.

For a description of these causal factors, see Definitions and Information Regarding Ford Credit Causal Factors.

Second Quarter First Half

Third Quarter First Nine Months

Key Metrics 2021 2022 H / (L) 2021 2022 H / (L)

10 unchanged sentences

retail financing only.

36-month off-lease second quarter auction values at Q2 2022 mix and YTD amounts at 2022 YTD mix.

36-month off-lease third quarter auction values at Q3 2022 mix and first nine months amounts at first nine months 2022 mix.

Change in EBT by Causal Factor (in millions)

Second Quarter 2021 EBT $ 1,623

Third Quarter 2021 EBT $ 1,077

Volume / Mix (46)

3 unchanged sentences

Exchange (15)

Second Quarter 2022 EBT $ 939

Ford Credit’s total net receivables were $2 billion lower than a year ago, primarily reflecting lower volume due to supply constraints and exchange.

The loss-to-receivables (“LTR”) ratio remained at a low level in the second quarter of 2022, at five basis points, 12 basis points higher than a year ago.

auction values in the second quarter of 2022 were 8% higher than a year ago, reflecting continued strong demand for used vehicles.

Ford Credit’s second quarter 2022 EBT of $939 million was $684 million lower than a year ago, primarily reflecting lower lease residual gains driven by lower lease return volume, unfavorable changes in net financing margin, lower volume due to supply constraints on new vehicle production, and lower credit loss reserve releases, partially offset by positive market valuation adjustments to derivatives due to higher interest rates, which is included in Other.

Third Quarter 2022 EBT $ 599

Ford Credit’s total net receivables of $116 billion were $1 billion (1%) lower than a year ago, reflecting the impact of currency exchange rates, lower consumer financing, and fewer operating leases, offset partially by increased non-consumer financing.

The loss-to-receivables (“LTR”) ratio remained at a low level in the third quarter of 2022, at 18 basis points, though higher than a year ago as losses begin to normalize from historic lows.

auction values in the third quarter of 2022 were about flat compared to a year ago.

Ford Credit’s third quarter 2022 EBT of $599 million was $478 million lower than a year ago, primarily reflecting lower lease residual gains driven by lower lease return volume, unfavorable changes in net financing margin, and lower credit loss reserve releases, offset partially by positive market valuation adjustments to derivatives, which is included in Other.

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

50 unchanged sentences

These include expenses related to setting and directing global policy, providing oversight and stewardship, and promoting the Company’s interests.

In the second quarter of 2022, Corporate Other had a $318 million loss, compared with a $263 million loss a year ago.

The higher loss was driven by negative fair market value adjustments on our cash equivalent portfolios as a result of higher interest rates and higher administrative and IT-related expenses.

In the third quarter of 2022, Corporate Other had a $250 million loss, compared with a $269 million loss a year ago.

The improvement was driven by higher Automotive interest income due to increases in interest rates (primarily Fed Funds).

Interest on Debt

Interest on Debt, which consists of interest expense on Company debt excluding Ford Credit, was $312 million in the second quarter of 2022, $141 million lower than a year ago, primarily explained by U.S.

debt restructuring actions undertaken in the fourth quarter of 2021.

Our Provision for/(Benefit from) income taxes for the second quarter and first half of 2022 was a provision of $153 million and a benefit of $576 million, respectively.

Interest on Debt, which consists of interest expense on Company debt excluding Ford Credit, was $321 million in the third quarter of 2022, $118 million lower than a year ago, primarily explained by U.S.

debt restructuring actions undertaken during the fourth quarter of 2021 and third quarter of 2022.

Our Provision for/(Benefit from) income taxes for the third quarter and first nine months of 2022 was a benefit of $195 million and $771 million, respectively.

This resulted in effective tax rates of 17.3% and 18.4%, respectively.

Our second quarter and first half of 2022 adjusted effective tax rates, which exclude special items, were 20.2% and 21.2%, respectively.

Our third quarter and first nine months of 2022 adjusted effective tax rates, which exclude special items, were 23.5% and 21.7%, respectively.

We regularly review our organizational structure and income tax elections for affiliates in non-U.S.

3 unchanged sentences

LIQUIDITY AND CAPITAL RESOURCES

At June 30, 2022, total balance sheet cash, cash equivalents, marketable securities, and restricted cash, including Ford Credit and entities held for sale, was $37.3 billion.

At September 30, 2022, total balance sheet cash, cash equivalents, marketable securities, and restricted cash, including Ford Credit and entities held for sale, was $40.3 billion.

We consider our key balance sheet metrics to be:

2 unchanged sentences

Company excluding Ford Credit

2021 June 30,

2021 September 30,

Balance Sheets ($B)

8 unchanged sentences

Total Funded Status OPEB $ (6.0) $ (5.8)

(a) Balances at June 30, 2022 reflect net funded status at December 31, 2021, updated for service and interest cost, expected return on assets, separation expense, actual benefit payments, and cash contributions.

(a) Balances at September 30, 2022 reflect net funded status at December 31, 2021, updated for service and interest cost;

expected return on assets;

curtailments, settlements, and associated interim remeasurement (where applicable);

separation expense;

actual benefit payments;

and cash contributions.

The discount rate and rate of expected return assumptions are unchanged from year-end 2021.

One of our key priorities is to maintain a strong balance sheet, while at the same time having resources available to invest in and grow our business.

At June 30, 2022, we had Company cash of $28.7 billion and liquidity of $45.1 billion, including approximately $2 billion of Rivian marketable securities.

In the second quarter, we sold approximately 25 million of our Rivian shares resulting in proceeds of about $700 million.

At September 30, 2022, we had Company cash of $32.0 billion and liquidity of $49.2 billion, including approximately $800 million of Rivian marketable securities.

In the third quarter, we sold approximately 52 million of our Rivian shares resulting in proceeds of about $1.8 billion.

As marketable securities increase or decrease in value, Company cash and liquidity will likewise increase or decrease.

At June 30, 2022, about 84% of Company cash was held by consolidated entities domiciled in the United States.

At September 30, 2022, about 91% of Company cash was held by consolidated entities domiciled in the United States.

To be prepared for an economic downturn, we target an ongoing Company cash balance at or above $20 billion plus significant additional liquidity above our Company cash target.

17 unchanged sentences

• Employee wages, benefits, and incentives

• Operating lease payments (for additional information, see the Aggregate Contractual Obligations table in the “Liquidity and Capital Resources - Company Excluding Ford Credit” section in Item 7 and Note 18 of the Notes the Financial Statements in our 2021 Form 10-K Report)

• Operating lease payments (for additional information, see the Aggregate Contractual Obligations table in the “Liquidity and Capital Resources - Company Excluding Ford Credit” section in Item 7 and Note 18 of the Notes to the Financial Statements in our 2021 Form 10-K Report)

• Cash effects related to the global redesign of our business (for additional information, see the “Changes in Company Cash” section below)

3 unchanged sentences

We plan to utilize our liquidity (as described above) and our cash flows from business operations to fund our material cash requirements.

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

Changes in Company Cash.

In managing our business, we classify changes in Company cash into operating and non-operating items.

Operating items include:

Company adjusted EBIT excluding Ford Credit EBT, capital spending, depreciation and tooling amortization, changes in working capital, Ford Credit distributions, interest on debt, cash taxes, and all other and timing differences (including timing differences between accrual-based EBIT and associated cash flows).

Non-operating items include:

global redesign (including separation payments), changes in Company debt excluding Ford Credit, contributions to funded pension plans, shareholder distributions, and other items (including gains and losses on investments in equity securities, acquisitions and divestitures, and other transactions with Ford Credit).

With respect to “Changes in working capital,” in general we carry relatively low Automotive segment trade receivables compared with our trade payables because the majority of our Automotive wholesales are financed (primarily by Ford Credit) immediately upon the sale of vehicles to dealers, which generally occurs shortly after being produced.

In contrast, our Automotive trade payables are based primarily on industry-standard production supplier payment terms of about 45 days.

As a result, our cash flow deteriorates if wholesale volumes (and the corresponding revenue) decrease while trade payables continue to become due.

Conversely, our cash flow improves if wholesale volumes (and the corresponding revenue) increase while new trade payables are generally not due for about 45 days.

For example, the suspension of production at most of our assembly plants and lower industry volumes due to COVID-19 in early 2020 resulted in an initial deterioration of our cash flow, while the subsequent resumption of manufacturing operations and return to pre-COVID-19 production levels at most of our assembly plants resulted in a subsequent improvement of our cash flow.

Even in normal economic conditions, however, these working capital balances generally are subject to seasonal changes that can impact cash flow.

For example, we typically experience cash flow timing differences associated with inventories and payables due to our annual summer and December shutdown periods when production, and therefore inventories and wholesale volumes, are usually at their lowest levels, while payables continue to come due and be paid.

The net impact of this typically results in cash outflows from changes in our working capital balances during these shutdown periods.

Our inventory includes vehicles completed but awaiting installation of components, including semiconductors.

As a result of the shortage, our inventory is higher than in periods prior to the supply shortage.

In response to, or in anticipation of, supplier disruptions, we may stockpile certain components or raw materials to help prevent disruption in our production of vehicles.

Such actions could have a short-term adverse impact on our cash and increase our inventory.

Moreover, in order to secure critical materials for production of electric vehicles, we plan to enter into offtake agreements with raw material suppliers and make investments in certain raw material and battery suppliers, including contributing up to $6.6 billion in capital to BlueOval SK, LLC over a five-year period ending in 2026.

Such investments, which are part of our plan to invest over $50 billion in electric vehicles through 2026, could have an additional adverse impact on our cash in the near-term.

Financial institutions participate in a supply chain finance (“SCF”) program that enables our suppliers, at their sole discretion, to sell their Ford receivables (i.e., our payment obligations to the suppliers) to the financial institutions on a non-recourse basis in order to be paid earlier than our payment terms provide.

Our suppliers’ voluntary inclusion of invoices in the SCF program has no bearing on our payment terms, the amounts we pay, or our liquidity.

We have no economic interest in a supplier’s decision to participate in the SCF program, and we have no direct financial relationship with the SCF financial institutions.

Moreover, we do not provide any guarantees in connection with the SCF program.

As of June 30, 2022, the outstanding amount of Ford receivables that suppliers elected to sell to the SCF financial institutions was $218 million.

The amount settled through the SCF program during the first half of 2022 was $605 million.

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

Changes in Company cash excluding Ford Credit are summarized below (in billions):

Second Quarter First Half

2021 2022 2021 2022

Company Excluding Ford Credit

Company Adjusted EBIT excluding Ford Credit (a) $ (0.6) $ 2.8 $ 2.4 $ 4.2

Capital spending $ (1.5) $ (1.5) $ (2.9) $ (2.9)

Depreciation and tooling amortization 1.3 1.3 2.5 2.6

Net spending $ (0.2) $ (0.2) $ (0.4) $ (0.2)

Receivables $ — $ (0.6) $ (0.6) $ (0.6)

Inventory (0.8) 0.3 (3.0) (2.5)

Trade Payables (4.6) 0.4 (3.0) 2.0

Changes in working capital $ (5.4) $ 0.1 $ (6.6) $ (1.1)

Ford Credit distributions $ 4.0 $ 0.6 $ 5.0 $ 1.6

Interest on debt and cash taxes (0.7) (0.6) (1.2) (0.9)

All other and timing differences (2.2) 0.9 (4.8) (0.5)

Company adjusted free cash flow (a) $ (5.1) $ 3.6 $ (5.5) $ 3.0

Global Redesign (including separations) $ (1.0) $ 0.3 $ (1.3) $ 0.2

Changes in debt — (0.6) 2.0 (0.8)

Funded pension contributions (0.2) (0.2) (0.4) (0.3)

Shareholder distributions — (0.4) — (0.8)

All other (b) — (2.8) (0.4) (9.0)

Change in cash $ (6.2) $ — $ (5.7) $ (7.8)

(a) See Non-GAAP Financial Measure Reconciliations section for reconciliation to GAAP.

(b) Includes a $2.4 billion loss and a $7.9 billion loss on our Rivian investment in the second quarter and first half of 2022, respectively.

Numbers may not sum due to rounding.

Our second quarter 2022 Net cash provided by/(used in) operating activities was positive $2.9 billion, an increase of $2.2 billion from a year ago (see page 62 for additional information), primarily driven by higher trade payables, timing differences, and higher net income, partially offset by lower Ford Credit operating cash flow.

Company adjusted free cash flow was $3.6 billion, $8.7 billion higher than a year ago, driven by higher adjusted EBIT, higher trade payables, and timing differences, partially offset by lower Ford Credit distributions.

Capital spending was $1.5 billion in the second quarter of 2022, unchanged from a year ago.

We continue to expect full year 2022 capital spending to be about $7.0 billion.

Second quarter 2022 working capital impact was $0.1 billion positive, driven by higher trade payables and lower inventory.

All other and timing differences were positive $0.9 billion, reflecting assorted differences including differences between accrual-based EBIT and the associated cash flows (e.g., pension and OPEB income or expense;

compensation payments;

marketing incentive and warranty payments to dealers).

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements