SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------
FORM 10-Q
(Mark One)
/x/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1997
OR
/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
-------------- ----------------
Commission file numbers 1-6368
FORD MOTOR CREDIT COMPANY
- -----------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 38-1612444
- -------------------- -----------------------------------
(State of Incorporation) (I.R.S. employer identification no.)
The American Road, Dearborn, Michigan 48121
- --------------------------------------- ---------
(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code (313) 322-3000
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. Yes X No
APPLICABLE ONLY TO CORPORATE ISSUERS: Indicate the number
of shares outstanding of each of the registrant's classes of
common stock, as of the latest practicable date: 250,000 shares
of common stock as of July 31, 1997.
The registrant meets the conditions set forth in General
Instruction I(1)(a) and (b) of Form 10-Q and is therefore filing
this Form in reduced disclosure format.
PAGE 1 OF 23.
EXHIBIT INDEX APPEARS AT PAGE 19.<PAGE>
<PAGE 2>
FORD MOTOR CREDIT COMPANY AND SUBSIDIARIES
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements - The interim financial data presented herein
are unaudited, but in the opinion of management reflect all adjustments
necessary for a fair presentation of such information. Results for interim
periods should not be considered indicative of results for a full year.
Reference should be made to the financial statements contained in the
registrant's Annual Report on Form 10-K for the year ended December 31,
1996 (the "10-K Report"). Information relating to earnings per share is not
presented because the registrant, Ford Motor Credit Company ("Ford
Credit"), is an indirect wholly owned subsidiary of Ford Motor Company
("Ford" or the "company").
FORD MOTOR CREDIT COMPANY AND SUBSIDIARIES
Condensed Consolidated Statement of Income
and of Earnings Retained for Use in the Business
For the Periods Ended June 30, 1997 and 1996
(in millions)
<TABLE>
<CAPTION>
Second Quarter First Half
1997 1996 1997 1996
--------- ---------- ---------- ----------
(Unaudited) (Unaudited)
<C> <C> <C> <C>
Financing Revenue
Operating leases $ 2,169.1 $ 1,998.7 $ 4,310.7 $ 3,990.1
Retail 1,269.8 1,233.3 2,527.3 2,397.0
Wholesale 419.4 409.5 851.6 846.3
Other 97.3 138.5 195.8 272.3
---------- ---------- ---------- ----------
Total financing revenue 3,955.6 3,780.0 7,885.4 7,505.7
Interest expense (1,609.8) (1,575.9) (3,236.4) (3,128.9)
Depreciation on operating leases (1,467.8) (1,337.6) (2,913.3) (2,715.0)
---------- ---------- ---------- ----------
Net financing margin 878.0 866.5 1,735.7 1,661.8
Other Revenue
Insurance premium earned 70.3 82.9 140.1 82.9
Investment and other income 271.4 285.8 581.4 498.9
---------- ---------- ---------- ----------
Total financing margin 1,219.7 1,235.2 2,457.2 2,243.6
and revenue
Expenses
Operating expenses 366.9 356.1 708.7 682.1
Provision for credit losses 296.4 196.9 652.1 400.4
Other insurance expenses 66.9 76.2 133.8 76.2
---------- ---------- ---------- ----------
Total expenses 730.2 629.2 1,494.6 1,158.7
---------- ---------- ---------- ----------
Equity in net income of affiliated
companies (1.2) 1.0 (0.5) 49.8
Income before income taxes 488.3 607.0 962.1 1,134.7
Provision for income taxes 196.4 213.2 379.2 384.0
---------- ---------- ---------- ----------
Income before minority interest 291.9 393.8 582.9 750.7
Minority interest in net income of
subsidiaries 12.9 17.8 28.0 35.7
---------- ---------- ---------- ----------
Net income 279.0 376.0 554.9 715.0
<PAGE>
Earnings retained for use in
the business
Beginning of period 7,153.5 7,063.0 6,892.1 6,724.5
Dividends 0.0 (324.0) (14.5) (324.5)
---------- ---------- ---------- ----------
End of period $ 7,432.5 $ 7,115.0 $ 7,432.5 $ 7,115.0
========== ========== ========== ==========
<FN>
The accompanying notes are an integral part of the financial statements.
</TABLE>
-2-
<PAGE>
<PAGE 3>
FORD MOTOR CREDIT COMPANY AND SUBSIDIARIES
Condensed Consolidated Balance Sheet
(in millions)
<TABLE>
<CAPTION>
June 30, December 31, June 30,
1997 1996 1996
----------- ----------- -----------
ASSETS (Unaudited) (Unaudited)
<S> <C> <C> <C>
Cash and cash equivalents $ 1,220.3 $ 2,716.0 $ 1,551.7
Investments in securities 829.7 1,324.8 1,406.1
Finance receivables, net (Note 2) 78,914.5 80,848.0 81,454.8
Net investment, operating leases 34,579.1 30,645.2 28,402.1
Accounts and notes receivable from
affiliated companies 737.3 1,133.0 1,107.2
Equity in net assets of affiliated
companies 45.5 44.4 23.5
Other assets 4,575.7 4,985.0 3,248.3
----------- ----------- -----------
Total assets $120,902.1 $ 121,696.4 $ 117,193.7
=========== =========== ===========
LIABILITIES AND STOCKHOLDER'S EQUITY
Liabilities
Accounts payable
Trade, customer deposits, and
dealer reserves $ 2,672.2 $ 3,362.6 $ 2,062.2
Affiliated companies 982.0 2,315.2 2,252.9
----------- ----------- -----------
Total accounts payable 3,654.2 5,677.8 4,315.1
Debt (Note 3) 100,325.6 98,024.3 95,926.1
Deferred income taxes 3,839.9 4,260.4 3,589.2
Other liabilities and deferred income 2,833.8 2,929.9 2,860.2
----------- ----------- -----------
Total liabilities 110,653.5 110,892.4 106,690.6
Minority interest in net assets of
subsidiaries 354.0 1,313.8 1,233.0
Preferred stockholder's equity in a 286.5 286.5 284.5
susidiary company
Stockholder's Equity
Capital stock, par value $100 a share,
250,000 shares authorized, issued and
outstanding 25.0 25.0 25.0
Paid-in surplus (contributions by
stockholder) 3,719.5 3,747.6 3,764.6
Note receivable from affiliated
company (1,517.0) (1,517.0) (1,917.0)
Unrealized gain on investment in
securities, net of taxes 65.6 56.9 44.2
Foreign-currency translation adjustments (117.5) (0.9) (46.2)
Earnings retained for use in the business 7,432.5 6,892.1 7,115.0
----------- ----------- -----------
Total stockholder's equity 9,608.1 9,203.7 8,985.6
----------- ----------- -----------
Total liabilities and stockholder's
equity $ 120,902.1 $ 121,696.4 $ 117,193.7
=========== =========== ===========
<FN>
The accompanying notes are an integral part of the financial statements.
</TABLE>
-3-
<PAGE>
<PAGE 4>
FORD MOTOR CREDIT COMPANY AND SUBSIDIARIES
Consolidated Statement of Cash Flows
For the Periods Ended June 30, 1997 and 1996
(in millions)
<TABLE>
<CAPTION>
First Half
1997 1996
---------- ----------
(Unaudited)
<S> <C> <C>
Cash flows from operating activities
Net income $ 554.9 $ 715.0
Adjustments to reconcile net income to net
cash provided by operating activities
Provision for credit losses 652.1 400.4
Depreciation and amortization 3,216.4 2,858.5
Gain on sales of finance receivables (18.4) -
Equity in net income of affiliates 0.5 (49.8)
Deferred income taxes (441.3) 448.2
Changes in the following items
Other assets 568.1 582.9
Other liabilities (581.4) 623.8
Other (60.3) (10.6)
---------- ----------
Net cash provided by operating activities 3,890.6 5,568.4
---------- ----------
Cash flows from investing activities
Purchase of finance receivables (other than wholesale) (18,092.3) (20,951.8)
Collection of finance/intracompany receivables
(other than wholesale) 16,973.9 14,876.8
Purchase of operating lease vehicles (12,856.5) (10,786.9)
Liquidation of operating lease vehicles 5,829.7 5,298.5
Net change in wholesale receivables (1,297.7) (1,420.6)
Proceeds from sale of receivables 1,541.1 2,763.9
Other 468.8 32.7
---------- ----------
Net cash used in investing activities (7,433.0) (10,187.4)
---------- ----------
Cash flows from financing activities
Proceeds from issuance of long-term debt 6,965.1 7,388.3
Principal payments on long-term debt (4,496.9) (4,023.6)
Change in short-term debt, net (441.6) 1,075.9
Cash dividends paid (14.5) (0.5)
Other 63.5 262.0
---------- ----------
Net cash provided by financing activities 2,075.6 4,702.1
---------- ----------
Effect of exchange rate changes on cash and cash
equivalents (28.9) (9.5)
---------- ----------
Net change in cash and cash equivalents (1,495.7) 73.6
Cash and cash equivalents, beginning of period 2,716.0 1,478.1
---------- ----------
Cash and cash equivalents, end of period $ 1,220.3 $ 1,551.7
========== ==========
Supplementary cash flow information
Interest paid $ 3,107.6 $ 2,959.0
Taxes paid/(received) 420.7 (211.3)
<FN>
The accompanying notes are an integral part of the financial statements.
</TABLE>
-4-
<PAGE>
<PAGE 5>
FORD MOTOR CREDIT COMPANY AND SUBSIDIARIES
Notes To Financial Statements
Note 1. Financial Statements Restatement
During the fourth quarter 1996, Ford FSG, Inc. contributed ownership of
Ford Credit Europe plc (approximately 78% ownership) to Ford Credit. Prior
years' quarterly financial statements were restated to include Ford Credit
Europe plc.
Note 2. Finance Receivables, Net (in millions)
<TABLE>
<CAPTION>
June 30, December 31, June 30,
1997 1996 1996
----------- ----------- -----------
(Unaudited) (Unaudited)
<S> <C> <C> <C>
Retail $ 52,583.4 $ 53,099.1 $ 51,814.1
Wholesale 21,898.2 22,706.3 21,802.8
Other 5,479.4 5,942.7 8,646.1
----------- ----------- -----------
Total finance receivables net of
unearned income 79,961.0 81,748.1 82,263.0
Less allowance for credit losses (1,046.5) (900.1) (808.2)
----------- ----------- -----------
Finance receivables, net $ 78,914.5 $ 80,848.0 $ 81,454.8
=========== =========== ===========
</TABLE>
-5-
<PAGE>
<PAGE 6>
FORD MOTOR CREDIT COMPANY AND SUBSIDIARIES
Notes To Financial Statements (continued)
Note 3. Debt (in millions)
<TABLE>
<CAPTION>
June 30, December 31, June 30,
1997 1996 1996
----------- ----------- -----------
(Unaudited) (Unaudited)
<S> <C> <C> <C>
PAYABLE WITHIN ONE YEAR:
Commercial paper $ 38,477.4 $ 38,228.3 $ 40,650.0
Other short-term debt* 4,970.5 4,788.7 2,223.6
----------- ----------- -----------
Total short-term debt 43,447.9 43,017.0 42,873.6
Long-term indebtedness payable
within one year** 10,952.3 9,178.0 7,224.0
----------- ----------- -----------
Total payable within
one year 54,400.2 52,195.0 50,097.6
----------- ----------- -----------
June 30, 1997
----------------------------
Weighted Average
Interest Rates*** Maturities
---------------- ----------
<C> <C>
PAYABLE AFTER ONE YEAR:
Secured indebtedness 16.76% 2000 17.6 9.9 -
Unsecured senior indebtedness
Notes**** 6.63% 1998-2048 44,703.0 44,273.6 44,475.6
Debentures 4.54% 2001-2006 1,097.0 1,228.3 1,351.2
Unamortized
premimum/(discount) 2.1 (7.5) 1.7
----------- ----------- -----------
Total secured and unsecured
senior indebtedness 45,819.7 45,504.3 45,828.5
Unsecured long-term 8.29% 2005 105.7 325.0 -
subordinated notes
----------- ----------- -----------
Total payable after one year 45,925.4 45,829.3 45,828.5
----------- ----------- -----------
Total debt $ 100,325.6 $ 98,024.3 $ 95,926.1
=========== =========== ===========
<FN>
* Includes $1,805.6 million, $2,477.7 million, and $89.2 million with affiliated
companies at June 30, 1997, December 31, 1996, and June 30, 1996, respectively.
** Includes $1,640.8 million, $653 million, and $0 million with affiliated companies at
June 30,1997, December 31, 1996, and June 30, 1996, respectively.
*** Rates were variable on about 21.3% of the debt payable after one year including the
effects of interest rate swap agreements.
**** Includes $2,413.3 million, $3,584.4 million, and $1,510.4 million with affiliated
companies at June 30, 1997, December 31, 1996, and June 30, 1996, respectively.
</TABLE>
-6-
<PAGE>
<PAGE 7>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
FORD CREDIT SECOND QUARTER 1997 COMPARED WITH SECOND QUARTER 1996 RESULTS
OF OPERATIONS
Ford Credit's consolidated net income in the second quarter of 1997 was
$279 million, down $97 million or 26% from 1996. Ford Credit's 1997 financial
results include a majority ownership (78%) of Ford Credit Europe plc ("Ford
Credit Europe") and results for 1996 have been restated to reflect this
ownership change. Compared with results from a year ago, the decrease
primarily reflects higher credit losses and loss reserve requirements,
higher taxes, and lower net margins. Higher levels of earning assets were
a partial offset.
Credit losses as a percent of average net finance receivables including net
investment in operating leases increased to 0.76% in 1997 compared with 0.60% in
1996 reflecting an increase in repossession rates and higher losses per
repossession. The increased repossession ratio reflects an increased mix of used
vehicle financing and expanded purchase policies to generate financing volume.
The increase in loss per repossession reflects a weaker used vehicle market
resulting in Ford Credit realizing lower prices for repossessed units sold at
auction.
The deterioration in net financing margins reflects higher depreciation on
operating leases which resulted from higher residual losses on off-lease
vehicles and higher residual reserves. Improved yields and lower borrowing costs
(6.50% net borrowing rate in 1997 compared with 6.68% in 1996) were a partial
offset. Higher depreciation costs on leased vehicles are expected to continue
to depress Ford Credit's earnings in second half 1997.
Total net finance receivables and net investment in operating leases at
June 30, 1997 were $113.5 billion, up $3.6 billion or 3% from a year earlier.
During the second quarter of 1997, Ford Credit financed 37% of all new cars
and trucks sold by Ford Motor Company dealers in the U.S., compared with 41% in
the same period of 1996. In Europe, Ford Credit financed 29% of all new vehicles
sold by Ford Motor Company in the second quarter of 1997 compared with 28% in
the second quarter of 1996. Ford Credit provided retail customers with financing
for 676,000 new and used vehicles in the United States and 192,000 in Europe. In
the second quarter of 1997, Ford Credit provided wholesale financing for 79% of
Ford Motor Company U.S. factory sales and 95% of Ford Motor Company Europe
factory sales compared with 81% for the U.S. and 91% for Europe in second
quarter 1996.
-7-<PAGE>
<PAGE 8>
FORD CREDIT FIRST HALF 1997 COMPARED WITH FIRST HALF 1996 RESULTS OF OPERATIONS
For the first half of 1997, Ford Credit's consolidated net income was $555
million, down $160 million or 22% from the first half of 1996. The factors
affecting financing profits during the first half of 1997 were the same as those
affecting second quarter results discussed above.
During the first half of 1997, Ford Credit provided retail financing for
38% of all new cars and trucks sold by Ford Motor Company dealers in the United
States, compared with 40% in the same period a year ago. In Europe, Ford Credit
financed 27% of all new vehicles sold by Ford Motor Company in the first half of
1997, equal to the first half of last year. Ford Credit provided retail
financing for 1,308,000 new and used vehicles in the United States and 358,000
in Europe. In the first half of 1997, Ford Credit provided wholesale financing
for 78% of Ford Motor Company U.S. factory sales and 95% of Ford Motor Company
Europe factory sales compared with 79% for the U.S. and 90% for Europe in the
first half of 1996.
NEW ACCOUNTING STANDARD
In June 1997, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards Nos. 130 and 131, "Reporting Comprehensive
Income" and "Disclosures about Segments of an Enterprise and Related
Information", respectively, both effective for fiscal years beginning after
December 15, 1997. Ford Credit will adopt these accounting standards on January
1, 1998. The effect of the adoption of these accounting standards on Ford
Credit's consolidated financial statements is not expected to be material.
-8-<PAGE>
<PAGE 9>
FORD CREDIT LIQUIDITY AND CAPITAL RESOURCES
Ford Credit's outstanding debt at June 30, 1997 and at the end of each of
the last three years was as follows:
<TABLE>
<CAPTION> December 31
June 30, --------------------------------
1997 1996 1995 1994
-------- ------- -------- ------
<S> <C> <C> <C> <C>
Commercial paper & STBAs(a) $ 39,516 $38,774 $40,419 $38,128
Other short-term debt (b) 3,932 4,243 1,781 1,357
Long-term debt (including
current portion)(c) 56,878 55,007 49,980 41,503
--------- -------- -------- --------
Total debt $ 100,326 $98,024 $92,180 $80,988
========= ======== ======== ========
United States $ 77,885 $76,635 $73,178 $65,715
Europe 14,275 14,028 13,013 10,548
Other international 8,166 7,361 5,989 4,725
--------- -------- -------- --------
Total debt $ 100,326 $98,024 $92,180 $80,988
========= ======== ======== ========
Memo:
Total support facilities
(billions) as of July 1, 1997
and December 31, 1996-1994,
respectively:
Ford Credit $ 26.7 $ 27.2 $ 27.4 $ 22.3
Ford Credit Europe 5.3 5.7 4.7 6.6
<FN>
- - - - - -
(a) Short-term borrowing agreements with bank trust departments.
(b) Includes $1,806 million, $2,478 million, $176 million, and $25 million with affiliated
companies at June 30, 1997, December 31, 1996, December 31, 1995, and December 31, 1994,
respectively.
(c) Includes $4,054 million and $4,237 million, $1,174 million and $75 million with
affiliated companies at June 30, 1997 and December 31, 1996, December 31, 1995,
and December 31, 1994 respectively.
</TABLE>
Support facilities represent additional sources of funds, if required. At July
1,1997, Ford Credit had approximately $19.3 billion of contractually committed
facilities. In addition, $7.4 billion of Ford lines of credit may be
used by Ford Credit at Ford's option. The lines have various maturity dates
through June 30, 2002 and may be used, at Ford Credit's option, by any of its
direct or indirect majority-owned subsidiaries. Any such borrowing will be
guaranteed by Ford Credit. Banks also provide $1.6 billion of contractually
committed liquidity facilities to support Ford Credit's asset backed commercial
paper program.
Additionally, at July 1, 1997, there were approximately $4.7 billion of
contractually committed facilities available for Ford Credit Europe's use.
In addition, $615 million of Ford lines of credit may be used by Ford
Credit Europe at Ford's option. The lines have various maturity dates through
June 30, 2002 and may be used, at Ford Credit Europe's option, by any of its
direct or indirect majority-owned subsidiaries. Any such borrowing will be
guaranteed by Ford Credit Europe
-9-
<PAGE>
<PAGE 10> PART II. OTHER INFORMATION
Item 1. Legal Proceedings
None to Report.
Item 2. Changes in Securities
Not required.
Item 3. Defaults Upon Senior Securities
Not required.
Item 4. Submission of Matters to a Vote of Security Holders
Not required.
Item 5. Other information
INFORMATION CONCERNING FORD
Following is a condensed consolidated statement of income (unaudited) of Ford
for the periods ended June 30, 1997 and 1996 (in millions except amounts per
share):
<TABLE>
<CAPTION>
Second Quarter First Half
------------- -----------------
1997 1996 1997 1996
---- ---- ---- ----
<S> <C> <C> <C> <C>
Sales and revenues $40,265 $38,973 $76,467 $74,198
Total costs and expenses a/ 36,925 37,069 70,612 71,167
Operating income 3,340 1,904 5,855 3,031
Automotive net interest income 94 7 149 19
Automotive equity in net income/(loss)
of affiliated companies 79 77 (65) 25
Gain on sale of Common Stock
of a subsidiary b/ 269 650 269 650
Income before income taxes 3,782 2,638 6,208 3,725
Provision for income taxes 1,182 694 2,080 1,107
Minority interests in net income
of subsidiaries 70 41 129 62
Net income $ 2,530 $ 1,903 $ 3,999 $ 2,556
Amounts Per Share of Common Stock
and Class B Stock after Preferred
Stock Dividends
Income per share $ 2.11 $ 1.60 $ 3.33 $ 2.15
Income per share
assuming full dilution $ 2.06 $ 1.56 $ 3.25 $ 2.10
Cash Dividends per share $ 0.42 $ 0.35 $ 0.805 $ 0.70
</TABLE>
a/ 1996 data includes write-down of investment in Budget Rent a Car Corporation
($700 million before taxes and $437 million after taxes).
b/ The gain was not subject to income taxes.
-10-<PAGE>
<PAGE 11>
MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS - FORD
OVERVIEW
The company's worldwide net income was $2,530 million in second quarter 1997, or
$2.06 per share of Common and Class B Stock (fully diluted), compared with
$1,903 million, or $1.56 per share (fully diluted) in second quarter 1996. The
company's worldwide sales and revenues were $40.3 billion, up $1.3 billion from
a year ago. Vehicle unit sales of cars and trucks were 1,879,000, up 69,000
units. Stockholders' equity was $29.1 billion at June 30, 1997, up $2.4 billion
compared with December 31, 1996. Results in second quarter and first half 1997
and 1996 included several one-time actions (see below).
Although second quarter results were a record for the company, there are some
cautions for second half 1997. There is some risk that U.S. industry volumes
will soften, particularly if interest rates rise. In addition, the industry is
experiencing immense competitive pressure in North America and Europe, including
escalating marketing incentives and the prospect of many new competitive product
entries scheduled for the remainder of the year.
ONE-TIME ACTIONS
Net income in second quarter 1997 and 1996 and first half 1997 and 1996 included
several one-time actions, as follows (in millions):
<TABLE>
<CAPTION>
Second Quarter First Half
------------------- ---------------------
1997 1996 1997 1996
------ ------ ------ ------
<S> <C> <C> <C> <C>
Automotive
- - Restructuring actions $(169) $ (21) $(169) $ (49)
Financial Services
- - Sale of The Hertz Corporation common stock 269 - 269 -
- - Sale of The Associates' common stock - 650 - 650
- - Sale of USL Capital's assets - 19 - 19
- - Net write-down for Budget Rent a
Car Corporation - (437) - (437)
----- ----- ----- -----
Total Financial Services 269 232 269 232
----- ----- ----- -----
Total Company $ 100 $ 211 $ 100 $ 183
===== ===== ===== =====
Per share $0.08 $0.17 $0.08 $0.15
</TABLE>
-11-<PAGE>
<PAGE 12>
RESULTS OF OPERATIONS
The company's net income for worldwide Automotive operations in second quarter
1997 and 1996 and first half 1997 and 1996 was as follows (in millions):
Second Quarter First Half
----------------- ----------------
1997 1996 1997 1996
------ ------ ------ ------
U.S. Automotive $1,192 $ 697 $2,028 $ 745
Automotive Outside U.S.
- Europe 157 196 262 269
- South America 25 (69) (22) (129)
- Other 361 284 471 365
------ ------ ------ ------
Total Automotive Outside U.S. 543 411 711 505
------ ------ ------ ------
Total Automotive $1,735 $1,108 $2,739 $1,250
====== ====== ====== ======
The company's net income for worldwide Financial Services operations in second
quarter 1997 and 1996 and first half 1997 and 1996 was as follows (in millions):
Second Quarter First Half
--------------- ----------------
1997 1996 1997 1996
----- ----- ------ ------
Ford Credit $279 $376 $ 555 $ 715
The Associates 245 200 483 392
USL Capital - 41 - 81
Hertz 54 40 74 48
One-Time Actions 269 232 269 232
Minority Interests, Eliminations,
and Other (52) (94) (121) (162)
---- ---- ------ ------
Total Financial Services $795 $795 $1,260 $1,306
==== ==== ====== ======
Memo: Ford's share of earnings in
----------------------------------
The Associates $197 $177 $389 $369
Hertz 45 40 65 48
SECOND QUARTER 1997 RESULTS OF OPERATIONS COMPARED WITH FIRST QUARTER 1997 -
FORD
Automotive Operations
Ford's worldwide Automotive operations earned $1,735 million in second quarter
1997 on sales of $32.8 billion, compared with $1,108 million in second quarter
1996 on sales of $31.8 billion. The increase in earnings was explained primarily
by improved results in the U.S.
Earnings for Automotive operations in the U.S. were up $495 million in second
quarter 1997 compared with a year ago. The increase reflected primarily
continuing cost and quality improvements, and improving product mix. A partial
offset was higher restructuring costs. U.S. Automotive after-tax return on sales
was 5.5% in second quarter 1997, up 2 points from a year ago.
-12-<PAGE>
<PAGE 13>
The U.S. economy slowed somewhat in second quarter 1997, compared with a strong
first quarter. Interest rates and inflation remained at relatively low levels.
The seasonally-adjusted annual selling rate for the U.S. car and truck industry
was 14.8 million units in second quarter, down from 15.6 million units in second
quarter 1996. The company expects car and truck industry sales in full-year 1997
to be slightly lower than 1996. Ford's combined U.S. car and truck share was
25.6%, up 8/10 of a point from a year ago, reflecting strong acceptance of new
products, and up 4/10 of a point from full year 1996.
Lower earnings for Automotive operations in Europe reflected lower volume and
higher marketing and restructuring costs, offset partially by lower operating
costs. The European automotive industry continues to be extremely competitive as
a result of excess industry capacity; this trend is expected to continue in
second half 1997 and beyond.
The seasonally-adjusted annual selling rate for the European car and truck
industry was 14.6 million units in second quarter 1997, up from 14.3 million
units in second quarter 1996. Ford's combined European car and truck market
share was 11.6% in second quarter 1997, down 4/10 of a point from a year ago,
reflecting the highly competitive market, and down 2/10 of a point from full
year 1996. The company expects car and truck industry sales in full-year 1997 to
be about equal to 1996.
Automotive operations in South America earned a profit in second quarter 1997,
compared with a loss a year ago. The improvement reflected primarily higher
industry volumes and market share, lower material costs and favorable tax
adjustments, offset partially by price reductions in response to the highly
competitive market. For full year 1997, Ford still expects to incur a loss in
South America.
Financial Services Operations
Earnings for Financial Services operations in second quarter 1997 were equal to
a year ago. Excluding one-time actions shown above, earnings were down $37
million. The reduction reflects a decline in earnings at Ford Credit, and the
absence of earnings from USL Capital, substantially all of the assets of which
were sold last year.
For a discussion of Ford Credit's operations in second quarter 1997, see Item 2.
"Management's Discussion and Analysis of Financial Condition and Results of
Operations - Ford Credit Second Quarter 1997 Compared with Second Quarter
1996 Results of Operations."
Record earnings at Associates First Capital Corporation ("The Associates")
in second quarter 1997 reflected primarily higher levels of earning assets,
lower operating costs, and improved net interest margins, offset
partially by higher credit losses. Credit losses as a percent of average net
receivables were 2.45% in second quarter 1997, compared with 1.95% in second
quarter 1996. The Associates believes the higher levels of credit losses may
continue.
Record earnings at The Hertz Corporation ("Hertz") reflected strong rental
demand and price improvement in the domestic car rental market.
-13-
<PAGE>
<PAGE 14>
FIRST HALF 1997 COMPARED WITH FIRST HALF 1996 - FORD
Ford earned $3,999 million, or $3.25 per share of Common and Class B Stock
(fully diluted), in first half 1997, compared with $2,556 million, or $2.10 per
share (fully diluted) in first half 1996. Results for first half 1997 and first
half 1996 included several one-time actions (see above). The company's worldwide
sales and revenues were $76.5 billion, up $2.3 billion from a year ago. Vehicle
unit sales of cars and trucks were 3,560,000, up 112,000 units.
Automotive Operations
Ford's worldwide Automotive operations earned $2,739 million in first half 1997
on sales of $61.7 billion, compared with $1,250 million in first half 1996 on
sales of $60.1 billion. The increase was explained primarily by improved
earnings in the U.S.
Earnings on Automotive operations in the U.S. were up $1,283 million in first
half 1997 compared with a year ago. The increase reflected primarily higher
margins from on-going cost and quality improvements, vehicle mix improvements
and higher volumes. A partial offset was higher restructuring costs. U.S.
Automotive after-tax return on sales was 5.1% in first half 1997, up 3.1 points
from a year ago.
The seasonally-adjusted annual selling rate for the U.S. car and truck industry
was 15.3 million units in first half 1997, compared with 15.6 million units in
first half 1996. Ford's combined U.S. car and truck market share was 25.3%,
equal to a year ago, and up 1/10 of a point from full year 1996.
Earnings on Automotive operations in Europe in first half 1997 were down $7
million from a year ago, reflecting primarily lower volumes and one-time
restructuring costs, offset largely by lower operating costs.
The seasonally-adjusted annual selling rate for the European car and truck
industry was 14.4 million units in first half 1997, up from 14.2 million units
in first half 1996. Ford's combined European car and truck market share was
11.5% in first half 1997, down 6/10 of a point from a year ago, reflecting the
highly competitive market, and down 3/10 of a point from full year 1996.
Lower losses in first half 1997 incurred by Automotive operations in South
America, compared to a year ago, reflected primarily higher volume and lower
material costs, offset partially by price reductions in response to the highly
competitive market.
Financial Services Operations
Earnings for Financial Services operations were down $46 million in first half
1997, compared with a year ago. Results in first half 1997 and first half 1996
included the one-time actions shown above; excluding these one-time actions,
earnings were down $83 million.
For a discussion of Ford Credit's operations in first half 1997, see Item 2.
"Managements Discussion and Analysis of Financial Condition and Results of
Operations - Ford Credit First Half 1997 Compared with First Half 1996
Results of Operations."
Higher earnings at The Associates and at Hertz in first half 1997, compared with
first half 1996, reflected primarily the same factors as those described in the
discussion of second quarter results of operations.
LIQUIDITY AND CAPITAL RESOURCES - FORD
Automotive Operations
Automotive cash and marketable securities were $18.2 billion at June 30, 1997,
up $2.8 billion from December 31, 1996. The amount of cash and marketable
securities is expected to decline during third quarter 1997, reflecting normal
seasonal patterns. The company paid $987 million in cash dividends on its Common
Stock, Class B Stock and Preferred Stock during first half 1997.
-14-<PAGE>
<PAGE 15>
Automotive capital expenditures were $3.5 billion in first half 1997, down $83
million from the same period a year ago. For full year 1997, Ford's capital
spending is expected to be about the same as it was in 1996; however, as a
percentage of sales, spending is expected to be lower.
Automotive debt at June 30, 1997 totaled $8.3 billion, which was 22% of total
capitalization (stockholders' equity and Automotive debt), essentially unchanged
from year-end 1996.
At July 1, 1997, Ford had long-term contractually committed global credit
agreements under which $8.4 billion is available from various banks at least
through June 30, 2002. The entire $8.4 billion may be used, at Ford's option, by
any affiliate of Ford; however, any borrowing by an affiliate will be guaranteed
by Ford. Ford also has the ability to transfer on a nonguaranteed basis $8.1
billion of such credit lines in varying portions to Ford Credit and Ford Credit
Europe. In addition, at July 1, 1997, $510 million of contractually committed
credit facilities were available to various Automotive affiliates outside the
U.S. Approximately $60 million of these facilities were in use at July 1, 1997.
Financial Services Operations
Financial Services cash and investments in securities totaled $4.6 billion at
June 30, 1997, down $1.4 billion from December 31, 1996.
Net receivables and lease investments were $168.3 billion at June 30, 1997, up
$6.4 billion from December 31, 1996.
Total debt was $155.5 billion at June 30, 1997, up $5.3 billion from December
31, 1996.
Outstanding commercial paper at June 30, 1997 totaled $38.5 billion at Ford
Credit, $19.3 billion at The Associates, and $2 billion at Hertz, with an
average remaining maturity of 35 days, 23 days, and 24 days, respectively.
At July 1, 1997, Financial Services had a total of $42.5 billion of
contractually committed support facilities (excluding the $8.1 billion available
under Ford's global credit agreements). Of these facilities, $24 billion are
contractually committed global credit agreements under which $19.3 billion and
$4.7 billion are available to Ford Credit and Ford Credit Europe, respectively,
from various banks; 61% and 77%, respectively, of such facilities are available
through June 30, 2002. The entire $19.3 billion may be used, at Ford Credit's
option, by any subsidiary of Ford Credit, and the entire $4.7 billion may be
used, at Ford Credit Europe's option, by any subsidiary of Ford Credit Europe.
Any borrowings by such subsidiaries will be guaranteed by Ford Credit or Ford
Credit Europe, as the case may be. At July 1, 1997, $73 million of the Ford
Credit global facilities were in use and $627 million of the Ford Credit Europe
global facilities were in use. Other than the global credit agreements, the
remaining portion of the Financial Services support facilities at July 1, 1997
consisted of $16.4 billion of contractually committed support facilities
available to various affiliates in the U.S, and $2.1 billion of contractually
committed support facilities available to various affiliates outside the U.S.;
at July 1, 1997, approximately $1.3 billion of these facilities were in use.
Furthermore, banks provide $1.6 billion of liquidity facilities to support the
asset-backed commercial paper program of a Ford Credit sponsored special purpose
entity.
ACCOUNTING CHANGES
Statement of Financial Accounting Standards No. 130 ("SFAS 130"), Reporting
Comprehensive Income, was issued by the Financial Accounting Standards Board in
June 1997. This Statement requires that all items that are required to be
recognized under accounting standards as components of comprehensive income be
reported in a financial statement that is displayed with the same prominence as
other financial statements. Ford will adopt SFAS 130 beginning January 1, 1998.
The effect of adopting this standard is not expected to be material.
-15-
<PAGE>
<PAGE 16>
Statement of Financial Accounting Standards No. 131 ("SFAS 131"), Disclosures
about Segments of an Enterprise and Related Information, was issued by the
Financial Accounting Standards Board in June 1997. This Statement establishes
standards for reporting information about operating segments in annual financial
statements and requires reporting of selected information about operating
segments in interim financial reports issued to stockholders. It also
establishes standards for related disclosures about products and services,
geographic areas, and major customers. Ford will adopt SFAS 131 beginning
January 1, 1998. The effect of adopting this standard is not expected to be
material.
LEGAL PROCEEDINGS - FORD
Environmental Matters
In the fifth full paragraph on page 19 of the 10-K Report, Ford referred to two
environmental matters involving governmental agencies and potential monetary
sanctions exceeding $100,000. In July 1997, one of those matters was resolved.
However, there since has arisen a new environmental investigation by a
governmental agency which involves possible sanctions in excess of $100,000.
The Corporation for Clean Air, Inc. ("CCA", a California non-profit group) has
filed a lawsuit in California against Ford and numerous other engine and vehicle
manufacturers and owners of vehicle fleets, under California's Safe Drinking
Water and Toxic Enforcement Act ("Proposition 65"). Under Proposition 65 any
business that knowingly and intentionally exposes any person to certain
carcinogens and reproductive toxins must provide that person with an advance
clear and reasonable warning, unless the business can prove that the exposures
are insignificant. CCA's complaint alleges that manufacturers and fleet owners
of diesel powered vehicles are exposing California's citizens to diesel exhaust
in violation of Proposition 65. Maximum penalties under Proposition 65 are
$2,500 per vehicle per day of violation.
Other Matters
In the first paragraph on page 20 of the 10-K Report, Ford discussed the suit
by an individual patent owner (Lemelson) alleging Ford's infringement of certain
patents concerning machine vision inspection technologies. Ford reported that
the district court judge had dismissed the case based on one of Ford's defenses.
That defense was that the patents were unenforceable because Lemelson engaged in
"undue delay" in taking 35 years and more to prosecute the patent applications.
In April 1997, however, the judge reversed his decision and granted Lemelson's
motion to dismiss the "undue delay" defense by Ford. At Ford's request, the
judge certified the issue for appeal and stayed all further proceedings until
the appeal is concluded. In June Ford filed a petition with the Court of Appeals
for the Federal Circuit in Washington, D.C. requesting an appeal; Ford awaits a
decision on its petition.
With respect to the paint-related class actions discussed in the second
paragraph on page 20 of the 10-K Report, the plaintiffs voluntarily
dismissed in May 1997 one of the nationwide cases (Jones) that had been
consolidated in federal court in Louisiana. In addition, in July 1997 a
statewide class action (Stallbaumer) that had been filed in Kansas, but was
subsequently consolidated with the cases in Louisiana, was also voluntarily
dismissed by the plaintiffs.
In the last paragraph on page 20 of the 10-K Report, Ford discussed various
class actions relating to an allegedly defective ignition switch. In June 1997,
State Farm Insurance Company moved to intervene as a named plaintiff in one of
the purported nationwide class actions. State Farm argued that it acquired
subrogation rights because of payments to members of the putative class arising
out of vehicle fires allegedly caused by the purportedly defective ignition
switch. Ford will oppose this motion.
-16-<PAGE>
<PAGE 17>
With respect to the airbag class actions reported on page 15 of Ford Credit's
Quarterly Report on Form 10-Q for the quarter ended March 31, 1997, an
additional class action was filed in state court in Alabama, bringing the
total of such lawsuits to three. Plaintiffs in these lawsuits seek economic
damages, claiming that the airbags in their vehicles are defective because they
can injure children and small adults. The Alabama court has conditionally
certified a nationwide class of owners of Ford, Chrysler, and General Motors
1993 to 1996 model passenger vehicles and 1993 to 1997 model light trucks, vans,
and sport utility vehicles containing front passenger air bags.
In July 1997 two new purported nationwide class actions were filed in state
courts (and subsequently removed to Federal courts) in Illinois and Washington
against Ford and Citibank on behalf of all persons who are holders of Ford
Citibank Visa credit cards. The actions allege damages in an amount up to $3,500
for each cardholder who obtained a Ford Citibank credit card in reliance on the
rebate program and who is precluded from accumulating discounts toward the
purchase or lease of new Ford vehicles after December 1997 as a result of the
termination of the rebate program. Plaintiffs contend that defendants
deceptively breached their contract by unilaterally terminating the program,
that defendants have been unjustly enriched as a result of the interest charges
and fees collected from cardholders, and further, that defendants conspired to
deprive plaintiffs of the benefits of their credit card agreement. Plaintiffs
seek compensatory damages, or alternatively, reinstatement of the rebate
program, and punitive damages, costs, expenses and attorneys' fees.
ITEM 6. Exhibits and Reports on Form 8-K
(a) Exhibits
Please refer to the Exhibit Index on page 18.
(b) Reports on Form 8-K during the quarter ended June 30, 1997:
FINANCIAL
DATE OF REPORT ITEM STATEMENTS FILED
- -------------- --------------------- ----------------
April 18, 1997 Item 5 - Other Events Consolidated Financial
Statements and Management's
Discussion and Analysis of
Financial Condition and
Results of Operations for
the first quarter of 1997
of Ford Motor Credit Company
and News release dated April
18, 1997 of Ford Motor
Company and subsidiaries
for the quarter ended
March 31, 1997, with
attachments.
June 9, 1997 Item 5 - Other Events None
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned thereunto duly authorized.
FORD MOTOR CREDIT COMPANY
(Registrant)
/s/ J. B. Smith III
August 11, 1997 --------------------------
J. B. Smith III
Vice President - Finance
(Chief Financial Officer)
-17-
<PAGE>
<PAGE 18>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors and Stockholder
of Ford Motor Credit Company:
We have reviewed the condensed consolidated balance sheet of Ford Motor
Credit Company and Subsidiaries at June 30, 1997 and 1996, and the
related condensed consolidated statements of income and of earnings
retained for use in the business and cash flows for the periods set forth
in this Form 10-Q for the quarter ended June 30, 1997. These financial
statements are the responsibility of the company's management.
We conducted our review in accordance with standards established by the
American Institute of Certified Public Accountants. A review of interim
financial information consists principally of applying analytical
procedures to financial data and making inquiries of persons responsible
for financial and accounting matters. It is substantially less in scope
than an audit conducted in accordance with generally accepted auditing
standards, 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 financial statements for them to be in
conformity with generally accepted accounting principles.
We have previously audited, in accordance with generally accepted auditing
standards, the consolidated balance sheet at December 31, 1996 and the
related consolidated statements of income and of earnings retained for use
in the business and cash flows for the year then ended (not presented
herein); and in our report dated January 27, 1997, we expressed an unqualified
opinion on those consolidated financial statements. In our
opinion, the information set forth in the accompanying condensed
consolidated balance sheet at December 31, 1996 is fairly stated in all
material respects in relation to the consolidated balance sheet from which
it has been derived.
/s/ Coopers & Lybrand
COOPERS & LYBRAND L.L.P.
Detroit, Michigan
July 14, 1997
-18-<PAGE>
<PAGE 19>
FORD MOTOR CREDIT COMPANY AND SUBSIDIARIES
EXHIBIT INDEX
Sequential
Designation Description Method of Filing
- ----------- ------------ -----------------
12-A Calculation of ratio of Filed with this
earnings to fixed charges Report.
of Ford Credit.
12-B Calculation of ratio of Filed with this
earnings to fixed charges Report.
of Ford.
15 Letter from Coopers & Filed with this
Lybrand L.L.P. dated Report.
August 11, 1997,
regarding unaudited
interim financial infor-
mation.
27 Financial Data Schedule. Filed with this
Report.
-19-
<Page 20>
Exhibit 12-A
FORD MOTOR CREDIT COMPANY AND SUBSIDIARIES
CALCULATION OF RATIO OF EARNINGS
TO FIXED CHARGES
(dollar amounts in millions)
<TABLE>
<CAPTION>
First Half For the Years Ended December 31
-------------------- -----------------------------------------------------
1997 1996 1996 1995 1994 1993 1992
--------- --------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Fixed Charges
Interest expense $ 3,236.4 $ 3,114.5 $ 6,235.7 $ 5,987.8 $ 4,226.3 $ 3,699.9 $ 4,184.3
Rents 12.8 10.2 22.2 19.5 16.9 13.0 10.8
--------- --------- --------- --------- --------- --------- ---------
Total fixed
charges 3,249.2 3,124.7 6,257.9 6,007.3 4,243.2 3,712.9 4,195.1
Earnings
Income before income
taxes and cumulative
effects of changes in
accounting principles 962.1 1,134.7 2,240.2 2,327.8 2,335.5 2,147.5 1,585.8
Less equity in net income
of affiliated companies (0.5) 49.8 55.3 255.4 232.5 198.0 155.0
Less minority interest
in net income of
subsidiaries 28.0 35.7 68.0 65.5 59.3 44.6 42.3
--------- --------- --------- --------- --------- --------- ---------
Earnings before fixed
charges $ 4,183.8 $ 4,173.9 $ 8,374.8 $ 8,014.2 $ 6,286.9 $ 5,617.8 $ 5,583.6
========= ========= ========= ========= ========= ========= =========
Ratio of earnings to
fixed charges 1.3 1.3 1.3 1.3 1.5 1.5 1.3
========= ========= ========= ========= ========= ========= =========
<FN>
For purposes of the Ford Credit ratio, earnings consist of income before taxes and cumulative effects of
changes in accounting principles and fixed charges. Income before income taxes and cumulative effects of
changes in accounting principles of Ford Credit includes the equity in net income of all unconsolidated
affiliates and minority interest in net income of subsidiaries. Fixed charges consist of interest on
borrowed funds,(there are no cumulative dividend requirements on subsidiary preferred stock) amortization
of debt discount, premium, and insurance expense, and one-third of all rental expense (the proportion
deemed representative of the interest factor).
</TABLE>
-20-
<PAGE 21>
Exhibit 12-B
<TABLE>
<CAPTION>
Ford Motor Company and Subsidiaries
CALCULATION OF RATIO OF EARNINGS TO COMBINED FIXED CHARGES AND PREFERRED STOCK DIVIDENDS
----------------------------------------------------------------------------------------
(in millions)
First For the Years Ended December 31
Half -----------------------------------------------------------
1997 1996 1995 1994 1993 1992
------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Earnings
Income/(loss) before income taxes
and cumulative effects of changes
in accounting principles $ 6,208 $ 6,793 $ 6,705 $ 8,789 $ 4,003 $ (127)
Equity in net (income)/loss of
affiliates plus dividends from
affiliates 98 36 179 (182) (98) 26
Adjusted fixed charges a/ 5,379 10,801 10,556 8,122 7,648 8,113
------- ------- ------- ------- ------- ------
Earnings $11,685 $17,630 $17,440 $16,729 $11,553 $8,012
======= ======= ======= ======= ======= ======
Combined Fixed Charges and
Preferred Stock Dividends
Interest expense b/ $5,211 $10,464 $10,121 $ 7,787 $ 7,351 $7,987
Interest portion of rental expense c/ 150 300 396 265 266 185
Preferred stock dividend requirements of
majority owned subsidiaries and trusts d/ 27 55 199 160 115 77
------ ------- ------- ------- ------- ------
Fixed charges 5,388 10,819 10,716 8,212 7,732 8,249
Ford preferred stock dividend
requirements e/ 42 95 459 472 442 317
------ ------- ------- ------- ------- ------
Total combined fixed charges
and preferred stock dividends $5,430 $10,914 $11,175 $ 8,684 $ 8,174 $8,566
====== ======= ======= ======= ======= ======
Ratios
Ratio of earnings to fixed charges 2.2 1.6 1.6 2.0 1.5 f/
Ratio of earnings to combined fixed
charges and preferred stock dividends 2.2 1.6 1.6 1.9 1.4 g/
- - - - - -
a/ Fixed charges, as shown below, adjusted to exclude the amount of interest
capitalized during the period and preferred stock dividend requirements of
majority owned subsidiaries.
b/ Includes interest, whether expensed or capitalized, and amortization of debt
expense and discount or premium relating to any indebtedness.
c/ One-third of all rental expense is deemed to be interest.
d/ Preferred stock dividend requirements of Ford Holdings, Inc. (applicable for
1992 through 1995) increased to an amount representing the pre-tax earnings
which would be required to cover such dividend requirements based on Ford's
effective income tax rates for all periods except 1992. The U.S. statutory
rate of 34% was used for 1992. Beginning in Fourth Quarter 1995, includes
requirements related to Company-obligated mandatorily redeemable preferred
securities of a subsidiary trust.
e/ Preferred stock dividend requirements of Ford Motor Company, increased to an
amount representing the pre-tax earnings which would be required to cover
such dividend requirements based on Ford's effective income tax rates for all
periods except 1992. The U.S. statutory rate of 34% was used for 1992.
f/ Earnings inadequate to cover fixed charges by $237 million.
g/ Earnings inadequate to cover combined fixed charges and preferred stock
dividends by $554 million.
</TABLE>
-21-
<Page 22>
EXHIBIT 15
Ford Motor Credit Company
The American Road
Dearborn, Michigan
Re: Ford Motor Credit Company Registration Statement Nos. 33-62973,
33-24928, 33-64237 and 33-64263 on Form S-3
We are aware that our report dated July 14, 1997 accompanying the
unaudited interim financial information of Ford Motor Credit Company and
subsidiaries for the periods ended June 30, 1997 and 1996 and included
in the Ford Motor Credit Company Quarterly Report on Form 10-Q for the
quarter ended June 30, 1997 will be incorporated by reference in the
above Registration Statements. Pursuant to Rule 436(c) under the Securities
Act of 1933, this report should not be considered a part of the Registration
Statements prepared or certified by us within the meaning of Sections 7
and 11 of the Act.
/s/ Coopers & Lybrand L.L.P.
COOPERS & LYBRAND L.L.P.
Detroit, Michigan
August 11, 1997
-22-
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
Ford Credit's Condensed Consolidated Balance Sheet is unclassified. Therefore,
the following tags listed below are not applicable to Ford Credit: Current
Assets and Current Liabilities. Information relating to earnings per share is
not presented because Ford Credit is an indirect wholly owned subsidiary of Ford
Motor Company.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> JUN-30-1997
<CASH> 1,220
<SECURITIES> 830
<RECEIVABLES> 78,915
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 120,902
<CURRENT-LIABILITIES> 0
<BONDS> 100,326
0
0
<COMMON> 25
<OTHER-SE> 9,583
<TOTAL-LIABILITY-AND-EQUITY> 120,902
<SALES> 0
<TOTAL-REVENUES> 2,457
<CGS> 0
<TOTAL-COSTS> 1,495
<OTHER-EXPENSES> 843
<LOSS-PROVISION> 652
<INTEREST-EXPENSE> 3,236
<INCOME-PRETAX> 962
<INCOME-TAX> 379
<INCOME-CONTINUING> 555
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 555
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
