Earnings call · Ford Wed Oct 28, Saidwire live coverage archive https://saidwire.com/archive/earnings-f-oct28 STORY (final version) Ford Narrows 2026 Profit Outlook, Sees 2027 Roughly Flat Amid $2 Billion in Cost Headwinds Executives said commodity, memory and logistics costs will weigh on next year even as Ford expands trucks, the Fathom EV and its battery-storage business. Ford Motor Co. narrowed its 2026 adjusted EBIT forecast to between $10.5 billion and $11 billion and said it is "targeting profitability next year to be roughly in line with this year," as the automaker expects about $2 billion in commodity, memory and logistics cost pressure in 2027, executives said on the company's third-quarter earnings call. THIRD QUARTER AND 2026 OUTLOOK CFO Sherry House said third-quarter adjusted EBIT rose 3% despite 2% lower revenue, with revenue of $49.5 billion and adjusted EBIT of $2.7 billion. Ford generated $4.7 billion in adjusted free cash flow and ended the quarter with $25.3 billion in cash and $46.4 billion in total liquidity. The company declared a regular fourth-quarter dividend of 15 cents per share. For the full year, Ford left adjusted free cash flow guidance at $6 billion to $7 billion and capital expenditures at $9.5 billion to $10.5 billion. It expects Ford Blue EBIT of about $5.5 billion, Ford Pro EBIT of about $7 billion, Model e losses of about $4 billion and Ford Credit pre-tax profit of about $2.8 billion. Commodity headwinds are now approaching $2.5 billion year over year, an increase of about $500 million. The guidance excludes the potential impact of "a significant escalation in the Middle East or a material downturn in the us economy," House said. Ford Blue's third-quarter EBIT was $1.4 billion, down 10%, on lower volume tied to discontinued products, the Middle East conflict and higher commodity costs. Ford Pro EBIT was $1.7 billion, down 16%, which the company attributed to higher commodities and temporary costs tied to the Oakville plant launch. Model e posted a $1.1 billion EBIT loss on $1.2 billion in revenue. 2027 PLANS AND MODEL E CEO Jim Farley said 2027 will be "a foundational year" toward the company's target of 8% adjusted EBIT by 2029, with 70% of its global vehicle portfolio by volume refreshed. He said planned production downtime for the new F-150 will be largely offset by added Super Duty capacity at Oakville. Farley said Ford expects to offset the roughly $2 billion headwind through industrial-system improvements, revenue optimization and company-wide cost efficiency. House said Model e expenses will be higher in 2027 as investments continue, with the "next step function change in profitability" expected in the first half of 2028 as the Universal EV platform and Ford Energy ramp. Ford still targets Model e breakeven by 2029. FATHOM LAUNCH AND FORD ENERGY Executives said 90% of validation testing for the Fathom has been completed and first production-line vehicles have been built at the Louisville plant. Ford has produced 5,000 of the large unicastings central to the vehicle, and the remaining risk is mainly in the supply base. A pre-order program will launch in the first quarter. Executive Andrew Frick said the Fathom's starting price is $28,350 and the range will extend to the high $30,000s. On Ford Energy, Farley said executed contracts and late-stage negotiations account for more than 80% of 2028 capacity, which Ford expects to be fully committed by the first quarter of next year. The company remains on track to bring 20 gigawatt-hours of annual capacity online at its Kentucky plant by the end of next year. An executive said Ford will spend about a third of roughly $2 billion in investment this year and about two-thirds next year, and that it will begin disclosing backlog next year. EUROPE, CHINA AND GEELY Asked about Chinese competition, Farley said the main pressure on Ford is in Europe, citing EU electric-vehicle mandates and long-standing overcapacity along with Chinese exports. He said partnerships with Renault and Geely are low-capital routes to more profitable EVs there. On Geely, an executive said the partner can offer parts at a lower landed cost in Europe and develop vehicles months faster, and that Ford is institutionalizing those lessons in its global product development system. Farley said Ford is the number one traditional automaker exporting from China. BULLETINS 5:02:47 PM ET FORD CEO FARLEY: Q3 ADJUSTED EBIT $2.7 BILLION 5:03:29 PM ET FORD RAISES LOW END OF FY ADJUSTED EBIT GUIDANCE, NOW SEES $10.5 BILLION-$11 BILLION 5:04:17 PM ET FORD CEO: TARGETS 8% ADJUSTED EBIT MARGIN BY 2029 5:06:17 PM ET FORD CEO: ON TRACK TO CUT ANOTHER $1 BILLION IN WARRANTY AND MATERIAL COSTS THIS YEAR 5:06:59 PM ET FORD: OAKVILLE SUPER DUTY RAMP EXCEEDING PLANNED VOLUME, SHIPPING TRUCKS TO DEALERS 5:09:05 PM ET FORD: FATHOM EV LAUNCH ON TRACK FOR Q4 NEXT YEAR, MSRP UNDER $30,000 5:10:29 PM ET FORD: SOFTWARE SERVICES AND PARTS BUSINESSES BOTH HIT RECORD REVENUE IN Q3 5:11:11 PM ET FORD: SOFTWARE SUBSCRIPTION PLUS REGULAR SERVICE LIFTS PARTS RETENTION ABOUT NINE POINTS 5:11:53 PM ET FORD: SEES PRO DIGITAL FLEET MANAGEMENT PORTFOLIO OVER 100,000 UNITS BY YEAR END 5:12:35 PM ET FORD: LAUNCHED FORD PRO LEASING IN Q3, ADDING COMMERCIAL LEASING TO FLEET OFFERINGS 5:13:23 PM ET FORD ENERGY: KENTUCKY PLANT ON TRACK FOR 20 GWH ANNUAL CAPACITY ONLINE BY END OF NEXT YEAR 5:14:05 PM ET FORD ENERGY: CONTRACTS, LATE-STAGE TALKS >80% OF 2028 CAPACITY; EXPECTS FULL COMMITMENT BY Q1 5:14:59 PM ET FORD CFO: Q3 REVENUE $49.5 BILLION, ADJUSTED EBIT $2.7 BILLION, BOTH HIGHER SEQUENTIALLY 5:15:41 PM ET FORD CFO: Q3 ADJ FREE CASH FLOW $4.7 BILLION; CASH $25.3 BILLION, LIQUIDITY $46.4 BILLION 5:16:41 PM ET FORD CFO: Q4 REGULAR DIVIDEND OF 15 CENTS PER SHARE 5:17:23 PM ET FORD CFO: FORD BLUE Q3 REVENUE $27.1 BILLION, EBIT $1.4 BILLION, DOWN 3% AND 10% 5:18:11 PM ET FORD CFO: NOVELIS COSTS ABOUT $1 BILLION YTD; STILL SEES NET TAILWIND ABOUT $1 BILLION IN 2026 5:18:53 PM ET FORD CFO: MODEL E Q3 EBIT LOSS $1.1 BILLION ON REVENUE $1.2 BILLION; EBIT IMPROVED 25% YOY 5:20:17 PM ET FORD CFO: FORD PRO Q3 REVENUE $17.8 BILLION, UP 2%; EBIT $1.7 BILLION, DOWN 16% 5:21:05 PM ET FORD CFO: FORD CREDIT Q3 EBT $803 MILLION, UP $172 MILLION 5:21:47 PM ET FORD CFO: MACH-E TARGETING BREAKEVEN BY 2029; Q3 HAD LOWEST INCENTIVE SPEND SINCE 2023 5:24:59 PM ET FORD CFO: FY SEGMENT EBIT: BLUE ~$5.5B, PRO ~$7B, MODEL E LOSS ~$4B, CREDIT EBT ~$2.8B 5:25:41 PM ET FORD CEO: TARGETING 2027 PROFITABILITY ROUGHLY IN LINE WITH 2026 5:26:29 PM ET FORD CEO: 2027 COMMODITIES, MEMORY, LOGISTICS COSTS SEEN ABOUT $2 BILLION YOY HEADWIND 5:27:05 PM ET FORD: TARGETS 8% ADJUSTED EBIT MARGIN BY 2029; MODEL E TURNAROUND BY 2029 5:27:53 PM ET FORD: SEES FORD ENERGY 20 GWH CAPACITY ONLINE, KEY TO MODEL E TURNAROUND BY 2029 5:29:59 PM ET FORD CFO: SOFTWARE AND PARTS GROWTH NOW ABOUT 10% OF REVENUES AT ACCRETIVE GROWTH MARGINS 5:30:41 PM ET FORD: UEV LAUNCH PROGRESSING VERY WELL; 90% OF VALIDATION TESTING COMPLETED 5:31:23 PM ET FORD: FIRST UEV PRODUCTION LINE VEHICLES BUILT AT LOUISVILLE; 5,000 UNICASTINGS PRODUCED 5:32:05 PM ET FORD: SEES US EV PRICES UP ABOUT 10%, PRICING MANY NEW VEHICLES OUT OF AFFORDABLE MARKET 5:32:47 PM ET FORD: UEV STARTING MSRP $28,350; OVER HALF OF US EVS SOLD UNDER $40,000 ARE USED 5:34:59 PM ET FORD: UEV PRE-ORDER PROGRAM TO LAUNCH IN FIRST QUARTER 5:35:41 PM ET FORD CFO: MODEL E BREAKEVEN TARGET BY 2029; EXPECTS HIGHER MODEL E EXPENSES IN 2027 5:36:23 PM ET FORD CFO: SEES NEXT STEP CHANGE IN PROFITABILITY IN FIRST HALF 2028 AS UEV, FORD ENERGY RAMP 5:39:53 PM ET FORD: F-150 STOCK AT 49 DAYS COMING OUT OF SEPTEMBER, BELOW TARGET RANGE 5:40:41 PM ET FORD: F-150 STOCK TARGET 50-60 DAY SUPPLY, EXPECTS TO BE IN RANGE BY YEAR END 5:42:11 PM ET FORD: NOVELIS ALUMINUM PLANT RECOVERY GOING AS PLANNED, NOW RUNNING AT RATE 5:43:23 PM ET FORD: NOVELIS RECOVERY KEEPS $1 BILLION NET TAILWIND GUIDE BY END OF 2026; COSTS, VOLUMES LOWER 5:45:41 PM ET FORD ENERGY: WON'T DISCLOSE BACKLOG TODAY, PLANS TO START DISCLOSING NEXT YEAR 5:46:23 PM ET FORD: SAYS IT IS NUMBER ONE TRADITIONAL OEM EXPORTING FROM CHINA 5:46:59 PM ET FORD: TERRITORY IS SECOND MOST PROFITABLE VEHICLE GLOBALLY; CHINA EXPORTS UP ABOUT 60% 5:49:11 PM ET FORD: UEV STARTING PRICE $28,150; SAYS WILL OFFER OPTIONS BEYOND $28,000 FOR CUSTOMERS 5:49:53 PM ET FORD: UEV PRICING RANGE TO GO TO HIGH $30,000S; STARTS AT $28,150 5:50:29 PM ET FORD: UEV GETS 48-VOLT ARCHITECTURE; EMBEDDED APPLE MAPS, SEES LONG-TERM SUBSCRIPTION UPSELL 5:51:17 PM ET FORD: SEES RETAIL PRICING UP ABOUT ONE PERCENTAGE POINT THIS YEAR, 'VERY STRONG' ENVIRONMENT 5:51:59 PM ET FORD: FLEET PRICING UP OVER ONE PERCENT YEAR OVER YEAR; 2027 MODEL YEAR FLEET ORDERS ON TARGET 5:54:23 PM ET FORD: ENERGY INITIAL 20 GWH TO BE ONLINE, RAMPED IN 2028; EVALUATING EXPANSION SCENARIOS 5:55:53 PM ET FORD CFO: ENERGY INVESTMENT ABOUT $2 BLN, ABOUT A THIRD THIS YEAR, ABOUT TWO THIRDS NEXT YEAR 5:57:59 PM ET FORD: SAYS 5,000 UEV UNITS ALREADY BUILT; TWO LARGE UNIT CASTINGS CUT PART COUNT, LABOR CONTENT 5:58:41 PM ET FORD: SAYS UEV MOTORS, GEARBOX, INVERTERS ABOUT 30% MORE EFFICIENT THAN BYD'S POSTS (quotes verbatim; each shows when the words were said and when we drafted it) Ford CEO Jim Farley said the company is "raising our low end of our previous full year adjusted ebit guidance and now expect to earn between $10.5 billion and $11 billion." said 5:02:53 PM ET · drafted 5:05:30 PM ET Ford CEO Jim Farley: "We reduced warranty and material costs by $1.5 billion in 25 and are on track to reduce another $1 billion this year," excluding Novelis and tariffs. said 5:05:47 PM ET · drafted 5:06:17 PM ET "The production ramp is already exceeding planned daily volume and jobs per hour rates," Ford said of the Super Duty launch at its Oakville, Ontario, plant. Ford began shipping trucks to dealerships last week. said 5:06:29 PM ET · drafted 5:07:02 PM ET Ford CEO Jim Farley said prototype builds for the next-generation F-150 begin in the first quarter of 2027. For a new international midsize pickup: "We expect the base material cost for this truck to be 20 lower." said 5:07:53 PM ET · drafted 5:08:17 PM ET Ford CEO Jim Farley said the Fathom, the first vehicle off Ford's UEV platform, "remains on track for fourth quarter next year." It will be built in Louisville, Kentucky, he said, with an MSRP under $30,000. said 5:08:23 PM ET · drafted 5:09:44 PM ET Ford CEO Jim Farley, on the company's auto adjacencies business: "Both software services and parts businesses achieved record revenue in the third quarter and highly accretive margins." said 5:10:05 PM ET · drafted 5:11:04 PM ET "We remain on track to bring 20 gigawatt hours of annual capacity online by the end of next year," a Ford executive said of Ford Energy. Contracts and late-stage talks cover over 80% of 2028 capacity. said 5:12:53 PM ET · drafted 5:13:25 PM ET "Adjusted ebit growth of 3% despite 2% lower revenue," Ford's CFO said Wednesday, describing the automaker's third-quarter results on an earnings call with analysts. said 5:14:11 PM ET · drafted 5:14:27 PM ET Ford CFO Sherry House said the company generated "4.7 billion in company adjusted free cash flow in q three." Ford ended the quarter with $25.3 billion in cash and $46.4 billion in total liquidity. said 5:14:41 PM ET · drafted 5:15:30 PM ET Ford CFO Sherry House said the company has incurred about $1 billion in Novelis-related temporary costs this year, with more in Q4. "We are still tracking to a net tailwind of about $1 billion in 2026." said 5:16:59 PM ET · drafted 5:17:29 PM ET Ford's CFO said Ford Blue "delivered $27.1 billion of revenue and 1.4 billion in ebit," down 3% and 10%, on lower volume and higher commodity costs. said 5:17:11 PM ET · drafted 5:18:30 PM ET Ford's CFO said, "we reported an ebit loss of 1.1 billion" for Model e in the third quarter, on revenue of $1.2 billion. Ebit improved 25% from a year earlier, and Ford is "still targeting breakeven." said 5:18:47 PM ET · drafted 5:19:34 PM ET "Pro ebit was 1.7 billion down 16%," Ford's CFO said of Ford Pro, which had $17.8 billion in revenue, up 2%. She cited higher commodity costs and temporary costs tied to the Oakville launch. said 5:19:47 PM ET · drafted 5:20:51 PM ET Ford now expects "full year adjusted ebit between 10½ 1 billion to $11 billion" for 2026, its CFO said. Free cash flow and capital spending guidance is unchanged. said 5:23:29 PM ET · drafted 5:24:03 PM ET Ford CEO Jim Farley said Wednesday the company is "targeting profitability next year to be roughly in line with this year." He called 2027 a "foundational year" and cited "substantial external cost pressures." said 5:24:17 PM ET · drafted 5:25:04 PM ET Ford CEO Jim Farley said on the earnings call that the new F-150 will require "planned production downtime next year." "we expect the added super duty capacity at oakville to largely offset the impact of that downtime." said 5:25:17 PM ET · drafted 5:26:11 PM ET Ford executive on offsetting 2027 cost headwinds: "We have transformed our sales and operating plan and are now leveraging ai tools that are enabling us to match demand sensing to capacity planning." said 5:28:17 PM ET · drafted 5:29:18 PM ET Ford executive on 2027 cost headwinds: "We've now seen those combined you know representing 10% of our revenues at accretive growth margins." The remark referred to software and parts growth. said 5:29:23 PM ET · drafted 5:30:23 PM ET Ford executive Kumar Galhotra said "90% of the validation testing has been completed" on its universal EV platform. He said the remaining risk is "primarily in the supply base." said 5:30:41 PM ET · drafted 5:31:22 PM ET A Ford executive said EV prices have gone up about 10%, which "has priced a lot of new vehicles out of the affordable market." He spoke on the earnings call while discussing the Fathom EV. said 5:31:59 PM ET · drafted 5:32:23 PM ET A Ford executive said on the call that "the fathom starting msr is at $28,350." He said nearly 50% of U.S. new vehicles transact under $40,000 and pre-orders open in the first quarter. said 5:32:23 PM ET · drafted 5:33:49 PM ET Ford executive on Model e: "Working towards our target for model a to reach breakeven by 2029." Said progress "isn't gonna be linear" during the earnings call Wednesday. said 5:34:47 PM ET · drafted 5:35:00 PM ET Ford said it expects "higher expenses in 2027" for Model e. It said the "next step function change in profitability" should come in the first half of 2028 as UEV and Ford Energy ramp. said 5:34:53 PM ET · drafted 5:36:17 PM ET Ford executive said partnerships with Renault and Geely in Europe are "very low capital investments with really great cost levels," adding they will replace unprofitable EVs there with better profit outlooks. said 5:37:23 PM ET · drafted 5:38:11 PM ET "We are completely committed building a profitable European business with these actions," a Ford executive said of Europe, adding, "we have a really aggressive plan." The executive declined to detail Valencia, Romania and Turkey. said 5:38:23 PM ET · drafted 5:39:12 PM ET Ford executive Andrew on F-150 inventory: "We're running at 49 days coming out of september that is below our range." He said Ford expects stock at the low end of that range at year-end. said 5:39:35 PM ET · drafted 5:40:26 PM ET A Ford executive said F-150 inventory should reach a 50-to-60-day supply by year's end, "substantially lower than Ford's operated." He said norms were 80 to 100 days in the past. Ford held its earnings call Wednesday. said 5:40:41 PM ET · drafted 5:41:29 PM ET "It has been going as planned operationally and we're now running at rate." Ford executive on the Novelis aluminum plant recovery. Said "we have seen costs coming in a little bit lower." said 5:42:11 PM ET · drafted 5:42:28 PM ET Ford said its Novelis aluminum plant recovery is on plan and it expects to keep to its guide of "$1 billion of a net tailwind by the end of 2026." Costs and volumes are a little lower. said 5:42:35 PM ET · drafted 5:43:35 PM ET "We're actually not talking about backlog today we were going to start disclosing that next year," Ford's Dave Carroll said on the earnings call, responding to an analyst's question about Ford Energy backlog. said 5:44:29 PM ET · drafted 5:44:43 PM ET "We are actually ahead of expectations where we are with our customers," Dave Carroll said of Ford Energy on Ford's earnings call. He said a customer toured the Marshall plant, which is making LFP prismatic cells. said 5:44:35 PM ET · drafted 5:45:43 PM ET A Ford executive said, "we've held up really well internationally as the Chinese gain more and more share." Competition is most intense in Latam and Southeast Asia, where Ford has a large Ranger business, he said. said 5:45:47 PM ET · drafted 5:46:44 PM ET A Ford executive on Europe, citing Chinese competition, EU EV mandates and overcapacity: "That's where we see the the real pressure on our business." Oct. 28 earnings call. said 5:46:53 PM ET · drafted 5:47:47 PM ET Ford exec: "We expect pricing to be up about one percentage point this year." He called the pricing environment "very strong" and said Ford sees "a lot of different levers" on product mix and net pricing next year. said 5:51:11 PM ET · drafted 5:51:53 PM ET Ford said on its earnings call that the upside for next year for pro is "pretty meaningful between Oakville and getting past Novelis." It cited fleet pricing up over 1% and on-target 27 model-year orders. said 5:52:41 PM ET · drafted 5:53:15 PM ET A Ford executive named Dave said the company is evaluating scenarios to expand energy storage capacity beyond the first 20 gigawatt hours. "We don't have anything to announce today in that regards," he said. said 5:54:17 PM ET · drafted 5:54:35 PM ET Ford said it had discussed about $2 billion in investment for Ford Energy. An executive said "we're going to spend about a third of that this year and about two thirds next year." said 5:54:35 PM ET · drafted 5:55:53 PM ET A Ford executive said on the Oct. 28 earnings call that Ford is "already learning that they can offer excuse me a certain percentage lower cost landed in Europe for us," referring to its Geely partnership. said 5:55:53 PM ET · drafted 5:56:56 PM ET Ford exec says the company's motors, gearbox and inverters are "about 30% more efficient than theirs and allows us to design a battery that's much less," in comparing its EV platform with BYD's. said 5:58:11 PM ET · drafted 5:59:01 PM ET Ford exec said "the heart and soul of our company is gonna be this new industrial system," built on lessons from its UEV program, Geely and AI tools, and folded into its global product development. said 5:59:11 PM ET · drafted 6:00:09 PM ET "We are going to move that into the core part of the company as fast as we can," a Ford executive said, referring to lessons from its UEV program, Geely and AI tools, during the company's earnings call Wednesday. said 5:59:59 PM ET · drafted 6:02:11 PM ET TRANSCRIPT (copy-edited; times Eastern) [4:51:41 PM ET] I'm not there in the middle. [4:51:47 PM ET] And actually, [4:51:59 PM ET] we're determined of it. [4:52:05 PM ET] Yeah [4:52:23 PM ET] why this is a good thing. [4:52:29 PM ET] like this one. [4:52:41 PM ET] make the goods. [4:53:23 PM ET] there's a lot of people in the house. [4:53:29 PM ET] one. [4:53:41 PM ET] I'm not sure. It isn't a good idea. I'm going to go. [4:53:47 PM ET] the problem now is. [4:54:05 PM ET] to be found in that. [4:54:11 PM ET] you're not in now. [4:54:17 PM ET] bat close. [4:54:23 PM ET] I know we can be. [4:54:47 PM ET] I didn't even know. [4:55:17 PM ET] both of it is good enough. [4:55:29 PM ET] I [4:55:41 PM ET] than [4:56:17 PM ET] game. [4:56:29 PM ET] as the [4:56:35 PM ET] you're gonna be. [4:56:53 PM ET] to be there. [4:57:05 PM ET] And it's [4:57:11 PM ET] colours, and [4:57:23 PM ET] for a given. [4:57:35 PM ET] this one we do with the means all the time. [4:57:41 PM ET] of a [4:57:53 PM ET] a pen. [4:57:59 PM ET] like to say that it. [4:58:23 PM ET] I don't know how you can. [4:58:29 PM ET] school and reasonable. [4:58:35 PM ET] Okay, and it does not. [4:58:41 PM ET] your money. [4:58:47 PM ET] we're in the [4:59:05 PM ET] I don't know and [4:59:17 PM ET] a mainstream. [4:59:23 PM ET] So I don't know. [4:59:35 PM ET] actions. [4:59:41 PM ET] But it's nothing. [4:59:47 PM ET] things of the diet. [5:00:05 PM ET] I think that. [5:00:23 PM ET] there. [5:00:29 PM ET] I mean it cheaters [5:00:35 PM ET] Good day, everyone. My name is Ronnie and I will be your conference operator today. [5:00:35 PM ET] good day everyone [5:00:35 PM ET] my name is ronnie and i will be your conference operator today [5:00:41 PM ET] At this time, I would like to welcome you to the Ford Motor Company third quarter 2026 earnings conference call. [5:00:41 PM ET] at this time i would like to welcome you to the ford motor company third quarter [5:00:47 PM ET] conference call. All lines have been placed on you to prevent any background noise. After the speaker's remarks, there will be. [5:00:47 PM ET] twenty twenty six earnings conference call [5:00:47 PM ET] all lines have been placed on mute to prevent any background noise [5:00:53 PM ET] a question and answer session. If you would like to ask a question during this time, please use the raised hand function, which can be [5:00:53 PM ET] after the speakers' remarks there will be a question and answer session [5:00:59 PM ET] found on the black bar at the bottom of your screen. At this time, I would like to turn the call over to Maria Richards. [5:00:59 PM ET] if you would like to ask a question during this time please use the raise hand function which can be found on the black [5:00:59 PM ET] bar at the bottom of your screen [5:01:05 PM ET] Richardone, deep investment relations officer. Thank you, Rani, and welcome to you for. [5:01:05 PM ET] at this time i would like to turn the call over to maria richardone [5:01:05 PM ET] chief investment relations officer [5:01:11 PM ET] Motor Company's third quarter 2026 earnings call. I'm Maria Richard On Ford. [5:01:11 PM ET] thank you ronnie and welcome to [5:01:11 PM ET] ford motor company's third quarter twenty twenty six earnings call [5:01:17 PM ET] investor relations officer. With me today are Jim Farley, president and CEO, and Sherry House. [5:01:17 PM ET] i'm maria richardone ford's chief investor relations officer [5:01:23 PM ET] CFO. Joining us for QA are Andrew Frick, president of Ford Blue, and model. [5:01:23 PM ET] with me today are jim farley president and ceo and sherry house cfo [5:01:29 PM ET] E. Alicia Buller Davis, president of Ford Pro. Kumar Gahultra, chief operating office. [5:01:29 PM ET] joining us for q and a are andrew frick [5:01:29 PM ET] president of ford blue and model e [5:01:29 PM ET] alicia bohler davis president of ford pro kumar gahultra [5:01:35 PM ET] officer, Cappy O'Callahan, CEO of Ford Credit, and Dave Carroll, president of Ford Energy. [5:01:35 PM ET] chief operating officer [5:01:35 PM ET] kathy o'callaghan ceo of ford credit and dave carroll [5:01:41 PM ET] Energy. Jim will give a high-level overview of the business, and Sherry will provide added texture on the financials. [5:01:41 PM ET] president of ford energy [5:01:41 PM ET] jim will give a high level overview of the business [5:01:47 PM ET] and guidance. We will be referencing non-gap measures today. These are reconciled to the most comparable U.S. gap. [5:01:47 PM ET] and sherry will provide added texture on the financials and guidance [5:01:47 PM ET] we will be referencing non gaap measures today these are reconciled to the most comparable u s [5:01:53 PM ET] measures and the appendix of our earnings deck. You can find the deck at shareholder.ford.com. [5:01:53 PM ET] gaap measures in the appendix of our earnings deck you can find the deck at shareholder [5:01:53 PM ET] ford dot com [5:01:59 PM ET] discussion also includes forward-looking statements. Our actual results may differ. The most significant [5:01:59 PM ET] our discussion also includes forward looking statements [5:02:05 PM ET] risk factors are included on page 20 of our deck. Unless otherwise noted, all comparisons are year over year. [5:02:05 PM ET] our actual results may differ the most significant risk factors are included on page [5:02:05 PM ET] twenty of our deck [5:02:11 PM ET] Company EBIT, EPS, and Free Cash Flow are on an adjusted basis. Upcoming night. [5:02:11 PM ET] unless otherwise noted all comparisons are year over year [5:02:11 PM ET] company ebit eps and free cash flow are on an adjusted basis [5:02:17 PM ET] IR engagements include Sherry House at the Berkeley's Global Auto and Mobility tech conference in New York. [5:02:17 PM ET] upcoming ir engagements include sherry house at [5:02:23 PM ET] on November 18th. Now I'll turn the call over to Jim. Hey, Samaria, we're delivered in another strong. [5:02:23 PM ET] the barclays global auto and mobility tech conference [5:02:23 PM ET] in new york on november eighteenth now i'll turn the call over to jim [5:02:23 PM ET] thanks maria [5:02:29 PM ET] quarter thanks to our great products, our services, and execution. I want to thank. [5:02:29 PM ET] ford delivered another strong quarter thanks to our great products [5:02:35 PM ET] our employees and our dealers, all of our suppliers, for this progress. [5:02:35 PM ET] our services and execution i want to thank our employees [5:02:35 PM ET] and our dealers [5:02:35 PM ET] all of our suppliers [5:02:41 PM ET] and for their commitment to Ford Plus. In the third car quarter, as you know, we generated 2.7. [5:02:41 PM ET] for this progress and for their commitment to ford plus [5:02:47 PM ET] 2.7 billion dollars in adjusted eBay. We're raising our low end of our previous four year adjustment. [5:02:47 PM ET] in the third quarter as you know we generated [5:02:47 PM ET] two point seven billion dollars in adjusted ebit [5:02:53 PM ET] adjusted EBIT guidance. And now we specify 10.5 billion and 11 billion dollars. [5:02:53 PM ET] we're raising our low end of our previous full year adjusted ebit guidance [5:02:59 PM ET] dollars. Our strategy is clear. Number one, grow our auto business with a whole new generation. [5:02:59 PM ET] and now expect to earn between ten point five billion dollars and eleven billion dollars [5:02:59 PM ET] our strategy is clear number one grow our auto business [5:03:05 PM ET] generation of vehicles focused on North America, focused on transforming our ED business, and global price. [5:03:05 PM ET] with a whole new generation of vehicles focused on north america [5:03:05 PM ET] focused on transforming our ev business [5:03:11 PM ET] products with much less capital. Number two, aggressively expand our auto adjacencies. [5:03:11 PM ET] and global products with much less capital [5:03:17 PM ET] Software, services, and parts. Well, strengthening our finance and capability. [5:03:17 PM ET] number two aggressively expand our auto adjacencies [5:03:17 PM ET] software services and parts [5:03:23 PM ET] capability. And third, diversifying with Ford Energy. The objective. [5:03:23 PM ET] while strengthening our financing capability and third [5:03:23 PM ET] diversifying with ford energy [5:03:23 PM ET] the objective [5:03:29 PM ET] is a more profitable, capital efficient, and resilient forward, one that achieves 8% of justice. [5:03:29 PM ET] is a more profitable capital efficient and resilient ford [5:03:35 PM ET] EBIT margins by 2029. And deliver sustained earnings, cash flow, and return. [5:03:35 PM ET] one that achieves eight percent adjusted ebit margins by twenty twenty nine [5:03:41 PM ET] returns to our shareholders over time. Let's start with our vehicles. In the third quarter, [5:03:41 PM ET] and deliver sustained earnings cash flow and returns [5:03:41 PM ET] to our shareholders over time [5:03:42 PM ET] let's start with our vehicles [5:03:47 PM ET] quarter, we continue to focus on a portfolio that leads into our strengths. Trucks, vans, you need. [5:03:47 PM ET] in the third quarter we continue to focus on a portfolio that leans into our [5:03:47 PM ET] strengths [5:03:53 PM ET] and utilities. Our pickup lineup gives customers an unmatched breath of choice because. [5:03:53 PM ET] trucks vans and utilities [5:03:53 PM ET] our pickup lineup gives customers an unmatched breadth [5:03:59 PM ET] between vehicles, prices, trims, and power trains. In Q3, F series. [5:03:59 PM ET] of choice between vehicles [5:03:59 PM ET] prices [5:03:59 PM ET] trims and powertrains [5:04:05 PM ET] captured the highest retail share among all full-size truck brands and is on pace for the [5:04:05 PM ET] in q3 f series captured the highest retail share [5:04:11 PM ET] 50th straight year as America's best-selling truck. Maverick is a Merica's. [5:04:11 PM ET] among all full size truck brands and is on pace for the [5:04:11 PM ET] fiftieth straight year as america's best selling truck [5:04:17 PM ET] America's best-selling hybrid pickup. Internationally, Ranger leads in many markets, including Australia. [5:04:17 PM ET] maverick is america's best selling hybrid pickup [5:04:23 PM ET] Australia and Europe. Early demand for the Ranger Superduty is very strong. [5:04:23 PM ET] internationally ranger leads in many markets including australia and europe [5:04:29 PM ET] Already, number one, the heavy duty medium-sized truck market in Australia in his first year. [5:04:29 PM ET] early demand for the ranger super duty is very strong [5:04:29 PM ET] already number one heavy duty medium sized truck market in [5:04:35 PM ET] year, opening a very profitable opportunity for us. Transit. [5:04:35 PM ET] australia in its first year [5:04:35 PM ET] opening a very profitable opportunity [5:04:35 PM ET] for us [5:04:41 PM ET] continues to be the best-selling band in the US, for it also leads in three-row SU. [5:04:41 PM ET] transit continues to be the best selling van in the us [5:04:47 PM ET] SUVs in the U.S. with the expedition and explorer. We're also expanding. [5:04:47 PM ET] ford also leads in three row suvs in the us [5:04:47 PM ET] with the expedition and explorer [5:04:53 PM ET] expanding access to customers through Ford Blue Oval Advantage. Our certificate. [5:04:53 PM ET] we're also expanding access to customers [5:04:53 PM ET] through ford blue oval advantage [5:04:59 PM ET] certified pre-owned program, making Ford now the number one certified pre-owned brand in. [5:04:59 PM ET] our certified pre owned program making ford now [5:05:05 PM ET] in the US. This program builds customer loyalty and positions forward for our. [5:05:05 PM ET] the number one certified pre owned brand in the u s [5:05:05 PM ET] this program builds customer loyalty and positions ford [5:05:11 PM ET] our affordable new vehicles that will be coming in the next couple of years to our showrooms. And it really helps. [5:05:11 PM ET] for our affordable new vehicles that will be coming in the next [5:05:17 PM ET] helps our resale values. In fact, we found that these used customers are 50%. [5:05:17 PM ET] couple years to our showrooms and it really helps our resale values [5:05:23 PM ET] more likely than typical used car buyers to purchase a new Ford. [5:05:23 PM ET] in fact we found that these used customers [5:05:23 PM ET] are fifty percent more likely [5:05:23 PM ET] than typical used car buyers to purchase a new ford [5:05:29 PM ET] foundation of our sustained growth is world-class quality. Of course, topping the GDP. [5:05:29 PM ET] the foundation of our sustained growth [5:05:29 PM ET] is world class quality [5:05:35 PM ET] JD Powers 2026 IQS study and reduction we've seen in warmth. [5:05:35 PM ET] of course topping the j d powers [5:05:35 PM ET] twenty twenty six iqs study [5:05:41 PM ET] warranty coverages is encouraging to all of us. Excluding novellas and tariffs, we [5:05:41 PM ET] and reduction we've seen in warranty coverages [5:05:41 PM ET] is encouraging to all of us [5:05:41 PM ET] excluding novelis and tariffs [5:05:47 PM ET] reduce warranty and material costs by $1.5 billion in 25. [5:05:47 PM ET] we reduced warranty and material costs by one point five billion dollars in twenty [5:05:47 PM ET] five [5:05:53 PM ET] on track to reduce another one billion this year. But we have much more to do. [5:05:53 PM ET] and are on track to reduce another one billion dollars this year [5:05:53 PM ET] but we have much more to do [5:05:59 PM ET] especially on long-term durability and the ownership experience. [5:05:59 PM ET] especially on long term durability [5:05:59 PM ET] and the ownership experience [5:06:05 PM ET] We are accelerating our industrial system, including very aggressive next-generation vehicle. [5:06:05 PM ET] we are accelerating our industrial system [5:06:11 PM ET] vehicle cost reduction targets. The goal is a world-class industrial system, one that makes. [5:06:11 PM ET] including very aggressive next generation vehicle [5:06:11 PM ET] cost reduction targets the goal is a world class industrial system [5:06:17 PM ET] makes cost competitiveness and quality repeatable. Our Super Dude launched in the Oak. [5:06:17 PM ET] one that makes cost competitiveness and quality repeatable [5:06:23 PM ET] Oakville, Ontario is an important example of this discipline. The production ramp is already [5:06:23 PM ET] our super duty launch in oakville ontario [5:06:23 PM ET] is an important example of this discipline [5:06:29 PM ET] already exceeding planned daily volume and jobs per hour rates. [5:06:29 PM ET] the production ramp is already exceeding [5:06:29 PM ET] planned daily volume and jobs per hour rates [5:06:35 PM ET] reached okay to buy last week and began shipping trucks to dealerships. And the quality was [5:06:35 PM ET] we reached okay to buy last week and began shipping trucks to dealerships [5:06:41 PM ET] we're seeing is fully competitive with our existing super duty plan, which is number one at J.D. Powers. [5:06:41 PM ET] and the quality we're seeing is fully competitive with our existing super duty plan [5:06:41 PM ET] which is number one in jd powers [5:06:47 PM ET] The added capacity will give us flexibility for future plant changeovers and support. [5:06:47 PM ET] the added capacity will give us flexibility for future plant changeovers [5:06:53 PM ET] profitable growth in retail, rental, and upfitter channels. We're bringing the same [5:06:53 PM ET] and support profitable growth in retail rental and outfitter channels [5:06:59 PM ET] discipline to the next generation at 150. Prototypes begin builds on. [5:06:59 PM ET] we're bringing the same discipline to the next generation [5:06:59 PM ET] f-one hundred fifty [5:06:59 PM ET] prototypes begin [5:07:05 PM ET] our beginning in first quarter of 27, just a couple months away. We have an incredible power train durability. [5:07:05 PM ET] builds are beginning in first quarter twenty twenty seven just a couple of months away [5:07:11 PM ET] testing, which is now five-fold increase to meet our bullet-proof power train target. [5:07:11 PM ET] we have an incredible powertrain durability testing [5:07:11 PM ET] which is now fivefold increase to meet our bulletproof powertrain [5:07:17 PM ET] at Ford. We're doubling endurance and strength testing and increasing full. [5:07:17 PM ET] target at ford we're doubling endurance and strength testing [5:07:23 PM ET] full vehicle test mileage by nearly 60% to almost four million miles. [5:07:23 PM ET] and increasing full vehicle test mileage [5:07:23 PM ET] by nearly sixty percent [5:07:29 PM ET] The F-150 will be the most extensively tested truck ever forward, and we will apply. [5:07:29 PM ET] to almost four million miles the f-one hundred fifty will be the most [5:07:29 PM ET] extensively tested truck [5:07:35 PM ET] apply this exact same approach across our company. Alongside strength in [5:07:35 PM ET] ever at ford and we will apply this exact same approach [5:07:35 PM ET] across our company [5:07:41 PM ET] strengthening our best franchises, we're opening new paths to grow at more affordable price points. [5:07:41 PM ET] alongside strengthening our best franchises [5:07:47 PM ET] points. Next year, we will be launching our affordable mid-size pickup for international. [5:07:47 PM ET] we're opening new paths to grow at more affordable price points [5:07:47 PM ET] next year we will be launching our affordable midsize pickup [5:07:53 PM ET] markets. We expect the base material cost for this truck to be 20% lower than today. [5:07:53 PM ET] for international markets [5:07:53 PM ET] we expect the base material cost for this truck to be twenty [5:07:59 PM ET] today's ranger. Just as Maverick is done in the US, this truck is designed to bring new customers. [5:07:59 PM ET] lower than today's ranger just as maverick has done in the u s [5:08:05 PM ET] customers into the Ford truck lineup internationally, at a cost structure that allows us to compete. [5:08:05 PM ET] this truck is designed to bring new customers into the ford truck lineup [5:08:11 PM ET] compete, in this case, with the Chinese. And at Louisville, we are preparing a launch of the [5:08:11 PM ET] internationally at a cost structure that allows us to compete in this case [5:08:11 PM ET] with the chinese [5:08:11 PM ET] and in louisville [5:08:17 PM ET] Fab, our first vehicle off the UED platform. Rigorous testing and early supply or preparation. [5:08:17 PM ET] we are preparing the launch of the fathom our first vehicle off the uev platform [5:08:23 PM ET] preparation are central to that effort. The launch remains on track for the fourth quarter next year. [5:08:23 PM ET] rigorous testing and early supplier preparation are central to that effort [5:08:23 PM ET] the launch remains on track for fourth quarter next year [5:08:29 PM ET] Yesterday I had the opportunity to drive our prototype. Wow, it completely [5:08:29 PM ET] yet yesterday i had the opportunity to drive our prototype [5:08:29 PM ET] wow [5:08:35 PM ET] blew me away. There's zero to sixty, huge Roman side, and the hands for. [5:08:35 PM ET] it completely blew me away zero to sixty [5:08:35 PM ET] huge room inside [5:08:41 PM ET] hands-free eight ass experience was like something I've never experienced. Fathom is really a [5:08:41 PM ET] and the hands free [5:08:41 PM ET] adas experience was like something i've never experienced [5:08:47 PM ET] breakthrough product. It's highly capable, innovative, affordable. [5:08:47 PM ET] fandom is really a breakthrough product it's highly capable [5:08:47 PM ET] innovative [5:08:47 PM ET] affordable [5:08:53 PM ET] and that EV product will be available to more Americans way ahead of our competition. [5:08:53 PM ET] and that ev product [5:08:59 PM ET] This will require high-level execution by our team to deliver on time and at cost. [5:08:59 PM ET] will be available to more americans way ahead of our competition [5:08:59 PM ET] this will require high level execution by our team to deliver on time and at cost [5:09:05 PM ET] And the MSRP, under $30,000, and the low cost of ownership, is perfect for today. [5:09:05 PM ET] in the msrp under thirty thousand dollars and the low cost of ownership [5:09:11 PM ET] today's market. Fathom will offer something brand new for US EV customers. [5:09:11 PM ET] is perfect for today's market [5:09:11 PM ET] fathom will offer something [5:09:11 PM ET] brand new for u s ev customers [5:09:17 PM ET] And advanced zonal electric architecture for its first 48-bolt. [5:09:17 PM ET] an advanced [5:09:17 PM ET] zonal electrical architecture [5:09:23 PM ET] 48-bolt low-voltage system, along with the sophisticated advanced driver capability. [5:09:23 PM ET] for its first forty eight volt low voltage system [5:09:29 PM ET] as hand speed driving. In a credible real-wheel drive performance feel, and a lot. [5:09:29 PM ET] along with a sophisticated advanced driver assist capability [5:09:29 PM ET] such as hands free driving [5:09:35 PM ET] lot of fun to drive. And bidirectional charging, so you can power your home with the fathom. [5:09:35 PM ET] an incredible rear wheel drive performance feel [5:09:35 PM ET] and a lot of fun to drive [5:09:41 PM ET] rates are high or during an outage. And there's so much more to this product that we're excited to share. [5:09:41 PM ET] and bidirectional charging so you can power your home with the fathom [5:09:41 PM ET] when rates are high [5:09:41 PM ET] or during an outage [5:09:41 PM ET] and there's so much more to this product that we're exciting [5:09:47 PM ET] share with you. Twitching gears to our growing auto services business, software services. [5:09:47 PM ET] to share with you switching gears to our growing auto services business [5:09:53 PM ET] parts, and financing. Now, these auto-adjacencies deepen our customer's relationship with us. [5:09:53 PM ET] software services parts and financing [5:09:59 PM ET] with us and create downstream value by enabling us to earn more over the [5:09:59 PM ET] now these auto adjacencies deepen our customers' relationship with us [5:09:59 PM ET] and create downstream value [5:10:05 PM ET] the life of each vehicle. Both software services and parts businesses achieve. [5:10:05 PM ET] by enabling us to earn more over the life of each vehicle [5:10:05 PM ET] both software services and parts businesses [5:10:11 PM ET] achieved record revenue in the third quarter at highly accretive margins. [5:10:11 PM ET] achieved record [5:10:11 PM ET] revenue in the third quarter and highly accretive margins [5:10:17 PM ET] An important link exists here between software and parts. Connected services. [5:10:17 PM ET] an important linkage exists here between software and parts [5:10:23 PM ET] services help us anticipate maintenance over time, including a whole new software product. [5:10:23 PM ET] connected services help us anticipate maintenance over time [5:10:29 PM ET] product called Prognostics at Ford, bringing customers to our remote service bands, almost 5,000. [5:10:29 PM ET] including a whole new software product called prognostics at ford [5:10:35 PM ET] 5,000 of them now, and our dealer network to keep their vehicles running 24/7. [5:10:35 PM ET] bringing customers to our remote service vans almost five thousand of them now [5:10:35 PM ET] and our dealer network to keep their [5:10:35 PM ET] vehicles running twenty fourseven [5:10:41 PM ET] We found that when a retail customer combines a software description with regular service. [5:10:41 PM ET] we found that when a retail customer combines a software subscription [5:10:47 PM ET] service, the retention of the customer, especially for parts, is about nine points. [5:10:47 PM ET] with regular service [5:10:47 PM ET] the retention [5:10:47 PM ET] of the customer [5:10:53 PM ET] points higher. In parts specifically, we grew our U.S. wholesale business to third-party independent records. [5:10:53 PM ET] especially for parts is about nine points higher [5:10:53 PM ET] in parts specifically we grew our u s wholesale business [5:10:59 PM ET] repair shops, and we've expanded a lot in Europe. A broader motorcraft catalog also allows. [5:10:59 PM ET] to third party independent repair shops and we've expanded a lot in europe [5:11:05 PM ET] allows us to serve fleet customers of competitive brands and owners of much older Ford V. [5:11:05 PM ET] a broader motorcraft catalog also allows us to serve [5:11:05 PM ET] fleet customers [5:11:11 PM ET] vehicles. And Ford Credit has had a great third quarter, notably to give. [5:11:11 PM ET] of competitive brands and owners of much older ford vehicles [5:11:11 PM ET] in ford credit [5:11:11 PM ET] has had a great third quarter [5:11:11 PM ET] notably [5:11:17 PM ET] together with Ford Pro, Credit launched Ford Pro leasing in the third quarter. [5:11:17 PM ET] together with ford pro credit launched [5:11:17 PM ET] ford pro leasing [5:11:23 PM ET] It's a big deal for Pro. Adding commercial leasing to our fleet management, software. [5:11:23 PM ET] in the third quarter it's a big deal for pro [5:11:29 PM ET] software, and maintenance offerings will help us grow our pro-digital fleet management portfolio. [5:11:29 PM ET] adding commercial leasing to our fleet management [5:11:29 PM ET] software and maintenance offerings [5:11:29 PM ET] will help us grow our pro digital fleet management portfolio [5:11:35 PM ET] which we will expect to be over 100,000 units by year-end. Many of those are not. [5:11:35 PM ET] which we will expect to be over one hundred thousand units by year end [5:11:41 PM ET] non-ford vehicles. Turning to Ford Energy, the investment thesis is. [5:11:41 PM ET] many of those are non ford vehicles [5:11:41 PM ET] turning to ford energy [5:11:47 PM ET] is very clear. Ford is going to solve a meaningful customer problem. Build on Ford's. [5:11:47 PM ET] the investment thesis is very clear [5:11:47 PM ET] ford is going to solve a meaningful customer problem [5:11:53 PM ET] Ford's advantage and offer a credible path to material earnings. With a tract of research, [5:11:53 PM ET] build on ford's advantage and offer a credible path [5:11:59 PM ET] returns in the short term. Our starting point is U.S. manufactured grid-scale battery stores. [5:11:59 PM ET] to material earnings with attractive returns in the short term [5:12:05 PM ET] storage for companies building America's new power infrastructure and data centers. [5:12:05 PM ET] our starting point is u s manufactured grid scale battery storage [5:12:05 PM ET] for companies building america's new power infrastructure and data centers [5:12:11 PM ET] These customers need a domestic partner with the manufacturing know-how and scale, and [5:12:11 PM ET] these customers need a domestic partner [5:12:17 PM ET] staying power to support them throughout the product's life. We are progressing on two fronts. [5:12:17 PM ET] with the manufacturing know how and scale [5:12:17 PM ET] and staying power to support them throughout the product's life [5:12:23 PM ET] fronts: preparing our manufacturing capacity and securing customers. [5:12:23 PM ET] we are progressing on two fronts [5:12:23 PM ET] preparing our manufacturing capacity [5:12:23 PM ET] and securing customers [5:12:29 PM ET] battery plant, Kentucky, we have met every single operating milestone so far. [5:12:29 PM ET] at our battery plant in kentucky we have met every [5:12:29 PM ET] single operating milestone so far [5:12:35 PM ET] We have completed trial runs of electrode mixing, the first step in producing prismatic. [5:12:35 PM ET] we have completed trial runs of electrode mixing [5:12:41 PM ET] prismatic LFP battery cells. Using the exact same process as our battery plant and work. [5:12:41 PM ET] the first step in producing prismatic lfp battery cells [5:12:47 PM ET] Marshall, Michigan. We remain on track to bring 20 gigawatt hours of annual capacity online. [5:12:47 PM ET] using the exact same process as our battery plant in marshall michigan [5:12:53 PM ET] by the end of next year. Commercial progress is encouraging, and demand remains. [5:12:53 PM ET] we remain on track to bring twenty gigawatt hours of annual capacity online [5:12:53 PM ET] by the end of next year [5:12:53 PM ET] commercial progress is encouraging [5:12:59 PM ET] remains very strong. Executed contracts and late-stage negotiations together are ready. [5:12:59 PM ET] and demand remains very strong [5:13:05 PM ET] currently account for more than 80% of Ford Energy's 2028 capacity. [5:13:05 PM ET] executed contracts and late stage negotiations together [5:13:05 PM ET] already currently account for more than eighty percent [5:13:05 PM ET] of ford energy's twenty twenty eight capacity [5:13:11 PM ET] We are building a diverse customer base across solar, grid support, and data centers, and we [5:13:11 PM ET] we are building a diverse customer base across solar [5:13:17 PM ET] expect our 2028 capacity to be fully committed by Q1 over the next year. [5:13:17 PM ET] grid support and data centers and we expect our twenty twenty eight capacity [5:13:17 PM ET] capacity to be fully committed [5:13:17 PM ET] by q1 of next year [5:13:23 PM ET] Pricing singles remain consistent with our investment assumptions. The goat for 29. [5:13:23 PM ET] pricing signals remain consistent with our investment assumptions [5:13:29 PM ET] and 30 capacity are already advancing, with customers engaged way ahead of our initial. [5:13:29 PM ET] negotiation for twenty nine and thirty capacity [5:13:35 PM ET] initial expectations. The DC block gives us a practical starting point to build a broader [5:13:35 PM ET] are already advancing with customers engaged [5:13:35 PM ET] way ahead of our initial expectations [5:13:41 PM ET] broader capability. We expect attractive returns with short payback period, as I said. [5:13:41 PM ET] the dc block gives us a practical starting point [5:13:41 PM ET] to build a broader capability [5:13:47 PM ET] sharing now is going to take you through our financial performance. Thank you, Jim, and hello. [5:13:47 PM ET] we expect attractive returns with short payback period as i said [5:13:47 PM ET] sherry now is going to take you through our financial performance [5:13:53 PM ET] hello, everyone. Our third quarter results reflect the deliberate actions we're taking to improve profit. [5:13:53 PM ET] thank you jim and hello everyone [5:13:53 PM ET] our third quarter results reflect the deliberate [5:13:59 PM ET] profitability and deliver consistent financial returns. Our increase seemed like the end. [5:13:59 PM ET] actions we're taking to improve profitability [5:13:59 PM ET] and deliver consistent financial returns [5:14:05 PM ET] industrial system, coupled with strong vehicle sales and auto adjacency performance. [5:14:05 PM ET] our increasingly fit industrial system [5:14:05 PM ET] coupled with strong vehicle sales [5:14:05 PM ET] and auto adjacency performance [5:14:11 PM ET] enabled adjusted e-bic growth of 3%, despite 2% lower revenue. [5:14:11 PM ET] enable adjusted ebit growth of three percent [5:14:11 PM ET] despite two percent lower revenue [5:14:17 PM ET] As we sunset products like Scape and Corsair to transition the Louisville Assembly plant for the all-new. [5:14:17 PM ET] as we sunset products like escape and coursera [5:14:23 PM ET] all-new fathom. Sequentially, revenue at $49.5 billion in a [5:14:23 PM ET] to transition the louisville assembly plant for the all new fathom [5:14:23 PM ET] sequentially [5:14:23 PM ET] revenue at forty nine point five billion dollars [5:14:29 PM ET] adjusted EBIT at 2.7 billion were both higher, despite being impacted by a short term. [5:14:29 PM ET] and adjusted ebit at two point seven billion [5:14:29 PM ET] were both higher [5:14:35 PM ET] short-term supply or disruption late in the quarter, we also generated 4.7 billion. [5:14:35 PM ET] despite being impacted by a short term supplier disruption [5:14:35 PM ET] late in the quarter [5:14:41 PM ET] billion in company adjusted free cash flow and Q3 and end of the quarter with 25.3. [5:14:41 PM ET] we also generated four point seven billion [5:14:41 PM ET] in company adjusted free cash flow in q three [5:14:47 PM ET] 25.3 billion in cash and 46.4 billion in total liquidity. Maintaining our commitment. [5:14:47 PM ET] and ended the quarter with twenty five point three billion dollars in cash [5:14:47 PM ET] and forty six point four billion dollars in total liquidity [5:14:53 PM ET] to a strong investment grade rating and to returning capital to shareholders. Today, [5:14:53 PM ET] maintaining our commitment to a strong investment grade rating [5:14:53 PM ET] into returning capital to shareholders [5:14:59 PM ET] we announced a fourth quarter regular dividend of 15 cents per share. This [5:14:59 PM ET] today [5:14:59 PM ET] we announced a fourth quarter regular dividend [5:14:59 PM ET] of fifteen cents per share [5:15:05 PM ET] strong performance reflects the underlying quality of the sales accomplishments Jim mentioned, is well. [5:15:05 PM ET] this strong performance reflects the underlying quality of the [5:15:05 PM ET] sales accomplishments jim mentioned [5:15:11 PM ET] as well as our progress toward a leaner [5:15:11 PM ET] more fit industrial system [5:15:11 PM ET] well as our progress toward a leaner, more fit industrial system. We continue to see. [5:15:17 PM ET] mixed strength in trucks and three-roll SUVs. Our higher margin, off-road piachi. [5:15:17 PM ET] we continue to see mixed strength in trucks [5:15:17 PM ET] and three row suvs [5:15:23 PM ET] passion products. It counted for about a quarter of our U.S. sales in Q3. Almost four. [5:15:23 PM ET] our higher margin off road passion products [5:15:23 PM ET] accounted for about a quarter of our us sales in q three [5:15:29 PM ET] four points from a year ago. And our customers have been resilient amid higher fuel prices. [5:15:29 PM ET] up almost four points from a year ago [5:15:29 PM ET] and our customers have been resilient [5:15:29 PM ET] amid higher fuel prices [5:15:35 PM ET] interest rates, and inflation. We also continue to deliver efficiencies of. [5:15:35 PM ET] interest rates [5:15:35 PM ET] and inflation [5:15:41 PM ET] across the business, including the use of AI in our business segments and throughout our operations. [5:15:41 PM ET] we also continue to deliver efficiencies across the business [5:15:41 PM ET] including the use of ai [5:15:47 PM ET] operations. These actions, together with our industrial improvements, have helped. [5:15:47 PM ET] in our business segments and throughout our operations [5:15:47 PM ET] these actions together with our industrial improvements [5:15:53 PM ET] have helped us absorb the vast majority of headwinds [5:15:53 PM ET] helped us absorb the vast majority of headwinds from the Middle East conflict in rising commodity costs. [5:15:53 PM ET] from the middle east conflict [5:15:59 PM ET] costs. It is this discipline and operational rigor that is taking root across. [5:15:59 PM ET] and rising commodity costs [5:15:59 PM ET] it is this discipline and operational rigor [5:16:05 PM ET] across board. In fact, it is directly benefiting our next generation product pipeline where we're [5:16:05 PM ET] that is taking root across board [5:16:05 PM ET] in fact it is directly benefiting our next generation product pipeline [5:16:11 PM ET] making real progress in improving the cost phase across our products. In addition, [5:16:11 PM ET] where we're making real progress [5:16:11 PM ET] improving the cost base across our products [5:16:17 PM ET] addition, the traction and warranty of material cost improvement is strong again this year. [5:16:17 PM ET] in addition [5:16:17 PM ET] the traction in warranty and material cost improvement is strong again this year [5:16:23 PM ET] Both were lower in the quarter and year to date. Keeping us firmly on plan towards reducing. [5:16:23 PM ET] both were lower in the quarter [5:16:23 PM ET] and year to date [5:16:23 PM ET] keeping us firmly on plan [5:16:29 PM ET] reducing these costs by $1 billion this year, excluding nobels and tariffs. [5:16:29 PM ET] towards reducing these costs [5:16:29 PM ET] by one billion dollars this year [5:16:29 PM ET] excluding novelis and tariffs [5:16:35 PM ET] And we are leveraging these reductions to fund our investments in a universal ED platform. [5:16:35 PM ET] and we are leveraging these reductions to fund our investments [5:16:41 PM ET] and Ford Energy. On New Gelis, operationally, the recovery is. [5:16:41 PM ET] in the universal ev platform [5:16:41 PM ET] and ford energy [5:16:41 PM ET] on novelis [5:16:41 PM ET] operationally [5:16:47 PM ET] is largely behind us. Financially, we have incurred about one billion dollars in novellas related. [5:16:47 PM ET] the recovery is largely behind us [5:16:47 PM ET] financially [5:16:53 PM ET] related temporary cost shared at eight, with some more to go into four. And we are still tracking. [5:16:53 PM ET] we have incurred about one billion dollars in novelis related temporary costs year to date [5:16:53 PM ET] with some more to go in q four [5:16:59 PM ET] tracking to a net tailwind of about one billion dollars in twenty twenty-six. [5:16:59 PM ET] and we are still tracking to a net tailwind of about one billion dollars [5:16:59 PM ET] in twenty twenty six [5:17:05 PM ET] now let's turn to our segment results [5:17:05 PM ET] Now, let's turn to our segment results. In Fort Blue, we delivered 27. [5:17:05 PM ET] in ford blue [5:17:11 PM ET] 27.1 billion of revenue and 1.4 billion in EBIT down 3% in 10%. [5:17:11 PM ET] we delivered twenty seven point one billion dollars of revenue [5:17:11 PM ET] and one point four billion in ebit [5:17:17 PM ET] respectively. Our performance primarily reflects lower volume driven by. [5:17:17 PM ET] down three percent and ten percent respectively [5:17:17 PM ET] our performance primarily reflects [5:17:17 PM ET] lower volume [5:17:23 PM ET] by product discontinuations and the impact to the Middle East conflict within the region and higher commodity. [5:17:23 PM ET] driven by product discontinuations and the impact of the middle east [5:17:23 PM ET] conflict within the region [5:17:29 PM ET] commodity costs. Our underlying business continues to benefit from favorable mix. We see [5:17:29 PM ET] and higher commodity costs [5:17:29 PM ET] our underlying business continues to benefit from favorable mix [5:17:35 PM ET] saw significant year-to-date demand in the U.S. for Explorer with the higher margin tremor. [5:17:35 PM ET] we saw significant year to date demand in the us for explore [5:17:41 PM ET] Platinum series, increasing sales by nearly 60%. F-Ceres could. [5:17:41 PM ET] with the higher margin tremor and platinum series [5:17:41 PM ET] increasing sales by nearly sixty percent [5:17:47 PM ET] performed well as we executed a discipline go-to-market approach that yielded the highest. [5:17:47 PM ET] f series performed well [5:17:47 PM ET] as we executed a disciplined go to market approach [5:17:53 PM ET] share of revenue and lowest incentive to spend in the third quarter. Blinken also had. [5:17:53 PM ET] that yielded the highest share of revenue [5:17:53 PM ET] and lowest incentive spend in the third quarter [5:17:59 PM ET] an impressive quarter with both Nautilus and Aviator experiencing double-digit sales growth. [5:17:59 PM ET] lincoln also had an impressive quarter [5:18:05 PM ET] growth in the US. Our stock bubbles are healthy. We ended the quarter. [5:18:05 PM ET] with both nautilus and aviator experiencing double digit sales growth [5:18:05 PM ET] in the u s [5:18:05 PM ET] our stock levels are healthy [5:18:11 PM ET] slightly below our target range of 55 to 65 retail days supply. [5:18:11 PM ET] we ended the quarter slightly below our target range of fifty five [5:18:11 PM ET] to sixty five retail days supply [5:18:17 PM ET] increased gross stocks by about six percent versus Q2 2026. [5:18:17 PM ET] and we increased gross stocks by about six percent [5:18:17 PM ET] versus q two twenty twenty six [5:18:23 PM ET] Our F-150 inventory and proof quarter over quarter to 49 retail days supply. [5:18:23 PM ET] our f one fifty inventory improved quarter over quarter to [5:18:23 PM ET] forty nine retail days supply [5:18:29 PM ET] still below our DL range, which provides us with upside. As we work to restock, to [5:18:29 PM ET] though it's still below our ideal range [5:18:29 PM ET] which provides us with upside as we work to restock [5:18:35 PM ET] target levels. Overall, we expect stocks to return within our targeted levels. [5:18:35 PM ET] to target levels [5:18:41 PM ET] levels, I yearned. For Model E, we improved EBIT by 25%. [5:18:41 PM ET] overall we expect stocks to return within our targeted levels [5:18:41 PM ET] by year end [5:18:41 PM ET] for model e [5:18:47 PM ET] 25% year over year in the quarter. We reported an EBIT loss of 1.1 billion on revenue. [5:18:47 PM ET] we improved ebit by twenty five percent year over year in the quarter [5:18:47 PM ET] we reported an ebit loss of one point one billion [5:18:53 PM ET] revenue of 1.2 billion. These results reflect our focus on capital efficiency in starting. [5:18:53 PM ET] on revenue of one point two billion [5:18:53 PM ET] these results reflect our focus on capital efficiency [5:18:59 PM ET] structural cost reductions, as we realize the benefits from right-sizing our Gen 1 volumes. [5:18:59 PM ET] and structural cost reductions [5:18:59 PM ET] as we realize the benefits from rightsizing our gen one volumes [5:19:05 PM ET] we continue to invest in our UED platform and port energy. We are on trade. [5:19:05 PM ET] while we continue to invest in our uev platform [5:19:05 PM ET] and ford energy [5:19:11 PM ET] track to improve Gen 1 EBIT by approximately 40% year over year in 2020. [5:19:11 PM ET] we are on track to improve gen one ebit [5:19:11 PM ET] by approximately forty percent [5:19:17 PM ET] 2026, is we balance production and pricing with natural demand. [5:19:17 PM ET] year over year in twenty twenty six [5:19:17 PM ET] as we balance production and pricing [5:19:17 PM ET] with natural demand [5:19:23 PM ET] In fact, in Q3, Mustang Maki had the lowest incentive spend since 2010. [5:19:23 PM ET] in fact [5:19:23 PM ET] in q three mustang mach e had the lowest incentive spend [5:19:29 PM ET] 2023. Importantly, we are still targeting break even by 2023. [5:19:29 PM ET] since twenty twenty three [5:19:29 PM ET] importantly we are still targeting breakeven [5:19:35 PM ET] 29. Ford Pro delivered another solid quarter, with [5:19:35 PM ET] by twenty twenty nine [5:19:35 PM ET] ford pro delivered another solid quarter [5:19:41 PM ET] 17.8 billion of revenue, up 2%. Despite wholesale volumes being down. [5:19:41 PM ET] with seventeen point eight billion of revenue [5:19:41 PM ET] up two percent [5:19:47 PM ET] down 4%, pro-Ebit was 1.7 billion down 16%. [5:19:47 PM ET] despite wholesale volumes being down [5:19:47 PM ET] four percent [5:19:47 PM ET] pro ebit was one point seven billion down sixteen percent [5:19:53 PM ET] primarily due to higher commodities and temporary costs associated with the Oakville launch. [5:19:53 PM ET] primarily due to higher commodities [5:19:53 PM ET] in temporary costs associated with the oakville launch [5:19:59 PM ET] Lower tariffs and favorable product mix, driven by higher truck production as we were coming. [5:19:59 PM ET] lower tariffs and favorable product mix [5:20:05 PM ET] from novellas, partially offset these headwinds. 2027 model your [5:20:05 PM ET] driven by higher truck production as we recover from novelis [5:20:05 PM ET] partially offset these headwinds [5:20:11 PM ET] signals are favorable. As most commercial agreements are complete, with both leek demand and [5:20:11 PM ET] twenty twenty seven model year signals are favorable [5:20:11 PM ET] as most commercial agreements are complete [5:20:17 PM ET] with both fleet demand and pricing [5:20:17 PM ET] and pricing in line with our expectations. Ford Credit delivered a [5:20:17 PM ET] in line with our expectations [5:20:17 PM ET] ford credit [5:20:23 PM ET] a great quarter with EBT of 803 million, up 172 million. [5:20:23 PM ET] delivered a great quarter [5:20:23 PM ET] with ebt of eight zero three million [5:20:29 PM ET] million. These results reflect favorable performance on our derivatives. Healthy finance. [5:20:29 PM ET] up one hundred and seventy two million [5:20:29 PM ET] these results [5:20:29 PM ET] reflect favorable performance on our derivatives [5:20:35 PM ET] financing margins in a supported use vehicle pricing environment. Our hike was. [5:20:35 PM ET] healthy financing margins [5:20:35 PM ET] and a supportive used vehicle pricing environment [5:20:41 PM ET] high-quality portfolio of offerings across board credit remains resilient, and we maintain a consistent. [5:20:41 PM ET] our high quality portfolio of offerings [5:20:41 PM ET] across board credit remains resilient [5:20:47 PM ET] consistent, disciplined approach to risk management. Jim talked earlier about. [5:20:47 PM ET] and we maintain a consistent [5:20:47 PM ET] disciplined approach to risk management [5:20:53 PM ET] about the record quarter for software services and parts, I'd like to double-click on that. [5:20:53 PM ET] jim talked earlier about the record quarter for [5:20:53 PM ET] software services and parts [5:20:53 PM ET] i'd like to double click on that [5:20:59 PM ET] These auto-adjacent businesses were significant drivers of the quarter's strong performance. [5:20:59 PM ET] these auto adjacent businesses were significant drivers of the [5:20:59 PM ET] strong performance [5:21:05 PM ET] contributing approximately 10% of the quarter's revenue. Yes, strong margins. [5:21:05 PM ET] contributing approximately ten percent [5:21:05 PM ET] of the quarter's revenue [5:21:11 PM ET] margins. The largest contributors to software services, revenue growth in the quarter. [5:21:11 PM ET] at strong margins [5:21:11 PM ET] the largest contributors to software services revenue growth in the quarter [5:21:17 PM ET] and year to date. We're blue crews and connectivity. And we continue to see momentum. [5:21:17 PM ET] and year to date [5:21:17 PM ET] were bluecruise [5:21:17 PM ET] in connectivity [5:21:23 PM ET] momentum in Ford Pro Intelligence. Parts revenue growth this year has been drained. [5:21:23 PM ET] and we continue to see momentum [5:21:23 PM ET] in ford pro intelligence [5:21:29 PM ET] driven by double-digit growth in our U.S. wholesale channel and the expansion of our research. [5:21:29 PM ET] parts revenue growth this year [5:21:29 PM ET] has been driven by double digit growth [5:21:29 PM ET] in our us [5:21:29 PM ET] wholesale channel [5:21:35 PM ET] retail and wholesale businesses in Europe. We are also increasing dealer service retail. [5:21:35 PM ET] and the expansion of our retail [5:21:35 PM ET] wholesale businesses in europe [5:21:41 PM ET] retention with digital and uptime tools to drive organic parts growth. [5:21:41 PM ET] we are also increasing dealer service retention [5:21:41 PM ET] with digital and uptime tools [5:21:41 PM ET] to drive organic parts growth [5:21:47 PM ET] We are excited about the prospects these auto adjacent sees offer for continued accretive. [5:21:47 PM ET] we are excited about the prospects [5:21:47 PM ET] these auto adjacencies offer [5:21:53 PM ET] accretive growth. Now, looking ahead to our full year 2026 outlook. [5:21:53 PM ET] for continued accretive growth [5:21:53 PM ET] now looking ahead to our full year twenty twenty six outlook [5:21:59 PM ET] We are confident in our full year trajectory, in our planned investment cadence. [5:21:59 PM ET] we are confident [5:21:59 PM ET] our full year trajectory [5:21:59 PM ET] our planned investment cadence [5:22:05 PM ET] and now expect full year adjusted ebit [5:22:05 PM ET] And now expect full year adjusted EBIT between 10 and a half billion to 11 billion dollars. [5:22:05 PM ET] between ten and a half billion [5:22:11 PM ET] dollars. A just in free cash flow and capital expenditures are unchanged. At 6 billion. [5:22:11 PM ET] to eleven billion dollars [5:22:11 PM ET] adjusted free cash flow [5:22:11 PM ET] and capital expenditures are unchanged [5:22:17 PM ET] billion to seven billion, and nine and a half billion to ten and a half billion, respectively. Our guys. [5:22:17 PM ET] it's six billion dollars to seven billion [5:22:17 PM ET] and nine point five billion dollars to ten point five billion dollars respectively [5:22:23 PM ET] guidance does not include potential impacts of a significant escalation in the Middle East or a material downturn in the. [5:22:23 PM ET] our guidance does not include potential impacts [5:22:29 PM ET] of a significant escalation in the middle east or a material downturn in the us economy [5:22:29 PM ET] the U.S. economy, which, if either or both occurred, could have a substantial impact on industry demand. [5:22:29 PM ET] which if either or both occurred could have a substantial impact on industry demand [5:22:35 PM ET] For our full year segment outlook, we expect more blue ebit of about five points. [5:22:35 PM ET] for our full year segment outlook [5:22:35 PM ET] we expect [5:22:35 PM ET] ford blue ebit [5:22:41 PM ET] 5.5 billion. Ford Pro Ebit of about 7 billion. Model E losses. [5:22:41 PM ET] of about five point five billion [5:22:41 PM ET] ford pro ebit [5:22:41 PM ET] of about seven billion [5:22:47 PM ET] losses remain unchanged at about four billion. And Ford Credit EBT updated. [5:22:47 PM ET] model e losses remain unchanged at about four billion [5:22:47 PM ET] and ford credit ebt [5:22:53 PM ET] updated to about two point eight billion dollars [5:22:53 PM ET] updated to about $2.8 billion. Our guidance now assumes a unique. [5:22:53 PM ET] our guidance now assumes [5:22:59 PM ET] U.S. SAR of 16.5 million units. Commodity headwinds are approaching to [5:22:59 PM ET] a us sar of sixteen point five million units [5:23:05 PM ET] two and a half billion dollars year over year. An increase of about 500 million. [5:23:05 PM ET] commodity headwinds approaching two and a half billion dollars year over year [5:23:05 PM ET] an increase of about five hundred million [5:23:11 PM ET] continue to see increasing pressure from input costs. In addition, higher fuel. [5:23:11 PM ET] as we continue to see increasing pressure from input costs [5:23:11 PM ET] in addition [5:23:17 PM ET] prices are impacting our freight and energy costs. But notably, we are not seeing it impact customers. [5:23:17 PM ET] higher fuel prices are impacting our freight and energy costs [5:23:23 PM ET] customer demand for trucks and fleet vehicles at this point. We now expect full year. [5:23:23 PM ET] but notably we are not seeing it impact customer demand [5:23:23 PM ET] for trucks and fleet vehicles at this point [5:23:29 PM ET] U.S. industry pricing to be about 100 basis points higher year over year, which is a [5:23:29 PM ET] we now expect full year us industry pricing [5:23:29 PM ET] be about a hundred basis points higher [5:23:29 PM ET] year over year [5:23:35 PM ET] half point higher than our previous assumption. And lastly, we continue to target one. [5:23:35 PM ET] which is a half point higher than our previous assumption [5:23:35 PM ET] and lastly [5:23:41 PM ET] billion dollars in material and warranty cost reductions, excluding novellas and here. [5:23:41 PM ET] continue to target one billion dollars [5:23:41 PM ET] in material and warranty cost reductions [5:23:47 PM ET] tear-ups. In summary, our ability to increase profits in Q3. [5:23:47 PM ET] excluding novelis and tariffs [5:23:47 PM ET] in summary [5:23:53 PM ET] our ability to increase profits in q three [5:23:53 PM ET] reflects the actions we have taken [5:23:53 PM ET] reflects the actions we have taken to optimize our product portfolio and create a business. [5:23:53 PM ET] to optimize our product portfolio [5:23:59 PM ET] business that is more efficient and agile in the face of increasing cost pressures. [5:23:59 PM ET] and create a business that is more efficient [5:23:59 PM ET] and agile in the face of increasing cost pressures [5:24:05 PM ET] intensified global competition [5:24:05 PM ET] intensify global competition, in an uncertain macroeconomic environment. I'll now turn it back over to. [5:24:05 PM ET] an uncertain macroeconomic environment [5:24:11 PM ET] to Jim to provide some commentary on 2027. Thank you, Sharon. At this point, we're talking. [5:24:11 PM ET] i'll now turn it back over to jim to provide some commentary on twenty twenty seven [5:24:11 PM ET] thank you sherry [5:24:17 PM ET] targeting profitability next year to be roughly in line with this year. With an even stronger automotive. [5:24:17 PM ET] at this point we're targeting profitability next year to be roughly in line with this year [5:24:23 PM ET] automotive business that enables us to invest in our future. Our outlook reflects three things. [5:24:23 PM ET] with an even stronger automotive business [5:24:23 PM ET] that enables us to invest in our future [5:24:29 PM ET] our outlook reflects three things investing in future growth [5:24:29 PM ET] three things: investing in future growth, substantial external cost pressures. [5:24:35 PM ET] and continued operating improvements. Next year will be a foundational year. [5:24:35 PM ET] substantial external cost pressures [5:24:35 PM ET] and continued operational operating improvements [5:24:41 PM ET] year on our journey to 8%. When we will have refreshed 70%. [5:24:41 PM ET] next year will be a foundational year on our journey to eight percent [5:24:47 PM ET] of our global portfolio of vehicles by volume. We are allocating the majority of that industry. [5:24:47 PM ET] when we will have refreshed [5:24:47 PM ET] seventy percent of our global portfolio of vehicles [5:24:53 PM ET] investment to North America, where we will be expanding our truck and utility lineup. [5:24:53 PM ET] by volume we are allocating majority of that investment to north america [5:24:53 PM ET] where we will be expanding our truck and utility lineup [5:24:59 PM ET] additionally ford pro will be expanding their global lineup [5:24:59 PM ET] Additionally, Ford Pro will be expanding their global lineup for transit and ranger with all. [5:25:05 PM ET] all new price points. Additionally, we are investing in our plants. [5:25:05 PM ET] for transit arranger with all new price points [5:25:11 PM ET] for our new F-150, which will require planned production downtime next year. [5:25:11 PM ET] additionally we are investing in our plants [5:25:11 PM ET] for our new f-one hundred fifty which will require [5:25:11 PM ET] planned production downtime next year [5:25:17 PM ET] expect the added super duty capacity at Oakville will largely offset the impact of that down time. [5:25:17 PM ET] we expect the added super duty capacity at oakville to largely offset [5:25:17 PM ET] the impact of that downtime [5:25:23 PM ET] We will also continue to grow our investments in the Universal Electric Vehicle platform ahead of fathers. [5:25:23 PM ET] we will also continue to grow our investments in the universal electric vehicle [5:25:29 PM ET] Fathom's launch and bring Fort Energy's 20 gigawatt hours of capacity online. Both of which. [5:25:29 PM ET] platform ahead of fathom's launch and bring ford energy's [5:25:35 PM ET] which are key to the model E turnaround by 2029. In order to [5:25:35 PM ET] twenty gigawatt hours of capacity online both of which are key [5:25:35 PM ET] to the model e turnaround by twenty twenty nine [5:25:41 PM ET] adjacencies, we expect continued growth in software services and parts. [5:25:41 PM ET] in auto adjacencies we expect continued growth [5:25:47 PM ET] to increase the contribution from reoccurring and counter-cyclical revenues. This secreted. [5:25:47 PM ET] in software services and parts [5:25:47 PM ET] to increase the contribution from reoccurring and countercyclical revenues [5:25:53 PM ET] growth should help offset certain macro headwinds we expect at Ford credit. [5:25:53 PM ET] this accretive growth [5:25:53 PM ET] should help offset certain macro headwinds we expect at ford credit [5:25:59 PM ET] we currently expect commodities [5:25:59 PM ET] We currently expect commodities, memory, and logistics costs to raise. [5:25:59 PM ET] memory [5:26:05 PM ET] represent a year-over-year headwind of about two billion dollars at Ford. Our current plan. [5:26:05 PM ET] logistics costs to represent a year over year headwind [5:26:05 PM ET] of about two billion dollars at ford [5:26:11 PM ET] plan is that the improved reliability and capability of our industrial system. Together, we [5:26:11 PM ET] our current plan is that the improved reliability and capability [5:26:11 PM ET] of our industrial system [5:26:17 PM ET] with revenue optimization and a company-wide efficiency on costs. [5:26:17 PM ET] together with revenue optimization [5:26:23 PM ET] will allow us to offset the expected headwinds that I just walked through. We intend to finish this year. [5:26:23 PM ET] and a company wide efficiency on cost [5:26:23 PM ET] will allow us to offset [5:26:23 PM ET] the expected headwinds that i just walked through [5:26:29 PM ET] we intend to finish this year strong executed twenty seven [5:26:29 PM ET] this year strong, execute a 27, with great profit bill when he investments, and with this. [5:26:35 PM ET] with great profitability investments and with discipline [5:26:35 PM ET] discipline to build towards that target of 8% adjusted to eBay by 29. I'd like to take your questions. [5:26:35 PM ET] to build towards that target of eight percent adjusted ebit by twenty nine [5:26:41 PM ET] we'd like to take your questions now [5:26:41 PM ET] now. You would like to ask a question, please use the red. [5:26:47 PM ET] rays here in chin, which can be found on the black bar at the bottom of your screen. Leave time for as many questions as [5:26:47 PM ET] which can be found on the black bar at the bottom of your screen [5:26:53 PM ET] to leave time for as many questions as possible please limit to one question [5:26:53 PM ET] as possible. Please limit to one question. Your first question comes from the line of Radio. [5:26:59 PM ET] your first question comes from the line of rajat gupta [5:26:59 PM ET] with jpmorgan please unmute and ask your question [5:27:03 PM ET] Roger Gupta with JP Morgan. Please unmute and ask your question. Great, thanks to Nicole. [5:27:05 PM ET] great thanks for taking the questions and and appreciate all the color [5:27:05 PM ET] on twenty twenty seven [5:27:05 PM ET] questions and appreciate all the color on 2027. Assuming, you know, you know. [5:27:11 PM ET] i mean assuming you know you know the commodities logistics [5:27:11 PM ET] you know the memory headwinds you know [5:27:11 PM ET] the commodities, logistics, the memory headwinds, stay where they are. [5:27:17 PM ET] you know stay where they are right now you know at the two billion guide [5:27:17 PM ET] are right now, you know, and the two bullion died. I'm just curious, you know, how much of the 2020? [5:27:23 PM ET] just curious you know how much of the twenty twenty seven offset [5:27:23 PM ET] stack you know that you have pointed to [5:27:23 PM ET] 2027 offset stack that you're pointing to is within your controls. [5:27:29 PM ET] is within your control today you know how much is [5:27:29 PM ET] today. How much of that do you still need to work on? Just because a lot of the inflation has happened. [5:27:35 PM ET] much of that you still need to work on just because a lot of the inflation has happened in the last [5:27:35 PM ET] in the last three, four months. Just curious to get your thoughts on that, and like how comfortable you are with that. [5:27:35 PM ET] three four months just curious to get your thoughts on that on like how comfortable [5:27:41 PM ET] you are with that twenty seven guide and what more needs to be done to get there [5:27:41 PM ET] that 27 guide, and what more needs to be done to get there? And have a quick follow-up. Thanks. [5:27:41 PM ET] i have a quick follow-up thanks [5:27:47 PM ET] yeah sure thank you so much for your question [5:27:47 PM ET] Yeah, sure. Thank you so much for your question. I would say that the areas that we see. [5:27:53 PM ET] i would say that the areas that we see more in our control would be [5:27:53 PM ET] the areas of revenue optimization [5:27:53 PM ET] more in our control would be the areas of revenue optimization. Continued side. [5:27:59 PM ET] continued software in parts growth [5:27:59 PM ET] software in parts of the growth, and also continued savings as well. [5:28:05 PM ET] and also continued savings as well [5:28:05 PM ET] and i can give you a little bit more [5:28:05 PM ET] I can give you a little bit more color on that too, if that would be helpful. I mean, on the market. [5:28:11 PM ET] color on that too if that would be helpful [5:28:11 PM ET] i mean on the market equation side as you know mix optimization is [5:28:11 PM ET] market equation side, as you know, mixed optimization is something where we have made huge progress this year. [5:28:17 PM ET] something where we have made huge progress this year and we [5:28:17 PM ET] expect that progress to continue into next year we have transformed our sales [5:28:17 PM ET] and we expect that progress to continue into next year. We have transformed our sales and operating plan. [5:28:23 PM ET] and operating plan and are now leveraging ai tools [5:28:23 PM ET] plan, and are now leveraging AI tools that are enabled us to match demand, sensing the capacity plan. [5:28:29 PM ET] that are enabling us to match demand sensing to capacity planning [5:28:29 PM ET] and that's leading to more production stability which leads to real savings [5:28:29 PM ET] planning, and that's leading to more production stability, which leads to real savings. We also have [5:28:35 PM ET] we also have better inventory and pricing models for both vehicle [5:28:35 PM ET] better inventory and pricing models for both vehicles and parts, and that's leading to faster. [5:28:41 PM ET] and parts and that's leading to faster turn rates and leaner stocks [5:28:41 PM ET] turn rates and leaner stocks. In just an overall disciplined approach in management of our market equation. [5:28:47 PM ET] in just an overall disciplined approach in management of our market equation [5:28:47 PM ET] so that is gonna be an area that's in our control we're continuing to get better through [5:28:47 PM ET] equation. So that is going to be an area that's in our control. We're continuing to get better through tech modernization. [5:28:47 PM ET] tech modernization [5:28:53 PM ET] on the structural cost side we're already working plans [5:28:54 PM ET] On the structural cost side, we're already working plans. We've been at this for six months. [5:28:59 PM ET] we've been at this for six months already going into [5:28:59 PM ET] months already going into 2027. And in fact, we're already looking ahead in populating properties. [5:29:05 PM ET] twenty twenty seven and in fact we're already looking ahead in populating [5:29:05 PM ET] profit improvement actions for both twenty eight and twenty nine as well [5:29:05 PM ET] profit improvement actions for both 28 and 29 as well. And then, as I said, we're going to continue. [5:29:11 PM ET] and then as i said we're gonna continue to see we believe [5:29:11 PM ET] continue to see we believe increased revenues in both the software. [5:29:17 PM ET] increased revenues in both the software and the parts [5:29:17 PM ET] growth area and as i just mentioned in my my comments here a moment ago [5:29:17 PM ET] the parts growth area. And as I just mentioned in my comments here a moment ago, we've now seen. [5:29:23 PM ET] we've now seen those combined you know representing ten percent of our revenues [5:29:23 PM ET] seen those combined, you know, representing 10% of our revenues at accretive growth margins. So this is [5:29:29 PM ET] at accretive growth margins so this is an area that [5:29:29 PM ET] is in our control areas that we're focused on and we're [5:29:29 PM ET] area that is in our control areas that we're focused on, and we're seeing the benefits. [5:29:35 PM ET] seeing the benefits of that [5:29:35 PM ET] to stabilize our returns in the face of things like [5:29:35 PM ET] that. To stabilize our returns in the face of things like commodities in an uncertain manner. [5:29:41 PM ET] commodities in an uncertain macro environment [5:29:41 PM ET] i would i would only add that [5:29:41 PM ET] macro environment. I would only add that our days should. [5:29:47 PM ET] our day supply on f one fifty and super duty [5:29:47 PM ET] supply on F-150 and super duty is a major accomplishment. [5:29:47 PM ET] is a major [5:29:53 PM ET] accomplishment compared to our competitors it's real we're going into twenty [5:29:53 PM ET] Accomplishment compared to our competitors. It's real, we're going into 27, as Sherry said in her speech, and a real [5:29:59 PM ET] seven as sherry said in her speech in a really good situation in our truck business [5:29:59 PM ET] really good situation in our truck business. I'm good. That's very helpful. [5:30:05 PM ET] understood that's very helpful color [5:30:05 PM ET] and then just on uev you know with the deliveries expected next year [5:30:05 PM ET] helpful color. And then, just on UEV, you know, with the deliveries expected next year. [5:30:11 PM ET] just curious what remains to be derisked [5:30:11 PM ET] I'm just curious what remains to be de-risked. Between now and Launch, you know, when it comes to supply risk. [5:30:17 PM ET] between now and launch you know when it comes to supplier readiness [5:30:17 PM ET] software validation you know just battery cost [5:30:17 PM ET] readiness, software validation, you know, just battery costs. You know, how much of the bats do? [5:30:23 PM ET] you know how much of the path to the modeling breakeven depends [5:30:23 PM ET] to the modeling break-even defends on UAV, hitting its volume and [5:30:29 PM ET] on uev hitting its volume and cost targets on schedule [5:30:29 PM ET] thanks [5:30:29 PM ET] boss targets on schedule. Next. Hey, this is Kumara. [5:30:35 PM ET] hey this is kumar let me give you some [5:30:35 PM ET] color on the status of the launch [5:30:35 PM ET] it's progressing very well [5:30:35 PM ET] Let me give you some color on the status of the launch. It's progressing very well. [5:30:41 PM ET] ninety percent of the validation testing has been completed [5:30:41 PM ET] 90% of the validation testing has been completed. We've built our [5:30:47 PM ET] we've built our first production line vehicles [5:30:47 PM ET] on at louisville assembly plant [5:30:47 PM ET] built our first production line vehicles on at Lugo Assembly plant. So we start. [5:30:53 PM ET] so we're starting to prove out our production processes [5:30:53 PM ET] starting to prove out our production processes. One of the new technologies for fair. [5:30:59 PM ET] one of the key new technologies for fathom is [5:30:59 PM ET] unicastings [5:30:59 PM ET] Faraday is unicastings. We've already produced 5,000 of them, so we're proving it. [5:31:05 PM ET] we've already produced five thousand of them [5:31:05 PM ET] so we're proving out our capability to run at rate and that's gone really well [5:31:05 PM ET] out our capability to run at rate, and that's done really well. And to be specific about [5:31:11 PM ET] and to be specific about your question on what risk remains [5:31:11 PM ET] to be mitigated it's primarily in the supply base [5:31:11 PM ET] about your question on what risk remains to be mitigated, it's primarily in the supply base. We need to make sure. [5:31:17 PM ET] we need to make sure that the supply base can run at great [5:31:17 PM ET] sure that the supply base can run at rate with high-quality parts. And that's very normal. [5:31:23 PM ET] with high quality parts and that's very normal at this [5:31:23 PM ET] this stage of the launch and that's what we're going to be working on for the next few months [5:31:23 PM ET] normal at this stage of the launch, and that's what we're going to be working on for the next few months. [5:31:29 PM ET] the other element of the fathom launch is critical is [5:31:29 PM ET] The other element of the Fathom launch is critical is the revenue picture, which actually seems to be strengthened. [5:31:35 PM ET] the revenue picture which actually seems to be strengthening andrew do you wanna [5:31:35 PM ET] strengthening. Andrew, do you want to highlight the change in the US EV market and how that relates to the profitable? [5:31:41 PM ET] to highlight the change in the u s market [5:31:41 PM ET] and how that relates to the profitability modeling [5:31:41 PM ET] profitability modeling. Yeah, I mean, the market, as we've learned over the last couple years, is definitely. [5:31:47 PM ET] i mean the market as we've learned over the last couple of years is definitely [5:31:47 PM ET] in the us specifically is not acting as a monolith especially when it comes to the [5:31:47 PM ET] definitely in the U.S. specifically, not acting as a monolith, especially when it comes to the [5:31:53 PM ET] affordable evs we've actually seen [5:31:53 PM ET] affordable EVs, we've actually seen EV prices go up about 10%. [5:31:59 PM ET] which has priced a lot of new vehicles out of the affordable market. So the customer is very limited. [5:31:59 PM ET] ev prices go up about ten percent [5:31:59 PM ET] which has priced a lot of new vehicles out of the affordable market so the customer [5:32:05 PM ET] is very limited with their new vehicle options in fact a lot of them are looking to the [5:32:05 PM ET] limited with their new vehicle options. In fact, a lot of them are looking to the used market. So we're now looking at the Evie market. [5:32:11 PM ET] used market so we're now looking at the ev market as new and used [5:32:11 PM ET] we're about [5:32:11 PM ET] market as new and used. We're about over half now of the vehicles sold under 40. [5:32:17 PM ET] over half now of the vehicles sold under forty thousand are used vehicles [5:32:17 PM ET] 40,000 are used vehicles. That's really important because, as you said, Jim, the fathoms. [5:32:23 PM ET] that's really important because as you said jim the fathom starting msr [5:32:23 PM ET] is at twenty eight thousand three hundred fifty dollars that's going to be right in the heart of the market [5:32:23 PM ET] starting MSRP is at 28,350. That's going to be right in the heart of the market. And it's not just the easy. [5:32:29 PM ET] and it's not just the ev market it's actually opening us up to the [5:32:29 PM ET] a massive total addressable market [5:32:29 PM ET] market, it's actually opening us up to the massive total addressable market. Um, if you [5:32:35 PM ET] if you know that nearly fifty percent [5:32:35 PM ET] If you know that nearly 50% of the U.S. new vehicle industry transactions. [5:32:41 PM ET] of the u s new vehicle industry transacts under forty thousand dollars so [5:32:41 PM ET] transacts under $40,000. So not only do we expect fathom for the reasons you mentioned earlier to attract new and [5:32:47 PM ET] not only do we expect fathom for the reasons you mentioned earlier to [5:32:47 PM ET] attract new and used ev buyers [5:32:47 PM ET] but also ice [5:32:47 PM ET] used EV buyers, but also hybrid customers, especially because we're going to have much lower options. [5:32:53 PM ET] hybrid customers especially because we're going to have much lower operating [5:32:53 PM ET] costs than even a mainstream hybrid vehicle so [5:32:53 PM ET] operating costs than even a mainstream pyramid vehicle. So the customer response on what we've shared so far. [5:32:59 PM ET] the customer response on what we've shared so far has been really strong [5:32:59 PM ET] we're preparing for the launch and we'll be [5:32:59 PM ET] far has been really strong. We're preparing to the launch, and we'll be launching our pre-order program. [5:33:05 PM ET] launching our pre order program [5:33:05 PM ET] in the first quarter and we'll have more to share with everyone at that time [5:33:05 PM ET] program in the first quarter, and we'll have more to share with everyone at that time. [5:33:11 PM ET] as we get closer feeling pretty good about the industrial preparation and the revenue picture [5:33:11 PM ET] it's impressive to me [5:33:11 PM ET] industrial preparation and the revenue picture. It's impressive to me to see that. [5:33:17 PM ET] to see that the used the ev market is [5:33:17 PM ET] above eight percent of the u s industry now [5:33:18 PM ET] that the used the EV market is above 8% of the U.S. industry now. [5:33:23 PM ET] and that's including all the issues [5:33:23 PM ET] And that's including all the issues that Andrew just highlighted and the lack of affordability. [5:33:29 PM ET] that andrew just highlighted and the lack of affordability options so [5:33:29 PM ET] i think we're [5:33:29 PM ET] you know [5:33:29 PM ET] options. So I think we're, you know, it's a lot of work to be still to be done. [5:33:35 PM ET] it's a lot of work to be still be done we have a year to go [5:33:35 PM ET] i think we're positioned really well [5:33:35 PM ET] We have a year to go. And I think we're positioned really well, which will be one of the two big drivers. [5:33:41 PM ET] which will be one of the two big drivers turning around model e [5:33:41 PM ET] the vehicle side of model e [5:33:41 PM ET] drivers turning around Model E, the vehicle side of Mahali. [5:33:47 PM ET] thank you [5:33:47 PM ET] Thank you. As a reminder, we ask that you limit yourself to one question. [5:33:53 PM ET] as a reminder we ask that you limit yourself to one question [5:33:53 PM ET] your next question will come from emmanuel rosner with wolfe research [5:33:53 PM ET] please unmute and ask your question [5:33:53 PM ET] Your next question will come from Emmanuel Rosner with Bull of Research. Please unmute and ask your question. [5:33:59 PM ET] great great thank you so much [5:33:59 PM ET] Great, great, thank you so much. Maybe just following up here on Model A E. [5:34:05 PM ET] maybe just following up here on model e so [5:34:05 PM ET] i know for twenty twenty seven overall for the company's [5:34:05 PM ET] So I know for 2027 overall for the company's stable results versus 2026. [5:34:11 PM ET] stable results versus twenty twenty six are you still looking to [5:34:11 PM ET] Are you still looking to improve Model E within that E bit? [5:34:17 PM ET] improve model e within that ebit [5:34:17 PM ET] and maybe what are the moving pieces within that are you planning similar [5:34:17 PM ET] And maybe what are the moving pieces within that? Are you planning similar or higher investment? [5:34:23 PM ET] or higher investments into this [5:34:23 PM ET] uev and bss and then [5:34:23 PM ET] investment into this UEV and BSS. And then, you know, what are the drivers of [5:34:29 PM ET] what are the drivers of improvement on the car [5:34:29 PM ET] improvement on the car side of the business? [5:34:29 PM ET] side of the business [5:34:35 PM ET] great [5:34:35 PM ET] manuel thank you so much for your questions so you just heard about the model e [5:34:35 PM ET] Great, Manuel, thank you so much for your questions. So, you just heard about the model operational steps that were. [5:34:41 PM ET] operational steps that we're taking in the milestones there [5:34:41 PM ET] we're taking in the milestones there. From a financial perspective, as I said in my comments, we're working. [5:34:47 PM ET] from a financial perspective as i said in my comments we're working towards our target [5:34:47 PM ET] for model a to reach breakeven by twenty twenty nine [5:34:47 PM ET] working towards our target model to reach break even by 2029. The progress isn't going to be linear, and we're now. [5:34:53 PM ET] progress isn't gonna be linear and we're now expecting higher [5:34:53 PM ET] now expecting higher expenses in 2027 as the plan's coming into focus. So, let me give you a little bit of. [5:34:59 PM ET] expenses in twenty twenty seven as the plan's coming into focus [5:34:59 PM ET] of what we're seeing. We think that the next step function change in profitability is going to happen in. [5:34:59 PM ET] let me give you a little bit of what we're seeing we think that the next [5:35:05 PM ET] step function change in profitability is gonna happen in the [5:35:05 PM ET] the first half of 2028. As UEB and Ford Energy both bramp with rather. [5:35:05 PM ET] first half of twenty twenty eight as uev and ford energy [5:35:11 PM ET] both ramp with revenue on both so if you break that down a bit [5:35:11 PM ET] revenue on both. So, if you break that down a bit, you're going to see Fadom launching towards the [5:35:17 PM ET] you're gonna see fathom launching you know towards the end of the year with the first derivative off the [5:35:17 PM ET] the end of the year with the first derivative off the platform. Then you're going to have that full year of production. [5:35:23 PM ET] platform then you're gonna have that full year of production in twenty twenty eight [5:35:23 PM ET] 2028. Then we're going to be escalating the Ford Energy business with investment, full year of. [5:35:29 PM ET] then we're gonna be escalating the ford energy business with investment [5:35:29 PM ET] full year production also by twenty twenty eight [5:35:29 PM ET] production also by 2028. And then, new is the launch of the European partnership products. [5:35:35 PM ET] products by 2028. So there will be investment in that in 2027. [5:35:35 PM ET] and then new is the launch of the european partnership products by twenty twenty eight [5:35:35 PM ET] so there will be investment in that in twenty twenty seven [5:35:41 PM ET] in the full year of production on those will be [5:35:41 PM ET] year of production on those will be by 2029. So you're going to have those in. [5:35:47 PM ET] by twenty twenty nine so you're gonna have those investments that are happening through [5:35:47 PM ET] investments that are happening through 27 with the unlock really starting to unleash as you get. [5:35:53 PM ET] twenty seven with the unlock really starting to unleash as you get into [5:35:53 PM ET] twenty twenty eight and nine [5:35:53 PM ET] get into 20, 20, 8, and 9. [5:35:59 PM ET] Your next question comes from Tom Narion with RBC. He's a new. [5:36:05 PM ET] your next question comes from tom narayan with rbc [5:36:05 PM ET] please unmute and ask your question [5:36:05 PM ET] hi yeah thanks for taking the question my question has to do with [5:36:05 PM ET] ask your question. Hi, yeah, thanks for taking the question. My question has to do with Ford Blue in Europe. [5:36:11 PM ET] ford blue in europe [5:36:11 PM ET] you know china has about sixty million vehicles of auto production capacity it's [5:36:11 PM ET] Europe. You know, China has about 60 million vehicles of auto production capacity. [5:36:17 PM ET] consuming about twenty million a year in [5:36:17 PM ET] consuming about 20 million a year and exporting 10 million. A decent portion going to Europe. [5:36:23 PM ET] exporting ten million a decent portion going to europe [5:36:23 PM ET] and then this has been worsened by weakening domestic sales in china [5:36:23 PM ET] Europe and then this has been worsened by weakening domestic sales in China. And then you have a JV with Julian. [5:36:29 PM ET] and then you have a jv with geely in valencia the [5:36:29 PM ET] partnerships with renault and vw are these enough to rightsize [5:36:29 PM ET] and Galencia, the partnerships with Brano and BW. Are these enough to right-size? [5:36:35 PM ET] your capacity in europe or do you need further [5:36:35 PM ET] actions from the eu to [5:36:35 PM ET] your capacity in Europe, or do you need further actions from the EU to hold check? [5:36:41 PM ET] halt chinese exports [5:36:41 PM ET] thanks for your question [5:36:41 PM ET] Chinese exports. Thanks for your question. Europe is quite different. [5:36:47 PM ET] europe is quite different than [5:36:47 PM ET] what's happening in southeast asia and latam [5:36:47 PM ET] different than what's happening, you know, in Southeast Asia and Let Ham for. [5:36:53 PM ET] for the china competition so i appreciate your questions specific [5:36:53 PM ET] europe [5:36:53 PM ET] the China competition. So I appreciate your questions, specific to Europe. [5:36:59 PM ET] the situation in europe is very different because the eu has [5:36:59 PM ET] Yeah, and the situation in Europe is very different because the EU has such a strong EU. [5:37:05 PM ET] such a strong ev mandate [5:37:05 PM ET] and as you said there's a lot of overcapacity in europe [5:37:05 PM ET] EU mandate. And as you said, there's a lot of open capacity in Europe, not just to export it from. [5:37:11 PM ET] not just to export it from china [5:37:11 PM ET] we do feel like we know we have the right plan [5:37:11 PM ET] from China. We do feel like we know we have the right plan to write this. [5:37:17 PM ET] to right the ship [5:37:17 PM ET] in terms of our passenger car profitability [5:37:18 PM ET] the ship in terms of our passenger car profitability with Renault. And Geely, as you mentioned. [5:37:23 PM ET] with renault and geely as you mentioned [5:37:23 PM ET] those are very low capital investments with [5:37:23 PM ET] mentioned, those are very low capital investments with really great cost levels. [5:37:29 PM ET] really great cost levels [5:37:29 PM ET] especially for the ev portion of our lineup that will allow us [5:37:29 PM ET] levels, especially for the EV portion of our lineup, that will allow us to replace unprofitable. [5:37:35 PM ET] to replace unprofitable evs with very [5:37:35 PM ET] unprofitable EVs with very, with much better profit outlooks on EV. [5:37:41 PM ET] with much better profit outlooks on ev [5:37:41 PM ET] the commercial side is also under pressure [5:37:42 PM ET] commercial side is also under pressure in Europe, and we have a pretty exciting. [5:37:47 PM ET] in europe and we have a pretty exciting lineup [5:37:47 PM ET] especially around the ev requirements for the commercial [5:37:47 PM ET] exciting lineup, especially around the EV requirements for the commercial business. [5:37:53 PM ET] pro business. There's a lot of negative profit pressure, but we have a [5:37:53 PM ET] business the pro business there's a lot of negative [5:37:59 PM ET] really good solution coming next year that we're really excited about. I think the content. [5:37:59 PM ET] profit pressure but we have a really good solution coming [5:38:05 PM ET] next year that we're really excited about [5:38:05 PM ET] i think the combination of both [5:38:05 PM ET] combination of both will make sense. As far as the capacity utilization that you mentioned, you're specifically. [5:38:11 PM ET] will make sense as far as the capacity utilization that you mentioned you're [5:38:11 PM ET] specific question at this point i don't want to get into the details [5:38:11 PM ET] specific question at this point. I don't want to get into the details other than working through. [5:38:17 PM ET] the opportunity in Valencia and Romania and Turkey. So, thank you. [5:38:17 PM ET] other than working through the opportunity of valencia [5:38:23 PM ET] and romania and turkey so [5:38:23 PM ET] thank you you know we are completely committed [5:38:23 PM ET] we are completely committed to building a profitable European business with these actions. We've been. [5:38:29 PM ET] building a profitable european business with these actions we've been on it for several years [5:38:29 PM ET] we have a really aggressive plan [5:38:29 PM ET] on it for several years, and we have a really aggressive plan. [5:38:35 PM ET] Your next question comes from the line of Joseph Stack with DB. [5:38:41 PM ET] your next question comes from the line of joseph spak with ubs [5:38:41 PM ET] please unmute your audio and ask your question [5:38:41 PM ET] UBS. Please unmute your audio and ask your question. Thanks, Referenc, everyone. [5:38:47 PM ET] thanks good afternoon everyone [5:38:47 PM ET] I guess I just want to start with some of your comments around. [5:38:47 PM ET] i i guess i just wanna start with [5:38:53 PM ET] of your comments around [5:38:53 PM ET] the f one fifty and and and not to sort of get [5:38:53 PM ET] the F150 and not to sort of get, you know, just sort of really buckle down on this. [5:38:59 PM ET] you know just sort of really buckle down on this you mentioned [5:38:59 PM ET] You mention that F-150 stock, you expect to recover to target levels by the end of the year. And I want to be clear. [5:39:05 PM ET] f one fifty stock you expect to recover to target levels [5:39:05 PM ET] by the end of the year and i wanna be clear on this because [5:39:05 PM ET] you've talked about stock in terms of days [5:39:05 PM ET] clear on this because we've talked about stock in terms of days historically, and I think even in your prepared. [5:39:11 PM ET] historically and i think even in your prepared remarks but [5:39:12 PM ET] prepared remarks, but you know, seasonally, we always see end of year December is much lower than September. So [5:39:17 PM ET] you know seasonally we always see end of year december as much lower than september so [5:39:17 PM ET] when you say recover [5:39:17 PM ET] just to to to correct levels [5:39:17 PM ET] when you say we cover this to correct levels, are you talking back? [5:39:23 PM ET] are are you talking back to that base level because that would mean a pretty significant increase in absolute in [5:39:23 PM ET] inventory [5:39:24 PM ET] that days level? Because that would mean a pretty significant increase in absolute inventory. [5:39:29 PM ET] thanks joe it's andrew [5:39:29 PM ET] Thanks, Joe. It's Andrew. No, I think when we talk specifically to our [5:39:35 PM ET] no i think when we talk specifically to our f-one hundred fifty stock [5:39:35 PM ET] we're running at forty nine days coming out of september that is below our range [5:39:35 PM ET] F-150 stock, we're running it 49 days coming out of September. That is below our range. [5:39:41 PM ET] as we look at towards the year end will be running probably on the low end of that [5:39:41 PM ET] we look at towards the year end, we will be running probably on the low end of that. We'll continue to run on the low end of that. [5:39:47 PM ET] we'll continue to run on the low end of that [5:39:47 PM ET] of that. And as Jim mentioned, you know, below our competitive set, we've seen really high days to turn. [5:39:47 PM ET] and as jim mentioned below our competitive set [5:39:53 PM ET] we've seen really high days to turn [5:39:53 PM ET] on our units that we have in stock. In fact, we just came out of the third quarter where we. [5:39:53 PM ET] on our units that we have in stock in fact we just came out of the [5:39:59 PM ET] third quarter where we had the fastest turn rates of the year and [5:39:59 PM ET] they were faster than any of our competitors in the segment and that's really [5:39:59 PM ET] had the fastest turn rates of the year, and they were faster than any of our competitors in the segment. And that's really helping. [5:40:05 PM ET] helping us manage our overall market equation, as we mentioned. But we do not expect to see our stocks building. [5:40:05 PM ET] helping us manage our overall market equation as we mentioned but we do not expect to [5:40:11 PM ET] see our stocks building to a much higher level at the end of this year [5:40:11 PM ET] building to a much higher level at the end of this year. Just want to reinforce and be specific. [5:40:17 PM ET] just want to reinforce and be specific to your question you said dig in [5:40:17 PM ET] think that's great [5:40:17 PM ET] you know [5:40:17 PM ET] your question. You said dig in, I think that's great. You know, for [5:40:23 PM ET] for me over the many last many years you know [5:40:23 PM ET] for me over the last many years, you know, a normal stocking level for F-150 could have been aged to 100 days. [5:40:29 PM ET] a normal stocking level for f-one hundred fifty could have been eighty to one hundred day supply in the past [5:40:29 PM ET] we're i just wanna reinforce what sherry said [5:40:29 PM ET] days supply in the past. I just want to reinforce what Sherry said. Our target is that. [5:40:35 PM ET] our target is that fifty little sixty day supply [5:40:35 PM ET] 50 little 60 days supply. And I think by the end of this year, we're going to be in that. [5:40:41 PM ET] i think by the end of this year we're gonna be in that range that is [5:40:41 PM ET] range. That is substantially lower than Ford's operated, and it's really allowed us to build. [5:40:41 PM ET] substantially lower than ford's operated and it's really allowed us to [5:40:47 PM ET] build that disciplined full size truck business while we watch our competitors [5:40:47 PM ET] build that discipline, full-size truck business. While we watch our competitors play a very different game. [5:40:53 PM ET] play a very different game [5:40:53 PM ET] and our dealers are very anxious for [5:40:53 PM ET] game. And our dealers are very anxious to report more stock. Our mix is good. [5:40:59 PM ET] more stock our mix is good [5:40:59 PM ET] and our turn rates is really what we're focused on now [5:40:59 PM ET] good, and our turn rates is really what we're focused on now, as the Andrew said. [5:41:05 PM ET] as andrew said [5:41:05 PM ET] So I would say, to answer your question simply, that 55 to 60 day range that [5:41:05 PM ET] so i would say to answer your question simply [5:41:11 PM ET] that fifty five to sixty day range that [5:41:11 PM ET] Sherry talked about is historically much lower than we normally run our truck. [5:41:11 PM ET] that sherry talked about is historically much lower than we normally [5:41:17 PM ET] run our truck business [5:41:17 PM ET] business. Your next question comes to the [5:41:23 PM ET] your next question comes from the line of james [5:41:23 PM ET] picariello with bnp [5:41:23 PM ET] paribas please unmute your audio and ask your question [5:41:23 PM ET] line of James Picariello with B and Pus, please admit your audio and ask your question. [5:41:29 PM ET] hi everybody yeah just [5:41:29 PM ET] Hi, everybody. Yeah, just follow on Joe's question. [5:41:35 PM ET] on the S series recovery and inventory. Is the 150? [5:41:35 PM ET] follow on joe's question [5:41:35 PM ET] on f series recovery and inventory [5:41:41 PM ET] 150,000 units recovery targets still cleanly impacted? [5:41:41 PM ET] is the one hundred and fifty thousand units [5:41:41 PM ET] recovery target still [5:41:47 PM ET] cleanly intact or or is [5:41:47 PM ET] is that number lower, and there's something else to, you know, favorably. [5:41:47 PM ET] or is that number lower and there's something else to to you know favorably [5:41:53 PM ET] offset and keep that that net one billion [5:41:53 PM ET] and keep that net one billion in the guide intact. Is it better? [5:41:53 PM ET] the guide intact [5:41:59 PM ET] is it better price mix or is that volume [5:41:59 PM ET] target still [5:41:59 PM ET] price mix, or is that volume target still to God? [5:41:59 PM ET] still the guide [5:42:05 PM ET] so so here's how i answer that on the novelis [5:42:05 PM ET] So here's how you answer that. On the new velocity recovery, it has been going as planned operations. [5:42:05 PM ET] recovery [5:42:11 PM ET] it has been going as planned operationally [5:42:11 PM ET] and we're now running at rate [5:42:11 PM ET] operationally. And we're now running at rate. And most, the vast majority. [5:42:17 PM ET] and most the vast majority [5:42:17 PM ET] of the materials have been validated and we're gonna continue to run it rate in [5:42:17 PM ET] of the materials have been validated. And we're going to continue to run it right in Q4 is our plan. [5:42:17 PM ET] four as our plan [5:42:23 PM ET] you get to the financial side of it we have seen costs coming in a little bit lower [5:42:23 PM ET] get to the financial side of it, we have seen costs coming in a little bit lower, and the volumes are. [5:42:29 PM ET] and the volumes have been proportionately a little bit lower too [5:42:29 PM ET] been proportionally a little bit lower, too. And so that's going to enable us to continue to keep with the guide that we. [5:42:35 PM ET] and so that's gonna enable us to continue to keep with the guide that we said [5:42:35 PM ET] we said at the outset of the year, which is one billion dollars of a net tailwind by the [5:42:35 PM ET] at the outset of the year which is one billion dollars of a net tailwind [5:42:41 PM ET] by the end of twenty twenty six [5:42:41 PM ET] as it relates to this [5:42:42 PM ET] end of 2026, as it relates to this set of problems. [5:42:47 PM ET] this set of products [5:42:47 PM ET] products. [5:42:53 PM ET] your next question comes from andrew [5:42:53 PM ET] percoco with morgan stanley please unmute your audio and ask your question [5:42:53 PM ET] Your next question comes from Andrew Percoca with Morgan Stanley, please unmute your audio and ask a question. [5:42:59 PM ET] great thanks for taking the questions [5:42:59 PM ET] Great, thanks for taking the questions. So I [5:42:59 PM ET] so [5:43:05 PM ET] i guess to start out a two part question here first [5:43:05 PM ET] guess to start out, a two-part question here. First, I want to ask a follow-up on energy storage. [5:43:11 PM ET] i want to ask a follow-up on energy storage i think you guys [5:43:11 PM ET] know, the US provided a great update in your prepared remarks. It sounds like you're 80% contracted. [5:43:11 PM ET] provided a great update in your prepared remarks it sounds like [5:43:17 PM ET] you're eighty percent contracted for twenty twenty eight [5:43:17 PM ET] so i guess that would [5:43:17 PM ET] contracted for 2028. So I guess that would imply about 16 gigawatt hours. [5:43:23 PM ET] imply about sixteen gigawatt hours kind of in the backlog [5:43:23 PM ET] but i think you also said that that included [5:43:23 PM ET] hours, kind of in the back log. But I think you also said that that included contracted back logs. [5:43:29 PM ET] contracted backlog as well as late stage negotiations so [5:43:29 PM ET] backlog as well as late stage negotiations. So I guess, did I get that right? And is there any other [5:43:35 PM ET] i guess did i get that right and is there any other [5:43:35 PM ET] information or color you can kind of provide in terms of [5:43:35 PM ET] other information or color you can kind of provide in terms of what needs to happen to maybe get that full significant. [5:43:41 PM ET] what needs to happen to maybe get that full sixteen gigawatt hours [5:43:41 PM ET] 16 gigawatt hours, you know, fully contracted versus late stage. Just kind of curious what the final steps are. [5:43:47 PM ET] fully contracted versus late stage just kind of curious [5:43:47 PM ET] what the final steps are there and and then my second question [5:43:47 PM ET] are there. And then my second question, you know, coming back to [5:43:53 PM ET] coming back to what tom asked about in terms of [5:43:53 PM ET] of china [5:43:53 PM ET] what Tom asked about in terms of China, you know, obviously exports are. [5:43:59 PM ET] obviously exports are continuing to increase pretty substantially [5:43:59 PM ET] continuing to increase pretty substantially out of the region, the domestic market. [5:44:05 PM ET] out of the region the the domestic market feels fairly saturated [5:44:05 PM ET] you just talk to [5:44:05 PM ET] feels fairly saturated. Can you just talk to how you expect that to impact your business? [5:44:11 PM ET] how you expect that to impact your business at higher level not just in europe but [5:44:11 PM ET] business at a higher level, not just in Europe, but just globally. And what you think needs to be done to make [5:44:17 PM ET] globally and you know what you think needs to be done to make sure that that's not gonna [5:44:17 PM ET] make sure that that's not going to create a bigger disruption for you guys going forward. Thank you. They were. [5:44:17 PM ET] create a a bigger disruption for you guys going forward thank you [5:44:23 PM ET] dave why don't you hear on ford energy yeah so andrew this is dave [5:44:23 PM ET] carroll [5:44:23 PM ET] you here not for the energy. Yeah, so Andrew, this is Dave Carroll. First, just to cover your first question. [5:44:23 PM ET] first just to cover your first question [5:44:29 PM ET] we're actually not talking about lack backlog today, we were going to start disclosing that next year. And what we [5:44:29 PM ET] we're actually not talking about backlog today we were going to start disclosing that next year [5:44:35 PM ET] and what we what jim had indicated in his remarks is that we are actually ahead of expectations where we are with [5:44:35 PM ET] Jim had indicated in his remarks is that we're actually ahead of expectations where we are with our customers. And we see that primarily. [5:44:41 PM ET] our customers and we see that primarily [5:44:41 PM ET] ford energy is very excited about [5:44:41 PM ET] Ford Energy is very excited about the quality of the product that we have on the market. We believe it's one of the highest quality products out there. [5:44:47 PM ET] quality of the product that we have on the market we believe it's one of the highest quality products out there in the market that you can buy [5:44:47 PM ET] the market that you can buy. And we're seeing that from our customers. And we believe that's what's bringing the customers to us. [5:44:53 PM ET] and we're seeing that from our customers and we believe that's what's bringing the customers to us [5:44:53 PM ET] as we're moving forward in fact last week we had one of our customers out of our marshall [5:44:53 PM ET] us as we're moving forward. In fact, last week we had one of our customers at an [5:44:59 PM ET] manufacturing facility where [5:44:59 PM ET] they toured where we're producing lfp prismatic cells right now [5:44:59 PM ET] where they toured, where we're producing LFP prismatic cells right now, and they toured that fact. [5:45:05 PM ET] and they toured that factory [5:45:05 PM ET] factory and came out saying it's top tier of all the factors they've seen globally. So, we're very excited. [5:45:05 PM ET] and came out saying it's top tier of all the factors they've seen globally so [5:45:11 PM ET] we're very excited that we have the highest quality product in the market and we believe that's what's driving the customers to us [5:45:11 PM ET] we have the highest quality product in the market, and we believe that's what's driving the customers to us. [5:45:17 PM ET] Yeah, and I think for back log, that would be something we're probably. [5:45:23 PM ET] yes and i think for backlog that would be something we're [5:45:23 PM ET] probably give more transparency on next next year [5:45:23 PM ET] give more transparency on next year, right? Yes, that's correct. Okay. [5:45:29 PM ET] right yes that's correct okay [5:45:29 PM ET] So thanks for your question. And we have a lot to do with Ford Energy, but really promising start. [5:45:29 PM ET] so thanks for your question and we have a lot to do with ford energy but [5:45:35 PM ET] really promising start and we're going to open the aperture for all the investors [5:45:35 PM ET] and we're going to open the aperture for all the investors more and more as time goes on. As far as the Chinese. [5:45:41 PM ET] more and more as time goes on as far as china is concerned thank you for your question [5:45:41 PM ET] concerned, thank you for your question. You know, frankly, we've held up really well internationally. [5:45:47 PM ET] frankly we've held up really well internationally [5:45:47 PM ET] as the Chinese would gain more and more a share in open and closed markets. [5:45:47 PM ET] as the chinese gain more and more share [5:45:53 PM ET] in open and closed markets [5:45:53 PM ET] we see the competition the most intense is latam and [5:45:53 PM ET] Where we see the competition the most intense is Latam in Southeast Asia, where we have a large ranger business. [5:45:59 PM ET] southeast asia where we have a large ranger business [5:45:59 PM ET] and in both cases ranger is still doing very well [5:45:59 PM ET] business. And in both cases, Ranger is still doing very well because it competes at a much. [5:46:05 PM ET] because it competes at a much higher price point [5:46:05 PM ET] much higher price point. And as I said, we're going to be going into their price point. [5:46:11 PM ET] and as i said we're going to be going into [5:46:11 PM ET] their price point next year with this new affordable truck [5:46:11 PM ET] point next year with this new affordable truck. So we'll see how that plays out, but we're confident. [5:46:17 PM ET] so we'll see how that plays out but we're confident in addition [5:46:17 PM ET] In addition, I think Ford is the number one traditional OEM exporting from China. It's been our strategy for [5:46:23 PM ET] i think ford is the number one traditional oem exporting from china [5:46:23 PM ET] been our strategy for several years now the [5:46:23 PM ET] several years now. The Territory is our second most profitable vehicle globally. [5:46:29 PM ET] territory is our second most profitable vehicle globally [5:46:29 PM ET] and it is really successful for us [5:46:29 PM ET] and it is really successful for us. And I think the exports are up, I don't know, like 60. [5:46:35 PM ET] and i think the exports are up i don't know like sixty percent in [5:46:35 PM ET] 60%. It's a really big improvement. And we expect to continue to take. [5:46:35 PM ET] it's a really big improvement [5:46:41 PM ET] and we expect to continue to take advantage of that [5:46:41 PM ET] for the open markets especially i kind of try to give a view [5:46:41 PM ET] take advantage of that for the open markets, especially. I kind of try to give a view. [5:46:47 PM ET] view on Europe so I won't be repetitive. But that's where we, for four, that's where we see the real problem. [5:46:47 PM ET] on europe so i won't be repetitive but that's where we [5:46:53 PM ET] for ford that's where we see the the real pressure on our business [5:46:53 PM ET] pressure on our business with the Chinese. It's really in Europe. It's not just the Chinese, it's the Evie Mandate. [5:46:59 PM ET] with the chinese it's really in europe it's not just the chinese [5:46:59 PM ET] it's the ev mandates by the eu which we expect them to address over [5:46:59 PM ET] mandates by the EU, which we expect them to address over time, as well as the UK. And all the overcapacity. [5:46:59 PM ET] time as well as the uk [5:47:05 PM ET] and all the overcapacity in europe [5:47:05 PM ET] it's been there for many many years [5:47:05 PM ET] as far as the rest of the world [5:47:05 PM ET] capacity in Europe. It's been there for many, many years. As far as the rest of the world, I think we're well. [5:47:11 PM ET] well positioned not only now, but with our new lineup. And our global partnerships will give us a lot of. [5:47:11 PM ET] i think we're well positioned not only now but with our new lineup [5:47:17 PM ET] and our global partnerships will give us a lot of opportunity [5:47:17 PM ET] we have learned so much exporting from china [5:47:17 PM ET] of opportunity. We have learned so much exporting from China. It's been really a very successful. [5:47:23 PM ET] it's been really a very successful exercise for ford [5:47:23 PM ET] with very low capital [5:47:23 PM ET] successful exercise for Ford with very low capital. And we've learned a lot about China. [5:47:29 PM ET] and we've learned a lot about china cost [5:47:29 PM ET] as well as china cost [5:47:29 PM ET] China cost, as well as China cost in places where it needs to be localized, like Taiwan. [5:47:35 PM ET] in places where it needs to be localized like thailand [5:47:35 PM ET] and europe over time [5:47:35 PM ET] Thailand in Europe over time. So I think we're well positioned. The issue for us. [5:47:41 PM ET] so i think we're well positioned the issue for us in the [5:47:41 PM ET] short term is really europe [5:47:41 PM ET] in the short term is really Europe. [5:47:47 PM ET] Your next question will come from Jairam Nathan Daiwa, please unmute your audio and ask your question. [5:47:47 PM ET] your next question will come from jairam nathan with daiwa [5:47:47 PM ET] please unmute your audio and ask your question [5:47:53 PM ET] yeah hi thanks for taking my question here [5:47:53 PM ET] Yeah, hi, thanks for taking my question here. So I just wanted to understand. [5:47:59 PM ET] so i i just wanted to understand the ability to upsell on the patent [5:47:59 PM ET] the ability to upsell on the fatum. And the starting point of your 30,000 is crazy. [5:48:05 PM ET] you know the starting point of you know thirty thousand is is [5:48:05 PM ET] pretty good but i just wanted to understand how would you what ways you can upskill that [5:48:05 PM ET] pretty good, but I just wanted to understand how would you, what ways you can upset that. [5:48:11 PM ET] Do you mean just so we understand the question? [5:48:17 PM ET] do you mean just so we understand the question [5:48:17 PM ET] mean how do we get to a point where it's profitable at that price point? Is that what you mean by the offset? [5:48:17 PM ET] you mean how do we how do we get to a point where where it's [5:48:23 PM ET] profitable at that price point is that what you mean by the offset [5:48:23 PM ET] offset. And no, no, no, not offset, upsell, upsell the next. [5:48:23 PM ET] no no not offset upsell the [5:48:29 PM ET] you know up sell the vehicle [5:48:29 PM ET] upsell the current kind of buy often like getting a bit of mix on the [5:48:35 PM ET] kind of by offering like getting a bit of mix on the vehicle beyond [5:48:35 PM ET] vehicle beyond that 30,000 on the 30,000. I see, I see what you mean. Okay, thank you. Yeah. [5:48:35 PM ET] beyond that thirty thousand under thirty thousand i see i see what you mean okay thank you yeah [5:48:41 PM ET] great question i think we're already pretty deep in [5:48:41 PM ET] yeah, great question. I think we're already pretty deep in a lot of intelligence, a lot of customers have shown in. [5:48:47 PM ET] a lot of intelligence a lot of customers have shown interest in the vehicle so we're learning a lot [5:48:48 PM ET] interest in the vehicle, so we're learning a lot. There's a lot to that strategy at Forward 2. [5:48:53 PM ET] there's a lot to that strategy at ford to [5:48:53 PM ET] offer customers a lot of options beyond the $28,000, Android will let you highlight. [5:48:53 PM ET] to offer customers a lot of options beyond the twenty eight thousand dollars [5:48:59 PM ET] andrew i'll let you highlight the three or four key points yeah i think what [5:48:59 PM ET] highlight the three or four key points. Yeah, I think we're one, and we'll get more into this when we do. [5:49:05 PM ET] one and we'll get more into this when we when we do a full review of the [5:49:05 PM ET] product you'll you'll learn a lot more about our positioning strategy but [5:49:05 PM ET] do a full reveal of the product. You'll learn a lot more about our positioning strategy, but the starting price of the 20%. [5:49:11 PM ET] the starting price of the twenty eight thousand hundred fifty is just that [5:49:11 PM ET] 28,350 is just that. We'll have a range that goes to the high 30,000 range. [5:49:17 PM ET] we'll have a range that goes to the high thirty thousand range [5:49:17 PM ET] and we'll have a couple of different offerings within that so [5:49:17 PM ET] range, and we'll have a couple different offerings within that. So I would say we. [5:49:23 PM ET] i i would say we will give you a lot more detail around this the the [5:49:23 PM ET] we will give you a lot more detail around this, the offerings themselves as we get closer. [5:49:29 PM ET] offerings themselves as we get closer it's probably too soon to [5:49:29 PM ET] It's probably too soon to share more at this point. The big breakthrough conceptually for us about customer. [5:49:35 PM ET] to share more at this point the big breakthrough conceptually for us [5:49:35 PM ET] about customers you know buying nicer [5:49:35 PM ET] fathoms are really on the digital side [5:49:35 PM ET] customers buying nicer paths are really on the digital side. We put in an advanced. [5:49:41 PM ET] we put in an advanced electric architecture in a forty eight volt system [5:49:41 PM ET] electric architecture or 48 volts system so we can offer at an incredibly low cost. [5:49:47 PM ET] very advanced ADAS. As well as, you know, digital. [5:49:47 PM ET] so we can offer at an incredibly low cost [5:49:47 PM ET] very advanced adas [5:49:47 PM ET] as well as [5:49:53 PM ET] digital [5:49:53 PM ET] camera dashboard. You know, I won't go into all the details Andrew said, but the digital suite. [5:49:53 PM ET] camera dashboard you know i won't go into all the details andrew said but [5:49:59 PM ET] the digital suite including the embedded apple maps [5:49:59 PM ET] including the embedded Apple Maps, is really a game changer for any EP. [5:50:05 PM ET] is really a game changer for any ev [5:50:05 PM ET] let alone at this price i think for me personally [5:50:05 PM ET] alone at this price. I think for me personally, that is going to be the most exciting upsell. [5:50:11 PM ET] that is going to be the most exciting upsell opportunity it's really [5:50:11 PM ET] opportunity. It's really the long-term subscription and digital experience. [5:50:11 PM ET] long term subscription [5:50:17 PM ET] and digital experience for the customer [5:50:17 PM ET] experience for the customer. Oh, no. [5:50:23 PM ET] our next question will come from mark delaney with goldman sachs [5:50:23 PM ET] please unmute your audio and ask your question [5:50:23 PM ET] next question will come from Mark Delaney with Golden Sachs, visa meet your audio and ask your question. [5:50:29 PM ET] yes good afternoon thank you very much for [5:50:29 PM ET] Yes, good afternoon, and thank you very much for taking my question. I was hoping you could give a bit more color on what Ford is. [5:50:35 PM ET] taking my question i was hoping you could give a bit more color on what [5:50:35 PM ET] seeing for pricing. The company took up its view of U.S. industry pricing by a little bit for 2026. [5:50:35 PM ET] ford is seeing for pricing the company took up its view of u s industry pricing [5:50:41 PM ET] by a little bit for twenty twenty six maybe you can share a [5:50:41 PM ET] bit more on what's driving that and then also on this [5:50:41 PM ET] Maybe you can share a bit more on what's driving that. And then also on this topic more broadly, any early views and pricing for 2066. [5:50:47 PM ET] topic more broadly any early views on pricing for twenty twenty seven including what you're seeing in [5:50:47 PM ET] pro with the annual negotiations which i think are now well underway [5:50:47 PM ET] 2027, including what you're seeing in pro with the annual negotiations, which I think are now well underway. [5:50:53 PM ET] that's a big question thank you for asking [5:50:53 PM ET] That's a big question. They never asked me. So I [5:50:59 PM ET] Adrian and Lisha, I think you should bring up. Yeah, maybe I'll start with the retail side banks. [5:50:59 PM ET] so andrew and alicia i think you should bring up too yeah maybe i'll i'll [5:51:05 PM ET] start with the retail side thanks mark yeah we're seeing a very strong [5:51:05 PM ET] pricing environment right now [5:51:05 PM ET] Mark. Yeah, we're seeing a very strong pricing environment right now. We expect pricing to be up about a percentage. [5:51:11 PM ET] we expect pricing to be up about one percentage point [5:51:11 PM ET] this year and [5:51:11 PM ET] as we looked into next year [5:51:11 PM ET] percentage point this year. And, you know, as we looked into next year, we think. [5:51:17 PM ET] we think there's a lot of different levers that we'll be able to work with with our product mix and [5:51:17 PM ET] there's a lot of different levers that we'll be able to work with with our product mix and net pricing, both the top line, but [5:51:23 PM ET] and net pricing both the top line but also [5:51:23 PM ET] but also our variable marketing as well. Just very similar to how we approach this year. [5:51:23 PM ET] variable marketing as well just very similar to how we approach this year [5:51:29 PM ET] the industry remains really strong [5:51:29 PM ET] industry remains really strong. We're seeing the segmentation remain strong. Very, really big Brazilian. [5:51:35 PM ET] we're seeing the segmentation remain strong very really big resilience with [5:51:35 PM ET] customer base especially in trucks and utilities [5:51:35 PM ET] resilience with customer base, especially in trucks and utilities, which is really playing to our advanced. [5:51:41 PM ET] which is really playing to our advantage and we expect that [5:51:41 PM ET] continue into next year and alicia do you want to comment on the what you're seeing in the [5:51:41 PM ET] advantage, and we expect that to continue in the next year. And Alicia, do you want to comment on what you're seeing in the early part of [5:51:47 PM ET] early part of commercial side yes can just also on pricing for fleet we're also seeing [5:51:48 PM ET] of the commercial side. Yeah, I can just also empic. We're also seeing strong pricing year over year. [5:51:53 PM ET] strong pricing year over year over one percent [5:51:53 PM ET] over 1%. But as Sherry mentioned, our fleet demand orders for 27 model year. [5:51:59 PM ET] but as sherry mentioned our fleet demand orders for twenty seven model year [5:51:59 PM ET] are on target we're excited about [5:51:59 PM ET] are on target. We're excited about Oakville and that capacity because that's going to allow. [5:52:05 PM ET] oakville and that capacity because that's going to allow us to really grow [5:52:05 PM ET] allow us to really grow our truck rental sales. We can return to our pre-pandemic levels where the economic. [5:52:11 PM ET] our truck rental sales we can return to our pre pandemic levels where the economics are really [5:52:11 PM ET] favorable for us [5:52:11 PM ET] economics are really favorable for us. We are also able to take a larger share of wallet for our large commercial. [5:52:17 PM ET] we are also able to take a larger share of wallet for our large commercial customers [5:52:17 PM ET] commercial customers. And then we were able to supply more chassis cap units to the body modifiers. And we are very [5:52:23 PM ET] and then we were able to supply more chassis cab [5:52:23 PM ET] to the body modifiers and we are very competitive [5:52:23 PM ET] that space and we have been constrained [5:52:23 PM ET] very competitive in that space, and we have been constrained. So, we're excited about the ability to really. [5:52:29 PM ET] so we're excited about the ability to really meet this unmet [5:52:29 PM ET] demand and the strong order take that we're seeing so far [5:52:29 PM ET] meet this unmet demand and the strong order take that we're seeing so far. Gives us competition. [5:52:35 PM ET] gives us confidence that we'll continue to grow there [5:52:35 PM ET] confidence that we'll continue to grow there. The upside for next year for Pro is pretty meaningful. Between [5:52:41 PM ET] the upside for next year for pro is pretty meaningful [5:52:41 PM ET] OPIL and getting past nobellas, it's really a great opportunity for us at Ford. [5:52:41 PM ET] between oakville and getting past novelis yes [5:52:47 PM ET] it's really a great opportunity for us at ford [5:52:47 PM ET] Your next question comes from the line of John saying. [5:52:53 PM ET] your next question comes from the line of john sager with evercore isi [5:52:53 PM ET] please unmute your audio and ask your question [5:52:53 PM ET] Sager with Evercore ISI. Please unmute your audio and ask your question. [5:52:59 PM ET] Dawn your line is open, please unmute and ask your question. [5:52:59 PM ET] john your line is open please unmute and ask your question [5:53:05 PM ET] hey thanks sorry about that [5:53:05 PM ET] Hey, thanks, sorry about that. Yeah, I just wanted to take one more shot at BESS. You had mentioned. [5:53:11 PM ET] yeah i just wanted to take one more shot at ess you you had mentioned [5:53:11 PM ET] you know the discussions for twenty nine and thirty advancing [5:53:11 PM ET] kind of ahead of your prior expectations [5:53:11 PM ET] you know, the discussions for 29 and 30, advancing kind of ahead of your prior expectations. We're using [5:53:17 PM ET] do you need to see in terms of commit commitment capacity to [5:53:17 PM ET] you need to see in terms of commitment capacity to start to think about expanding? [5:53:23 PM ET] start to think about expanding beyond that first twenty gigawatt hours [5:53:23 PM ET] beyond that first 20 gigawatt hours. And then, what does incremental cap exist? [5:53:23 PM ET] and then what does incremental [5:53:29 PM ET] capex look like [5:53:29 PM ET] bags look like for that. And then maybe if I get asked to follow up on just the inner. [5:53:29 PM ET] for that and then maybe if i could ask a follow-up [5:53:35 PM ET] on just the the impact to earnings [5:53:35 PM ET] impact to earnings as we go through the course of the year, as you go through the ramp to get towards the [5:53:41 PM ET] as we go through the course of the year as you go through the ramp [5:53:41 PM ET] to get towards the the fourth quarter of twenty gigawatt hours of capacity could you just [5:53:41 PM ET] give us some puts and takes there [5:53:41 PM ET] fourth quarter of 20 gigawatt hours of capacity. Could you just maybe give us some puts and takes there? [5:53:47 PM ET] yes so john so [5:53:47 PM ET] Yes, John. So obviously, the team is really focused. This is Dave, the team is really focused on law. [5:53:53 PM ET] obviously the team is really this is dave the team is really focused on launching the initial twenty gigawatt hours [5:53:53 PM ET] we have to to bring online and ramp up in twenty twenty eight [5:53:53 PM ET] launching the initial 20 gigawatt hours that we have to bring online and ramp up in 2028. That being said, [5:53:59 PM ET] that being said [5:53:59 PM ET] we are already evaluating scenarios how we could best expand [5:53:59 PM ET] said, we are already evaluating scenarios how we could best expand capacity, expand our offerings to our customers. [5:54:05 PM ET] capacity expand our offerings to our customers because we do see the real demand out there [5:54:05 PM ET] when we're doing so we do consider the returns on our investment [5:54:05 PM ET] because we do see the real demand out there. But when we're doing so, we do consider the returns on our investment, consider the customer demand. [5:54:11 PM ET] consider the customer demand [5:54:11 PM ET] the tax treatment and other strategic uses of capital [5:54:11 PM ET] the tax fremont, and other strategic uses of capital. So we do see upside at our consequences. [5:54:11 PM ET] so we do see upside [5:54:17 PM ET] our kentucky one facility [5:54:17 PM ET] excited for the potential growth but we don't have anything to announce today in that regards [5:54:17 PM ET] Contechu 1 facility. We're excited for the potential of growth, but we don't have anything to announce today in that regard. [5:54:23 PM ET] sure any tips you wanna give on the spending for for [5:54:23 PM ET] for an energy next year [5:54:23 PM ET] really need does she want to give all the spending for an energy next year. [5:54:29 PM ET] The only thing I would give is that we had talked about around $2 billion. [5:54:35 PM ET] the the only thing i would give is that we had talked about [5:54:35 PM ET] around two billion dollars of investment and we're going to spend about a third of that this [5:54:35 PM ET] dollars of investment, and we're going to spend about a third of that this year, and about two-thirds next year. [5:54:35 PM ET] year and about two thirds next year [5:54:41 PM ET] that gives you a little bit more understanding [5:54:41 PM ET] gives you a little bit more understanding. [5:54:47 PM ET] Your next question comes to the line of Dan Letty with Barclays. They submit your audio and ask your question. [5:54:47 PM ET] your next question comes from the line of dan levy with barclays please unmute your audio and ask your [5:54:47 PM ET] question [5:54:53 PM ET] I goody lame, thank you for taking the [5:54:53 PM ET] hi good evening thank you for [5:54:59 PM ET] taking the the questions wanted to ask [5:54:59 PM ET] the questions. I wanted to ask about the partnership with Geely. [5:55:05 PM ET] about the partnership with geely [5:55:05 PM ET] I believe part of the partnership is to establish learnings from them. [5:55:05 PM ET] i believe part of the partnership is to [5:55:05 PM ET] establish learnings from them [5:55:11 PM ET] maybe you could just be a bit more concrete you know what you hope to learn within [5:55:11 PM ET] maybe you could just be a bit more concrete, you know, what you hope to learn within supply base. [5:55:17 PM ET] supply base and designing the vehicle and then i'll just extend that question to [5:55:17 PM ET] and designing the vehicle. And I'll just extend that question to how you plan to achieve profit. [5:55:23 PM ET] how you plan to achieve profitability [5:55:23 PM ET] profitability on Thalada, which I think you've talked about, sort of indexing or benchmarking against the child? [5:55:29 PM ET] on fathom which i which i think you've talked about sort of index [5:55:29 PM ET] ing or benchmarking against the chinese [5:55:29 PM ET] know some of the supply chain [5:55:29 PM ET] Chinese, you know, some of the supply chain opportunities there. So maybe you can talk about what you're doing. [5:55:35 PM ET] opportunities there so maybe you can talk about you know what you're doing with geely [5:55:35 PM ET] doing with Jealy and maybe how some of that potentially extends to how you're going to achieve the right cost that. [5:55:35 PM ET] and maybe how some of that potentially extends to how you're gonna achieve [5:55:41 PM ET] the right cost that you need [5:55:41 PM ET] you need to fall off? So let me break it down into [5:55:47 PM ET] so let me break it down into [5:55:47 PM ET] two pieces [5:55:47 PM ET] two pieces: um, its cost and its quality. [5:55:47 PM ET] it's cost and it's quality [5:55:53 PM ET] We are already learning that they can. [5:55:53 PM ET] we are already learning [5:55:53 PM ET] that [5:55:53 PM ET] they can [5:55:59 PM ET] offer [5:55:59 PM ET] excuse me [5:55:59 PM ET] a certain percentage [5:55:59 PM ET] offer a certain percentage, lower cost. [5:55:59 PM ET] lower cost [5:56:05 PM ET] landed in europe for us so we're going through [5:56:05 PM ET] landed in Europe for us. So we're going through part by part understanding each system. [5:56:05 PM ET] part by part [5:56:05 PM ET] understanding each system [5:56:11 PM ET] and [5:56:11 PM ET] speed [5:56:11 PM ET] Speed, we're learning there are a few. [5:56:17 PM ET] we're learning there a few months faster than this [5:56:17 PM ET] and we're going through [5:56:17 PM ET] few months faster than. And we're going through each part of the product. [5:56:17 PM ET] each [5:56:23 PM ET] part of the product development system [5:56:23 PM ET] to understand how they are faster than us [5:56:23 PM ET] development system to understand how they are faster than us. And it comes. [5:56:29 PM ET] and a combination of both of those items [5:56:29 PM ET] combination of both of those items is being institutionalized into our own. [5:56:29 PM ET] is being institutionalized [5:56:35 PM ET] into our own global product development system [5:56:35 PM ET] own global product development system. [5:56:41 PM ET] on the ued [5:56:41 PM ET] On the UED, you know, we always set our target even for you. [5:56:47 PM ET] you know we we always set our target even four years ago [5:56:47 PM ET] with imagining what a byd could do in mexico [5:56:47 PM ET] years ago with imagining what a BYD could do in Mexico. Now, because we knew. [5:56:53 PM ET] not because we counter on that happen, but because we knew that ultimately, if that platform is going to be competitive. [5:56:53 PM ET] because we knew not because we count on that happen but because we knew that ultimately that [5:56:59 PM ET] platform is gonna be competitive we had to make sure [5:56:59 PM ET] competitive. We had to make sure, even in the US, it would be fully competitive. So that's why we took such a [5:57:05 PM ET] even in the u s would be fully competitive so that's why we took [5:57:05 PM ET] big swing at the innovation because we had to. The big breakthroughs. [5:57:05 PM ET] such a big swing at the innovation because we had to [5:57:11 PM ET] you know, in general on the cost for that product is really. [5:57:11 PM ET] the big breakthroughs you know in general on the cost for [5:57:11 PM ET] for that product is is really [5:57:17 PM ET] a couple of things in general the first is [5:57:17 PM ET] a couple of things in general. The first is the [5:57:23 PM ET] the e box and the whole electronic [5:57:23 PM ET] e-box and the whole electronics and electrical architecture in ADAS is much, much slower. [5:57:29 PM ET] in electric architecture and adas is much much lower cost than [5:57:29 PM ET] lower cost than supply chain. We could do that all in-house, and the big benefit. [5:57:29 PM ET] supply chain we did that all in house [5:57:35 PM ET] and the big benefit would be the cost and the design cost of that [5:57:35 PM ET] benefit would be the cost and the design cost of that. Number two is we rapidly. [5:57:35 PM ET] number two [5:57:41 PM ET] is we radically resimplified the parts [5:57:41 PM ET] radically simplify the parts. So the two large unit castings that Kumar talked. [5:57:47 PM ET] so the two large unit castings that kumar talked about derisking [5:57:47 PM ET] talked about, de-risking the 5,000 we've already built. That is a radical enabler. [5:57:53 PM ET] the five thousand we've already built that is a radical enabler [5:57:53 PM ET] enabler for much lower part count in the VFL. And then, obviously, the labor content is. [5:57:53 PM ET] for much lower part count in the vehicle [5:57:59 PM ET] and then obviously the labor content is much lower [5:57:59 PM ET] is much lower in the vehicle by intention. But there's another area that we really found. [5:58:05 PM ET] in the vehicle by intention but there's another area that we really found [5:58:05 PM ET] found to be quite advantage relative to you know BYD, and that is the efficiency of our motor. [5:58:05 PM ET] to be quite advantage relative to you know a byd [5:58:11 PM ET] and that is the efficiency of our motors gearbox and inverters [5:58:11 PM ET] motors, gearbox, and inverters, which are about 30% more efficient than theirs and allows us to design. [5:58:17 PM ET] which are about thirty percent more efficient than theirs and allows us to design a battery [5:58:17 PM ET] that's much less and so that i think that's [5:58:17 PM ET] design a battery that's much less. And so, that I think God's really critical. [5:58:23 PM ET] critical. The LFP cell in Marshall is another big enabler, and I think you get the points. [5:58:23 PM ET] really critical the lfp cell in march [5:58:23 PM ET] is another big enabler [5:58:29 PM ET] and i think you get the point which is like [5:58:29 PM ET] every part of this project [5:58:29 PM ET] had to be world class [5:58:29 PM ET] point, which is like every part of this project had to be world class, Chinese. [5:58:35 PM ET] chinese cost efficiency in order to convince ourselves we would be fully [5:58:35 PM ET] Chinese cost efficiency thing in order to convince ourselves we would be fully competitive. But it also [5:58:35 PM ET] competitive [5:58:41 PM ET] also introduced a lot of new technology and, frankly, a lot of new suppliers. [5:58:41 PM ET] but it also introduced a lot of new technology and frankly a lot of new [5:58:41 PM ET] suppliers [5:58:47 PM ET] and so what we learned from uev [5:58:47 PM ET] And so, what we learned from UEB and what we're learning from GLI, and what will. [5:58:53 PM ET] and what we're learning from geely and what we wanna keep strategically in the company [5:58:53 PM ET] are all [5:58:53 PM ET] want to keep strategically in the company. We're all getting captured at the same time. [5:58:53 PM ET] getting [5:58:59 PM ET] captured at the same moment for kumar [5:58:59 PM ET] moment for Kumar, and his team is now curating how that all is going to work. [5:58:59 PM ET] and his team is now curating [5:59:05 PM ET] how that all is gonna work along with our ai tools that sherry mentioned [5:59:05 PM ET] work along with our AI tools that Sherry mentioned. And that's why we mentioned the heart and soul of our. [5:59:11 PM ET] and that's why we mentioned the heart and soul of our company is gonna be this new industrial system [5:59:11 PM ET] going system enabled by all that benchmarking [5:59:11 PM ET] company is going to be this new industrial system enabled by all that benchmarking, including supposed. [5:59:17 PM ET] including suppliers manufacturing efficiency [5:59:17 PM ET] suppliers, manufacturing efficiency, all the way to how fast we create the vehicle. [5:59:23 PM ET] all the way to how fast we create the vehicle [5:59:23 PM ET] that's exciting for us [5:59:23 PM ET] That's exciting for us because it's quite. [5:59:29 PM ET] because it's quite [5:59:29 PM ET] it's quite a big change for ford [5:59:29 PM ET] a big change for Ford. A real concrete example is the motors and the patients who. [5:59:35 PM ET] yeah a real concrete example is the [5:59:35 PM ET] motors and the patient's physician that you mentioned jim [5:59:35 PM ET] that you mentioned, Jim, are being now being transported into our hypertension. [5:59:41 PM ET] are being now being transported into our [5:59:41 PM ET] hybrid systems for the rest of the week for the rest of our [5:59:41 PM ET] portfolio [5:59:41 PM ET] hybrid systems for the rest of the ecosystem, for the rest of our portfolio. We're putting a lot. [5:59:47 PM ET] and we're putting a lot of pressure on ourselves [5:59:47 PM ET] to make sure that whether it's uev [5:59:47 PM ET] lot of pressure on ourselves to make sure that whether it's UED or GLE or JMC. [5:59:53 PM ET] or geely or jmc [5:59:53 PM ET] we or ai tools [5:59:53 PM ET] JMC. We, or AI tools, we are going to move that into the corporate. [5:59:59 PM ET] we are going to move that into the core part of the company [5:59:59 PM ET] as fast as we can [5:59:59 PM ET] part of the company as fast as we can. [6:00:05 PM ET] this concludes the ford motor company third [6:00:05 PM ET] quarter twenty twenty six earnings conference call [6:00:05 PM ET] This includes the Ford Motor Company third quarter 2026 earnings conference call. [6:00:11 PM ET] you for your participation you may now disconnect [6:00:11 PM ET] you for your participation, you may now disconnect. -- Saidwire · verified quotes, live transcript and a running story from live events · support@saidwire.com