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Announcement:

Moody's reviews Ford prime auto loan ABS from 2007 to 2010 for possible upgrade

04 Mar 2011

Approximately $973 million of asset-backed securities affected

New York, March 04, 2011 -- Moody's has placed on review for possible upgrade twenty-three tranches from eleven auto loan securitizations sponsored by Ford Motor Credit Company ("Ford Credit") during 2007 to 2010. The actions are a result of updated lower lifetime loss expectations as well as build up in credit enhancement relative to remaining losses due to the non-declining reserve accounts and sequential payment structure of the transactions.

RATINGS:

Issuer: Ford Credit Auto Owner Trust 2007-A

Cl. D, A2 (sf) Placed Under Review for Possible Upgrade; previously on Jul 1, 2010 Upgraded to A2 (sf)

Issuer: Ford Credit Auto Owner Trust 2007-B

Cl. D, A1 (sf) Placed Under Review for Possible Upgrade; previously on Jul 1, 2010 Upgraded to A1 (sf)

Issuer: Ford Credit Auto Owner Trust 2008-2

Cl. C, Aa1 (sf) Placed Under Review for Possible Upgrade; previously on Jul 1, 2010 Upgraded to Aa1 (sf)

Issuer: Ford Credit Auto Owner Trust 2008-A

Cl. D, A1 (sf) Placed Under Review for Possible Upgrade; previously on Jul 1, 2010 Upgraded to A1 (sf)

Issuer: Ford Credit Auto Owner Trust 2008-B

Cl. C, Aa2 (sf) Placed Under Review for Possible Upgrade; previously on Jul 1, 2010 Upgraded to Aa2 (sf)

Cl. D, Baa1 (sf) Placed Under Review for Possible Upgrade; previously on Jul 1, 2010 Upgraded to Baa1 (sf)

Issuer: Ford Credit Auto Owner Trust 2008-C

Cl. C, Aa2 (sf) Placed Under Review for Possible Upgrade; previously on Jul 1, 2010 Upgraded to Aa2 (sf)

Cl. D, Baa2 (sf) Placed Under Review for Possible Upgrade; previously on Jul 1, 2010 Upgraded to Baa2 (sf)

Issuer: Ford Credit Auto Owner Trust 2009-1

Cl. B, Aa2 (sf) Placed Under Review for Possible Upgrade; previously on Dec 4, 2009 Assigned Aa2 (sf)

Cl. C, A1 (sf) Placed Under Review for Possible Upgrade; previously on Dec 4, 2009 Assigned A1 (sf)

Cl. D, Baa1 (sf) Placed Under Review for Possible Upgrade; previously on Dec 4, 2009 Assigned Baa1 (sf)

Issuer: Ford Credit Auto Owner Trust 2009-D

Cl. B, Aa2 (sf) Placed Under Review for Possible Upgrade; previously on Sep 15, 2009 Definitive Rating Assigned Aa2 (sf)

Cl. C, A1 (sf) Placed Under Review for Possible Upgrade; previously on Sep 15, 2009 Definitive Rating Assigned A1 (sf)

Cl. D, A3 (sf) Placed Under Review for Possible Upgrade; previously on Sep 15, 2009 Definitive Rating Assigned A3 (sf)

Issuer: Ford Credit Auto Owner Trust 2009-E

Cl. B, Aa2 (sf) Placed Under Review for Possible Upgrade; previously on Dec 1, 2009 Definitive Rating Assigned Aa2 (sf)

Cl. C, A1 (sf) Placed Under Review for Possible Upgrade; previously on Dec 1, 2009 Definitive Rating Assigned A1 (sf)

Cl. D, A2 (sf) Placed Under Review for Possible Upgrade; previously on Dec 1, 2009 Definitive Rating Assigned A2 (sf)

Issuer: Ford Credit Auto Owner Trust 2010-1

Cl. B, Aa2 (sf) Placed Under Review for Possible Upgrade; previously on Feb 25, 2010 Assigned Aa2 (sf)

Cl. C, A1(sf) Placed Under Review for Possible Upgrade; previously on Feb 25, 2010 Assigned A1 (sf)

Cl. D, Baa1 (sf) Placed Under Review for Possible Upgrade; previously on Feb 25, 2010 Assigned Baa1 (sf)

Issuer: Ford Credit Auto Owner Trust 2010-SR1

Cl. B, Aa2 (sf) Placed Under Review for Possible Upgrade; previously on Feb 8, 2010 Assigned Aa2 (sf)

Cl. C, A1 (sf) Placed Under Review for Possible Upgrade; previously on Feb 8, 2010 Assigned A1 (sf)

Cl. D, A2 (sf) Placed Under Review for Possible Upgrade; previously on Feb 8, 2010 Assigned A2 (sf)

RATINGS RATIONALE

Moody's current lifetime cumulative net loss projections (CNL) for 2007 transactions range between 1.8% to 2.60% of the original pool balance, compared to a range of 2.20% to 3.00% from our previous rating actions in April 2010. Total hard credit enhancement (excluding available excess spread and yield supplement overcollateralization (YSOC)) for Class D tranches ranges from approximately 3.80% to 4.00% of the outstanding collateral pool balances adjusted for YSOC. The YSOC compensates for the lower APR on the subvened loans, and declines each month based on a fixed schedule. Currently, YSOC for these transactions range between approximately 6.9% to 7.3%.

For 2008 transactions, Moody's projects cumulative lifetime CNL between 1.90% to 2.40% of the original pool balance, compared to a range of 2.30% to 3.00% from our previous rating actions in April 2010. Total hard credit enhancement (excluding available excess spread and yield supplement overcollateralization (YSOC)) for affected Class C tranches ranges from approximately 10.2% to 11.0% of the outstanding collateral pool balances adjusted for YSOC. Total hard credit enhancement (excluding available excess spread and yield supplement overcollateralization (YSOC)) for Class D tranches ranges from approximately 2.2% to 3.1% of the outstanding collateral pool balances adjusted for YSOC. Currently, YSOC for these transactions range between approximately 6.8% to 8.3%.

The lifetime loss expectations for the 2009 and 2010 issued transactions, which are now sufficiently seasoned, were lowered significantly. The improvement can be attributed to a combination of stronger underlying credit (as compared to prior transactions), healthy used vehicle market, and stabilizing economy that has persisted through the early term of these transactions.

Moody's current lifetime CNL for 2009 transactions range between 0.90% to 1.40% of the original pool balance, compared to a range of 3.00% to 3.50% at closing. Total hard credit enhancement (excluding available excess spread and yield supplement overcollateralization (YSOC)) for Class B tranches ranges from approximately 8.6% to 11.1% of the outstanding collateral pool balances adjusted for YSOC. Total hard credit enhancement (excluding available excess spread and yield supplement overcollateralization (YSOC)) for Class C tranches ranges from approximately 5.2% to 6.2% of the outstanding collateral pool balances adjusted for YSOC. Total hard credit enhancement (excluding available excess spread and yield supplement overcollateralization (YSOC)) for Class D tranches ranges from approximately 1.9% to 2.2% of the outstanding collateral pool balances adjusted for YSOC. Currently, YSOC for these transactions range between approximately 9.9% to 14.3%.

For 2010 transactions, Moody's projects cumulative lifetime CNL between 0.85% to 1.35% of the original pool balance, compared to a range of 2.75% to 3.00% at closing. Total hard credit enhancement (excluding available excess spread and yield supplement overcollateralization (YSOC)) for Class B tranches ranges from approximately 8.2% to 10.3% of the outstanding collateral pool balances adjusted for YSOC. Total hard credit enhancement (excluding available excess spread and yield supplement overcollateralization (YSOC)) for Class C tranches ranges from approximately 4.9% to 5.0% of the outstanding collateral pool balances adjusted for YSOC. Total hard credit enhancement (excluding available excess spread and yield supplement overcollateralization (YSOC)) for Class D tranches is approximately 1.8% of the outstanding collateral pool balances adjusted for YSOC. Currently, YSOC for these transactions range between approximately 12.0% to 16.6%.

The performance expectations for a given variable indicate Moody's forward-looking view of the likely range of performance over the medium term. From time to time, Moody's may, if warranted, change these expectations. Performance that falls outside the given range may indicate that the collateral's credit quality is stronger or weaker than Moody's had anticipated when the related securities ratings were issued. Even so, a deviation from the expected range will not necessarily result in a rating action nor does performance within expectations preclude such actions. The decision to take (or not take) a rating action is dependent on an assessment of a range of factors including, but not exclusively, the performance metrics. Primary sources of assumption uncertainty are the current macroeconomic environment, in which unemployment continues to rise moderately, and strength in the used vehicle market. Moody's currently views the used vehicle market as much stronger now than it was at the end of 2008 when the uncertainty relating to the economy as well as the future of the U.S auto manufacturers was significantly greater. Overall, we expect a sluggish recovery in the U.S. economy, with elevated fiscal deficits and persistent, high unemployment levels.

The principal methodology used in these securities was "Moody's Approach to Rating U.S. Auto Loan-Backed Securities" rating methodology published in June 2007.

Further information on Moody's analysis of this transaction is available on www.moodys.com.

In addition, Moody's publishes a weekly summary of structured finance credit, ratings and methodologies, available to all registered users of our website, at www.moodys.com/SFQuickCheck.

Moody's Investors Service did not receive or take into account a third party due diligence report on the underlying assets or financial instruments related to the monitoring of this transaction in the past 6 months.

San Francisco
Eric Fellows
VP - Senior Credit Officer
Structured Finance Group
Moody's FIS Domestic Sales Office - San Francisco CA
JOURNALISTS: 212-553-0376
SUBSCRIBERS: 212-553-1653

New York
Alda F. Sanchez
Associate Analyst
Structured Finance Group
Moody's Investors Service
JOURNALISTS: 212-553-0376
SUBSCRIBERS: 212-553-1653

Moody's Investors Service
250 Greenwich Street
New York, NY 10007
U.S.A.
JOURNALISTS: 212-553-0376
SUBSCRIBERS: 212-553-1653

Moody's reviews Ford prime auto loan ABS from 2007 to 2010 for possible upgrade
No Related Data.
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