Fitch Affirms 6 and Upgrades 4 Classes of Ford Credit Auto Owner Trust

CHICAGO--()--As part of its ongoing surveillance, Fitch Ratings affirms six and upgrades four classes from the Ford Credit Auto Owner Trust (FCAOT) 2011-B and 2012-D transactions as follows:

2011-B:

--Class A-4 affirmed at 'AAAsf'; Outlook Stable;

--Class B affirmed at 'AAAsf'; Outlook Stable;

--Class C affirmed at 'AAAsf'; Outlook Stable;

--Class D upgraded to 'AAAsf' from 'AAsf'; Outlook revised to Stable from Positive.

2012-D:

--Class A-2 affirmed at 'AAAsf'; Outlook Stable;

--Class A-3 affirmed at 'AAAsf'; Outlook Stable;

--Class A-4 affirmed at 'AAAsf'; Outlook Stable;

--Class B upgraded to 'AAAsf' from 'AAsf'; Outlook revised to Stable from Positive;

--Class C upgraded to 'AAsf' from 'Asf'; Outlook Positive;

--Class D upgraded to 'Asf' from 'BBBsf'; Outlook Positive.

KEY RATING DRIVERS

The rating upgrades of the applicable classes in the series 2011-B transaction are a result of strong loss coverage under Fitch's assumptions and stresses in cash flow modeling. The affirmations on the remaining notes in both 2011-B and 2012-D reflect loss coverage levels consistent with current ratings. The transactions have continued to perform well within Fitch's cumulative net loss expectations to date.

The Positive Outlooks on three of the classes of notes reflect Fitch's view that the notes will continue to perform well and may warrant a review for a potentially positive rating action in the next six months.

The ratings reflect the quality of Ford Motor Credit Company's (FMCC) retail auto loan originations, the sound financial and legal structure of the transaction, and the strength of the servicing provided by FMCC.

RATING SENSITIVITIES

Unanticipated increases in the frequency of defaults and loss severity could produce loss levels higher than the current projected base case loss proxies and impact available loss coverage and multiples levels for the transactions. Lower loss coverage could impact the ratings and Rating Outlooks depending on the extent of the decline in coverage.

In Fitch's initial review of the transactions, the notes were found to have limited sensitivity to a 1.5x and 2.5x increase of Fitch's base case loss expectations. To date, the transactions have exhibited strong performance with losses well within Fitch's initial expectations with rising loss coverage and multiple levels. As such, a material deterioration in performance would have to occur within the asset pools to have potential negative impact on the outstanding ratings.

Fitch's analysis of the Representation and Warranties (R&W) of 2012-D can be found in 'Ford Credit Auto Owner Trust 2012-D Appendix'. The R&W are compared to those of typical R&W for the asset class as detailed in the special report 'Representations, Warranties, and Enforcement Mechanisms in the Global Structured Finance Transactions' dated April 17, 2012.

Additional information is available at 'www.fitchratings.com'.

Applicable Criteria and related research:

--'Rating Criteria for U.S. Auto Loan ABS' (April 24, 2014);

--'Global Structured Finance Rating Criteria' (May 24, 2013);

--'Ford Credit Auto Owner Trust 2012-D Appendix' (Aug. 22, 2013).

Applicable Criteria and Related Research:

Rating Criteria for U.S. Auto Loan ABS

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=738718

Global Structured Finance Rating Criteria

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=708661

Ford Credit Auto Owner Trust 2012-D -- Appendix

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=714318

Additional Disclosure

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

Contacts

Fitch Ratings
Primary Analyst
Andrew Tinari
Analyst
+1 312-368-3127
Fitch Ratings, Inc.
70 West Madison Street
Chicago, IL 60602
or
Secondary Analyst
Hylton Heard
Senior Director
+1 212-908-0214
or
Committee Chairperson
Du Trieu
Managing Director
+1 312-368-2091
or
Media Relations
Sandro Scenga, New York, Tel: +1 212-908-0278
sandro.scenga@fitchratings.com

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Contacts

Fitch Ratings
Primary Analyst
Andrew Tinari
Analyst
+1 312-368-3127
Fitch Ratings, Inc.
70 West Madison Street
Chicago, IL 60602
or
Secondary Analyst
Hylton Heard
Senior Director
+1 212-908-0214
or
Committee Chairperson
Du Trieu
Managing Director
+1 312-368-2091
or
Media Relations
Sandro Scenga, New York, Tel: +1 212-908-0278
sandro.scenga@fitchratings.com