DBRS Morningstar Confirms Rating on Ford Auto Securitization Trust 2019-A

DBRS Limited (DBRS Morningstar) confirmed the AAA (sf) rating on the Asset-Backed Notes, Series 2019-A, Class A-3 (the Class A Notes) issued by Ford Auto Securitization Trust 2019-A as part of DBRS Morningstar’s continued effort to provide market participants with updates on an annual basis.

The Asset-Backed Notes, Series 2019-A, Class B, and Class C are unrated (together with the Class A Notes, the Notes). The Notes are supported by a portfolio of prime retail auto loan contracts originated by Ford Credit Canada Company (Ford Credit Canada; rated BB (high) and R-4 with Positive trends by DBRS Morningstar) and secured by new and used passenger cars, light trucks, and utility vehicles. The rating confirmations are based on the following factors as of December 2022:

(1) Total credit enhancement levels available to the Class A Notes, measured as a percentage of the outstanding Note balance, have increased to 59.1% from initial levels.

(2) Excess spread, net of losses, has grown to approximately 13.8%.

(3) To date, cumulative losses amounted to 45 basis points of the Initial Pool Balance and are below DBRS Morningstar’s expectations set at the time of the initial rating.

(4) Ford Credit Canada has extensive experience in administrating, servicing, and managing securitizations, as demonstrated by its long track record of Ford Auto Securitization Trust transactions since 2009, all of which performed or are performing within expectations. A performance guarantee is provided by Ford Credit Canada’s parent, Ford Motor Credit Company LLC (rated BB (high) with a Positive trend by DBRS Morningstar).

DBRS Morningstar monitors the performance of each transaction to identify any deviation from DBRS Morningstar’s expectation at issuance and to ensure the ratings remain appropriate. The review is predicated upon the timely receipt of performance information from the related providers. The performance and characteristics of each publicly rated auto loan portfolio and the Notes are available and updated each month in the Monthly Canadian ABS Report, which is available at www.dbrsmorningstar.com.

ENVIRONMENTAL, SOCIAL, AND GOVERNANCE CONSIDERATIONS
There were no Environmental/Social/Governance (ESG) factors that had a significant or relevant effect on the credit analysis.

A description of how DBRS Morningstar considers ESG factors within the DBRS Morningstar analytical framework can be found in the DBRS Morningstar Criteria: Approach to Environmental, Social, and Governance Risk Factors in Credit Ratings at https://www.dbrsmorningstar.com/research/396929 (May 17, 2022).

Notes:
All figures are in Canadian dollars unless otherwise noted.

The principal methodology applicable to the rating is the Master Canadian Structured Finance Surveillance Methodology (December 13, 2022; https://www.dbrsmorningstar.com/research/407359).

Other methodologies referenced in this transaction are listed at the end of this press release. These may be found at: https://www.dbrsmorningstar.com/about/methodologies.

The DBRS Morningstar Sovereign group releases baseline macroeconomic scenarios for rated sovereigns. DBRS Morningstar analysis considered impacts consistent with the baseline scenarios as set forth in the following report: https://www.dbrsmorningstar.com/research/384482.

The related regulatory disclosures pursuant to the National Instrument 25-101 Designated Rating Organizations are hereby incorporated by reference and can be found by clicking on the link under Related Documents or by contacting us at [email protected].

The rated entity or its related entities did participate in the rating process for this rating action. DBRS Morningstar had access to the accounts and other relevant internal documents of the rated entity or its related entities in connection with this rating action.

Please see the related appendix for additional information regarding the sensitivity of assumptions used in the rating process.

DBRS Limited
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Toronto, ON M5H 3M7 Canada
Tel. +1 416 593-5577

The rating methodologies used in the analysis of this transaction can be found at: https://www.dbrsmorningstar.com/about/methodologies.

For more information on this credit or on this industry, visit www.dbrsmorningstar.com or contact us at [email protected].