Revenue (Notes)

6 Months Ended

Jun. 30, 2021

Revenue from Contract with Customer [Abstract]

REVENUE

REVENUE

    The following tables disaggregate our revenue by major source for the periods ended June 30 (in millions):

	Second Quarter 2020
	Company excluding Ford Credit		Ford Credit		Consolidated
Vehicles, parts, and accessories	$	15,406	$	—	$	15,406
Used vehicles	533		—		533
Services and other revenue (a)	608		44		652
Revenues from sales and services	16,547		44		16,591
Leasing income	85		1,401		1,486
Financing income	—		1,261		1,261
Insurance income	—		33		33
Total revenues	$	16,632	$	2,739	$	19,371
	Second Quarter 2021
	Company excluding Ford Credit		Ford Credit		Consolidated
Vehicles, parts, and accessories	$	22,663	$	—	$	22,663
Used vehicles	752		—		752
Services and other revenue (a)	656		48		704
Revenues from sales and services	24,071		48		24,119
Leasing income	78		1,367		1,445
Financing income	—		1,174		1,174
Insurance income	—		14		14
Total revenues	$	24,149	$	2,603	$	26,752
	First Half 2020
	Company excluding Ford Credit		Ford Credit		Consolidated
Vehicles, parts, and accessories	$	45,247	$	—	$	45,247
Used vehicles	1,464		—		1,464
Services and other revenue (a)	1,131		85		1,216
Revenues from sales and services	47,842		85		47,927
Leasing income	143		2,860		3,003
Financing income	—		2,686		2,686
Insurance income	—		75		75
Total revenues	$	47,985	$	5,706	$	53,691
	First Half 2021
	Company excluding Ford Credit		Ford Credit		Consolidated
Vehicles, parts, and accessories	$	54,798	$	—	$	54,798
Used vehicles	1,497		—		1,497
Services and other revenue (a)	1,264		64		1,328
Revenues from sales and services	57,559		64		57,623
Leasing income	155		2,747		2,902
Financing income	—		2,417		2,417
Insurance income	—		38		38
Total revenues	$	57,714	$	5,266	$	62,980

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(a)Includes extended service contract revenue.

NOTE 3. REVENUE (Continued)

The amount of consideration we receive and revenue we recognize on our vehicles, parts, and accessories varies with changes in return rights and marketing incentives we offer to our customers and their customers. Estimates of marketing incentives are based on expected retail and fleet sales volumes, mix of products to be sold, and incentive programs to be offered. Customer acceptance of products and programs, as well as other market conditions, will impact these estimates. As a result of changes in our estimate of marketing incentives, we recorded an increase related to revenue recognized in prior periods of $48 million and $214 million in the second quarter of 2020 and 2021, respectively.

We sell separately-priced service contracts that extend mechanical and maintenance coverages beyond our base warranty agreements to vehicle owners (“extended service contracts”). We had a balance of $4.2 billion and $4.3 billion of unearned revenue associated with outstanding contracts reported in Other liabilities and deferred revenue at December 31, 2020 and June 30, 2021, respectively. We expect to recognize approximately $700 million of the unearned amount in the remainder of 2021, $1.3 billion in 2022, and $2.3 billion thereafter. We recognized $276 million and $336 million of unearned amounts as revenue during the second quarter of 2020 and 2021, respectively, and $606 million and $678 million in the first half of 2020 and 2021, respectively.

Amounts paid to dealers to obtain these contracts are deferred and recorded as Other assets. We had a balance of $283 million and $304 million in deferred costs as of December 31, 2020 and June 30, 2021, respectively. We recognized $19 million of amortization during the second quarter of both 2020 and 2021 and $39 million in the first half of both 2020 and 2021.