Fitch Rates Ford Credit Auto Lease Trust 2013-A
NEW YORK -- March 20, 2013
Fitch Ratings assigns the following ratings to the Ford Credit Auto Lease
Trust 2013-A notes:
--$154,000,000 class A-1 'F1+sf';
--$344,000,000 class A-2 'AAAsf'; Outlook Stable;
--$344,000,000 class A-3 'AAAsf'; Outlook Stable;
--$69,470,000 class A-4 'AAAsf'; Outlook Stable;
--$44,680,000 class B 'AAsf'; Outlook Stable;
--$44,680,000 class C 'Asf'; Outlook Stable;
--$31,276,000 class D 'BBBsf'; Outlook Stable.
KEY RATING DRIVERS
Strong Credit Quality: Credit quality for the pool is consistent with recent
pools. The weighted average (WA) Fair Isaac Corp. (FICO) score is 745 and the
term is 33.40 months, with 26.15% of the leases with terms of more than 36
months. The pool is geographically diverse with approximately nine months
seasoning, consisting of 100% new vehicles.
Adequate Structural Protection: 2012-B is a sequential-pay structure. Initial
hard credit enhancement (CE) for the class A notes totals 18.90% (8.00%
subordinated class B and C notes, 9.90% initial overcollateralization [OC],
and 1.00% reserve).
Consistent Lease Maturities: 2012-B consists of 71.02% undiscounted base
residual value (RV), in line with prior pools. The lease maturities are well
distributed, although eight months represent more than 5.00% of the total base
RV with a single-month period in March 2014 accounting for 8.30% and 54.70% of
the pool maturing in 2014.
State of the Wholesale Vehicle Market: The U.S. wholesale vehicle market (WVM)
rebounded considerably during late 2009 to 2011 and remains strong in 2012.
However, Fitch remains cautious on the potential impact of general economic
weakness and rising fuel prices on demand for and values of used vehicles.
Stable Corporate Health: Fitch currently rates the long-term Issuer Default
Rating (IDR) of Ford, the parent of Ford Credit, and Ford Credit 'BBB-' with a
Stable Rating Outlook.
Consistent Origination/Underwriting/Servicing: Ford Credit demonstrates good
capabilities as originator, underwriter, and servicer, as evidenced by
historical delinquency and loss
Unanticipated decreases in the value of returned vehicles and/or increases in
the frequency of defaults and loss severity on defaulted receivables could
produce loss levels higher than the base case and could result in potential
rating actions on the notes. Fitch evaluated the sensitivity of the ratings
assigned to FCALT 2013-A to increased credit and residual losses over the life
of the transaction.
Fitch's analysis found that the transaction displays some sensitivity to
increased defaults and credit losses, showing downgrades of one rating
category under Fitch's 1.5x base case loss scenario, while experiencing
downgrades of one or two rating categories under Fitch's severe (2.5x base
case loss) scenario. The transaction shows significantly more sensitivity to
residual loss volatility, under Fitch's severe residual loss scenario, all
class of notes would be expected to be downgraded by two or more rating
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Additional information is available at www.fitchratings.com. The ratings above
were solicited by, or on behalf of, the issuer, and therefore, Fitch has been
compensated for the provision of the ratings.
Applicable Criteria and Related Research:
--'Global Structured Finance Rating Criteria', June 2012;
--'Criteria for Rating U.S. Auto Lease ABS', May 2012;
--'Counterparty Criteria for Structured Finance Transactions', May 2012;
--'Criteria for Servicing Continuity Risk in Structured Finance', August 2012;
--'Structured Finance Tranche Thickness Metrics', July 2011.
Applicable Criteria and Related Research
Global Structured Finance Rating Criteria
Criteria for Rating U.S. Auto Lease ABS
Counterparty Criteria for Structured Finance Transactions
Criteria for Servicing Continuity Risk in Structured Finance
Structured Finance Tranche Thickness Metrics
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Peter Chung, +1-212-908-0724
Fitch Ratings, Inc.
One State Street Plaza
New York, NY 10004
Smitha Dawson, +1-212-908-0298
John H. Bella, +1-212-908-0243
Sandro Scenga, +1-212-908-0278
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